Meeting with a financial planner for the first time? Here’s how to prepare

Our combined income is about $100,000 gross, and our main goal is to save a down payment for our first home in two or three years here in Welland, Ont.

What paperwork should we bring with us to our meeting with the planner? What kinds of questions should I be asking?
–Conrad

A. Conrad, this is a great opportunity for you and Gina to get a clear understanding of your financial situation. And it’s a great proactive step to ready yourselves for the meeting. Doing so will provide you and Gina with a more meaningful experience.

Talking with your spouse about your financial future together is important. While many couples have a vague idea of what they want to achieve with their money and investments, they often fail to communicate and discuss their goals together. Having such a discussion would be the first step to preparing for the meeting with your advisor. After all, to help you reach your financial goals, your advisor needs to know where the starting line is.

There may be financial issues or investment products you and Gina aren’t familiar with. For instance, have you started contributing to RRSPs* or TFSAs*? If so, the planner will want to know what contributions were made to these accounts, how this money is invested, and what the amount total is in each account. So recent financial statements and any other documentation regarding these financial plans (for instance, investments held, beneficiary designations) will provide the planner with better insight.

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Employer pension details are also crucial when creating a plan and you should bring the specifics of Gina’s employer pension as well as yours, Conrad, if you have one. It’s these details that will help pinpoint which financial products are most necessary for you to meet your goals.

Of course, if you have bank statements for other household assets, including chequing and savings account information, bring them along. Also, bring an outline of all debt obligations and what the terms of repayment are for each one. The planner will be able to give you general advice on your debt repayment plan and what you can do to speed up the process.

Realize, too, that just knowing your annual household income isn’t enough for the planner to understand the bigger money picture in your household. The planner will need to see your budget and cash management details. This will provide a more accurate picture of your monthly expenses, including non-discretionary items like rent, utilities, and groceries, as well as discretionary items such as money spent on restaurant meals, gym memberships, clothes and travel. It’s often these budget numbers that are real eye-openers when it comes to understanding your spending habits.

Finally, consider the types of financial goals you have. For instance, you mentioned saving for a house; other goals may include planning to achieve a comfortable retirement, budgeting time and money for more education for a career change, etc. Really zero in on what’s most important to the two of you in the short term—say, the next five years—as well as the bigger picture of what you want your life to look like in 20-plus years.

Other “critical” types of issues to discuss with your planner can include:

• Emergency savings. What sort of financial cushion should you have?
• Insurance requirements at different stages of your life.
• Financial and investment literacy. The planner will likely question the extent of your financial literacy and suggest how to increase it to better support your understanding of key financial concepts that will affect your money. And it goes without saying that if you don’t understand a specific financial term during your consultation, be sure to ask and have it clarified.

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By the end of the meeting, you should have a clear understanding of everything you discussed with the financial planner, as well as a quick summary of what financial goals need to be addressed. You and Gina should also both feel comfortable enough to work with the planner for the long term.

Heather Franklin is a fee-for-service certified financial planner in Toronto.

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