6-Step Process for Financial Planning

Step 1: Establishing and defining the relationship

The first stage of financial planning is establishing and defining the client / financial planner relationship.  Initially we will have a no-obligation meeting, where we will wear the cost of the consultation – so it’s free to you.  At an agreed time we arrange a meeting at our offices, or if you prefer, we’ll come to you at your place of work, or at your home.  We will discuss what you would like to achieve, now and in the future.

Step 2: Gathering client data, including goals
To review your current financial position we will look at your assets, debts, income and expenses, so we have a good understanding of where you’re at.  Then we’ll look at what you want out of life and establish some goals.

homeloanSetting up your goals

If you know what you want in life, it's so much easier to achieve it.  Having clear goals is very motivational and helps you strive towards them instead of putting things off.  We help you list all the things that are important for you to achieve in life.  The goals can be segmented into short, medium and long-term.

Short-term goals:

It's recommended to put aside money for unexpected expenses and emergencies, like the car breaking down or dental emergencies.  Also saving for occasional expenses, like buying new furniture.  This prevents you from over committing yourself with hire purchases, using your credit card, or just getting yourself into more debt.

Medium-term goals:

Saving for further tertiary training, a car, overseas holiday, or a deposit for a home or investment property can be classified as medium-term goals requiring savings over a 3-7 year period.

Long-term goals:

Take a look at the big picture - where you want to be in retirement and what you want to achieve on the journey there - money for your children’s education, rental property investments, starting or investing in a business, holidays, lump sums to give you freedom and security, and a comfortable retirement.

Step 3: Analysing & evaluating financial status
coincalculatorWe will use our vast expertise and experience to analyse and evaluate your financial status and your ability to reach your goals through various routes.  It is crucial to determine whether you have adequate risk management strategies in place.  Protecting your assets and the things you love is paramount to you being able to reach your goals.  Protecting means having adequate insurance for your needs and ensuring you have an estate plan which includes a will and enduring power of attorney, and possibly a family trust - it it's suitable for your needs.  There are many different types of insurance available in New Zealand.  We can advise what will best suit you in your current and projected situation.  Here is a brief run down on the types of insurance available. 

Different Types of Insurance

Income Protection

When most people are asked what their greatest asset is they reply "my house".  But who pays the mortgage? That's right, your ability to earn an income is your biggest financial asset and an important source of your future wealth.  Imagine if you were unable to work because of illness or disability.  How would you cope financially?  Did you know that you'll probably earn between one million and three million dollars in your lifetime?  Maybe even more than that! That is something worth protecting, so you need to look at income protection insurance.  

Life Insurance

Provides financial security for your family should you become terminally ill or die.  This should be enough to pay off the mortgage, your debts, and provide for your family. Life insurance policies can have crisis cover, which means that you're also covered for serious illness, like heart disease, cancer, or stroke.

Private Medical Insurance

This cover provides the funding to enable you to have private hospital treatment whenever you require more immediate access or a broader range of treatment options than are available to you through the public health system.  For example access to cancer medication which may be the most effective type of treatment, but which is not subsidised by the government.  

Trauma Insurance

Trauma cover provides a lump sum payment should you suffer a major condition that by nature is serious and life threatening, and as a result can have a significant financial impact on you and your family.  This type of insurance helps alleviate the financial worries and can reduce debt, purchase specialised equipment, pay for home modifications, provide additional care, or create an investment fund to generate ongoing income, amongst other things.  The purpose of the funds is entirely yours to decide. 

Total and Permanent Disability Insurance (TPD)

TPD cover provides a lump sum payment should you lose your ability to ever work again (or carry on normal task, if you are not employed), as a result of illness or injury.  Most people figure they are covered by ACC, however does not cover illness, and it is very limiting in terms of payment.  TPD cover can provide a lump sum to reduce debt, purchase specialised equipment, pay for home modifications, provide additional care, to fund the gap left in your retirement funding due to being unable to work again or create an investment fund to generate ongoing income, amongst other things.  The purpose of the funds is entirely yours to decide.  
If you are self employed talk to us about how to restructure your ACC cover, reduce your ACC levies and use these savings to fund a superior protection for yourself and your family.  Find out more about reducing ACC levies.

Mortgage Repayment Insurance

Mortgage repayment cover provides a financial safety net should you suffer a total or partial disability which causes a reduction in your ability to meet mortgage repayments and which lasts longer than the chosen waiting period.  The monthly benefit is designed to cover mortgage repayments on your behalf during treatment and recovery.  


Your home and other assets

Home, contents and car need insuring and regular reviewing to ensure you are fully covered in the event of a disaster.  Trying to recover from a disaster like an earthquake could ruin the best financial plan. 

Wills and Enduring Powers of Attorney

willsIt's important to have an up-to-date will, so your assets go to the people you want.  We can all suffer an injury or illness that, while not fatal, may leave us unable to make decisions about our affairs. Enduring Powers of Attorney ( EPA ) is a legal document that enables someone who you to trust act on your behalf if you become incapacitated.  Say if you have a stroke or an accident that leaves you unable to sign cheques, pay bills, manage investments, or make wise decisions about your medical care.  If no one has the legal right to act on your behalf, your loved ones would need to apply to the Family Court to be appointed as your manager.   Not even your spouse can automatically act on your behalf if they are not legally appointed. 

Without these documents it can be messy, costly and time-consuming to sort things out.  Only by acting in advance and giving someone authority through an Enduring Power of Attorney ( EPA ) will you have a say in who looks after your affairs if you are unable to.  Trusts and EPA's are an important part of a package of solutions to deal with risk. 

Iconic Financial do not directly create EPA's. We give advice on the best structures to have in place to keep you protected and give you peace of mind. 

Step 4: Developing and presenting financial plan recommendations

20investmentadviceAt this stage we will develop and present your financial planning recommendations and/or alternatives to you.  We will meet with you in person and present your personalised financial plan.  In many cases there will be more than one option available for you to reach your financial and lifestyle goals.  We believe in keeping it simple, and will present you with diagrams and graphs in your personalised financial plan so you can easily see where you are at now and how you need to plan for your future.
You can download a PDF format example of a financial plan.

Step 5: Implementing the financial plan recommendations
Whether it is protecting your assets, or investment options, or a combination of both, we will make the paperwork as simple as possible for you.  We will submit all paperwork on your behalf and act as your advocate, particularly when it comes time to make an insurance claim.  To see how Iconic Financial has helped in gaining insurance payouts for clients view our success stories and case studies.    

Step 6: Monitoring the financial plan recommendations
wrapWe monitor each financial plan a minimum of once per year for insurances. Investments and wealth management portfolios undergo constant research and review.  Economic market changes may indicate changes to your portfolio are required in between review periods and your proactive team at Iconic Financial will contact you to advise and make recommendations.  To see how Iconic Financial has helped our clients achieve their investment goals, view our success stories.