Why now is the perfect time for a financial check-in
Bertie Nel, Head of Financial Planning and Advice at Momentum
With Christmas decorations about to pop-up all over malls and shopping centres across the country, we’re all realising the year is quickly coming to an end. You might not have made progress on your 2022 New Year’s Resolutions, but fear not, you can still have an excellent financial start to your 2023.
Because the year is coming to an end, now is the perfect time to evaluate how you’re tracking on your financial goals. Bertie Nel Head of Financial Planning and Advice at Momentum, says an annual talk with your financial adviser is of paramount importance and sets the tone for the year ahead, which should be on top of your holiday season to-do list.
Further on, Bertie explains that an annual financial review with your financial adviser is essential to help bring the following aspects into perspective:
Savings goals
Healthy credit accumulation.
Expenditure readjustments.
The above sounds good and well once you have a well-established relationship with your adviser. But, for the individual or couple who recently got in touch with a financial adviser, some blind spots need to be checked, and blurred lines need to be clearly defined before continuing to trust their advice.
Bertie shares the four most important questions when reviewing your finances with the help of your financial adviser.
1. Am I adequately covered?
In the same way, we insure everything from cars to phones. We also need to cover and safeguard our income as well as our life to ensure that those we leave behind will be taken care off in the instance of our passing. Your financial adviser can help you set up a personal insurance policy to protect you against loss of income or life. The yields can be used to replace your income or take care of your loved ones when you are no longer here or are unable to provide for them.
“Your financial advisor will also be able to advise you if you are over-insured and on different premiums,” he says.
2. Which fees am I paying?
From your monthly account fee or issuing statement fees, numerous fees are attached to your financial decisions, especially when it comes to investments. Selling and buying shares and reinvesting dividends all come at a cost.
“When you go for your financial check-in, it is vital to ask your financial adviser about these fees and evaluate whether they are above the average effective annual cost. The effective annual cost shows the total cost of managing your investment,” Bertie advises.
3. Am I on track with my investment and/or savings goals?
Asking yourself whether you are adequately meeting your investment and savings helps you gauge how you’re doing in terms of the goals you set at the start of the year. While you can lie to an adviser, you cannot really lie to yourself, so honesty will keep your finances in check. With that reality check in mind, this is also an excellent time to evaluate whether your goals are realistic and aligned with your life goals.
“A financial adviser will help you come to terms with the realities and put you the proper path to reaching your goals,” says Bertie.
4. Can I trust them?
Trust is one of the pillars of any healthy and solid relationship; therefore, Bertie says ensuring a relationship with your advisor is essential. This might seem like a simple question, but it is not only polite but also a way to make you feel more comfortable with your adviser and build a trusting relationship.
Your financial adviser cannot make you a millionaire overnight or make your debt disappear overnight. However, they can help you make better financial decisions and assist you on your journey to success.
ENDS
