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Financial planner Q&A: what does a typical day look like?

Catherine Elliott22 July 2019

Financial planners — who are they and what do they do? And more importantly, how can they help you?

I sat down with our Head of Planning here at Octopus Wealth, Andrew McMillan, to discuss what a typical day looks like for our financial planning team.

We talk about the nuts and bolts of financial planning, and how his role directly impacts the lives of those he helps.

So if you’ve ever thought about seeking advice, but aren’t sure what it entails and the value it could bring, this blog will help!

So, what exactly is a financial planner?

In a nutshell, a financial planner is someone who has an in-depth understanding of different financial products and investments, and most importantly, how they can be best used to meet a client’s needs.

Here at Octopus Wealth, our partners are the people who meet clients and help them set their personal financial goals — the planning team are the ones who actually put together the financial plan that aims to get them there.

What does a typical day at the Octopus Wealth office look like for a planner?

Most days are typically spent building financial plans for new clients.

To do this, we'll start by getting to grips with the client’s financial standing — the ‘hard facts.’ This spans the big ticket items like the value of their house and how much cash they have, to more granular things like how their pension investments are run and how they’re performing.

All of the information is then put into our financial modelling tool — what we call the Lifeline — to create an overview of their current situation.

We'll then move onto the soft facts — in other words the client’s goals and objectives and their risk appetite. This is really important to get right: it’s only by really knowing a client and where they want to get to that you can start to build the plan that’s going to get them there.

It’s then a case of putting it all together. We'll draw up all of our recommendations and findings into one plan that will be explained in the next client meeting.

Part of the day will also be spent reviewing existing client’s plans and following changes in the market and tax legislation; as planners it’s important that we're always clued up on anything that might affect current and future clients.

What kinds of people do you help? Do you think financial advice is for a specific type of person?

Anyone and everyone can benefit from financial advice.

Because ultimately, advice is simply about providing the reassurance that your finances are in great shape, and that you or your family will be able to live the life you want, no matter what comes your way — and who wouldn’t want that?

Financial advice isn’t just about investing in this or that fund, chasing higher returns, creating wills or putting in place life cover. It’s about working out what you fundamentally want to achieve — how you want to live your life — and working out the easiest, most stress-free way of getting there. Everyone’s goals will be unique.

What are the most common things people need help with when it comes to their finances?

Definitely pensions. After all, pensions are complicated. A chartered planner will have spent hundreds of hours studying legislation and taking many exams on this very subject, and will have years of experience actually dealing with them. The government rolled out “pension simplification” a number of years back and you know what — they’re still complicated!

Many people have a good understanding of how pensions work, but many more miss the bigger picture and don’t appreciate some of the brilliant things you can do with them that can really transform your finances for the better.

Another big thing I see time and time again is that people need help to ‘fit it all together.’ Most people understand the short-term aspect of their finances — how much they need to pay their monthly bills — but what about the long-term?

Big questions like ‘when can I retire?’ or ‘can I afford to help my children on the property ladder’ are only answered by understanding lots of different variables and possible choices in someone’s life, over various time frames. Ultimately, the life you want in the future depends on the financial decisions you make today, not tomorrow — and so it’s no surprise that people ask for help.

Is there anything that usually takes people by surprise when they enlist the help of a financial planner?

The amount of work that goes into building a plan!

There’s a lot that goes on behind the scenes that often takes people by surprise. For example, we write to every provider to gather the finer details of every pension, investment or policy that a client has, so we can conduct a thorough analysis of their current financial state — and that’s before we even start putting together a plan.

The other thing that often comes as a surprise is the amount they’re potentially missing out on. You might be great with your money, but being able to introduce someone to an opportunity they didn’t know about is really exciting. I’ve yet to meet a client that we can’t do something for.

Why do you think financial advice is so important? What’s the value?

Great financial advice can completely change someone’s life. Humans are short-termist by nature, so helping people step back and see the bigger picture can allow for great improvements.

I’ve helped people realise they could afford to cut their working hours and spend irreplaceable time raising their children. I’ve helped people free up their finances to start their own business with a financial safety net. And I’ve also helped people ensure their finances are protected should the worst happen. Unfortunately, I’ve seen the worst come into being in a few cases, but it’s always comforting to know that the planning we’ve put in place has ensured the family’s looked after and will be OK.

The hardest part of the job though is meeting the clients who’ve left it too late to plan their finances. There physically isn’t enough time for their money to work the magic they need it to and in some cases, this means having to retire with a very different lifestyle than they’d hoped for.

What’s the thing you like most about your role?

I help people with one of the most important aspects of their lives — their wealth.

Don’t get me wrong — there’s much more to life than money, and it certainly isn’t the answer to happiness. But it does help free up that precious commodity which we all have only a limited amount of: time.

Consider this: the average British person will spend nearly 3,515 full days working — almost ten years. That’s a significant portion of our lives we give up to earn money, so it’s vital that the money you earn and save during this time is put to the best use. As financial planners, we help to not only grow people’s wealth, but to free up their time to do more of the things they really care about.

Ultimately, the money we’re entrusted with represents years of hard work and sacrifice. Our actions will impact the families we work with for generations.

And finally, for anyone who wants to DIY their financial planning, what would you say?

Be aware that you’re likely to miss out on some key opportunities, and ultimately end up with less money, than someone who’s taken advice. Financial planning involves bringing together lots of moving parts and keeping on top of changing legislation — it’s almost impossible to get it all right if you do it alone, even if you think you know what you’re doing.

Another point to bear in mind is that when making big decisions with your own money, emotion will always come into play. That’s why we manage money for a lot of investment and fund managers — an unbiased third party will tend to be much more disciplined and make smarter decisions than someone dealing with their own finances.

With that being said, if you can do the the basics!

Here are some key pointers:

  1. Always have an emergency fund — you never know when the boiler is going to break or the roof starts leaking.

  2. Pay off any expensive debt — that interest is money you’re throwing away.

  3. Insure yourself and your family because you never know what’s around the corner. (More people actually have insurance for their pet than they do for themselves and their income!)

  4. Save as much as you can, as early as you can. Thanks to the 8th wonder of the world, compound interest, the earlier you start saving, the less heavy lifting you’ll have to do further down the line.

  5. When saving for the long-term, save in assets designed for long term growth. Your savings account isn’t that place. Take advantage of tax-efficient savings vehicles like pensions and ISAs that let you invest in stocks and shares instead.

The best piece of advice I could give someone? Don’t leave your finances to chance — ask for help.

If you’ve got some big questions about your own finances that you’d like to talk through with an experienced financial planner, then why not talk to Octopus Wealth today? Getting started only takes two minutes.

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