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RJ Weiss


This is a guest article by RJ Weiss, one of the youngest Certified Financial Planners at the age of 26 and the founder of the blog Gen Y Wealth. You can download his free Financial Freedom Blueprint to create your own financial plan. RJ Weiss is contributing to Consumerism Commentary’s series on finding and working with the right financial adviser or planner with this article about being prepared for your first working meeting.

You’ve hired a Certified Financial Planner, and you’re days away from the first meeting. It’s a very exciting time, as you imagine your bright financial future.

The first step to ensure that your initial meeting goes well is to gather the information you’ll need to form the basis of your discussions. In order to make a comprehensive financial plan, a financial planner must know where you’ve been, where you are, and where you want to go. Once your planner has this information, they can start to design a plan that gives you the best chance of reaching your goals.

The purpose of this article is to walk you through the information-gathering process for your first meeting with a CFP. Most financial planners will ask you for these documents either before or during your first meeting, but in my experience, it’s always better if a client shows up prepared.

The following are the eight things you need to have with you to be prepared for a meeting with your financial planner.

  1. Net worth statement with recent account statements. A net worth statement is easy to make, and helpful to have. A simple excel spreadsheet sorted by assets and liabilities, is all you need. Consumerism Commentary offers a good net worth template for Excel that can get you started in the right direction.

    Along with your net worth statement, bring the most recent statements that match each account listed. Include your bank accounts investment accounts, including retirement accounts such as IRAs and 401(k)s, so you planner can review your entire asset allocation.

  2. Statement of cash flows. A doctor can’t do their job without knowing your health history. Likewise, a financial planner can’t do their job, unless they know your monthly income and expenses. In other words, you need to prepare a budget.The more detailed your budget the better. At a minimum, break out your expenses between fixed (mortgage, utilities, insurance, car, food, etc…) and flexible (travel, eating out, subscriptions, etc…) from the last three months. Again, Consumerism Commentary has designed an income and expense report template that should do the job.
  3. List of 401(k) investment options sorted by expense ratio. If you want to save your planner a lot of time, bring a list of your 401(k) investment options, sorted by expense ratio. You may need to look at the prospectuses for each of the funds offered in order to find the expense ratio, and if you have annuities-based funds, that information might be difficult to find.
  4. Social Security statements. Bring the Social Security statement that you receive once a year and file away. If you can’t find your most recent copy, you can get an estimate online.
  5. Your goals, including projected retirement age. Knowing when you’d like to retire is a tremendous help to your planner. One of the basic calculations your planner will help you out with is to see if you’re saving enough for retirement.

    Besides a retirement date, write down your other financial goals. Are you looking to save for college for a child or grandchild? Are you looking to travel more? What about buying or selling your house? A good financial planner will take you through this process during your meeting, but the idea here is to put some thought into it beforehand, so you know what you really want.. Life often goes in an unplanned direction, but being as clear as possible with your goals is the only way planners can begin to design a plan that meets your needs.

  6. Tax returns and paycheck stubs. On more than one occasion, I have seen someone with high-interest debt, giving a free loan to the Government. One adjustment to their W-4, and all of a sudden, this person can now start paying off their debt. This is just one good example of why you should bring your recent tax return and paycheck stubs. Also, many people don’t really have a good understanding of how much income they earn. In my experience, when you ask how much they earn, they tend to round up, making precise planning difficult.
  7. Insurance information. As a Certified Financial Planner with an insurance background, I know firsthand that no one likes paying for insurance. Reviewing insurance documents may not sound as exciting as planning for an early retirement, but it’s just as important.

    The ironic thing about insurance planning (because nobody likes to pay for it) is that people are often over-insured. As a result, there is a good chance a client can save a tremendous amount of money by reviewing their insurance. For example, someone who hasn’t been to the doctor in a few years but still pays for a health insurance plan with a low deductible could benefit financially from changing his coverage options. Or, someone might pay $200 a year to insure her computer, but won’t spend that much for a term-life insurance policy.

  8. Benefits package. If your employer offers benefits such as health, life, dental, disability, dental, or vision insurance, bring coverage information pertaining to each plan. You probably received a packet at open enrollment with all of this information. Also bring the rest of your benefit information such as 401(k), pension, FSA, employee stock option plan, profit sharing, tuition reimbursement, child care, and any other benefits offered by your employer.

I applaud you for working with a Certified Financial Planner. The steps above may sound tedious, but it’s for your benefit. A client who shows up prepared shaves off hours off of the total time it takes to put together a comprehensive financial plan. If you’re working with a fee-only planner, that results in immediate savings to you.

Best of luck.

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