What to Expect from a Financial Planner


With today’s growing economic needs, you may find it overwhelming to pursue major financial goals such as buying property or sending your children to university. In such situations, it may be wise to consider working with a financial planner. Before you do that, know the basic principles:

How are the fees charged?

If you go to a dependent financial planner like Christian Pratama –who has been a Registered Financial Planner (RFP) for two years, he does not charge for consultation fees because he is affiliated with a financial institution. He said he would help his clients by analyzing and calculating their financial situation and risks, then offer solutions in the form of suitable products such as investments, savings plans, and insurance. Christian would then earn a commission based on the sale of products.

That said, there are also independent financial planners. Due to their non-affiliation with financial institutions, some might say that they are more likely to give objective advice compared to dependent financial planners. They typically charge by session or by the amount of assets that you have.

Credentials

A financial planner should be registered as an RFP or certified as a CFP by the Financial Planning Standards Board. FPSB membership is valid for two years and must be renewed afterwards –members will be listed on www.fpsbindonesia.net if he or she is based in Indonesia, or www.fpsb.org if based elsewhere.

The process

  1. Initial meeting –for establishing rapport.
  2. Fact finding –the financial planner would ask about points that give him or her an idea of your current financial situation.
  3. Calculating –the financial planner calculates what it takes to get to your financial goal.
  4. Presentation –the financial planner presents the calculations and offer solutions in the form of financial products.
  5. Refining –if you have questions about the solutions or want to give more information on your financial situation to get better solutions than the ones currently offered.
  6. Closing –you commit to investing in one or more of the products offered.
  7. Servicing –the financial planner continues to guide you to focus toward your financial goals.

Get regular check ups

Using the analogy of relationship between a patient and a doctor, usually a patient sees his or her doctor when there is a problem. However, ideally, a health conscious person would come for regular check ups regardless of whether there is a problem. “Likewise, it’s a good idea to see your financial planner regularly and ask for a financial check up,” said Christian.

In addition to regular 'check ups', it is good idea to see your financial planner when you’re looking forward to major changes in your life –getting married, having a child, or even getting promoted. These changes typically impact your lifestyle and your spending priorities.

TIP: Be sure that your financial planner discloses any conflict of interest –name which institutions he or she is affiliated with. In the unfortunate event that your financial planner is proven to have violated proper business ethics, you can report him or her to the FPSB, which may revoke his or her financial planning license.

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