When do you need a Financial Planner?

We look for helping hands when we don’t want to do a job ourselves. We also do it when we know we are incapable of handling a task. The theory behind hiring a financial planner also treads a similar path; we usually hire one when we don’t have much idea of where to direct our money for better returns.

But before we take the discussion further, we must also know there stays a substantial difference between an IFA and a financial planner. While both of them are equally equipped to take care of your tax structures; the best-suited financial products or mortgage schemes, loan repayment methods and restructuring of your expenses for a better financial future, a financial planner is always a part of a financial institution. If not, then independent is the prefix for him. Now, a look at how all these is handled by a financial planner.

• Annuities or pensions: Annuities are all about trading your pension for a better return. The primary drawback with annuities is it’s a one-time game that doesn’t give any scope to rectify mistakes. A financial planner takes away the worry arising from choosing a wrong investment scheme.



• Endowments: This is all about gaining a permanent source of income. Only a financial planner can tell you how much can you put into a scheme to earn substantial gains without straining your current economic status. In case an endowment is a sizeable one, surrendering or selling it can give rise to complexities that can only be handled by a professional.



• Financial and tax planning and structuring: Since high-end finance is a complex matter as well, a translation of jargons into layman’s language are usually handled well by a financial planner.



• Investments: Making an investment and taking a risk are the same things; you need a moderator who can establish a fine balance between the two. But it also takes something to make the best guesses and a financial planner is the person who has it.



• Mortgages: Mortgages are huge transactions that need professional and specialized guidance. There are financial planners who deal only in mortgages and the fact establishes the importance of these professionals.



• Protection products: These are primarily the insurance products turned complex because of multiple exclusions. Buying a policy is not a big deal; getting maximum benefits out of it is. Only a financial planner can chalk out how much you are going to benefit from the premiums you are to pay.



• Pensions and pension transfers: If it’s a private pension, then it’s a simple case where one picks a stakeholder. For more complex stuff e.g. an existing pension through a company scheme and its transfer, unless handled by a qualified financial planner, is not going to prove a sensible move.