September 2016

People don’t Plan to Fail - they often Simply Fail to Plan


As an affluent individual it is likely you are smart and successful. However you may still have blind spots when it comes to managing your money.

Here are five tips those with a high net worth should keep in mind:

  1. Accept that you can benefit from financial planning. Many people think that just because they have sufficient assets to meet any expected needs they need less or no financial planning. What they’re missing out on is a complete picture. A financial planner can help to accurately provide context around assets, liabilities and annual expenses, which in turn can offer insight and analysis into spending ratios, annual expenses and possibly misallocation into certain sectors causing undue risk to the portfolio.
  2. Focus on your financial objectives not the money. What happens all too frequently is an individual looks at some statements and says, I’ve got all this money, I’d better manage it. Then when he or she speaks to an adviser, the financial planner picks up the same wavelength and focuses just on the money. First and foremost you and your adviser need to focus on your individual values, goals and objectives.
  3. Ask how the adviser is paid. Understanding an adviser’s compensation structure can be an eye opening experience. Are the fees time-based or asset-based? Do commissions come from mutual funds, from insurance products or something else, even a combination? You have a right to know how you’re spending money to have your portfolio managed.
  4. Audit your portfolio for hidden (especially ongoing fees). This is especially true with inherited assets or products that may have rolled over or changed since you initially selected them. Be sure to examine all ‘managed’ type funds and portfolios. Your adviser should be able to reproduce a similar portfolio that strips out many of the fees of the actively managed funds.
  5. Right-size insurance. Whether it’s life, health, home, car or other the proper “ not excessive “ insurance cover is crucial to any well -designed financial plan. Decide what is most important to you, transfer the risks to an insurance company, pay the premium, and have some peace of mind.

After all it’s important to know whether you or your money is going to run out first?

This Briefing Note is provided for information purposes only and does not constitute any form of financial or investment advice. We believe the information to be correct at the time of going to press but we cannot accept any responsibility for any loss to any person as a result of action or refraining from action as a result of any item herein.

Printed and published by ©Holborn Financial Limited authorised & regulated by the Financial Conduct Authority. September 2016