I’m a Financial Advisor: Here’s the First Thing I Tell New Clients To Do
Written by
Andrew Lisa
Edited by
Gary Dudak
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The most universally applicable piece of money advice is to work with someone who gives money advice for a living. Capable and experienced financial advisors often join family doctors and lawyers as the most trusted and indispensable professionals in the lives of the clients they serve.
They guide their clients through debt reduction, estate planning, taxes, investing, entrepreneurial endeavors and the basic day-to-day management of their personal finances. Perhaps most importantly, they cut through the clutter, confusion and conflicts of interest that bombard people every day with misinformation through their phones, laptops and social media feeds.
Although the best financial advisors tailor personalized strategies that are unique to the individuals they serve, some money advice is universal. To learn more about the money moves that experienced industry professionals think will have the biggest impact, GOBankingRates asked a trio of financial advisors what they tell their clients to do right out of the gate as step No. 1.
They offer a range of perspectives. One works with high-net-worth individuals, another serves older clients and the third guides the youngest adults who are just learning the ropes. Here’s their main money advice.
A Wealth Manager Concentrates on Cash Flow
John M. Jennings is the president and chief strategist of St. Louis Trust & Family Office, a $15 billion wealth management firm, and an adjunct professor at the Washington University Olin School of Business in St. Louis in its Wealth and Asset Management graduate program. Jennings is also a Forbes contributor and author of “The Uncertainty Solution: How to Invest with Confidence in the Face of the Unknown.”
“The first thing we do with new clients is to dig into their cash flow,” said Jennings. “What money comes in and what goes out? Understanding cash flow is foundational to all other planning. You can’t effectively design a financial plan, an investment plan, or an estate plan without understanding cash flows — both recurring and extraordinary items. It’s not sexy work, but having a handle on money’s ins and outs is essential for planning for financial success.”
A Financial Planner Says Goals Come First
Bill Gallagher is a senior planner with Zynergy Retirement Planning. He specializes in working with mature adults over 50 years old. He holds the certified financial planner designation and the master planner advanced studies designation through the College for Financial Planning. Gallagher is also a member of the Financial Planning Association (FPA).
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“As a professional financial advisor, the first thing I would tell new clients to do is to establish clear financial goals,” said Gallagher. “This involves understanding what they want to achieve with their money, both in the short term and long term. By setting specific, measurable, achievable, relevant, and time-bound (SMART) goals, clients can have a roadmap to guide their financial decisions and behaviors.”
As they outline their goals, he asks them to draft budgets that track their income and expenses.
“By creating a budget, clients can identify areas where they can cut back on expenses and redirect those funds toward their financial goals.”
A Gen Z Specialist Wants Young Adults To Put a Plan in Writing
Akpan Ukeme is a certified financial planner (CFP) and the founder of Finance4Zoomers. Compared to Gallagher, he deals with the opposite end of the age spectrum, focusing specifically on the youngest adults in Gen Z who are just beginning their financial journeys. He’s also a firefighter who has served for seven years in the aviation industry.
His top priority is to get his clients’ plans on paper so they can be read, revised and revisited.
“Creating a written plan is a big money move that has the biggest impact,” said Ukeme. “Before you start making changes to your finances, you need a written plan that lays out your investment strategy and goals. This is especially important given the current tumultuous market. In the past year, we’ve seen some big swings in the financial markets, and this volatility can make investors feel like they have little control over their investment success. It’s important to avoid overreacting to short-term downturns and making moves that could work against your long-term strategy. Having a written plan should extend beyond investing and include spending and saving as well. Figure out where your money is going. Once you know that, you can begin to make adjustments — like reallocating cash to different accounts — that will bring you closer to your goals.”
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