5 times You Need A Financial Planner — even if you're good with money

When it comes to managing your money, you might want a financial planner on the job. It is the same as there are situations when you should call in a professional — like when you're rewiring a bathroom or renovating your home.

What does a financial planner do?

A financial planner looks at the big picture when it comes to your money and develops a comprehensive plan to address your needs and long-term goals. Ideally, he or she can advise you on investments, insurance, estate planning, and taxes, among other things.

Your planner might be paid hourly, on a project basis, via a monthly retainer or most commonly through a commission percentage of any services he or she manages on your behalf.

Do you need a financial planner?

If your finances are relatively simple and your money questions can be answered with a Google search, you do not need a financial advisor. You don't need someone to tell you that you need to enhance your EPF’s withdrawal for investment.

"Do you need a surgeon to put on a plaster? Do you need a mechanic to put air in your tires? The complexity of the situation should dictate how much help you need." - Pedro Silva, a financial advisor in Massachusetts.

Moreover, there will be choices to review, decisions to make and forms to fill up. Below are four potentially complex money situations that might warrant a financial planner.

You Are Getting Married
Sometimes combining finances requires a neutral party. A financial planner can be that party, says Scott Snider, a financial planner who works in Ohio and Florida.

"When couples are first married, they're still getting to know how they both operate in terms of money. A financial planner can help them work through defining their goals, how they look at their money, and then ranking and prioritizing goals." - Scott Snider

Once you have a plan, you can implement it yourself and check in with a planner as you approach other milestones that could affect your finances, such as having children.
A planner can also determine whether you and your partner are better off filing taxes together or separately. Depending on scenario, filing separately tax return may save thousands of ringgit.

You Are Getting Divorced
Happily ever after doesn’t always end that way, and the consequences can wreak havoc on your finances. For starters, you’re likely going from two incomes to one. You’re also divvying up financial assets — property, investments and cash — and responsibilities, such as child support and alimony.

“Anyone going through a divorce should find a good lawyer and a good planner and make sure they’re on the same page. A good lawyer will fight for a fair division of assets and a financial planner will help you hit the reset button and figure out how to manage your money going forward." - Scott Snider

You will still need to update your financial documents like your EPF beneficiary, Insurance nominee, housing loans (if it is a joint loan), will and or your living trust.

You Are Starting A Family
Babies are expensive. That’s not news to parents, but exactly how expensive might be surprising.
With health care, clothing, food, toys, diapers and day care, parents could spend more than RM50,000 in just their child’s first year. Never underestimate the costs of raising a baby.
A financial planner can help you plan for your child’s first year and beyond. He or she can advise you on balancing college savings with retirement savings and other priorities, ensure you have the right level of disability and life insurance coverage, and help you stretch your dollars.

Your Salary Increased, Big Time
You didn't just get a new job, you got your dream job. But this gig could raise new financial questions, such as how to handle stock options or lessen your tax burden. A financial planner can help you answer those questions, as well as others you didn't consider.

"I help develop and implement tax-savings and execution strategies to ensure they make smart financial decisions on how they handle their income, benefits and investments," - Paul Murray, a financial planner in Pennsylvania.

When You Have No Plans
Lastly, if you are just living paycheck by paycheck, month by month, it is time you seek for a financial planner's advice. A proper financial planner will assist you in leading you on how to save from your overspending and recommend some solutions for you. A proper financial planner will be able to highlight to you your retirement goal planning as well.

 This article is adapted from NerdWallet for Malaysian context.

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8 ‘Star Wars’ Quotes that Apply to Investing

Most of us grew up watching and quoting various Star Wars characters, and since today is May the Forth or how Star Wars Fans refer to as 'Star Wars Day', we adapted an article from Market Watch. The site has picked out eight of the films’ best quotes that we can apply directly to the our investment strategy of save and invest. From Obi-Wan to Darth Vader, here are some of the wisest words Star Wars has to offer:

“Adventure. Excitement. A Jedi craves not these things.” — Yoda
Neither should long-term investors. Leave it to those risk-riding daytraders to get their jollies from the stock market’s wicked swings. Boring is usually a good thing when it comes to building a nest egg. You may prefer stock trading as a higher risk, higher return but do take into consideration of setting aside a portion for defensive and stable return investments.

“Who’s more foolish, the fool, or the fool who follows him?” — Ben Obi-Wan Kenobi
Paying attention to what the professionals—and yes, even the media—have to say about the market is probably a good idea. Blindly following their advice—well, you’re better off playing with the wrong end of a lightsaber. Here is Malaysia, there are not just investment gurus, but also investment scam gurus. It is still back to you on whether to believe them or not

“It’s a trap!” — Admiral Ackbar
Where doesn’t this apply when it comes to the stock market? Using past performance as a gauge of future returns. Selling your winners. Adding to your losers. Think of the handsome admiral before making your next move. Always look for long term investment. If you are trying to go into an investment which is risky or on a late bull run, make sure you know when to exit.

“Stay on target.” — Davish Krail
Set your plan and stick to it. Ignore all the noise. Of course, you won’t get shot down by the Dark Lord if you fail, but you might find yourself pushing back retirement by a few years if you stray too far from what you’re trying to accomplish. Over the course of your investment, you may be tempted by other opportunities. If your current investment is delivering the return you targeted, do not be tempted to switch.

“You don’t have to do this to impress me.” — Princess Leia
Slow and steady wins the race. Just because you read about some teenager logging triple-digit returns doesn’t mean you need to ramp risk to uncomfortable levels to chase the gains. Stick to your plan and don't be greedy.

“You are unwise to lower your defenses.” — Darth Vader
Just like in Las Vegas, never take big risks with more capital than you’re OK with losing. Don’t get caught up in the moment and expose yourself to the dangers that lurk outside the boundaries of your comfort zone. Don't over expose yourself by investing ALL your money into a single investment.

“You know better than to trust a strange computer.” — C3PO
That could have been the title of Michael Lewis’s book on high-frequency trading, in which he paints those players as cutthroat financial predators blurring the lines of the law. While there is a rise in robo investing, somehow human communication with actual consultants, advisors or fund managers will help you to make logical decisions.

“You will never find a more wretched hive of scum and villainy. We must be cautious.” — Ben Obi-Wan Kenobi
Cautious approach towards investment is a must in view of so many unlicensed or unregistered investments schemes out here. Practice cautious in finding out if a certain investment is genuine and is not a form of Ponzi or Pyramid Schemes.

Adapted from Source: Market Watch

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