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Declutter Your Financial “Wardrobe”

Apr 26, 2023 | General, Lifestyle | 0 comments

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Often when we meet with new or prospective clients, they tell us that they have been meaning to sort out their finances, but have kept putting it on the backburner for years.

It is a bit like opening up your wardrobe at home…

You know there is stuff inside that you should throw out or give away.

There are items that are never going to fit you.

There are clothes that you know you will never wear.

Yet, there is stuff that you could still wear and items that you love and will definitely keep.

You know it is a bit of a mess and that it needs your attention, but it one of those jobs we all put off …..right??

What is sorely needed is a good old spring clean—but this is put off while we focus instead on what we think requires our immediate attention: putting food on the table and paying the monthly bills.

When sitting down with clients for the first time we often see a mishmash of investments, policies and accounts, all with an interesting story behind them:

“I signed up for this policy when I started working and a friend who’s an insurance broker told me I needed it”; or

“I started this life policy when I got a bond… I think”; or

“This is a retirement policy I have had for years”;

“I think my Dad started this investment for me: or

“I’m not sure why I have this endowment”.

More often than not, they end off with: “I have no idea what all of these are about. I just know I pay quite a lot every month!”

This is where we step in as financial planners.

We put all the financial “clothing” aside and start by spending time simply trying to understand you, your family and what you are trying to achieve in your lives.

From there we assess where you and your family are today and where you want to get to as a family. We need to know what your plans and aspirations are and by when you want to achieve them.

Once we understand what your current financial resources are, where you want to end up and how much time you have, we put together a financial model that works out by how much your hard-earned money needs to grow so that you can reach your life goals in your desired time frames.

An important part of the process is working out—with your input—what is achievable.

We can then determine the “growth rate” (or mandated return) that you need on your funds to achieve your goals over the long term.

Only then do we move to the “wardrobe” cleanup stage.

We examine all your policies and investments and work out what we can discard to save you some costs and what can be repurposed and fixed.

We identify what we definitely need to keep and we ensure it is invested to achieve the correct mandate over the desired period.

We look at what can be given away; what must be mended – perhaps moving your investment to a different platform or provider to achieve a better outcome. We check that the items that remain in your “cupboard” are tax efficient and optimally structured.

There may be that coat that you never wear but it is in there for a reason. You will be happy for it to take up space, because one rainy day you may need it.

As specialist financial planners we help you sift through your financial baggage, discard what you do not need, rework what you have to be “wearable” again and buy in essential items that suit you. Finally, we look at how it all ties together – we look at your Will and your broader estate plan.

In the end you will come away with a tidier financial wardrobe and most importantly you will know exactly what is in it and why.



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