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The Top 4 Myths about Financial Planning

August 9, 2022 | Financial Advice

Financial planning is one of those things that everyone thinks they know about, but most people only have a vague understanding of what it is. Done right, financial advice is a complex process that can help you achieve your financial goals and fund your lifestyle. But this can be simplified with the guidance of an accredited financial adviser.

Unfortunately, many myths about financial planning can prevent people from taking advantage of this valuable resource. So, today we will debunk the top four myths and misconceptions about financial planning.

Financial Planning Myths

Myth 1: Financial Planning Is Good for Self-Learning

The plethora of money management websites on the internet proves that many people struggle to successfully budget and save on their own. Despite the promises, no financial DIY advice tool can offer you the tailored advice you need to handle your finances as well as a professional financial plan can.

These DIY tools can provide generic guidance on investments, retirement, and planning. But then, the pitfall of this approach is that the advice is very general. Incorrect or vague advice might cause you to make mistakes and in turn, create an uncertain financial future for yourself.

Conversely, a professional financial adviser has access to years of experience and formal education that can help you to manage your money professionally and give you confidence in your money-making decisions.

Myth 2: Financial Advice Is Only Appropriate for Retiring People

Everyone can benefit from a financial plan, even if they’re nowhere near retirement. Without one, it can be difficult to build your strong foundation and achieve those early goals short-term and mid-term goals needed to set you on the right path to financial freedom.

The bottom line is that everyone should have a financial plan, regardless of income or net worth. It is not a big deal where you are in your life – whether you’re just starting your professional life or you’ve had a career for twenty-five years – figuring out how to navigate your money is essential. It will be hard to meet your goals and dreams without a financial plan.

Myth 3: Accountants Are Also Financial Advisers.

This is more a semantics issue that can make you hire the wrong person. People usually have one accountant they know well, but they should also seek the guidance of a professional financial adviser for complementary needs. An accountant does tax returns and generally offers tax management. A financial adviser will assist you with superannuation and retirement planning, investment planning and wealth management, personal insurance, estate planning and aged care advice.

Myth 4: Financial Planning Is All About How You Invest Your Money.

When you first meet a financial expert, revealing your financial situation can be a little scary. This is even more intimidating if you’re sitting in a room with a financial adviser talking about your hopes, dreams and goals which are deeply personal to you.

It’s important to remember that your Financial Adviser is here to help you – not judge you. We want to understand what drives you and what makes you happy. Our goal is to provide you with a comfortable environment, founded on trust and understanding so that you feel comfortable telling us about your life. The IOOF The True Value of Advice research paper released in 2020 found that 98% of survey respondents agreed that their Financial Adviser was easy to talk to.

While every financial planner will have their own unique approach, it’s best to look for a licensed expert. Ensure you select an accredited Financial Adviser who operates under a credible business, and is authorised to provide advice under an Australian Financial Services Licence (AFSL).

Myths about Financial Planning De-bunked

Financial planning is necessary to help you reach your financial goals. However, many myths and misconceptions about financial planning can keep people from taking the steps needed to get started.

To learn more about your finances, start by making minor changes to your current routine and see how those work for you. If you are ready to start achieving your financial goals, reach out to Coastal Advice Group. We have offices located in Newcastle, the Central Coast, Sydney, Port Macquarie, and Byron Bay. Call or book online to secure your first appointment with us today and get started!