Why it’s important to speak with your planner before you make financial decisions

Throughout your lifetime, you’ll no doubt be presented with financial decisions to make. These might come from suggestions made by friends and family, or you may read news that influences you and makes you want to act.

For example, a common concern many individuals have recently had is over rising interest rates, and whether you should hold a greater proportion of your wealth in cash, rather than investments.

Before you make these choices, however, it’s important that you speak to your financial planner first. Their guidance is crucial when making these decisions, helping you to assess whether they’re appropriate for you.

Yet, according to figures published by FTAdviser, 92% of financial advisers and wealth managers say that their clients make decisions without involving them.

This could potentially see you make choices that harm your overall financial health, rather than help you.

So, read on to discover why it’s so important to discuss any big decisions you’re planning to make with your financial planner first.

The decisions you make need to fit with your wider financial goals

When you first approach a financial planner, they’ll have taken the time to get to know everything about you and your life.

Rather than starting with your wealth, they’ll have wanted to know what your life is like now, and where you want to be in future.

They’ll have then developed a personalised plan specifically tailored to you, organising your finances so that you can achieve your life goals.

This plan is not static, but rather designed to grow with you as your life changes. As a result, it’s crucial that you update your planner when making decisions to ensure that these choices fit with this wider plan. Otherwise, you might inadvertently disrupt your progress towards your targets.

Looking back to the example of rising interest rates on savings accounts, it may seem sensible to liquidate investments and take the guaranteed return from the interest. But, you may actually need those investments to provide you with an income in later life.

Without speaking to your financial planner first, you can’t make a fully informed decision over whether this change is right and in line with your plan.

Meanwhile, contacting them first gives you a sounding board to discuss your ideas, whether they’re right for you or not. Whatever your planner ultimately says, it means you can be confident that the choices you’re making are keeping you on track to achieving your goals.

Your planner could make suggestions for options you haven’t considered

As an experienced professional, your financial planner has a depth of knowledge across financial services. This is what allows them to design a plan that helps you achieve your goals.

This also means that you can benefit from this information and insight to underpin your significant financial decisions by consulting with your planner first.

In fact, they might make alternative suggestions that you hadn’t considered, drawing on their extensive experience to help you find and make the most suitable choices.

By not keeping your planner in the loop, you potentially miss out on suggestions and advice that could have been even more effective for you.

You might be more likely to make mistakes on your own

Perhaps most concerningly, making decisions without speaking to your financial planner increases the likelihood of you making a mistake.

Whether it’s an investment decision that isn’t suitable for your portfolio and personal risk tolerance, or an attempt to save tax that ultimately lands you with a larger bill, making choices without the backing of a professional could make it more likely that you’ll harm your progress towards your goals.

You’re also more likely to be overwhelmed by common traps and biases that can affect you when you’re managing your wealth.

For example, it’s far easier to fall victim to herd mentality – in which you follow the crowd, rather than make decisions that are most suitable for you – when you’re trying to go it alone.

Read more: 5 psychological traps and biases to avoid when investing your money

Conversely, discussing your intentions with your planner first adds some much-needed oversight that can help you to stay on the straight and narrow in your decision-making.

They can help you steer clear of the potential pitfalls, so you can remain on the path towards living your desired lifestyle.

Get in touch

If you’re considering making any financial decisions, we can help you assess whether they fit with your wider financial plan.

Email info@britannicplace.co.uk or call 01905 419890 for help and guidance from an experienced financial planner.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

The Financial Conduct Authority does not regulate cashflow planning or tax planning.

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If you have any questions or queries, a member of the team will always be able to help. Feel free to use the form below or contact us via phone or email.