Questions to Ask Your Financial Advisor During Your Annual Review

How often do you meet up with your financial advisor? If you have not met with your financial advisor recently, it may be time to schedule an appointment to ensure that you and your advisor are on the same page.

Annual reviews with your financial advisor can help you navigate the financial waters and keep tabs on your long-term financial goals.In order to get the most out of your annual review, it is important to ask some essential questions. Asking the right questions can ensure that you understand all of your finances and that all of your bases are covered.

To have a productive conversation when you meet your financial advisor, here are some questions you can ask:

Are my current policies providing me with sufficient coverage?

Many people have the misconception that they are well insured when they purchase an insurance policy.  However, your policy’s coverage might not be sufficient as you move on to different stages in life. The coverage you require as a student may not have the coverage that you need for dependents, new purchases, or additional conditions. If you are not well insured, you put yourself and your dependents at a financial risk.

Creating a list of possible life events is a great way to identify needs within your coverage. Reviewing your list with your financial advisor can help you determine the coverage you require. Evaluate the likelihood of those events taking place and the financial loss you or your dependants may incur. Your financial advisor will consider your budget and your needs to help get you the coverage that you may need. Alternatively, you can calculate the total amount of insurance you need here.

Am I over insured?

With insurance premiums at an all time high, it is important to make sure that you do not have any more coverage than you actually need. Being underinsured or over insured is never a good thing, and it is a fine line to tread to ensure you are not overspending on insurance.

Take into account any coverage that your company is providing to make sure that you don’t have dual coverage, such as personal accident or disability insurance.If your employer is already providing coverage, it is unnecessary for you to spend money on dual coverage. You may be able to cut your insurance costs or even add additional coverage.

Is my investment strategy on track?

Make your money work harder and smarter to mitigate the threat of inflation. Check on the performance of your investments including investment-linked policies or unit trusts, and seek advice from your financial advisor.

Perhaps your risk tolerance has changed in the past year, and you could consider rebalancing your portfolios according to your risk appetite. Additionally, factor in whether there are any changes in your personal life that could affect your financial planning. For instance, if you have a new property purchase or a significant event that has affected your income, you may have lesser cash flow for your investments, and you should realign your investments accordingly.

What is my net worth?

Your net worth gives you a better idea of where you stand financially, and allows you to track how close you are to achieving your financial goals.

During your visit, you can have your financial advisor calculate your net worth for you. Learning to calculate your own net worth is simple. Figuring out your net worth is a great way to keep tabs on how you fare financially. To calculate your net worth simply subtract your debts from all of your current assets.

Net worth = Assets – Liabilities

This simple calculation will let you know if you have enough assets to account for your financial goals after subtracting the liabilities. Make it a habit to check your net worth after any big financial moves.There are different ways to do this.ome people prefer using spreadsheets while others prefer financial planning apps.

Protip: If you prefer to handle your money through the convenience of your mobile phone, download the Planner Bee app to track your expenses and assets across paper and digital statements.

Are there any applicable discounts for my existing policies?

When going through your annual review, your financial advisor may let you know if you are entitled to any discounts when you renew your policy. During this time, it might be worth mentioning all of the measures you have taken to protect your assets such as installing anti-theft systems in your home or having a clean driver’s record. This could help to reduce the cost of your premiums, as your insurer might deem the probability of you filing a claim to be lower.

For general insurance, comparing options during renewals can also reveal some cost savings and help you decide if it makes sense to switch insurers. Some plans also offer family discounts, so it might be worth checking with your financial advisor for more details. Always take note of the costs of your coverage, since you could potentially save a significant amount in the long run for a similar level of coverage.

Financial planning is a journey

Financial plans need to be managed on a continuous basis, so don’t be afraid to contact your financial advisor frequently. Hopefully, these five questions will direct you toward a more favourable outcome at your next annual review.

Remember to let your financial advisor know if there are any changes in your life over the past year, and take this opportunity to raise your concerns and doubts to ensure you have a comprehensive understanding of your policies.

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