What Should I Expect From the Financial Planning Process at Exchange?

If you’ve landed on this article, you’re probably considering hiring a financial advisor but your preliminary search may have left you with questions about the financial planning process. This article is intended to help you understand the fundamentals of our financial planning process here at Exchange and answer some of the questions we’re asked most often. Whether you’ve just begun your search, or are ready to reach out and schedule a meeting, we want to be as helpful and transparent as we can in your discovery process. 

Where Does Planning Fall in Terms of Your Priorities?

We’re often asked this question and our answer is always the same. Exchange is a financial planning-centric firm, where building and maintaining high-quality financial plans is the primary service that we provide for our clients. While investment management is important, we do not shy away from sharing our belief that the financial plan is the most critical element of helping our clients achieve their goals.  

When Do You Build a Financial Plan?

When working with prospective clients, we aim to create a financial plan as soon as possible in the process, at no charge. After a brief discovery call or meeting, it’s often easy to tell whether the services we offer are what the prospective client is seeking. Once this is established, both parties are eager to dig deeper and answer more personal questions. The more information we can gather, the better we’re able to answer these specific questions. Building a financial plan is the most effective way to do this. Your financial plan takes the pieces of your individual or family’s finances, fits them together like a puzzle, and creates a detailed picture that we can utilize to help you reach your goals. Without detailed information about your current circumstances, it’s difficult to answer targeted questions you may have.  

However, building a financial plan is not a one-time deliverable, it must be maintained and updated. The ever-changing nature of human lives means that your financial plan requires constant renovation. For our clients, we build financial plans at the beginning of the engagement and maintain them, year after year, for the duration of the relationship. When a substantial life change occurs, we analyze the long-term impact, as well as any variation to goals, and update your plan accordingly.  

What Information Do You Need to Build a Financial Plan?

Once you agree to have a financial plan built, it’s important to understand that you’ll need to share quite a bit of information for the sake of accuracy. Our planning team will build upon a scaffolding of existing cash flow, tax, and investment data that must be provided. Some required items include: 

• Pay stubs and W2’s 
• Bank account statements 
• Expenses 
• Investment account statements (401(k), IRA, brokerage) 
• Prior 1-2 years income tax returns 
• Annuity and insurance contracts 

Depending on your unique circumstances, our planning team may request further information.  

If you’ve ever applied for a mortgage, you’ll notice that we’re asking for the same information that’s provided in that situation. Mortgage Brokers use the information to conclude one number- how much house you can afford. We use this information to lay a foundation and answer a plethora of questions. Some you likely haven’t even thought to ask. 

How Do You Build Out a Financial Plan?

Once the above information has been collected, our team will start building out your financial plan. We start by analyzing cash flow, current investment holdings, and tax returns, and supplement that data by considering the objectives you wish to accomplish in the future. We then draft different scenarios to stress test your portfolio. These scenarios outline hypothetical events and circumstances to measure potential successes and identify shortcomings in reaching your goals.  

At Exchange, we pride ourselves on being what we call an ensemble firm. We put a strong emphasis on collaboration in serving our clients, especially in building a plan and preparing it for presentation. Every plan is seen by more than one set of professional eyes and each client relationship is maintained with more than one advisor at the firm. This collaboration has many benefits, but during the planning process specifically, it allows us to check each other’s blind spots and ultimately produce a strong financial plan that has been challenged and scrutinized.   

The Bottom Line

Exchange is a planning-centric firm. Building a financial plan is the backbone of the work that we do for our clients. As you explore the possibility of hiring Exchange, you’re sure to have more questions. Consider scheduling a meeting, we’d be happy to sit down with you, explore your struggles, and help you find the answers you're looking for.