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Don't Just Check Boxes: Consider the Importance of the Information Being Requested

| March 27, 2019
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Many people don’t like filling out paperwork. Whether we are at the doctor’s office, preparing our income tax return, or opening a financial account, it is rare when someone actually loves to complete forms. Unfortunately, forms are necessary for information gathering. That information is used to help determine suitability - such as for a particular medicine or, in the case of your financial advisor, for the products and services to create your investment strategy.

There are a few very important boxes that enable the financial advisor to know what other assets you might own, what your need for liquidity is, what the time horizon for the investments in this account are (they may be different than in another account you own), your tolerance for risk, and the overall investment objective (are you seeking growth? Income? Capital preservation? As examples).

It’s important to recognize that you may have multiple accounts and that the money in each account may need to work in a different way. For example, your retirement account may be working toward a goal that is 25 years from now and you have time to “recover” from any market downturns. Another account you have might need to be a bit more liquid because it is being used to fund a goal that is closer in range. When completing paperwork, consider the needs of the account you are opening.

Be truthful. Don’t “hide” the fact that you have accounts with another financial professional or at another financial institution. By only seeing a piece of the puzzle, your financial advisor can only craft a strategy based upon the information that is known -and that could possibly work against you.

Yes, paperwork isn’t fun but your financial advisor can help you to embrace it as a first step on the journey toward your goals. Paperwork can be very empowering! Have questions? Just ask.

This information is provided for educational purposes only and not as specific advice for any individual.

Seek professional advice before taking any action in regard to your finances.

Todd A. Slingerland, CFP®

6 Tower Place Albany, NY 12203  (518) 867-4000 x105   todd@4cfp.net   www.capitalfinancialplanning.net

 

 

 

 

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