I always thought planning for my family’s financial future would be something I would be working on years from now but I have learned that a CERTIFIED FINANCIAL PLANNER™ professional can help me get a plan in place to ensure my family has a path to financial security–no matter what stage of life we are in.
What can a CERTIFIED FINANCIAL PLANNER™ professional help me prepare for?
Creating a plan goes far beyond retirement. There’re plenty more financial hurdles that a CFP® professional factors in: rising child care costs, healthcare (especially the unexpected health related expenses), purchasing a home or vacation property, preparing for university, every day expenses and taking that memorable vacation.
Planning for daycare costs
The majority of the families in my life have their kids in a daycare or employ a nanny. When they tell me what they pay for child care it just blows my mind. According to Care.com, 1/3 of families spend more than 20% of their household income on childcare. Childcare is a huge consideration for working parents when family planning. Consulting with a CFP® professional when you are ready to start planning your family is the first step in setting your family up for financial success.
Planning for unexpected healthcare and health related expenses
We know from experience what it is like to have an unexpected and extended illness in our family. When my father in law was in the hospital for over a month, I saw one of the health care bills. The bill was over $100,000. I stopped opening envelopes after that. I deferred to my husband because I knew we had a plan for paying these bills. The average family of 4 will spend $28,000 on healthcare costs in 2018, according to the annual Milliman Medical Index Report. A CFP® professional will help you come up with a plan that helps you thoughtfully budget for medical expenses, planned or unexpected. The last thing a family needs when dealing with an unexpected illness is financial hardship.
Making a financial plan to purchase a home.
One of our biggest financial obligations is our mortgage. Having a plan in place to accommodate that financial obligation is extremely important. Did you know that only 39% of Millennials own a home? With rising costs all around the board, working with a CFP® professional is imperative to figuring out how much home you can really buy and how much you should budget for the mortgage, taxes, insurance and other expenses. It’s those expenses beyond the house cost that are tricky to plan for!
Help make a plan to pay for college
The average college tuition for a 4-year University is $152,000, according to College Data. I know that my fees were well over $100,000 – and that was 20 years ago! My parents worked with a CFP® professional to save money to help me and my sister attend college. It may feel impossible for some families to save enough to send all of their children to college debt-free but there are many different savings accounts that can make that dream feel more like a reality.
What does it take to become a CERTIFIED FINANCIAL PLANNER™ professional?
Anybody with a background in finance can call themselves a financial planner but having the expertise to build a financial roadmap for families takes more than that. CFP® professionals have to pass a very rigorous test that determines a CFP® professional from other financial planners.
They are required to have 4,000 or more hours of financial planning experience. Candidates must pass the comprehensive CFP® Certification Exam, which tests their ability to apply financial planning knowledge to real-life situations. They are required to put their clients’ interests above their own, and to provide their financial planning services as a “fiduciary.” Not all financial planning designations require these ethical standards.
Upon completion of the certification, a CFP® professional has proven that they understand real-life scenarios and how they can affect your investments, retirement funds, college savings or estate planning.
Not just everyone is certified to help you with your finances. Visit LetsMakeAPlan.org to find a qualified CFP® professional near you. And when you’re ready to meet with your CFP® pro, check out this list of questions that help you prepare to meet with a financial advisor.