Choosing the right financial advisor to stress test your financial plan is crucial for ensuring your strategies align with your goals. Below we’ll share three essential tips for finding a financial advisor who understands the importance of stress testing, focuses on your unique needs, and possesses the technical proficiency to optimize your financial plan. With the right advisor, you can confidently navigate financial uncertainties and achieve your goals.
What is Stress Testing Your Financial Plan?
Stress testing is a process completed by a Financial Advisor that evaluates and assesses to see if the current strategies being used are likely to achieve your financial goals and objectives. It also seeks to identify any gaps, or opportunities that are being overlooked but could add significant value to the financial plan.
There are a few important things to keep in mind when searching for a Financial Advisor who will perform regular stress tests on your financial plan.
Choosing the Right Financial Advisor for a Stress Test
- Seek out financial professionals who understand Stress Testing and its value
A good sign that a financial professional understands stress testing is if they can explain their process and the value stress testing adds to a financial plan. Stress testing doesn’t always mean changes are made to the financial plan, it just means that you are addressing gaps and opportunities, and making sure a discussion is had on the topic.
Think of stress testing as your annual physical with your doctor. It isn’t because something is wrong at that moment, but it’s preventative service and helps identify anything hidden problems you may have not noticed within your financial plan.
- Work with professionals who focus on “you” and your family
Stress testing is not evaluating your financial numbers versus some benchmark. It’s meant to evaluate your overall financial plan and to see collectively if the design of the plan suits your needs, wants, and preferences based on you and your family. Then, taking that current financial plan and comparing it to available alternatives.
This should be with a focus on you, getting a better understanding of you as a person, and your family including your goals, values, and vision. Not focusing on your net worth. Again, not necessarily meaning changes are made; rather more focused on addressing concerns and making sure the financial plan aligns with the objectives.
- Work with professionals who are highly technical
Not only is working with an advisor who focuses on you and your family, and not just the numbers important; it is just as important to have an advisor who is technically proficient. A highly proficient professional can help evaluate the most complex financial plans and help to provide solutions. They can construct side-by-side comparisons and look at all qualities of a financial solution. This may entail utilizing their own internal team or even bringing on a team of specialists from outside sources.
Financial Planning Stress Test with Kowal Investment Group
Stress testing isn’t meant to be stressful. It’s meant to provide a sound mind when things don’t go as planned. Knowing that whatever may happen in life, you’ve addressed that “test” and are prepared for what lies ahead. If you are looking for financial professionals with the human aspect, as well as the technical to conduct a stress test for you and your family, contact the Kowal Investment Group team today. We’ve been helping our clients reach their financial goals for over 30 years, and we’d like to help you too!
Any opinions are those of Kowal Investment Group and not necessarily those of Raymond James. This material is being provided for informational purposes only and is not a complete description, nor is it a recommendation. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or a loss regardless of the strategy selected. Prior to making an investment decision, please consult with your financial advisor about your individual situation.
