What a Financial Assessment Is and Why You Might Need One

by Stephany Kirkpatrick, CFP®

AMTWhen it comes to getting a plan for your money, it can be important to know your starting line. That’s where a financial assessment comes in. A financial assessment usually comes in the form of an online questionnaire, in-person meeting, or phone call with a financial planner. The purpose of the assessment is to understand where you stand today, and where you want to be in the future, so that you can get accurate recommendations for how best to achieve your financial goals.

A good financial assessment will most likely ask questions about:

  • Your current sources of income, bills, and expenses
  • Basic financial health, including your current retirement savings, emergency savings, and debt
  • Financial obligations, like caring for elderly parents
  • Your short and long-term goals, such as saving for a wedding, buying a house, or sending kids to college
  • Your credit score and current credit card payments and interest rates
  • Your mortgage or rent details

An in-depth or more personal financial assessment might also ask questions about:

  • Retirement options available to you through your employer
  • The types of accounts you currently have, rates, and current savings contributions
  • Your approach to money, and areas you want to work on
  • Your ideal balance between saving and lifestyle spending

A financial assessment may focus on different areas of your money life depending on who is giving it. Companies that sell financial products, such as insurance policies, brokerage accounts, or investment advice, may orient their questions and advice around the type of product they are selling.

At LearnVest, financial planners like me offer personal financial assessments to our clients as part of our Action Program. In order to understand my clients’ full financial picture, I have them fill out an online profile as well as have an in-depth “Strategy Session” over the phone to talk more about their goals and spending habits.

As a LearnVest Planner, I don’t manage wealth or sell financial products, like stocks, bonds or even insurance policies. Instead I focus on helping people simplify their money life by giving them a clear, personalized plan for their money, including step-by-step recommendations around achieving their goals, and a budget that takes their lifestyle into account. I also focus on helping them build better money habits over time, and giving them the resources they need to help them feel empowered and confident about their financial decisions.

Whatever financial assessment you choose to take, consider keeping in mind what your ultimate goals are, and how the company offering the assessment fits with those goals. If you are looking for a budget, an insurance company’s assessment might not be the right place for you. If you are looking for investment advice, keep in mind that your advisor might be earning fees or commissions on the investments they recommend.

Interested in signing up for LearnVest and getting your own personal financial assessment and custom Action Program? Schedule a free session with a LearnVest Program Expert to learn more.

LearnVest Planning Services is a registered investment adviser and subsidiary of LearnVest, Inc. that provides financial plans for its clients. Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice. Please consult a financial adviser, attorney or tax specialist for advice specific to your financial situation. LearnVest Planning Services and any third parties listed in this message are separate and unaffiliated and are not responsible for each other’s products, services or policies.

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No jargon, no judgment. Just advice.

Our mission is to help people feel amazing about their money by making financial planning affordable, accessible, and even delightful. We offer a custom program to help simplify your money life, designed by your very own LearnVest Planner.