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  • Writer's pictureMike Rogers

How Many Steps Are In the Financial Planning Process?

Updated: May 3

How Many Steps Are In the Financial Planning Process?

By Mike Rogers, AIF®, Founder and President of 360 Financial

How many steps are in the financial planning process? There are six steps in the financial planning process: understanding your financial circumstances, identifying goals, analyzing your current course of action, developing a financial plan, and monitoring progress and updating. This is a great question to ask if you’re considering working with a financial planner. We’ll help you understand the process.


What Is the Financial Planning Process?

The financial planning process documents your financial goals and the long-term strategy you will follow to achieve these goals. The plan is comprehensive but highly specific to your needs, obstacles, and goals. The financial planning process also includes implementing your plan, monitoring your financial progress, and making updates as needed.

A financial planner can help you every step of the way.

They help you make a plan to reach your financial goals, including:

  1. Budgeting

  2. Saving

  3. Retirement planning

  4. Investing

  5. Insurance

Now that you understand what the financial planning process is, we’ll break down the process into steps.

how many steps in the financial planning process?

What Are the Steps in the Financial Planning Process?

The financial planning process consists of six steps:

1 – Understanding your financial circumstances.

Your financial plan will be specific to you, so your financial planner will make sure they completely understand your financial circumstance. They’ll also try to understand your personal circumstances. This step ensures your financial plan is comprehensive and specific to your needs.

2 – Identifying goals.

Your financial planner will want to understand your top financial goals. Whether buying a house, saving for retirement, or creating a college fund, you will explain your financial goals.

3 – Analyzing your current course of action.

You’ll also explain what you’re currently doing with regard to your financial goals. Knowing where you’re starting from helps your financial planner create a more realistic plan to help you reach your goals.

4 – Developing financial planning recommendations.

Now that your financial planner knows all about your goals and situation, they will begin to create and record financial planning recommendations. They’ll present their recommendations to you, giving you options. At this point, it’s important you pick a plan that you’re comfortable and happy with.

5 – Implementing the financial plan.

Once you pick the plan you’re comfortable with, you’ll have to begin implementing it.

6 – Monitoring progress and updating.

As you implement your financial plan, you’ll monitor your progress. Then you can report back to your financial planner, and if something isn’t working, your financial planner will change it. On the flip side, if some aspects of your plan are working better than expected, your financial planner may adjust your plan to include more of the successful strategy.

Many people find financial planning easier when they work with a financial planner. Your financial planner will take the stress of making decisions off your shoulders, and they will only recommend their tried and true strategies.

Financial planners are professionals, and they can make the entire process easier for you.

What Are the Steps in Personal Financial Planning?

If you plan to work on your personal financial plan without hiring a financial planner, you’ll have to dedicate far more time to research, building strategies, and making decisions.

Here’s what the financial planning process looks like:

  1. Set your financial goals.

  2. Come to an understanding of what your current financial situation is.

  3. Analyze your current course of action.

  4. Research financial strategies to help you reach your specific financial goals.

  5. Build financial strategies, including alternatives so you have options.

  6. Choose your financial plan.

  7. Implement your financial plan.

  8. Monitor progress.

  9. Do research to update your current plan to meet your goals.

As you can see, when you do this process all on your own, it is much more involved than when you work with a financial planner. Many people prefer to work with a financial planner because they have to dedicate much less time to the process, and they typically get better results.

Financial planners are professionals, and they can make the entire process easier for you.

Key Takeaways

  1. The financial planning process includes setting your goals, implementing your plan, monitoring your progress, and updating your plan.

  2. A financial planner can make the entire process far easier for you. Doing the entire process alone can be far more work than you have time for.

  3. It pays off to hire an expert who knows how to help you pursue your goals.

Financial Planning and Wealth Management Services at 360 

At 360 Financial, we provide holistic wealth management services within a fiduciary environment. Schedule a 15-minute call if you're looking for an advisory team to guide your retirement planning and wealth management.

About the Author

Mike Rogers, AIF®

Mike Rogers is the founder and president of Minnesota-based financial advisory firm 360 Financial. As the founder, Mike’s priority is that 360 Financial always serves the clients with empathy, integrity, and honesty. This unique, client-centric approach allows the firm to help clients decipher between the things they can control and what truly matters. In other words, Mike understands that money is not the end-all-be-all; instead, it’s the “how” that fuels the “why” to the question: “What’s important to you?”

Read More Posts about Financial Planning

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.




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