January 22, 2024

What Is the First Step in the Financial Planning Process?

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

Mike Rogers is a fiduciary financial advisor with over 30 years of experience in the financial services industry as an investment advisor and financial planner. He founded 360 Financial in 1995 and holds series 7 and 63 security registrations with LPL Financial.

The First Step in the Financial Planning Process

The first step in the financial planning process is understanding and defining your financial goals.

Before any strategies can be formulated or investments chosen, it’s essential to clarify your goals, whether it’s early retirement, buying a home, or leaving a legacy for your children. 

This involves introspection and candid discussions with your financial advisor and family members about your dreams, priorities, and concerns for the future. By establishing clear objectives, you can create a roadmap that guides every financial decision that follows.

A well-defined goal serves as the foundation upon which a comprehensive financial plan is built.

Common Questions about the First Step in the Financial Planning Process

How many stages are there in financial planning? 

Typically, there are six stages in the financial planning process: 

  1. Initial assessment
  2. Goal setting
  3. Plan creation
  4. Plan implementation
  5. Monitoring
  6. Review and revision.

How do I assess my current financial situation? 

To assess your current financial situation, you should start by creating a detailed list of your assets and liabilities. Next, you should create a spreadsheet or other method for tracking your income and expenses. Following that, it’s important to review any outstanding debts and investments you have.

What information should I gather for financial planning? 

For financial planning, you should gather details the following information:

  • Income
  • Expenses
  • Assets
  • Liabilities
  • insurance policies
  • tax returns
  • any existing investment documents or retirement accounts

Can you provide examples of setting financial goals? 

Examples of setting financial goals include saving for a down payment on a house, accumulating a specific amount for retirement, funding a child’s college education, or reducing and eliminating debt within a certain timeframe.

What are the benefits of starting with a clear financial snapshot? 

Starting with a clear financial snapshot provides a solid foundation to set realistic and attainable financial goals, helping you make informed decisions and track progress over time.

Is professional help needed for the first step? 

Professional help is not strictly necessary for the first step of assessing your financial situation, but it can provide clarity, accuracy, and expert insight, especially if your finances are complex. If you have investable assets of $250,000 or more, it may be wise to get in touch with a financial advisor who can help you with financial planning and investment management. 

However if your assets are under $250,000, then it may be best to begin the financial planning and investing process on your own. You can use a robo advisor to get started with investing until you’re ready to start working with a financial advisor. When you do start searching for the right financial advisor, you’ll likely want to find a fiduciary financial advisor if possible. 

What’s the next step after completing the initial assessment? 

After completing the initial assessment, the next step in the financial planning process is to define and set your short-term and long-term financial goals.

Connect with a Financial Advisor Online or In Person


If you need a wealth management team to help you achieve your big-picture goals, we recommend scheduling a call with a financial advisor at 360 Financial.

360 Financial is one of Minnesota’s best independent wealth management firms with over 30 years of experience. We work with clients in Minnesota and across the US. If you’d like to work with a team that always puts your best interests first and is committed to helping you create a lasting legacy, please get in touch. 

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About the Author

Mike Rogers

Mike Rogers

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 customized, 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?”

Other Articles and Guides 

3 Main Elements of the Financial Planning Process

Retirement Planning for Self-Employed People

Learn More About Financial Planning for Retirement

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This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.

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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