When I was in primary school, I authored a poem that started with, “Yesterday is gone, tomorrow is here, who has done anything here?” This simple verse still holds a profound truth in my life today: time is precious, and each moment offers us the chance to be effective, no matter how big or small. This sentiment is especially relevant to the financial planning profession. Time is a currency that never stops flowing, reminding us to make the most of every moment, especially when it comes to planning for our clients’ (and our own) financial futures.
The importance of the time value of money and helping clients to understand this
Understanding the Time Value of Money (TVM) is crucial for clients to make informed decisions about investing, saving and borrowing money. A rand today is worth more than a rand in the future. Clients who grasp TVM are more likely to take a long-term perspective on their finances, understanding the benefits of starting to save and invest early, even if the risk and reward seem daunting.
This takes me to the role that financial planners play as mentors/coaches for their clients
Financial planners play a crucial role as a mentor and coach for their clients. They focus on key points essential to their clients’ financial well-being, such as understanding TVM, financial goals, budgeting, savings, debt management and more. The psychology of financial planning also comes into play here, as financial planners need to understand their clients’ attitudes, beliefs and behaviours related to money, demonstrating empathy and understanding of clients’ unique circumstances.
A great book recommendation based on the above
I recently had the opportunity to catch up with Warren Ingram, CFP®, and he told me about one of his new books, Small Changes for BIG Results – How to Improve Your Finances One Step at a Time. As I left Cape Town via Cape Town International Airport back to Gauteng, I stopped at Exclusive Books and bought my copy. The book covers real-life case studies of people who overcame financial difficulties and highlights the small steps they took to change the course of their lives. What is interesting is Warren’s own story that started with… a measuring cup!
Highlights at FPI and looking ahead
In February, over 130 candidates sat for the Professional Competency Examination (PCE) with a 54% pass rate. Over 240 candidates are registered for the April sitting. The Annual Budget review session had 1 167 online attendees and the Annual Refresher was a success with 962 attendees in-person and online. FPI has secured funding from INSETA for a project focusing on unemployed youth, a significant step in supporting and empowering young people in our community.
The FPI Professional’s Convention is coming to Cape Town on 13 and 14 August 2024. With the theme ‘Cultivate Growth, Harvest Excellence’, this event promises to be inspiring. In-person seats are limited, so do not miss this opportunity to attend in person. If you are not able to attend, there is an online option as this is a hybrid event.
On the regulatory front, just high level for now
In case you missed it, there is a new Ombudsman in town. The National Financial Ombudsman (NFO) came into effect on 1 March 2024 via the amalgamation of four voluntary ombudsman schemes. The Pension Funds Adjudicator may also in the future be known as the Retirement Fund Ombudsman (RFO). The four schemes that merged are the Short-term Ombud, Long-term Ombud, Banking Ombud and Credit Ombud Association. For more information on the establishment of the NFO, visit the Ombud Council website at ombudcouncil.org.za. National Treasury’s “A simpler, stronger Financial Sector Ombud System Policy Statement” is also well worth the read – this is on the Ombud Council’s website.
