Review 1
"When you see the title Fundamentals of Financial Planning, you might ask yourself: “Why another textbook on financial planning?” The aim of this book is to introduce the core values and principles of financial planning.
The South African Financial Planning Handbook is the “bible” of financial planning in South Africa, but it can be overwhelming for someone who is entering the industry. This book is a precursor to the Handbook, and considering that the only additional author is Jackie Palframan, while the other authors are the same as those who write the Handbook, the transition between novice and advanced will be seamless, because both books use similar language and definitions.
Keeping that in mind, who should read this book? From the authors’ perspective, it is aimed at undergraduate students, learning institutions and new advisers. It can also be used as a tool for advisers to prepare for the regulatory exams.
While reviewing this book, I sought some first impressions from junior advisers, as well as from office administrators, who provide administrative support to financial advisers. They all felt that the way in which the concepts are explained is very clear and understandable, even for people who might not be familiar with the terminology.
Although it might not have been the authors’ intention, Fundamentals of Financial Planning could also be a valuable tool for administrators working in the financial planning environment, as they often work closely with the advisers but are not always formally trained. This book will help administrators significantly to improve their knowledge and efficacy, improving the entire practice’s ability to service its clients.
While preparing for this review, I did a little te
st. Our practice has a graduate programme and has appointed a very junior para-planner with no industry knowledge or experience. So I drew up a little test that asked her questions on financial planning, and I gave her the textbook to see what she came back with. She was able to find all the answers and, more importantly, she could give me her own feedback on what she understood about the subject matter. That confirmed to me that Fundamentals of Financial Planning is very well written and user friendly.
The book is divided into eight sections that clearly highlight the various elements that make up the financial planning environment in which advisers work.
I found the section on the financial planning profession especially relevant for those advisers who have been in the industry for some years and have not taken the time to take a step back and evaluate how far the industry has come in the past decade.
The last section consists of a case study that shows how all the various elements come together in a comprehensive, holistic financial plan, using the six-step financial planning process that is supported and recommended by the Financial Planning Institute.
Fundamentals of Financial Planning is a valuable new addition to any financial planning practice’s library that can be used as a quick reference guide for junior planners, para-planners and administrators. It could go a long way to increasing the quality of support that financial planners require to raise levels of service in the profession."
Natasja Norval Hart
Personal Finance Magazine, 2nd Quarter 2011, Volume 47
Review 2
"This book will go a long way to improve the general knowledge levels in the Financial Services Industry."
Eugene Vermeulen
Acting Manager
FPI Examination Body
Review 3
'Need help to pass your regulatory exams?
Are you intimidated by the body of knowledge required to tackle your FAIS Regulatory exams? You needn't be – because help is at hand. LexisNexis has announced "the most significant development in the financial planning education environment in the past five years". They're launching a textbook called Fundamentals of Financial Planning, which will be available from December 2010. The textbook offers comprehensive coverage of financial planning topics at undergraduate level (NQF 5&6) and also covers a number of product category outcomes for the FSB regulatory exam syllabus. The new textbook complements the best selling South African Financial Planning Handbook! What does the new textbook cover? We flipped through the content pages to find out.
Everything you wanted to know about financial planning – and more
Fundamentals of Financial Planning delves into every aspect of personal financial planning. It comprises eight sections – with a number of chapters under each.
Section 1: Fundamentals of Financial Planning
The first section of the book provides a comprehensive overview of the financial planning industry. Because this section is relevant to every individual in the advice space I though I'd provide an outline of each of its chapters:
- Chapter 1: The financial planning profession
Those of you already active in the financial planning industry will enjoy the use of "profession" in the chapter heading. It's an acknowledgement of the major progress made in setting standards and education requirements for existing and new entrants to the industry. The first chapter of the textbook touches on financial planning as a profession and provides an outline of the key stakeholders in the financial services industry.
- Chapter 2: The Financial Advisory and Intermediary Services (FAIS) Act
Everything you ever wanted to know about the FAIS Act is jam packed into this section. The book offers a background to compliance legislation and touches on Policyholder Protection Rules before unpacking the Act in detail.
- Chapter 3: Counter-money laundering
If you're in the business of advising clients on how to invest their spare cash you'll inevitably run into some declarable transactions. The book outlines the Prevention of Organised Crime Act and the Financial Intelligence Centre Act to insure you understand your legal obligations with respect to the prevention of money laundering activities.
- Chapter 4: The Client and the Financial Planning Process
The nuts and bolts of financial advice happen in the client facing stages. Fundamentals of Financial Planning comments on the importance of financial planning and walks you through the six-step financial planning process.
- Chapter 5: Financial Calculations and the time value of money
Retirement planning is all about knowing how much money you need 20 years from today to last you another 20 years in retirement. A section on financial calculations and the time value of money is an essential tool for any financial planner. Chapters in this section cover basic principles, simple and compound interests, calculating future values of single lump sum investments, calculating bond instalments and amortisation – with practical examples. The book is worth having just for this important knowledge.
Section 2: Insurance planning and risk management
If you're going to sell either short or long-term insurance this section is just for you. It covers all aspects of risk management – from the basic "what is risk" to the advanced topics such as proximate cause and subrogation! Healthcare is addressed as a separate chapter in this section.
Section 3: Tax Planning
Love them or hate them, SARS has upped South Africa's revenue collection mechanisms over the past decade. They're getting smarter about making sure your clients pay every cent of their tax dues. This section puts the magnifying glass over tax and tax planning aspects under the headings Income Tax, Capital Gains Tax, Donations Tax – plus Transfer Duty and VAT and Estate Duty!
Section 4: Investment Planning
Nothing highlighted the importance of long-term investment planning more than the stock market hiccup experienced over the second half of 2008 and 2009. Investors who made short-term decisions over the period suffered huge losses to capital value. A financial planner can benefit from this section which imparts basic economic concepts and advanced investment planning skills.
Section 5: Estate Planning
Nothing is certain but death and taxes! Section three handles the "taxes" side of this equation, while the Estate Planning section handles the "death" angle. Fundamentals of Financial Planning covers aspects of succession planning, matrimonial property law and the law of and taxation of trusts.
Section 6: Retirement Planning
The retirement planning section is divided into two chapters, one covering individual retirement tools and strategies – and the other addressing employee benefits.
Section 7: Business Planning
The number of sole proprietors and small business owners has escalated in recent years. These individuals have unique needs when it comes to planning their financial futures. Fundamentals of Financial Planning includes a section to familiarise you with the business world – including insurance needs specific to businesses and understanding business financial statements.
Section 8: Integrated Financial Planning
And finally – the book provides case studies to illustrate the financial planning theory in practise.
Get your copy today!
The publishers have a wicked sense of humour. After a great deal of effort – or so they say – they managed to trim the textbook down to just 600 pages! The good news is the book is easy to read, and affordable. ”
Gareth Stokes
FAnews Online Editor