The seven steps
Securities are offered through Cetera Wealth Services, LLC, member FINRA/SIPC. Advisory services are offered through Cetera Investment Advisers LLC, a registered investment adviser. Cetera is under separate ownership from any other named entity. Insurance products are offered through licensed affiliates. This material is general information and is not individualized investment, tax, legal, or insurance advice.
CFP Board sets out a seven-step financial planning process that CFP professionals are expected to follow. It is worth knowing because it tells you what should happen and in what order, which makes it easy to spot when something is being skipped.
- Understand your personal and financial circumstances.
- Identify and select goals.
- Analyze the current course of action and any alternatives.
- Develop the recommendations.
- Present them.
- Implement them.
- Monitor progress and update.
Notice that recommendations are fourth. Three steps of understanding come first. A process that opens with a product, or with a portfolio review before anyone has asked what you spend, has started at step four.
What the first meeting covers
The first two steps happen in conversation. The planner is building an inventory: account balances by tax type, Social Security estimates for both spouses, pension documentation with the election options still open, insurance in force, estate documents, and what you actually spend.
That last one takes the most work and matters the most. A spending figure built from twelve months of statements, with essential separated from discretionary, is the number the entire plan rests on. A figure built from a replacement ratio is a guess wearing a decimal point.
Three steps of understanding before the first recommendation. That ordering is the whole method.
Goals come next, and they have to be specific enough to test. "Retire comfortably" cannot be modeled. "Stop working in June 2029, spend about this much, keep the house, help with two grandchildren's tuition" can be. We cover what is still adjustable at that stage in five years from retirement.
The analysis nobody sees
Step three is where most of the actual work happens, and it is the part clients may not always see. The question is not whether the plan works if things go averagely. It is whether it survives the things that go wrong.
That means testing the plan against a poor sequence of early returns, against a longer life than expected, against higher inflation, and against a care event. Monte Carlo simulation is one common tool: the plan is run through many randomized market paths to see how often it holds. The output is not a prediction. It is a sense of how much margin the plan is carrying, and simulations rely on assumptions that may not reflect actual future conditions.
Alternatives get tested in the same pass. Claiming at one age against another. Converting in a given year against not converting. Drawing taxable first against drawing tax-deferred first. The point is to see the trade-offs side by side rather than argue them in the abstract, which is the subject of the 4% rule and what it actually tells you.
What the document says
The plan that comes out of steps four and five should be specific enough to act on and specific enough to check later. At minimum it states the income target, which account funds spending in which year, when each income source starts, how much sits in reserve outside the growth portfolio, and what refills that reserve.
Alongside it sits a written investment policy statement: the target allocation, what triggers a rebalance, and the rule for a declining market. That document exists for one reason. It is written in a calm month so that the decision in a bad month has already been made. The mechanics are in how investment management changes when you retire.
Implementation at step six is the unglamorous part: custodial paperwork, transfers, beneficiary forms, and coordination with your CPA and attorney so the documents and the plan agree with each other.
The five areas it coordinates
A retirement plan touches five areas, and the value is in reading them against each other rather than handling each alone.
| Area | The question it answers | Where it reaches |
|---|---|---|
| Income | Which sources start when, and what each covers | Sets the withdrawal the portfolio must fund |
| Investments | Allocation, reserve, and the rule for a down year | Determines how much sequence risk the plan carries |
| Taxes | Withdrawal order and conversion sizing, with your CPA | Changes Medicare premiums and the taxable share of benefits |
| Health coverage | Enrollment timing and what the premium costs | Adds a recurring lifetime line to the cash flow |
| Protection and estate | What a care event is funded from, and what passes on | Frees or ties up assets the income plan counted on |
Insurance products are offered through licensed affiliates. Estate documents are drafted by your attorney; a planner's role is to keep the beneficiary designations and the plan aligned.
Beneficiary designations are worth singling out. On an IRA or a 401(k) they control who inherits, regardless of what a will says. They are also the item that may go unchanged for a decade. Related reading: the Illinois estate tax and long-term care costs.
Why it does not end there
Step seven is the one that distinguishes a plan from a document. Tax rules change. Contribution and distribution ages have moved more than once in recent years. Markets move, health changes, and a retirement date shifts.
A review on a set schedule checks the plan against what actually happened: whether the withdrawal rate still holds, whether the allocation has drifted, whether a conversion makes sense this year and not last, whether anything in the estate documents is now out of date. The alternative is a binder that described a situation that no longer exists.
What it does not include
Worth being plain about the boundaries. A CFP professional does not prepare your tax return and does not draft legal documents. The planning work sits above both and coordinates with the professionals who do them.
The credential also is not a registration. It reflects completed education, examination, experience and an ethical commitment, and CFP professionals commit to a fiduciary duty when providing financial advice under CFP Board's standards. What a credential cannot tell you is an advisor's regulatory history, which is why verifying an advisor through BrokerCheck is a separate step, and why the letters are only a starting point. Financial advisor designations covers what each set of letters requires.
Serving Tinley Park
Tinley Park has two Metra stations on the Rock Island line and grew as a commuter town, which means a large share of households here reach retirement with a full career at one employer behind them. That shapes the first conversation: it usually opens with a pension election or a rollover decision rather than with a portfolio question.
For Tinley Park clients the work is retirement income planning that turns a pension and a 401(k) into a coordinated paycheck, investment management built for withdrawals, tax-aware withdrawal sequencing in coordination with your CPA, and Medicare enrollment timing mapped against the retirement date. The Palos Heights office is a short drive, so most meetings happen in person.
Richard Casolari, Financial Advisor, Investment Advisor Representative, CFP®, has spent roughly fifty years in financial services. The practice is founder-led, so the person who runs the seven steps with you is the person you meet with when the plan needs revisiting.
Neither diversification nor asset allocation can assure or guarantee better performance/profit and cannot eliminate the risk of investment losses in declining markets. Distributions from traditional IRAs and employer sponsored retirement plans are taxed as ordinary income and, if taken prior to reaching age 59 ½, may be subject to an additional 10% IRS tax penalty.
Fees, charges and expenses are detailed in the Cetera Wealth Services LLC's ADV Part 2A. For a comprehensive review of your personal situation, always consult with a tax or legal advisor. Neither Cetera Wealth Services LLC nor any of its representatives may give legal or tax advice.
Securities offered through Cetera Wealth Services, LLC, member FINRA/SIPC. Advisory services offered through Cetera Investment Advisers LLC, a registered investment adviser. Cetera is under separate ownership from any other named entity. Insurance products are offered through licensed affiliates.
This material is for general information only and is not a recommendation to buy or sell any security or insurance product, or a solicitation in any jurisdiction where the advisor is not properly registered. Investing involves risk, including possible loss of principal. No strategy assures a profit or protects against loss in a declining market. Monte Carlo and similar simulations are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Tax rules, contribution and distribution ages, and Medicare premium tiers change and several are indexed annually; confirm current-year figures with your CPA before acting.
