What is the SECOND step in the financial planning advisory process?

• A. Identify, quantify and prioritise financial needs and objectives
• B. Fact-finding
• C. Devising a strategy
• D. Making a recommendation

Answer: (A)

The step being tested focuses on turning gathered information into defined, measurable goals. After you’ve collected the client’s data (income, assets, liabilities, timelines, risk tolerance, constraints) in the initial fact-finding phase, the next move is to identify what needs the client has, quantify how much is required, and prioritise those needs and objectives.

This matters because it creates a clear, data-driven set of goals that will guide the entire plan. By quantifying targets and ranking them by importance and urgency, you can determine what to address first, what assumptions are involved, and what resources are needed. This foundation makes the subsequent steps—developing a strategy and making specific recommendations—focused and aligned with the client’s priorities.

For example, if fact-finding reveals goals such as building an emergency fund, saving for retirement, and funding a child’s education, you would quantify the required amounts, set time horizons, and prioritise the goals (often emergency funding first due to its immediacy, followed by retirement, then education). The process of identifying, quantifying and prioritising ensures you’re solving the right problems in the right order before designing the strategy.