F.A.Q

For many, understanding every aspect of personal finance can be daunting. From investments to retirement to insurance, the decisions can be overwhelming.

That's where a financial advisor comes in.

Whether you have significant assets to manage—or if you are just starting to accumulate wealth—we have the tools and background to provide the services that may fit your needs.

What makes one car worth $200,000 and another $20,000? Although we might all have an answer, that answer likely differs from person to person. The value of a financial advisor is similarly difficult to define. For some investors without the time, willingness, or ability to confidently handle their financial matters, working with a financial advisor may be a matter of peace of mind: They may simply prefer to spend their time doing something—anything—else. Maybe they feel overwhelmed by product choices in the fund industry, where even the number of choices for the new product on the block—ETFs—exceeds 1,000. For these investors, using an advisor is an easy decision. For more knowledgeable investors, an advisor can serve as as an emotional buffer to remind you of what you already know, but are struggling emotionally to perform. An advisor can "talk you off the ledge", as it were.

While impossible to measure, in this context the value of a financial advisor is very real to clients. The overwhelming majority of mutual fund assets are advised, so investors have already indicated that they strongly value professional investment advice. We don't need to see oxygen to feel its benefits.

Look at it this way. Investors who prepare their own tax returns have probably wondered whether a professional like a CPA might do a better job. Are you really saving money by doing your own tax return, or might a CPA save you from paying more tax than necessary? Would you not use a CPA just because he or she couldn't tell you in advance how much you would save in taxes? If you believe a professional can add value, you see value, even if the value can't be well measured in advance. The same reasoning applies to other household services that we pay for— such as painting, house cleaning, or landscaping. We do not necessarily expect to profit from using these services, but see the value through emotional, rather than financial, means. You may well be able to wield a paint brush, but you might want to spend your limited free time doing something else. Or, maybe like many of us, you suspect that a professional painter will do a better job. Value is in the eye of the beholder.

Absolutely.  

There was a country song many years ago that went "I was country when country wasn't cool". Well, we were fiduciaries when being a fiduciary wasn't cool like it is today.

The easiest thing to say is that we are fiduciaries because the law mandates that all RIA's be fiduciaries. But the reality is we are fiduciaries because it's the only way to do business if you follow our stated core values. 

No, we don't think so. While fee-for-service is commonplace working with accountants and attorneys, for many it is a new experience to consider paying a service fee for financial planning services. Therefore, it is important to consider the value that an experienced advisor can bring to your life and financial strategy. Fee-based advisors are able to offer unbiased, objective advice that is not tied to the sale of any particular product, and all costs are fully transparent. And because we are an RIA, we can and usually do charge a little less than reps employed by large brokerage firms.

For those of you who like things quantified, remember you will never be recommended a product in which you pay a commission. If you invest $50,000 in something, your statement will show $50,000. If you utilize us for an advisory brokerage account, your fee will be 1% of the first $1 million dollars, and .5% of the balance above that. You will find both those numbers to be below the fee charged by most of your large investment management firms.

Wow, there's one we haven't seen before (kidding!) A financial professional is trained to listen to your concerns, identify any underlying issues, and help you find common ground. Believe me, this is very common, and usually results in a couple finding a lot more common ground then they originaly thought.

   Why should I use an Independent advisor instead of an advisor associated with a large firm?

That is a question I hear a lot, and it is a very good one. As for an answer, it breaks down to one simple thing-the arsenal of tools and services available to an independent advisor is typically much larger than that provided an advisor at a huge firm.

How do I know this? Prior to “going independent”, I worked as an advisor at three of the largest financial firms in the country. They were great places to work, and when I was there I felt pretty confident that I had all I needed to serve my clients. Of course, there were more than a handful of clients who always seemed to have a “hole” in their portfolio that my product set just really wouldn't let me fill. I shrugged it off as just one of those things you learn to deal with and tried to plug the hole as best that I could.

The biggest surprise to me when I went independent were the offerings I now had access to. Granted, some of them were pretty complex and required a good understanding of them before they could be recommended, but all of a sudden I was able to completely fill those holes in various portfolios. What was comical was the comment two of my clients made- “why didn't we ever do this before?” The answer was simple- “we didn't have the services before”.

I wondered why these huge firms I had worked at didn't have these offerings available. Frankly, it did not make a lot of sense to me. I shared that thought with a representative of one of these new products, and her answer was enlightening. She told me that her company had been trying for years to get on the platforms of these huge firms, but were repeatedly shut out. The reason was due to the complexity of the products. As she explained it, the complexity of the product made it very difficult for the compliance department of these huge firms to sufficiently train and supervise the sale of these products-so they made a decision to simply not offer them. It made sense, as a company with 10,000 representatives nationwide will almost certainly have reps of various experience and skill sets. And since protecting the company from legal actions, bad press and fines is the job of the compliance department, the decision was made accordingly to not expose them to the risks.

Does that mean that independent firms don't supervise their representatives very well? Absolutely not. Trust me, they do. But with 300-400 reps across the country, most of which tend to have many years of experience as advisors, the job is just much easier. And my clients are better off for it.

The answer is that you can, if you have enough time and knowledge, but do you really want to? Do you understand the risk levels in your investment portfolio? Are you comfortable choosing financial products? Additionally, certain investments may only be offered through a licensed financial advisor.

You must also ask yourself whether you have the discipline to develop a specific strategy and stick to it, as well as the time required to do it right. What is the opportunity cost? Could you be using that time to be moving closer to your goals and what is most important to you? An experienced advisor can provide an outside perspective to help you see things more clearly, provide a level of accountability, and save you time by ensuring that all angles of your financial picture are covered.

If you think you might like to partner with a financial professional to help you develop a strategy based on your values, coordinate the management of your investments, insurance and other financial vehicles to work together for your benefit, and free your time to focus on what's truly important to you, then working with an experienced advisor makes a lot of sense.