The financial industry has evolved quickly over the past few years to better serve the public and we are evolving with it. We have met with hundreds of families and business owners and know that most people are not shopping for a commission paying financial product when they call us. Most are looking for a trusted fiduciary to help them with one or more specific issues, and we are happy to provide targeted solutions on a fee-for-service basis, just like physicians, attorneys and accountants do. Of course, we continue to offer ongoing retainer based financial services as well.
What Is a Fiduciary?
Anyone can call oneself a “financial advisor” including financial product salespeople with no securities licenses or training. Being an SEC-Registered Investment Advisory Representative (IAR) means you are held to a fiduciary standard. To become an IAR, you must receive training and pass rigorous exams to earn securities licenses and agree to put your clients’ interests first by registering with the Securities and Exchange Commission (SEC) or a state securities regulator (we are registered with the SEC).
Stockbrokers, registered representatives, insurance agents and others who provide investment advice, on the other hand, are regulated by the private sector organization, Financial INdustry Regulatory Authority (FINRA), or by state insurance regulators, and they are not fiduciaries. Those advisors are often compensated by commissions on transactions that can put them in conflict with the interests of their clients; transactions that do not legally have to be in their clients’ best interests. Instead, they are held to the Suitability Rule, which states that firms and their associated persons “must have a reasonable basis to believe” that a transaction or investment strategy involving securities that they recommend is suitable for the customer (http://www.finra.org/investors/suitability-what-investors-need-know).
Many experienced fiduciary advisors have established investment minimums and only accept new clients who are willing to invest at least $500,000 or even $1 million or more with them as part of the engagement. This is what has led many people to assume that you have to be ‘rich’ to afford to hire an experienced fiduciary. We manage investment portfolios for clients, but we also work with people who have needs other than the investment management of their large portfolios. I will describe the most common of these financial planning scenarios next.
Problems We Solve
Hundreds of people have come to us with all manners of financial challenges and opportunities. Here are some of the most common things we help our clients with:
Desire to Learn
Some people want to manage their own finances but don’t want to learn all their financial and investment lessons the hard way. We are always diligent to fully explain our analysis and recommendations at whatever pace our clients need, and we will be there in the future should additional needs arise.
Debt and/or Spending Worries
This is fairly common at all income levels and is always the result of a lack of cashflow management. We work with you to set up a simple system to segregate your fixed monthly expenses from your discretionary spending and create a plan to eliminate your consumer debt permanently. We can also be retained on a monthly basis to help provide accountability and ongoing reporting and support if needed.
Sudden or Concentrated Wealth
It could be an inheritance or a windfall from a company sale or the diversification away from a large concentrated stock. We help clarify and prioritize your goals and share with you the most efficient ways to fund them with your newly acquired financial resources. We are also very experienced with identifying opportunities to minimize your taxes using charitable and non-charitable strategies.
Special Events
This could be something wonderful such as an exciting new job with complex benefits or a new pilot union contract, marriage or new family member. It can also be something sad such as the death or disability of a family member. We help you make the best decisions during these times and refer you to other financial professionals such as attorneys and CPAs, if needed.
Looming Retirement
You are winding down your career and want a professional to help you navigate the highly consequential, once-in-a-lifetime decisions related to Social Security, Medicare, long-term care planning, pension claiming and estate planning. We specialize in educating soon-to-be retirees on all their options to create reliable lifetime retirement income in the most efficient manner.
Second Opinion and Periodic Checkups
You know that the tax laws and investment landscapes are constantly changing and you are seeking a professional to review your current plans and provide recommendations and corrections. You may also seek periodic financial checkups to be sure you are continuing to make the best decisions.
Successor Financial Advisor
Many couples have a designated spouse or friend who serves as the ‘family advisor’ to handle financial planning and investment decisions. We can provide a professional second opinion on all your current financial strategies and serve as a trusted successor advisor if health issues or other circumstances create a need down the road.
Financial Stress in Your Marriage
We are not marriage counselors, but we do have a very effective and collaborative financial planning process that engages both spouses and contains elements of the issues listed above. This can be as simple as creating a financial plan together that everyone understands and has confidence in.
To Learn More
We work on an ongoing retainer basis and can also provide specific quotes or an hourly rate for any of your one-time planning or investment needs. We offer an introductory one-hour meeting at no charge to allow you to get to know us better and ask us anything that is on your mind. Give us a call at 303.500.1930 or request an appointment at StewardshipColorado.com.