financial planners

YFP 404: 5 Key Questions to Ask Before Hiring a Financial Planner

Posted on by YFP Media

Tim Ulbrich, PharmD, and Tim Baker, CFP®, break down how to find the right financial planner—covering what planners really do, how they’re paid, and the questions to ask—so you can move forward with clarity and confidence.

This episode is brought to you by First Horizon.

Episode Summary

Not sure who to trust with your finances—or if you even need a financial planner? In this episode, Tim Ulbrich, PharmD and Tim Baker, CFP® dive into what a great financial planner does beyond providing investment advice, and how they can help you navigate life’s financial twists and turns.

Tim and Tim explain the different types of planners, how to spot someone working in your best interest, and the key questions to ask before hiring one. Plus, they break down common fee structures (like AUM, flat-fee, and hourly), the importance of the CFP® designation, and how to evaluate the return on your planning relationship.

Whether you’re hiring a planner for the first time, reevaluating your current setup, or just exploring what’s out there, this episode will give you the clarity and confidence to take the next step.

Key Points from the Episode

[00:00] Welcome Back, Tim Baker!
[00:39] Skepticism in the Financial Planning Industry
[02:18] Understanding Financial Advisor Compensation
[03:56] The Importance of Transparency
[06:37] Defining Financial Planning
[11:27] Comprehensive Financial Planning Process
[20:06] Evaluating Financial Advisors
[32:07] Second Opinion Analysis
[34:47] Licensing and Compensation Models
[37:00] Commission-Based vs. Fee-Only Advisors
[37:40] Understanding Advisor Models
[38:53] Identifying Advisor Compensation
[41:44] Transparency in Advisor Fees
[01:04:06] Conflicts of Interest in Financial Planning
[01:05:54] Investment Philosophy Alignment
[01:12:56] The Value of Long-Term Financial Planning

Episode Highlights

“ I think it’s 5% of financial advisors, financial planners, whatever you want to call us, are fee-only fiduciaries. That means the other 95% are not, which means that they can put their own interests, the advisor, the planner’s interest, ahead of their clients.

When I tell pharmacists that, they’re like, are you serious? That doesn’t sound like it would be legal or true, but it is.” – Tim Baker [7:39]

“We’re not going to lay on our deathbeds and say, ‘Oh man, I wish YFP, or I wish my advisor would’ve told me to put more money into our Roth IRA.’ We’re going to say, ‘I wish I would’ve got into horseback riding again because it was a passion of mine that I just put on the back burner.’” – Tim Baker [1:00:40]

“ When I started Script [Financial], the thing I heard from pharmacists that I started working with was, the advisor that they would work with or they would talk to would say, ‘Hey, don’t worry about your student loans. They’ll figure themselves out,’ which we know is terrible advice.” – Tim Baker [12:37]

Mentioned in Today’s Episode

Tim Baker on LinkedIn

Episode Transcript

Tim Ulbrich: Tim Baker, welcome back to the show.

Tim Baker: Good to be back. What’s what’s good, Tim?

Tim Ulbrich: Well, I’m excited. We’re, we’re gonna be talking about questions to ask when hiring a financial planner. A topic that we’ve dabbled on before we, we’ve woven in and outta this topic throughout the show in, in various episodes before. But we’re gonna directly cover five questions that should be asked.

Tim Ulbrich: Certainly not the only questions, but when you’re evaluating a financial planner and no need to take notes, we’ve got all this information and even some additional resources in our YFP Nuts and Bolts Guide to hire a financial planner. We’ll link to that in the show notes so individuals can go get that resource.

Tim Ulbrich: Tim, I wanna start with maybe what is top of mind for many people, especially [00:01:00] if they haven’t worked with a planner before, which is some of the skepticism that may be out there in terms of working with a financial planner, engaging with a financial advisor, entrusting them with something that is so important, uh, which is their own financial plan.

Tim Ulbrich: And admittedly, an industry that doesn’t necessarily have. The best reputation. So let, let’s start there in terms of, you know, that skepticism that may be there and where some of that may be coming from.

Tim Baker: Yeah, I think, um, you know, I think a lot of the, the, you know, the advisors that came up back in the day kind of came up through like the wirehouse model. So some of these big companies that we all know the names or even even the insurance world. And I think, I think in those models, and again, you know, this episode, you know, we may throw shade on other models.

Tim Baker: There’s no hate here. Like it’s just, there are diff, you know, different strokes for different folks types of things. And I’ve been in, you know, a few, you know, at least one different model be, you [00:02:00] know, before we got into the fee only. But I would say, you know, um, haven’t, haven’t been in other firms. It can be very transactional, Tim, right?

Tim Baker: Tim? So, like, you know, you, you look at the things that you have available to you as a financial advisor and you try to find the best way possible to help your clients, but also to put like food on the table. Sometimes that can mean, you know, squeezing clients into things that they shouldn’t be in and, and it kind of feeling like a, Hey, I’m being pitched a product, versus like, is this person truly in my best interest?

Tim Baker: I think the other thing that’s part of this is, um, like our industry is not transparent at all. When I come across prospective clients that have worked with an advisor or are currently working with an advisor, I’ll ask the question like, how do you, how do you pay your advisor? And they’ll say. I don’t know, or I don’t pay them anything.

Tim Baker: You know? And I, I remember [00:03:00] distinctly when I, when I became a, a financial planner, I was talking to my parents and I’m like, how do you pay your financial planner? And they’re like, my mom was like, well, let’s do your dad’s work. You know, they pay or it’s free, or something like that. And I’m like, that can’t be true.

Tim Baker: And when I uncovered how much they were paying, it was like heart attack city. It was just buried in a product somewhere and they had no idea. So to me, I think it’s that. And then I think it’s also like you, you hear stories about like Bernie Madoff or, you know, really bad apples that, you know, you’re, you’re, you’re entrusting your, your, you know, your life’s work, your, your money, you know, to, you know, a person and you know, they do something that, you know, is, is fraudulent.

Tim Baker: And, you know, that kind of makes the headline. So it, it, it is similar to like, I think, um. Medicine or, or pharmacy where you’re, you’re definitely in a position of trust, right? And I think if [00:04:00] you’re, if you’re a person that takes advantage of that or is pushing a product or things like that, I think that that’s where the public perception can be tainted.

Tim Baker: Um, so it’s, it’s, it’s definitely, I, it’s earned, right? It’s, it’s valid. But I would say the overwhelming majority of people that are out there, no matter what model they’re in, they’re trying to do their best to help their client. I just argue that there are different models that are better, um, that position, the advisor and the client better, you know, where there’s less conflict of interest, every model’s gonna have conflict.

Tim Baker: But that’s what I would say is that, you know, to that answer.

Tim Ulbrich: Yeah. And to my experience too is there’s a lot of overgeneralization. Based on your experience or maybe the experience of someone else that you then adopt that mindset or story. I’m thinking about my grandparents, who I remember growing up. They had a, a financial advisor that wasn’t necessarily a good fit, good situation, and in the eyes of my grandfather.

Tim Ulbrich: That person caused them a lot of pain and therefore, like all financial advisor, [00:05:00] right. So, you know, and, and that was fair. His, his concern, the harm that was caused in that moment, that was very fair. But as we’ll talk about during the show, there are a lot of different types and, and flavors of financial advisors, financial planners.

Tim Ulbrich: What does that term even actually mean? And when I think back to my own journey, starting this industry, before I had the opportunity to cross paths with you and learn more about the industry and what do terms like fee only and fiduciary mean. I remember very early on, after starting the blog back in 20 15, 20 16, I started to interview various financial advisors and inevitably conversation after conversation.

Tim Ulbrich: I often left with more confusion than I had answers. And I, I was trying to ask pointed questions, and I would leave with this kind of feeling of smoke and mirrors not clear on, you know, how are things being charged, what’s included, what’s not included, and, and then I was able to put terms of those things later after I would understand.

Tim Ulbrich: But the problem that I had, and I see a [00:06:00] lot of pharmacists falling into this trap in a similar way, is I applied my pharmacy training mindset. And I tried to use that as the lens in which I was understanding the financial services industry. Because in, in pharmacy, right, there are, there’s variability between one pharmacy program and another, or one residency program in another.

Tim Ulbrich: But at the end of the day, like we know what a pharm D means. We know what a PGY one or PGY two means. We know what board certification means. And while there are some differences between institutions. There’s accreditation and there’s some level of consistency between those. And so we’re able to adopt that understanding when we hear those terms.

Tim Ulbrich: And I think that what I did, and what I see minute pharmacists do, is we take that mindset and we try to apply that to financial services. And it really is on some level, the wild, wild west, you know, the term financial advisor in and of itself doesn’t really carry a whole lot of weight. And so that’s what this episode is about is how do we ask questions?

Tim Ulbrich: What questions should we be asking so that [00:07:00] we as a consumer understand what are we actually talking about in terms of who we’re working with, what the services include or don’t include, and, and ultimately, how do those individuals get paid,

Tim Baker: Yeah. And I’ll piggyback on that, Tim, like, um, I, I, I hearken back to when you and Tim Church were writing the Seven Figure Pharmacist book, and we had the chapter on this and like, I was getting confused. So like, if I’m in the industry and we’re kind of talking about different, you know, tranches of the industry and who does what, and I’m getting confused, being in the industry, how does that, how does a, a consumer, a lay person, a pharmacist that is not versed well in, in financial services or whatever, how are they supposed to navigate that?

Tim Baker: It’s super confusing. And you know, I think the other thing is, is like where pharmacists come from, you know, like I’ll say. Something along the lines and won’t get into this is like, and I think it’s 5%, 5% of financial [00:08:00] advisors, financial planners, whatever you wanna call us, are fee only fiduciaries. That means the other 95% are not, which means that they can put their own interests, the advisor, the planner’s interest ahead of their clients.

Tim Baker: When I tell pharmacists that, they’re like, are you serious? Like, like, like that doesn’t sound like it would be legal or true, but it is. Like that’s, that’s the way it is. And you know, the 95%, I’m not saying that they’re twisting their mustache and they’re trying to find ways to defraud their people, their clients, but they, they don’t have to necessarily put, you know, they can say, Hey, I, you know, I, I can sell this product, I can make a case.

Tim Baker: It is suitable for you, Tim, but it’s not in your best interest. And I think that is a shock in revelation through a lot of people. Um, I. And why we feel the fee only the fiduciary, you know, and when I left my last job, I was not a fee, I was not fee only, I was not fiduciary. And that was one of the reasons I, I broke away and, and started Script Financial, which is now YFP.[00:09:00]

Tim Baker: Um, and I remember having a conversation with, you know, my mentor at the time, and he is like, you know, he’s like, I get it, you know? Um, but he’s like, do you, would you, do you think that I would do anything to kind of, you know, it would not be in the best interest? And I’m like, no, I don’t. But early in your career or just, you know, if you get into a money pitch, I think it puts you in a tough spot to say, it was like, okay, I can pay off this debt or whatever, or I can make sure that my clients are, you know, kind of on the up and up.

Tim Baker: So I just, I, I think, think that there’s better models, you know, to, to reduce the conflict. There’s not, there’s never gonna be a model that there is no conflict of interest. And I think that’s important to know, but I think to me, a, a. A theme in this conversation will be transparency. Transparency in what you’re paying, the service that you’re getting, how you’re paying your advisor.

Tim Baker: Um, I think that’s, that’s huge, right? Because in an industry that’s, it’s very black box of like, okay, how does this actually work? Um, and again, I’ve been in that model, you know, when, when a client would ask me, Hey, how do [00:10:00] you get paid previously? I’m like, well, I can sell you an insurance product. I can charge you an, you know, hourly, you know, all the things that we’re gonna talk about.

Tim Baker: And it’s like, okay, what does this actually mean? Like, what, what does that mean to me? And it’s a little bit of a chicken and the egg, it’s a catch 22. ’cause like, until I start working with you, Tim, I don’t really know what insurance product you need or how much you need, or what’s that gonna cost, right?

Tim Baker: So it’s a little bit, it’s not all on the advisor. It’s, it is a little bit of, like, you, you, you don’t know until, you know, type of thing. But that just leads to a lot of like, you know, what the heck? You know, what does this actually look like? So, yeah.

Tim Ulbrich: Tim, before we jump into the five questions, you, your, uh, share just reminded me of the John Oliver piece, uh, last, last week, tonight. We’ll link it in the show notes if you haven’t seen it before. I just looked it up real quick. It was back in 2016. I can’t believe it’s almost 10, 10 years ago, which is wild.

Tim Ulbrich: But he has a great piece on retirement plans. Um, that really highlights well in an entertaining way, um, some of the fiduciary fee only [00:11:00] types of concepts that we’re talking about. So if you’re looking for some re reinforcement or seeing that from a different angle, make sure to check that out. We’ll, we’ll link to it in the show notes, Tim.

Tim Ulbrich: So we’re gonna walk through five questions to ask when hiring a financial planner, again, these aren’t meant to be all inclusive, of course there’s more than just five things we wanna be thinking about. Um, and some of these seem very obvious, which question one is the case, but these are things that we can over overlook as we’re in the decision making process of working with a planner.

Tim Ulbrich: And so I encourage people before they go out and determine what is or is not the best fit for them. Have these questions in, in your back pocket. Right? These become the framework in, in which you can use as you’re evaluating some of the different options that are out there. And that first question we have, Tim, is what’s your process for offering financial planning AKA what?

Tim Ulbrich: What does financial planning actually mean when working with you or working with your firm? Right. We talk about that term a lot, a financial plan, financial [00:12:00] planning, comprehensive financial planning. But this can look and be very much apples to oranges between one firm and another. So before you sign the dotted line and you pay any fees, what are we actually talking about?

Tim Ulbrich: Right? What’s included in here?

Tim Baker: Yeah, I think, I think most people, I think most advisors, this is gonna be super generalized, but I think it in, in most firms, it’s very investment centric. Poten. It could, so investments in retirement. I think it’s, it’s probably pretty product centric like insurance life, disability, um, and then probably some light financial planning if I had to paint a broad stroke of what the, what the industry offers.

Tim Baker: Um, and so it’s important to know, you know, like what, what it is. So like if you say, Hey, it’s financial planning, like what does that actually entail? I think when I started script the, the goin, you know, the goin I think, um, thing I heard from [00:13:00] pharmacists that I started working with was, you know, the advisor that they would work with or they would, they would talk to it would say, Hey, don’t worry about your student loans.

Tim Baker: Like, they’ll figure themselves out, um, which we know is terrible advice. Um, I’ll, I’ll, you know, I’ll set up a Roth IRA, I’ll invest that for you. I’ll sell you a crappy insurance product that you probably don’t need, and then I’ll talk to you every couple years until you have assets for me to manage. So that was the way for them to help you know them.

Tim Baker: And I looked at that and I’m like, there is a huge gap in the market because we know, you know, often, especially if you’re in your new practitioner years and maybe plus like the tail that wags the dog for your financial plan are the student loans. So as the, you know, if you, if if we have 106 figures worth of student loans, that’s the tail that wags the dog, right?

Tim Baker: So as the loans go, so does the rest of the plan. So I looked at that and I’m like, this is a super underserved, you know, community of people. And that’s what I really hung my hat on in terms of, in terms of the business model. So that would be the [00:14:00] question I would ask. It’s like what that actually looks like.

Tim Baker: You know, for us, the way that we do this, Tim, is, you know, we, I would say that we are very comprehensive, right? So we, we look at what we call delivering the financial roadmap over the first year of our engagement. So when you, once you become a client, um. We go through the onboarding process. We, um, you know, part of that is linking all the things to your client portal.

Tim Baker: So we have a client portal that, you know, you link your check in, your savings, your credit cards, your, your investments, the value of the house, the mortgage, the student loans, all that stuff. And for a lot of people, it’s the first time they see all of their stuff in one, one spot, right? Because we, we bank over here, we have investments over here.

Tim Baker: We have debt over here. If you have a, a, a spouse or a partner, sometimes like that’s a little bit of a black box if you can’t directly see. So it feeds all this information in a read-only fashion. And it, and when we deliver this financial roadmap over the first course or the first year, the first stop on that roadmap, Tim, we call [00:15:00] the get organized meeting.

Tim Baker: So that’s where we’re gonna go line by line through all the things. And what we’re really trying to establish here, which again, I think is overlooked, is what is your starting net worth? What’s the first data point? What’s the before picture, so to speak? So. That’s the first stop. The second stop, once we establish that is, okay, now that we know where we’re at, let’s talk about where we want to go.

Tim Baker: So we call this second meeting the script, your plan meeting. So this is, um, hey, I wanna retire at this age. I wanna make sure I’m take these, these trips. I want to pay for my kids’ education. I want to take care of my parents that are, you know, that are aging. I want to, you know, retire by 60 or 65. Um, I want to volunteer.

Tim Baker: Whatever those things are, we gotta know where we’re going. And I think sometimes, yeah, I think sometimes planners would, will do good at kind of the, Hey, what are the investments? What are they? But they don’t necessarily do a deep dive on like the why. So. FP drinking game. If you’ve ever heard me say, it depends, right?

Tim Baker: When [00:16:00] a pharmacist asks the question, it depends on what’s the balance sheet look like and what are your goals, which are gonna be unique to you, right? So this is where I kind of scoff a little bit at the water cooler talk of like, oh, my colleague’s doing this, my colleague, you know, my, my uncle’s doing this, my cousin’s doing this.

Tim Baker: You’re a unique snowflake, Tim. So your balance sheet and your goals are gonna be unique to you and Jess. So we have to tailor the plan to that. And I think those two foundational meetings, which, you know, in the beginning of where are we at, where are we going, changes the, it depends to, this is what I think you should do.

Tim Baker: This is in your best interest. So. To me, it’s important to take those steps. And then really meeting three and beyond is, uh, on the roadmap is getting to the meat of that. So everyone starts with fundamentals. So it’s, we look at cash flow and budgeting. We look at a savings plan that’s gonna be anchored by an emergency fund, but we, you know, if you’re like, Hey, I’m, I want to be a big, I’m a big traveler.

Tim Baker: I wanna see a travel bucket, I wanna see a home purchase bucket, a home maintenance bucket. Maybe it’s a kids’ bucket. [00:17:00] Uh, so the short, medium term goals, which are not necessarily suited for like longer term investments, we have buckets of, um, you know, for, for us to be able to fund those goals. So it’s a, it’s cashflow and budget in, it’s a savings plan, and then it’s a plan for the debt.

Tim Baker: So often that’s a student loan analysis. It’s like, Hey, I have credit card debt, I have car note, I have a mortgage, I have a line of credit. How are we efficiently, um, you know, what’s the optimal way to tackle that debt? So that’s kind of the, the foundation for which longer term planning can then sit on.

Tim Baker: So really we get into retirement planning investments. Um, how much do I need for retirement? You know, I used to, I tell the story that back in the day we would say, Hey, you need 2.6 million to retire. And then we were on to the next thing. How can we actually break that down into a number in 2025 that actually makes sense, or, Hey, I’m five years away from retirement.

Tim Baker: What does that look like? How do we then start? I think one of the things that the CFP does well, Tim, is they’ll, they’ll, they’re good about, about, hey, the accumulation phase. But [00:18:00] once we, once we get to retirement, what the heck do we do? How do we, how do we turn these big pots of money into a paycheck for time unknown.

Tim Baker: We don’t know how long we’re gonna live, so investment retirement A to Z, you know, we manage investments at YFP, so we have a. A custodian that, you know, we set up accounts, we move, we move accounts over from, uh, other custodians. We buy and sell all, all that stuff we do conversions. Um, and then really the last two meetings, Tim, is gonna be things like, um, wealth protection.

Tim Baker: So meeting five, we do insurance planning. So what’s, you know, do we have the right life, disability, professional liability? If you’re getting to be my age? You start talk, talk, thinking about long-term care insurance. You know, do we buy our own policies? Do we just get the policies through our employer? You know, the big difference between us and a lot of the other guys is, and gals is, you know, if we, if I say, Hey Tim, we think that you should get this life insurance policy, it’s not because we’re lining our pocket with additional commissions because we think it’s in your best interest.

Tim Baker: Um, [00:19:00] so you know, some of those open enrollment questions that you have with your employer, we, we work through. And then lastly, the big thing is. The estate plan. And I, I often joke, this is the redheaded stepchild of, of the financial plan. I can say that as a, as a ginger, but, um, often forgotten. But do you have the proper wills, living wills, power of attorneys, trusts, you know, if, if you, if someone depends on you or if you have a pulse, like these things are really important to have in place.

Tim Baker: Um, so we get those documents in place as part of our fee in the state that you live in. Or if you have those in place, we evaluate them and then make sure that they’re good. So that’s our, you know, that’s our, the meat of our financial plan. We, we also do things with like business planning at a high level sour negotiation, which kind of stem from, Hey Tim, I got a new job.

Tim Baker: And I would say, great. Like, what did you counter? And they’re like, ah, I didn’t, you know, just, I was just happy. So things that are kind of, you know, more tangential to the plan, we’ll, we’ll look at. Um, but I think it’s important to kind of go back to the root of the question to say, okay, [00:20:00] what does the service actually look like?

Tim Baker: What am I getting? Um, and, and, and be clear about that because I think often if you say, Hey, I do, I do financial planning a lot of the time it’s very investment centric, it’s very insurance product centric, and that’s it, you know, so, um, be, be it’s a question I would definitely put at the top of the list.

Tim Ulbrich: Yeah. One of the things I’ve heard you say many times before, Tim, as it relates to our services, is, Hey, at the end of the day, if it has a dollar sign on it, we wanna be a part of the

Tim Baker: Yeah. Or at least quarterback a solution.

Tim Ulbrich: that’s right. That’s right.

Tim Baker: And we’ve, we’ve had clients recently that are like, or prospects that are like, ah, I’ve been working with someone at x, y, Z firm and I have a quarter million dollars in student loans that I need to figure out, you know, 10 years after I, you know, I, I graduated. No, you know, no hate.

Tim Baker: And can you help me with that? And I’m like, well, if you’re paying your advisor thousands of dollars that you don’t know, you’re pa, like why are, why are they not helping? And they’re either saying, Hey, I have a guy or a gal that can help you, that I can outsource this [00:21:00] to you, or, um, I just can’t help you.

Tim Baker: And to me, that’s unfathomable. You know, like, you know, one of the things we have to be wary of about is like, you know, we, we can’t give advice on things that we don’t, are not, you know, we, we don’t have, um, education in, or we’re not certified to do. That’s important to, to, to remember, but I would never look at a client and be like, I can’t help you.

Tim Baker: I would at least try to find a resource for them. You know, if someone’s like, I, I really wanna invest in a franchise that’s not in my wheelhouse, but I would try to find a resource that would say like, okay, like how can we go about it? I would, I want to quarterback a solution. Um, so that’s, that’s one example.

Tim Ulbrich: Yeah. And I think the point that we’re trying to make here as we’re talking about this first question, right, what’s the process for offering financial planning? Is, is are you clear on what that term means as a part of the engagement? And is that in alignment with what you need and what you want? And as Tim kind of articulated our roadmap, right?

Tim Ulbrich: The idea is, is [00:22:00] we have clients coming to us that are looking for service and we’re trying to determine, hey, what’s going on in their situation? What do we offer and is there a good fit? That roadmap is a visual to say, this is the expectation of what you’re going to go through over the first year. So before we make, and it’s important, this is a joint decision, is it, is it a good fit on both sides?

Tim Ulbrich: Before we make that decision, are we clear on what’s included and is it in alignment with what you need? And then there’s some more granular questions here, right? Exactly. Are we clear on how, how many times we’re gonna be meeting, how we’re gonna be meeting. Is that virtual? Is it in person? Is it over the phone?

Tim Ulbrich: You know, what does that look like? What’s the technology and the software that we’re gonna be using? What do I have access to in terms of tools and resources? Hey, if I have a question in between meetings, who do I get in touch with and how will that be received? Right? All of these are important considerations that you wanna be clear on before you engage.

Tim Ulbrich: And as Tim mention, as we look at our service in particular, you know, compared to kind of what’s out there in the general population of financial services, uh, in the industry. And what [00:23:00] we’re referencing here is a, a study that’s done by Michael Kitsis annually who’s a, a leader in the financial services space, looking at what are the components of the financial plan, what do, what’s typically covered, and how often are you typically meeting with an advisor, Tim, what we, what we usually see is most advisors are looking at an annual engagement or thereabouts, correct?

Tim Baker: Yeah, I mean there are, there are, you know, some advisors that are just like hourly. So it’s more transactional in nature. Most, most, most advisors when you go to work with them, you work with them for, for life or for, for many years. Right. Um, it’s, it’s less. I think it’s less, um, where it’s more you’re in, you’re out, that type of thing.

Tim Baker: I mean, and that’s for us, from our perspective. Like we’re, we’re trying to build relationships with clients that we’re gonna work with for many, many years, for the long term. Um, so yeah. And, and, and look at that, you know, the graph that he has, I’m looking at it that we will, you know, I’m sure we’ll share in the notes or at least a link, you know, the, the things at the top, you know, components [00:24:00] included in the financial plan retirement.

Tim Baker: 98% of advisors, you know, help with retirement investments. 96, tax planning, 92%. Social security, 86, estate planning, 84, life insurance, 82%. So these are things that it’s, it’s almost like, you know, when you think about, when you ask the public what a financial advisor does, like that’s what, what it is. The, the analogies, like when you, when you ask the public, well, what does a pharmacist do?

Tim Baker: They think about someone, you know, counting pills standing by on the bench. We know there’s a lot more that pharmacists can do, but if you look at the bottom of the graph, you know, I, I look at things like held away 401k. Um, 45%. So what

Tim Ulbrich: would be like an employer 401k.

Tim Baker: yeah, so something that you’re currently contributing into, which this is, this is bonkers to me.

Tim Baker: And then oftentimes outside of the house, it’s the biggest, it’s the biggest asset that you own. So more than half of advisors. So Tim, you hire me, I’m going to sell you insurance. I’m gonna, I’m gonna set up your IRA at my, at my [00:25:00] custodian, a brokerage account. And then you’re gonna say, Hey Tim, thanks for a lot of that advice.

Tim Baker: Can you help me allocate my 401k at Vanguard or Fidelity that, you know, my, my, uh, employer’s contributing and I’m, you know, I’m getting a match. And they say, no, that’s nuts to me. Like, that is crazy.

Tim Ulbrich: Well, especially what we see, Tim, a lot of our clients, you know, Hey, I’ve been working with Kroger for 10 years, or I’ve been at this hospital for 12 years. I mean this easily. For some people it’s half a million dollars or more. Um, could be much more if they’re further along right. Until those might roll over to certain buckets.

Tim Ulbrich: So thi this is a big part of the plan.

Tim Baker: Yeah. Yeah. I mean, college fundings, I would say only 71%. So if you’re kind of a older millennial, younger, you know, maybe younger Gen X, like that’s kind of the world that I’m in is, is like, that’s a big part that I have to look, you know, we have to look at, um, employee benefits 50%. Again, I look at that as, that’s a major part of your comp.

Tim Baker: Like, you know, that that’s something [00:26:00] I would wanna look at and make sure that you’re optimized the one that’s a little bit higher to me, Tim Life Plan is that 49%

Tim Ulbrich: I saw that. Probably interpretation of what that is.

Tim Baker: Yeah. Like what, how you define life plan and, and we’re big proponents of, you know, you build out a life plan that’s supported by the financial plan, not the other way around.

Tim Baker: And I think if we look at like, transformation and impact, a lot of it is centered around like a life, life plan and story. Um.

Tim Ulbrich: Well, and Stu, I’m looking at looking at student loans too, to the point you just made of a couple prospects here in the last week. Right. 31% student loans, so that, that matches a lot of what we’re hearing of. Hey, I work with an advisor probably who’s helping with retirements, insurance, et cetera.

Tim Ulbrich: Most likely not in a fee only. We don’t know that for sure. And hey, they don’t know what to do with my student loans. That data, you know, only 31% of advisors, part of that is generational. They may not work with clients that have many student loans, but we also know from experience with people that come our way, that there are often advisors that just the borrower, the borrower still has that [00:27:00] debt.

Tim Ulbrich: They just aren’t, aren’t helping them. And for the reasons you’ve already mentioned, it’s really hard to advise on the rest of the plan if you have a couple hundred thousand dollars of debt.

Tim Baker: yeah, I mean, I, yeah, it like it if you have a couple hundred thousand dollars of debt, like who cares about your investments? And I, and I say that somewhat facetiously, but I. It is the tail that wags the dog. Right? Of your, of your, you have to figure out the, the strategy and the plan. And I kind of ach in the student loans a little bit to like digital assets.

Tim Baker: So back in the day, you know, again, when I got into the industry 10 plus years ago, the, the advice was, we either can’t help you with the student loans or don’t worry about the student loans. You make a great income. They’ll figure themselves out or pay the one with the highest interest rate or the lowest balance, which is the snowball and the avalanche method.

Tim Baker: Right? Which we know Tim is it’s crap advice for your, for your student loans. And I, I remember having this like debate with an advisor that was very like, investments, insurance, blah, blah blah. And they’re like, well, what’s [00:28:00] like, what’s the big deal? It’s just like paying off your house or anything. And I’m like, if you have a quarter million dollars in student loans, the, the.

Tim Baker: The, um, the impact on your wealth building could be anywhere where you pay 80 grand if you’re in A-P-S-L-F and you’re completely optimized. So think about that as like a negative interest rate. Two, you’re paying 500, $600,000, or you drag it out over 30 years. And he is like, oh, okay. Like, that’s the spectrum of outcomes.

Tim Baker: And to me it’s, it’s just really important. Right? And, you know, I don’t want to just harp on student loans, but like, yeah, 31% of advisors, they’re either saying, I can’t help you, or I have a person that I can direct you towards, um, you know, 6% career salary benchmarking. And I think like, if we weren’t as niche, like if we worked with pharmacists and attorneys, and we, we do work with everyone, but our, our niche, you know, I would say probably 90, 95% of the, the households that we work with, Tim, there’s a pharmacist in the household.

Tim Baker: Um, but we kind of like, [00:29:00] I, I just got to the point of. Again, a a a client would say, Hey, Tim, I’m, I’m, I’m changing jobs. I just accepted this offer. And I would say, did you counter? And they’re like, no. And I had a client recently, um, shout out to her who recently came on, and she’s like, I’m fixing to get a, a job offer.

Tim Baker: Can you help me with that? And we did, and we earned our fee that day. Like we, you know, she got more base, she got a bonus, she got some, some stock. Um, and she’s like, I would, I would never have thought, and I don’t have the confidence to do that. And I, to me it was just kind of like, you know, the, the, in the income is what feeds the financial plan, what sticks is your net worth and things like that.

Tim Baker: So to me, it’s important to at least advocate for yourself and have the tools and the ability to do that. So it’s kind of a tangential thing. And I personally still do it. I love doing it. That’s probably the one thing that I, you know, that and some of the business consultant stuff that 20% of the, um, advisors will do.

Tim Baker: But, you know, these are all things that I think. [00:30:00] I think to go back to the question of like, what’s included and then from a frequency perspective, you know, the overwhelming majority of of financial planners, you know, they’re gonna meet with you two or three times in the first year to kind of complete the plan.

Tim Baker: And then after that, it’s typically every year or every couple years. In terms of like maintaining the plan for us, like our delivery of our roadmap is typically six or seven meetings, um, over the first year, typically seven meetings, and then we go into a semi-annual kind of rhythm, which, which is about 10% of advisors will do that.

Tim Baker: Um, so high touch and we typically do like an annual review and then a plan checkup. The warm blanket though, that I think, and this, you know, when I talk, when I spoke about that sour negotiation, um, the warm blanket w with working with a company with YFE, and I think most people are, most firms are like this, but, um, is if there is something that’s super time sensitive.

Tim Baker: Like, Hey, I got a job offer. Or We’re buying our house. We’re selling our [00:31:00] house. You know,

Tim Ulbrich: Investment property. Yeah.

Tim Baker: property. Hey, guess what? I’m retiring. You know, I thought it was gonna be in three years. Now I’m retiring. Now, you know, you can meet with us PRN as needed. Right? And that’s, we used to not call ’em, we used to just call ’em, like, we call ’em PRN meetings now.

Tim Baker: Um, so as needed, we can, you can meet. And that to me is like, Hey, we want to be able, and I think sometimes if you’re paying an advisor like hourly, and I kind of always joke about. Remember, Tim, we, like, we’ve had attorneys in the past where I’m, it’s like we, we would pay them hourly and I

Tim Ulbrich: Keep the email short.

Tim Baker: I would spend the, yeah, the email.

Tim Baker: And then I would spend the first 45 minutes reminding the attorney of like, who I am, what I do, and then get this huge bill like I I, and again, no shades or hourly invest or hourly planners out there that they exist. But to me it’s super transactional that I don’t, I don’t, I don’t want people like counting hours or anything like that.

Tim Baker: So, um, yeah, I would say comparatively super high touch with regard to, um, the, you [00:32:00] know, the, the frequency.

Tim Ulbrich: So brass tacks on this first point, and we’re, we’re intentionally spending the most time here because thi this is the meat on the bone, right? In terms of, you know, are you, are you getting what you need? So, brass tacks here is, does what you need and what you’re looking for help with the financial plan, does it align with what they offer?

Tim Ulbrich: Does what they call financial planning advising, does that align with your needs for the plan? And I’m gonna put a plug here, Tim, for us, we, we are beta testing what we’re calling a second opinion analysis. Maybe we’ll change the name on that, maybe we won’t. But the idea is for those that are already working with an advisor and having this nagging feeling of, Hey, I’m, I’m not sure it’s the best fit, right?

Tim Ulbrich: Whether it be frequency of meeting or questions getting answered, or maybe a lack of transparency in the fee structure, or, Hey, they don’t know what to do with this part of the plan. There could be a myriad of reasons. Um, through the second opinion analysis. Our goal is that they have an opportunity to sit down with you.

Tim Ulbrich: We can learn a little bit more about what’s going on in their situation, do an analysis of the current [00:33:00] engagement, what fees are being assessed, whether that’s transparent or not to them now. And then of course we can talk more about our services and see whether or not it makes sense to move forward. So we’re looking for some people to help beta test that for, for us.

Tim Ulbrich: If nothing else, I think it would shed some insights on the current engagement to help us refine our processes a little bit further. So if you are currently working with an advisor, you have that feeling of, Hey, I’m not sure if it’s the best fit, and you’d be open to helping us out, do a second opinion analysis.

Tim Ulbrich: Uh, send us an email [email protected]. Just say second opinion and we’ll get back to you and get something scheduled from there.

Tim Baker: Yeah, I, I’d love to be able to do like three to five of these, Tim, um, just kind of beta test and see what this looks like. And I think the, the way that I’m looking at this is, you know, the analysis will, will kind of be, um, similar to like what we do. We do a portfolio, insights, insights for our clients, and it kind of looks at, you know, the, um.

Tim Baker: The account location, so like [00:34:00] what and where your accounts are. So like when we try to build a retirement paycheck in the future, we want pre-tax accounts, we want taxable accounts, and we also want like Roth, like after tax accounts. So account location is, is really important. Um, you know, the other thing is allocation.

Tim Baker: So you know, kind of evaluating, you know, what are your percentage to stocks and bonds. You know, we, we, another section we talk, we talk about is move money, which is if, if money is moving in or out of your account. So, so much about is, uh, of this as, as how much you’re invested, not what you’re invested in.

Tim Baker: Um, and then like expense, like what are you actually paying, um, for, for those investments and kind of, you know, put some, um, investment analysis reports with that and, and you know, you can kind of hear some my thoughts on, on your portfolio. So I would say look into three, three to five Guinea pigs to kind of, you know, pilot this and see what it looks like.

Tim Baker: Um, would love to, I would love to do that. So, um, yeah, just email us and we’ll, we’ll figure that out.

Tim Ulbrich: Again, [email protected]. Just note, second [00:35:00] opinion in the subject line or email, and we’ll we’ll get back to you so you can get on Tim’s schedule. Tim, second question here is, are you licensed, if at all, are you licensed as a stockbroker? Are you licensed as an insurance agent? Are you licensed as an investment advisor?

Tim Ulbrich: Why? Why is this question important?

Tim Baker: So I think this kind of shows you like the underlying way, like the underlying model that they’re in. So I would say the, the three main models that are out there are, um, fee only, which is what we are, which I think makes up about 5% of advisors out there. So this is where you essentially pay for advice.

Tim Baker: You don’t pay for an investment product or a, like an insurance product. So no commissions. Um, so if you’re working with a planner, if you’re looking at a planner and you see like, um. Securities license or, um, or insurance sales. Like that means that they, they are commissioned. Um, so you have fee only that is kind of, um, like we feel the best, the most pure in [00:36:00] terms of like, you know, less conflict of interest.

Tim Baker: And then on the other side of the, the spectrum, which I don’t know if these guys and gals, um, are, are around anymore, but it’s basically like a commission only. So this is like, you know, you, you, uh, you see on the movies where you call up your stockbroker and or they call you and they say, Hey, I wanna sell you, you know, a hundred shares of x, y, Z company.

Tim Baker: And they, it’s more transactional. They’re selling you a product, they get their commission, they move on. So a lot, a, a lot less in terms of advice, right? So that’s the two ends of the spectrum in the middle where most advisors live. It’s called fee and commission, or what’s, what’s we typically call it is fee based.

Tim Baker: So oftentimes, you know, um, you know, a prospect will come to me and says, yeah, I want to, I wanna work with you because you’re fee based, you’re fiduciaries. And that’s actually a, a misnomer. We’re fee only. We’re we’re, and they sound similar, which is part of the problem, but a fee base is [00:37:00] fee and commissions.

Tim Baker: So this goes back to like, you know, in, in my previous model, Tim, if you were my client, you would say, Hey Tim, how do you get paid? I’m like, pull up a chair, it’s gonna take me a while. I can charge you hourly. I can charge you a percentage of a UM assets under management. I could sell you a life insurance product and get a commission.

Tim Baker: I could sell you a disability policy and get a commission. I could sell you an annuity and get a commission. I could sell you, you know what, whatever. So it could be a flat fee. So it’s, it’s, it’s, uh, and again, I, there’s no shade because I think what, what, what those advisors are trying to do is, you know, we, what?

Tim Baker: I was in that model, Tim. I thought we were awesome because. We didn’t work for one of the big wirehouses that we had to sell their proprietary products. We were like, we could sell whatever we wanted. And then I found out about fee only and I’m like, oh, like that’s what I want to be like. I don’t want my advice to be kind of directed by a product.

Tim Baker: I want it to be directed by the advice, the plan that’s in the best interest of the client. So those are the three broad, broad [00:38:00] buckets. So it’s fee only, which is, you know, no commissions. Essentially you have commission only, which I don’t know if they exist anymore because now we have E-Trade and Rob, we have access to the markets, right?

Tim Baker: And then we have everything in between, which is typically fee based or fee and commission. So, you know, you can look at, uh, an advisor website. So sometimes, uh, I’ll talk to an advisor and be like, Hey, I’m working with this group, or whatever. They’re fee only, they’re fiduciary. And I look at the website, I’m like, respectfully, they’re not, because at the bottom there’s disclaimers about I.

Tim Baker: Know. So if they have like a series seven, which is one of the exam, one of the first exams I passed when I got in the industry, that means that you can sell securities and earning commission if they have insurance. Um, which I used to have also, if they have, if they have insurance licenses, that means I can sell you life insurance and earn a commission.

Tim Baker: I had to give those up, the series seven and the, and the insurance stuff when I, when I transition to fee only. So I think these are more important to kind of understand the model in which they’re in, because I think even people in those models [00:39:00] don’t know what model they’re in. They’ll say, they’ll say, Hey, I’m a fiduciary while you a fiduciary all the time, or when you’re just talking about this specific thing.

Tim Baker: And that’s the thing that gets super confusing.

Tim Ulbrich: Tim, if I’m someone listening, I, maybe I work with an advisor. I have worked with an advisor in the past, or I’m looking to work with an advisor and I’m trying to answer this question like, which of these three models do they fit in? Um, we know that most people are probably in that middle one. You described that, that fee, fee-based.

Tim Ulbrich: Um, how do they figure this out? Is it information on the website disclosures? Is this for the a DV form comes in? Tell us more about that. If that’s the case, what, how, how do they do their homework on this?

Tim Baker: Yeah, the first place that I would look at, like first, like really quick, like when someone says, Hey, I’m working with this, and I, and I’m trying to suss out like what they, what they, I look at their website and typically at the bottom there’ll be, you know, um, you know, we use this, um, broker dealer. If you see like the words broker dealer, that’s typically their, their fee base, their fee and commission.

Tim Baker: Um, if you see things about insurance things. So typically at the bottom of their [00:40:00] website, there’ll be some type of disclaimer. That says like who they’re affiliate with. Um, you can ask them and see like, you know, the, the circles they might talk, talk in. Um, and then I think the last place would be like, go to broker.

Tim Baker: I think it’s broker check, broker check.com, and you can, um, basically look at their A DV brochures. So the A DV, I’m not even sure what the A DV stands, A DV stands for, but it’s basically there’s, there’s different, there’s part one, part two a, part two B, two A is gonna basically say it’s like, you know, for us it’s like a 40 page document that show that, that that kind of says, this is who we are, this is the services that we provide, this is the, this is the fees that we charge.

Tim Baker: Um, and it kind of gives you more of the detail. So if you think, see things like insurance or, um, again, security sales, things like that, you’re gonna be working with probably a fee-based advisor. So it would be ask them, it would be look at the website and it would go, and I would say, I would go to broker check to look [00:41:00] for the A DB brochures.

Tim Ulbrich: We’ll link to that in the show notes is broker check.finra.org. Um, so you can enter in an individual or affirm. So we’ll link to that in the show notes, and then we’ll also link to the page where it has Y fps, uh, a DV forms if folks are curious at looking at those more carefully as well. So get out a cup of coffee.

Tim Ulbrich: Uh, it’s not, not always the most exciting read, uh, but it’s an, it’s an important one. Alright, good stuff. Let, let’s continue the conversation then as we move to the third question, we start to talk about. Not only how are individuals license or which of those three models they’re in, but how do they ultimately get compensated?

Tim Ulbrich: And again, sounds obvious, but we’ll talk with a lot of folks where, hey, you know, what’s the current engagement look like? Um, how are you paying for services? And it’s either, I’m not sure, or the one I’ve heard several times before is like, I don’t, right? It’s free financial planning. No such thing. So third question here is how are you compensated and what ultimately is included in that fee and how is that calculated?

Tim Ulbrich: Right? And is that fee transparent? Tell us more about this [00:42:00] one.

Tim Baker: Yeah, so, so I think that’s the big thing is transparency, right? So like, we’re a business, you know, we’re, we’re in the business to, you know, uh, build a profitable business, you know, make money, all that kind of stuff. So, like, it’s important to say that out loud. We’re not a, we’re not this, you know, we have YFB Gibb, which is a non-profit, our main business or financial pharmacist is a for-profit company.

Tim Baker: So transparently like, you know, we wanna make sure that’s out there. I think, you know, the way, the way planners get paid, you know, some of the things I talked about is like insurance and investment products. I have a memory, Tim, of, um. Uh, you know, I, I was working with my previous firm and they’re, you know, my, one of the guys in our office is like, Hey, you know, if you, if you have the opportunity to sell your products, like a non-traded reit, do that.

Tim Baker: And I’m like, well, why? Like, what’s the, what’s the benefit? It’s like it pays 8% commission.

Tim Ulbrich: geez.

Tim Baker: And I’m like, uh, like to, I need, I need to take a shower. Like, it just is like yuck, right? So [00:43:00] it’s the same thing with like, uh, like variable annuities. Like, Hey, why pay variable annuities? It’s because the commissions are, so, I often say it’s like, typically the, the products that are better for the planner, the advisor are not good for you.

Tim Baker: Um. So, you know, if, if you’re, so when, when you, when we work with us, the only like, like we basically set the table and say, Hey Tim, you need x, y, Z insurance policy. And then we hand you off to someone that’s gonna sell the policy and not try to upsell you. Like we have, you know, organization, insurance companies that, you know, work with the only that understand that.

Tim Baker: Um, so you pay for the advice, not the product. That person that we send you to, they, they get the commission. Right. So, so there’s a, there’s a arm’s length, you know, in, in that regard. Anytime that you mix the sale of a product with advice, I think again, where you have the most conflict of interest. So, you know, if you’re looking at a statement and you’re like, I don’t really know how my advisor gets paid.

Tim Baker: Often there’ll be like an advisor’s like fee that you should see as a litem, but [00:44:00] sometimes there’s not, um, a place that you could look at is like when you sign a client agreement to, you know, to begin your, your engagement with a, an advisor. It should lay out exactly like what you’re paying. A lot of people just don’t look at that, or they don’t know, you know, typically when we sign clients, we go through the agreement together.

Tim Baker: And I do that in the spirit of transparency, Tim, because I wanna know pe, I want people to understand like what they’re paying and, and I, and part of it’s to combat the lack of transparency in the industry. And I, I always kind of go back to like, when I bought my first house many, many years ago, Tim, I felt like I was signing a tree and I couldn’t ask questions.

Tim Baker: And I just hated that feel on. So I want clients to say, Hey Tim, what does this mean? What does that mean? And, and we go through it together. Same thing with the invoice. So, but if you’re looking at a statement, there should be said, said something like advisor, um, expense or fee or commission, A lot of the times.

Tim Baker: Like a, a mutual fund. It’ll say like, it’ll have like an A or a C next to it. And that indicates that it’s an [00:45:00] a share mutual fund or a C share mutual fund, which has commissions tied to it. You just can’t see what it is. So if you, if you have x, y, z mutual fund and it says a, you would look up that mutual fund and you could see the, it’s called a front, a front loaded fee or a front loaded commission.

Tim Baker: It says that, okay, you paid 5.75% when you made that initial, but it’s like, you have to know that to, to, to, to like look for that. So it could be fee, it could be commissions on products. Um, probably the prevailing, um, model that most advisors use is called a UM Assets under management. So this is, um, a percentage that the advisor is managing directly.

Tim Baker: So, uh, they’ll take, they’ll typically roll over your investible assets like an old 401k an IRA. A Roth IRA, uh, a brokerage account, they’ll move it to their custodian and then they’ll manage it directly, and then they’ll, they’ll charge a fee out of that. The problem with that model in its purest form [00:46:00] is what I found is that if you don’t have a half a million dollars or a million dollars, the advisor will say, Hey, Tim would love to work with you, but I can’t help you unless you have this money.

Tim Baker: Or they’ll say, the way that I can help you is sell you a crappy insurance product. I’ll invest what you have and then I’ll talk to you every couple years until you have assets for me to manage IE that where, where you can pay me. I think the other, the other con, you know, the, one of the main conflicts of interest is that the more dollars that they’re managing, the more fee that you’re gonna pay.

Tim Baker: Right? So, you know, they’re incentivized for you to move, you know, accounts over to them. Um, so that’s the prevailing one. Another one is called a UA Assets under advisement. So this would be what they’re managing as well as what they’re not managing directly. So a, a held away 401k. Some advisors will, will put all that into a, a bucket and they’ll say, oh, they’re gonna charge a percentage of that.

Tim Baker: Um, could be flat fee where it’s just, Hey, it’s this fee. Um, you know. [00:47:00] And that’s it. It’s a, a flat, $5,000 a year, $10,000 a year. Um, and you know, the problem with that fee typically is you, you often see major increases in the fee over time because there’s no mechanism to kind of account for inflation, salaries going up, things like that.

Tim Baker: Um, or they’re typically higher, like a lot of flat fees. It’s like, Hey, you know, our minimum fee, flat fee is $7,500 or 10 grand, or, or things like that. So flat fee is definitely, uh, one and then hourly, you know, an hourly fee. And then there can be combinations of all these things, Tim, but those are the, the prevailing, um, you know, some, some people do hourly plus a percentage of what they do, or, you know, it’s, it’s, you know, an A A UM or you know, plus a, you know, they might charge a UM and then they’ll charge a planning fee in some way.

Tim Baker: Um, so that’s the big thing to, to understand is that there’s lots of different models out there, lots of different ways to kind of. Skin the [00:48:00] cat, so to speak, and just understanding, you know, who, who you’re working with and, and how they charge.

Tim Ulbrich: Tim, since a UM is the prevailing model, you did a great job of talking about all the different buckets, right? They can get paid from commissions. Uh, and then from a planning perspective, typically we see it’s either a UM to a lesser degree, a UA, uh, assets under advisement, which as you mentioned, would, would include some of the held away.

Tim Ulbrich: So not only what they’re managing, but also hey dollars that you have, for example, inside of a 401k at your current employer. And then you mentioned the flat fee. It could be a lot of variations of that in terms of both amount and what that looks like. And then of course, something like an hourly, more of a project type of of work.

Tim Ulbrich: If we go back to the a UM for a moment, given that that’s the prevailing model gi give us for, uh, for instance, so you know, what is a typical a UM fee? Certainly not consistent across the board. And then let’s say we have a client who’s got $400,000, that would be managed by an advisor under an a UI model what, what that might look like in terms of fees.

Tim Baker: Yeah, [00:49:00] so, so typically I would say the prevailing model is typically something that for an a UM model, it’s like 1% that’s tiered down, right? So if you, you know, if you have half a million dollars, 1% of that, you know that, that the advisor are managing 1% of that, it’s five grand a year that they’re gonna build directly outta your investment accounts.

Tim Baker: Um, that’s typically the prevailing, I was talking to a guy that, um, Liam plays soccer with over the weekend. He works for a big company based in, um, based in Columbus, and their model is ultra high net worth. You know, you got that, you have to have a minimum of like one to 2 million and their, their fee starts at about, uh, 1.5% or something, something there.

Tim Baker: Um, so. You know, there, there, it’s all over the place, but typically the, the, the, the one that I see most is like 1% that’s tiered down. So the more that you invest, you know, the, the fee, the fee goes down or over, or the percentage that that’s charged over time, um, the way that we [00:50:00] do it. So we, I was admittedly pretty anti a UM when I, when I started script back in the day, Tim, and there’s probably hours of, of footage on our podcast, you know, me kind of ex exclaiming that point.

Tim Baker: Um, and I think the reason why I was anti a UM is, is because I, I actually think that the model is, is somewhat elitist. So it, it kind of, it kind of kept a lot of people, um, that needed advice. IE you know, a 20, 30, 40 something year old, uh, pharmacist, um, out of the market

Tim Ulbrich: Excluded them.

Tim Baker: excluded ’em, because again, the, the, the prevailing advice was don’t worry about the student loans.

Tim Baker: I’ll invest your Roth, I’ll sell you insurance product and that’s how I can help you. Or they’re like, Hey, I can’t help you until you have that money. Um, so there’s lots of different reasons. So, so we’ve essentially adapted over the [00:51:00] years kind of a hybrid flat fee, a UM model. The positives of the a UM model is like, it, it, because it’s the most prevalent, everyone understands it, and everyone from a compliance perspective, um, you know, they, they kind of understand like,

Tim Ulbrich: SEC likes it.

Tim Baker: the, yeah, exactly.

Tim Baker: SEC likes it. They, they, they understand it. Um, but I think. The, one of the big things that we’ve discovered over working with hundreds of pharmacists is the a UM model. Even though money is fundable, meaning your money is your money, whether it’s in a, in a brokerage account, an IRA in your checking account, what we’ve discovered is that the, the model that we would charge, especially early on in our business, would be, um, very much in the realm of, hey, like we don’t really care where the assets are, so if you wanna manage it or, or whatever, you know, we’re gonna charge you a flat fee and you’re gonna primarily pay that out of [00:52:00] cashflow, your checking account, your credit card, et cetera, either as, as, because you need to or because you don’t have assets, or just, or just because that’s your option. The problem with that is that. The paying out a cash flow is more disruptive to your life and your lifestyle. So if I’m billing you quarterly on a financial plan, eventually you get some fee fatigue. And if you believe like us, that the best results come from the longevity of the relationship and stacking years of very intentional financial planning that yields the best result.

Tim Baker: That’s, that’s a problem. So the, the a UM model, so for if I’m billing you, you know, X amount of dollars per quarter out of your checking account or your credit card, that’s very different. Even though it’s the same amount. If I’m billing it out of a couple hundred thousand dollars of, of assets, it’s a little bit of outta sight, outta mind, even though it is your money, right?

Tim Baker: I wanna make that clear. But it doesn’t disrupt your lifestyle, so to speak. So. Our [00:53:00] models kind of adapted to, um, essentially if you have less than half a million, we’re gonna charge you some type of like flat fee that’s based on complexity. Anything above that is just gonna be based on, you know, a per, you know, a percentage that’s tiered down, um, on the assets that we’re managing.

Tim Baker: And I think the other thing that we, we change is like, we used to be more, um, ag agnostic about who’s managing the assets. Now we’re not, you know, we, we’ve experimented with that where it’s like, you can manage it or we can manage it. It was too many cooks in the kitchen, you know, so this is what we do. We do it well.

Tim Baker: We do this as, you know, our, what we do for a living. Um, we’re looking for clients that are like, yeah, take, take the investments. Obviously they play a major role in how we’re constructing the portfolio, but we’re basically doing, you know, the lion’s share of the work. And it was to kind of eliminate the too many cooks in the kitchen.

Tim Baker: So we feel that this hybrid model allows us to work with clients that have zero assets to clients that have. Hundreds of thousands, if not millions of [00:54:00] dollars. Um, and, and do that over the, over the long term.

Tim Ulbrich: Great stuff, Tim. I think it’s a great summary of, of how we’ve evolved over what is gonna be 10 years this fall,

Tim Baker: Yeah. Wow. Crazy.

Tim Ulbrich: Um, and where we started and what we’ve learned and, and how we’ve pivoted. And as you said, I was actually thinking about this morning as we were prepping for this. It was way back on episodes 15, 16 and 17.

Tim Ulbrich: So this would’ve been back in 2017 that we talked about some of this topic and, and why we landed on what was income and net worth at the time, uh, which was revolutionary Tim Baker style, uh, of fee assessment and how that worked for a season. But we realized where that kind of broke, and I cannot emphasize enough that we really believe the ROI of the relationship. Not only is it beyond just the quantitative, it’s also the qualitative, which gets overlooked so much in this industry, and it’s harder to measure. But even on the quantitative side, it comes from the years as you [00:55:00] mentioned. Compounding these wins and having the accountability and stacking those. And if that’s an 18 month relationship because the free structure doesn’t align such that it can’t be continued on, then you reduce the ROI of that long term.

Tim Ulbrich: And so, you know that that’s in part how we’ve arrived to, to the point that we have today.

Tim Baker: Yeah, and I would just piggyback on this, like there was a study done, um, by our friends up north, the Investment Funds Institute of Canada. They did a, they did a study, Tim, from 93 to 2008, um, that basically looked at. What was the impact of, of net worth or assets? Um, you know, with, you know, a group that didn’t work with a, an advisor and then those that did, and, you know, the impact on net worth for advise individuals was greatest by the end of study period of the study period.

Tim Baker: Suggesting that the impact of a financial advisor grows over time, which is kind of like, no duh, right, but I say that

Tim Ulbrich: any other [00:56:00] coach,

Tim Baker: yeah, yeah. I say that because like in a microwave society. We want results yesterday, completely get that. But you know, they, they’re, they have a graph that’s basically like no advice compared to, you know, those that, you know, have advice for seven to 14 years.

Tim Baker: It’s typically like two x now, I think based on what we do, like our results are a lot better than that. Um, you know, no promise for future, you know, uh, you know, like, that’s not a promise, but like, I, I feel like the transformation that we show with clients, it’s, it’s, it’s necessarily more impactful. ’cause I think we just cover a lot more than the, than the traditional advisor.

Tim Baker: So, um, to me it’s important to, you know, you’re, what you’re saying is that just like, invest in the value of advice compound compounds over time, and it’s stacking, you know, months, quarters, years, decades of really intentional planning. And I often, I, I tell the story. You know, when I, you know, before I was in, um, you know, financial services I worked in, I was a logistician.

Tim Baker: I worked in [00:57:00] warehouse. And so I would drive to the office at five o’clock in the morning, you know, go into a warehouse with no windows. You work all day, you know, 12 hours, you know, uh, leave the office at five or six, drive back in the dark. And I wouldn’t remember those drives at all. I was just on autopilot.

Tim Baker: And I think part of that, like, that, that can be an analogy of life and part of working with a financial planner, I think a good financial planner that’s looking at the life plan is questioning, like, like, are we on track? Is this what we, is this the way we want to do? Like, let’s, let’s have some introspection.

Tim Baker: And sometimes it, it, it requires a third party to ask those pointed questions to me to say like, Hey, let’s get off of io, uh, like of autopilot, and let’s ask some pointed questions about, you know, is this, is this a wealthy life for you today? And are we on track for a wealthy life, you know, 10, 20, 30 years in the future?

Tim Ulbrich: Tim. And I’m even thinking about our weekly team meetings where when we talk about the impact of the team. Yeah. I mean, of course we love seeing the net worth numbers go up. You know, we love seeing the, the, the numbers in the right [00:58:00] trajectory, you know, long term. And, and we certainly, you know, have seen that, but it, but it’s those life type of wins where it’s like, oh man, this, this is when I feel like I could run through the brick wall.

Tim Ulbrich: Right? It’s someone who’s been talking about doing this life dream for five years and we’ve moved the needle. I think about some of the examples we’ve talked about lately of someone really pursuing a passion and hobby and, and, uh, around horses and the passion they have there. Uh, previously, you know, somebody who looking at their experience as a pilot and ultimately, you know, having a fraction of a plane.

Tim Ulbrich: Or, I think about Jess and I in our own journey and some of the decisions we’ve made as a part of our own life plan and like those are the things that individually when we think about significance, meaning, and impact, but also as we celebrate our clients as a firm, like that’s when the team lights up.

Tim Baker: Yeah, and I, and I, I just found out recently the, the, the, the pharmacist you’re talking about, um, you know, that huge amount of student loans, credit card debt, you know, and you fast [00:59:00] forward a couple years and, you know, she’s essentially flipped her net worth from negative 300 to positive 300 in a couple years.

Tim Baker: And that’s not what she’s talking about. You know, she’s talking about pickles, the horse, um, the big old diesel truck that she has moving from one part of Florida to another, to be closer to the National Equestrian Center. She actually just emailed me this week saying that she, she bought another house.

Tim Baker: Uh, so we’re working through that. But the other big thing for her, when we talked way back in the day, she’s like, I’ve always wanted to do an African safari. So earlier this year she told me she booked a trip with her mom to do an a African safari. So like, those are the things, Tim, where it’s, you know, a lot of pharmacists will say, get, you know, your guys are scientists.

Tim Baker: You wanna weigh the scales of like, Hey, if I pay this fee. Am I gonna get that back? You know, what’s the ROI? And I put that back on its head like, well, what is, what do you mean by ROI to me? You know, we need to be technically sound so we can make sure that, you know, a lot of financial advisors will say, and that would be a question I would ask.

Tim Baker: It’s like, how do you guys measure progress? A lot [01:00:00] of it, financial advisors will say, look at me. I got you a 10% return on your investments. But who cares if you’re like drowning in debt or you’re living a life that doesn’t necessarily line up with the, you know, your goals. Money’s a tool, right? So to me, quantitatively it’s net worth.

Tim Baker: And then what are the qualitative things that are important to you? And are we doing something about it? Part of our job is to hold the mirror up and say, you know, carrot and stick. Hey Tim, I’m talking to the my myself. Hey, Tim, nowhere in your financial plan does it say that you need to lead the league in bottles of whiskey in your collection, right?

Tim Ulbrich: Although, although you

Tim Baker: I do. Uh, but like, that’s not in my financial plan. So like, if I’m, if I, if I’m like in a pinch or if I’m not like doing the other things on my financial plan, my advisors to say, Hey, guy, like, how about we not spend this money toward, you know, the, um, the, the whiskey and like, let’s like this, this bucket that’s been sitting dormant that you want to do X, Y, and Z where, show me the money, right?

Tim Baker: Because at the end of the day, Tim, we’re not gonna, we’re not gonna lay on our deathbeds and say, [01:01:00] oh man, I wish YFP, or I wish my advisor would’ve said, I sh I, I would’ve told me to put more money into our Roth. IRA. We’re not, we’re gonna say, I wish I would’ve got into horseback riding again because it was a passion of mine that I just put on the back burner.

Tim Baker: ’cause I think I couldn’t afford it, or it wasn’t a priority or played in a band or changed careers or became a pilot. You know, you know, that was, you know, those are the things that are transformational, inspiring, and I could talk about this all day long. Um, but that’s what this is about. It’s not about.

Tim Baker: You know, the ones and zeros, it’s not, we need to do that to make sure we keep our job and we push this forward and we need to be technically sound and all that. But to me it’s about aligning the life plan with the financial plan and holding people accountable to that. And I think that’s a big thing is having a third party that knows your goals, knows your, your balance sheet, and, and, and has your best interest in mind.

Tim Baker: So, um, yeah, I [01:02:00] think that’s super important.

Tim Ulbrich: Yeah. As we say all the time, right? It’s, it’s, are we living a rich life today while we’re taking care of our future selves, right? That’s the quantitative and the qualitative and, and I get it, it’s an analytical audience, right? I am, I am an analytical pharmacist. Like the ROI is a good question. As we’re talking about, you know, the numbers and even as we’re we’re talking, I’ll link to it in the show notes.

Tim Ulbrich: I’m thinking about the, uh, the Vanguard study of putting a value on your value and what’s the actual potential. Quantitative, ROI of an advisor, and it’s, it’s really interesting because when, when they look at those numbers, it, it comes from several different things, you know, whether it be asset allocation, saving on expense rebalancing, but the behavioral coaching is a huge chunk of that, which people, I think, underestimate, uh, in, in part, maybe due to some overconfidence.

Tim Ulbrich: But what’s missing from this table altogether of the ROI is what, what is the qualitative side

Tim Baker: Yeah. Yeah. And I, and I think the Vanguard study that was done in 2001 [01:03:00] a, a value of advice advisor to Alpha. Um, it’s, it’s narrow in a sense. I think it looks, it looks at a hypothetical portfolio, half a million dollars over 25 years, you know, with an advisor. You know, that’s managing it. It grows 8% per year or to 3.4 million for a self-manage a di iyer.

Tim Baker: It’s 5% per year. So it grows from half a million to about 1.7. But again, I say that’s too narrow. Like if you wanna look at quantitative talking to about net worth, not investment returns. If you wanna look at the whole thing. I want quantitative, I want net worth, and I want the qualitative stuff. Are you living a wealthy life today?

Tim Baker: Like, are you doing the things that you’re passionate about? Um, so I think that to to, to your point, like, you know, pharmacists, what’s the ROI like, what’s, you know, what with ’em, what’s in it for me, Tim? Like, I get that. But I would, I would turn that question right back to, to you, the prospect, the listener, to say like, define that for me.

Tim Baker: Like, how do I know? You know, [01:04:00] we’re scratching that itch and I think it’s a little bit more, it’s a little bit more than I give you this fee and I get this back in some, some way.

Tim Ulbrich: Great stuff. So that’s our third question. How are you compensated? What’s included in the fee? How do you calculate your fee? Is it transparent? We, we broke down the different fees that are common in the industry. The fourth question, Tim, I’m gonna move past this one quickly because we’ve already addressed it in the areas we’ve talked about.

Tim Ulbrich: The fourth question is, what are your conflicts of interest when working with a typical client? And if we go back to the three different buckets you mentioned in terms of the commissions, the fee only, or the fee based, or the fee and commissions another term for that fee based, you can start to identify where those conflicts of interest may be.

Tim Ulbrich: And as you say, often there is no such thing as conflict free advice. Correct?

Tim Baker: Correct. I know, I think it’s Tony Robinson, one of his books, he call, he talks about conflict free advice, and there doesn’t, doesn’t exist. Um, it just doesn’t, you know, so, so to me, if it doesn’t exist, tell me what the conflicts are and, you know, let, like let’s talk about that. Let’s be upfront. Yeah. And I [01:05:00] think oftentimes, you know, you’re, you know, if you’re, if you’re dancing around that question as a planner.

Tim Baker: There’s, there’s problems. So, you know, you know, and that, and that’s I think one of the frustrating things sometimes is someone’s like, I wanna work with a fee, like a, a fee only person. And I think I’m working with them and I’m like, eh, you’re not, but then like, there’s some inertia to change,

Tim Ulbrich: Mm-hmm.

Tim Baker: you know, even if you know that they’re, you know, they’re not fee only or whatever, or that you don’t really know what you’re, they’re paying.

Tim Baker: And like, there’s a nurse there and I get that. So, you know, to me it’s, it’s having that conversation. And I think often those conversations are buried or it’s, you know, it’s, it’s, we talk in circles until we can get through the question and then we’re onto the next thing. And again, I just think tr be transparent, right?

Tim Baker: Like, like that’s, that’s huge. So, um, you know, are you obligated to act at as a fiduciary all the time? And I think that all the time is the operative word, because sometimes, you know, in some of these models, fee-based, you can say, I’m, I act as a fi fiduciary, but it’s only when I’m, when I’m working with.[01:06:00]

Tim Baker: ERISA type funds, like a 401k. ’cause that’s, that’s the, you know, department of Labor is trying to like really narrow that down. Not, you know, some of these other entities that I think should really be drawn a firm line.

Tim Ulbrich: Tim, our last question and five questions to ask when hiring a financial planner is, what is your investment philosophy? And, and I would argue Tim thi this is an important two-way conversation, um, because the, the investment philosophy of the firm is there alignment there with the investment philosophy or preference of the client, right?

Tim Ulbrich: So talk, talk to us about why this is important and I think this one gets overlooked a lot that someone may have a preference, but that doesn’t necessarily align with, with the firm and how they approach their investments.

Tim Baker: Yeah. So what one of the questions I asked a prospective client is like, you know, if you had to make a list of the things that you want in your financial planner and for, or in your team for you to say like, Hey, these are my people. Um, you know, the, one of the things I’m kind of looking for and, and I think very rarely it comes up.[01:07:00]

Tim Baker: But, you know, sometimes I’ll, I’ll see people that are like, I need you to beat the s and p 500. And I’m like, that’s not us, right? So we believe in more passive buy the market. Don’t try to beat the, don’t try to beat the market. If you’re more of an active, you know, um, investor, you think that there’s ways to kind of game the system and beat, you know, beat the market.

Tim Baker: And only one person I think can, can consistently do that. Warren Buffet, who can buy companies and basically extract return, you know, most of us can’t do

Tim Ulbrich: Mm-hmm.

Tim Baker: So it’s a, you know, it’s, is it, are you trying to beat the market or is it kind of more of a singles and doubles approach where you’re in the right asset allocation, you’re in the right asset location, we’re keeping expense low, those types of things.

Tim Baker: So, um, a lot of people are like, I don’t know what, what is your philosophy? And see if that that works for me. So I think if you, if you trust the market and you let it do its thing over the course of long periods of time, 10, 15, 20, 30 years plus. Market takes care of you, right? So you waste a lot of time and money trying to like, gain the system.

Tim Baker: But it [01:08:00] might be like, you know, in this day and age, like what’s your opinion on digital assets? Right? So for a long time there, it was kind of similar to student loans. It’s like, ah, like don’t worry about it. And now digital assets are, are, you know, it should be something that your advisors is at least talking to you about.

Tim Baker: You know, are you, do you like Vanguard funds? Is it ESG, which is like Sustaina sustainable, invest in, you know, are there, are there different strategies, you know, that make sense to you that, that fit more into your portfolio? So I think a conversation about this is super important. And I would say a lot of the time, you know, prospects will take the lead from their advisor, whether they’re active or passive.

Tim Baker: Um, and I, I grew up in a, you know, where I not grew up, but my, my previous firm, Tim, um, kind of helped mold me. I. Where my in investment philosophy is, and it was more of a case of like, what not to do. So, you know, when I was, when I was being mentored, you know, we, we basically [01:09:00] selected investments from the people.

Tim Baker: You know, they, they would, they would come to our office, you know, these wholesalers, these mutual fund wholesalers would come to our office in a fancy car wearing fancy suits, and they would take us out to a fancy lunch and they would f show us fancy glossies of like, why their funds were so great.

Tim Ulbrich: It’s like old school pharma,

Tim Baker: Yeah, exactly.

Tim Baker: And they would say, Hey Tim, you know, when Tim Ulbrich rolls over his money, like wink, wink, like in, you know, use our funds and, you know, to, to, to mobilize a sales force like that costs a lot of money. And who pays for that? The investor. And it’s typically in the, in the form of commissions or an expense ratio.

Tim Baker: So, you know. These, that was our criteria to pick, you know, um, you know, large cap, mid cap, small cap, like these different, you know, sleeves of investments. And they were often super expensive. The other, the other, um, mentor that I had was, [01:10:00] you know, it’s more of an active strategy. It’s like, Hey, client, we’re gonna buy x, y, Z ETFs at a hundred dollars per share, and then when it goes to a one 10, we’re gonna basically put a stop gap at 1 0 5 and then kind of lock in our gains.

Tim Baker: And if it goes at 1 0 5, we’ll sell out and then we’ll live to fight another day. And, you know, we’ll look at the VIX and all this kind of stuff. And we have core and we have explorer positions. And the, the problem with that model was like, there was a fla, I remember being in a conference and there was a flash crash where something happened in China and the, and the market went down and then went back up.

Tim Baker: So in this, in this scenario. Had a, let’s say we had a, a, a, a sell order at 1 0 5 by the time we actually got filled, because some of these ETFs were thinly traded, mean not a lot. It got filled at 80 and then the market’s back up and now we’re, we sold at 80 and we’re trying to buy at one 10 or 1, 1 0 2 or something like that.

Tim Baker: And I’m like, okay, mentor, what do we do next? And it’s like, I don’t know. [01:11:00] So, so that was more, you know, more of the active strategy. And I’m like, you know, there has to be a better way. So, um, I’ve read books like the Index Revolution, um, which is a quick read that is kind of like what I would say. It’s like, hey, trust the market.

Tim Baker: You know, if you read something in the Wall Street Journal about a biopharmaceutical stock that’s been priced in many, many weeks ago, like, you’re not, it’s not a hot stock tip. Um, so it’s kind of a, the more born investment is the better, you know, investment should be like. Paying down a debt or watching paint drive, typically the more sexy it is, the the more expensive it is.

Tim Baker: And, and the more I think risky it is. So it should be super boring singles and doubles. Don’t try to hit home runs, you know, and often you wanna do the opposite of how you feel. So, you know, if the market’s crashing, you want to take your investment ball and go home. Don’t. If you have more money to put in, do that.

Tim Baker: You know, not investment advice. If the market is flying high and people are like, I wanna buy, buy, buy. That’s, you have to be cautious. ’cause it [01:12:00] goes in cycles. Right. So, you know, you will often wanna do the exact opposite of how you feel. And, and you know, these are the behavioral things that a lot of people get in trouble that, you know, they’ll, they’ll sell, they’ll sell low, they’ll buy high.

Tim Baker: Right. And, you know, part of our job is to kind of, you know, establish a structure and a framework to potentially talk you off the cliff from doing things that are rash. You know, and I’ve done that in the past before, you know, getting into financial services. I’ve done silly things with my investments, which I, which I regret.

Tim Ulbrich: Tim, it reminded me of, uh, Daniel Crosby, who wrote the Behavioral Investor, had a chance to interview him on the show. I’m drawing a blank on what number it is. We’ll link to it in the, the show notes. But one of the quotes from the behavioral investor that he had was, humans are wired to act, markets tend to reward inaction.

Tim Ulbrich: Um, and I love his take because he, he brings a, a research-based psychology approach to how you think about your money and. A little bit of dose of, of humble pie, right? When you understand the, the limitations of what we can do and great recommendations. You beat me to it. I was gonna mention, uh, the index [01:13:00] revolution, but Charles Ellis, if folks are looking to read more on this, unshakeable by Tony Robbins is another good one, uh, that touches several of the things that we talked about during today’s show.

Tim Ulbrich: Um, but really good stuff. I know we covered a lot of ground. Uh, this is one of our longer episodes, but I, I, I really feel like one that we’re gonna be able to come back to on repeat of, Hey, what are the things that you should be thinking about looking at questions you should be asking when you’re thinking about hiring a financial planner.

Tim Ulbrich: And we’re really proud of what we have built, our team of CFPs, certified financial planners at YFP, the impact that we’re having. And we would love to have an opportunity to talk with you, whether you work with an advisor now or not, and this may be your first engagement. We’d love to have a conversation to learn more about, Hey, what’s going on in your financial plan?

Tim Ulbrich: You can learn more about our services and together we can determine whether or not it’s a good fit. You can go to your financial pharmacist.com and right at the top of the page you’ll see an option to book a discovery call. Uh, we’ll also link to that in the show notes.

Tim Baker: Yeah. And I would just say, Tim, to add to that, like [01:14:00] sometimes I get the question from prospective clients. They’re like, oh, do I, like, do I need an advisor or should I, you know, do I have enough money? Or things like that. And there’s always gonna be a population of, of people out there that are DIYers and whether that’s, you know, handling your money, um, mowing your lawn, cleaning your house, whatever, whatever that is, right?

Tim Baker: There’s always gonna be that. I would say for the most part though. If you’re a pharmacist and you’re making a six-figure income as a household, and we’re aspiring to be, you know, a seven-figure pharmacist to kind of take from the book, you need an advisor, right? Like pharmacists are pharmacists. You do what you do.

Tim Baker: I think with the amount of money that we’re talking about, and I think the intentionality that we’re really trying to focus on, like. You hire a financial planner. Right. And, and I think sometimes I speak with pharmacists and they’re like, oh, they’re not sure. Or to give themselves permission. Do I have enough?

Tim Baker: And, and like I said, we work with clients that. Are all over the map in terms of their, like, where they’re starting net worth, which is very, very negative or very, very positive. And I [01:15:00] think to me, this is about building in a foundation and intention with your money and letting you know, a professional, you know, do that versus, you know, kind of you doing it on the side.

Tim Baker: ’cause I think there’s a lot of, you know, positive aspects from obviously the technical, um, stuff, but then just like the optimization. And I think one of the things that, you know, the, one of the. Prevailing things that I talk about, that I talk to that’s missing is like, am I optimized? Am is the money that’s kind of flowing through my household, you know, direct it in the best way possible.

Tim Baker: And there’s a variety of ways to look at that. So I would just plug that, you know, if you’re listening to this, you probably do need a financial planner, obviously bias actor, right, Tim? But, um, I would just throw that in there.

Tim Ulbrich: So Tim, I.

Tim Baker: Yeah, thanks Tim. [01:16:00]

[END]

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YFP 256: Why YFP Planning’s Lead Financial Planners Are All CFPs®

Posted on by yfpadmin

Why YFP Planning’s Lead Financial Planners Are All CFPs®

On today’s episode, sponsored by Splash Financial, YFP Planning Financial Planner, Kimberly Bolton, CFP® discusses why the CFP® designation is the most valuable credential when providing comprehensive financial planning, why the term financial planner in and of itself doesn’t mean a whole lot, what questions you can ask to find a planner who is a good fit for you, and what someone can expect when working with a financial planner.

About Today’s Guest

Kimberly Bolton, CFP®, is a Financial Planner at YFP Planning. Along with her team members, Robert Lopez, CFP®, and Savannah Nichols, she strives to help YFP Planning clients on their financial journey to living their best lives. To go along with her CFP® designation, Kim has a B.S. in Consumer Sciences with a concentration in Family Financial Planning and Counseling. When not working, Kim enjoys being in the sunshine, hitting the gym, hiking, traveling, taking her dogs Nugget and Toot on adventures, being a food enthusiast with her husband Allen, and spending time with her bonus kids Brianna and Brady.

Episode Summary

This week, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, sits down with YFP Planning Financial Planner, Kimberly Bolton, CFP®, to discuss why all of the lead financial planners at YFP Planning are CFPs®. In their discussion, Tim and Kim cover why Your Financial Pharmacist believes the CFP®, CERTIFIED FINANCIAL PLANNER, designation is the most valuable credential when providing comprehensive financial planning. Kim shares her personal story of becoming a CFP®, the rigorous education and experience requirements to become a CFP®, the comprehensive nature of the CFP® exam, the ethical standards associated with the credential, and why the CFP® is considered the most prestigious financial designation in the industry. She digs into why the term financial planner, or financial advisor, in and of itself doesn’t mean a whole lot, what specific questions you can ask to find a planner that is a good fit for you, and what someone can expect when working with a financial planner. Kim also explains common fee structures in the financial planning industry and why YFP Planning uses a fee-only structure. Tim shares a little bit of his own experience as a YFP Planning client himself, echoing Kim’s sentiment that the partnership between planner and client is an intimate one and that as a client, feeling comfortable with your planner will make an incredible difference in your experience. Kim closes with an awesome client success story, sharing how one couple was able to make their home-owning dreams come true years earlier than planned.

Key Points From This Episode

Background on Kim’s professional journey to becoming a CFP®.
What inspired her to pursue a career in financial planning.
We find out about the work that Kim is currently involved with at YFP Planning.
Why the YFP team believe so much in the CFP® designation.
Some examples of how comprehensive the CFP® training is.
How working with a certified CFP® is beneficial for the client.
Kim tells us what is required to enter the CFP® course.
What people taking the CFP® board exam can expect.
Learn about the experience requirement needed after passing the exam.
The expected ethical standards once you are certified.
Differences in the types of CFP® planners in terms of fees and services.
A brief breakdown of the different fee structures associated with CFP® planners.
Examples of good questions to ask a financial planner to ensure they are the right fit for you.
Kim shares a success story about working with a CFP®.

Highlights

“If you do any research on it, you’ll see that [being a Certified Financial Planner] is titled the most prestigious financial designation that you can have within the industry.” — Kimberly Bolton, CFP® [0:10:02]

“Here at YFP, it’s really important to us that our clients are comfortable with our recommendations. We want the clients to feel that the recommendations we make are made because it is in the client’s best interest.” — Kimberly Bolton, CFP® [0:11:58]

“Talking about your finances is a very intimate conversation. You want to make sure you are comfortable with your financial planner, because you’re going to have some intimate talks about your finances!” — Kimberly Bolton, CFP® [0:22:33]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[00:00:00] TU: Hey, everybody. Tim Ulbrich here, and thank you for listening to the YFP Podcast where, each week, we strive to inspire and encourage you on your path towards achieving financial freedom.

This week, I had a chance to welcome YFP Planning financial planner, Kim Bolton, onto the show. We discuss why we believe the CFP, Certified Financial Planner, designation is the most valuable credential when providing comprehensive financial planning. We also discuss why the term financial planner or financial advisor in and of itself doesn’t mean a whole lot, what questions you can ask to find a planner that is a good fit for you, and what someone can expect when working with a financial planner.

Now, before we hear from today’s sponsor and then jump into the show, I recognize that many listeners may not be aware of what the team at YFP Planning does in working one-on-one with more than 240 households in 45 states. YFP Planning offers fee-only high-touch financial planning that is customized for the pharmacy professional. If you’re interested in learning more about how working one-on-one with a certified financial planner may help you achieve your financial goals, you can book a free discovery call at yfpplanning.com. Whether or not YFP Planning’s financial planning services are a good fit for you, know that we appreciate your support of this podcast and our mission to help pharmacists achieve financial freedom.

Okay, let’s hear from today’s sponsor, and then we’ll jump into my conversation with YFP Planning financial planner, Kim Bolton. This episode of the Your Financial Pharmacist Podcast is sponsored by Splash Financial. With interest rates on the rise, it’s a good time to evaluate the refinancing of your student loans. If you’ve ever considered refinancing your loans, check your rate now through Splash Financial. If you qualify, refinancing could help you get a lower monthly payment on your student loans or get a lower interest rate. Splash helps you shop and compare loan refinancing offers across lenders nationwide.

Browsing rates through Splash Financial is fast, free, and won’t impact your credit until you complete a full application. Now, when you successfully refinance $50,000 or more, Splash Financial will give you an extra $500 in cash bonus using our link, splashfinancial.com/yfp. So check your rate today and see what you might be able to save at splashfinancial.com/yfp.

[INTERVIEW]

[00:02:21] TU: Kim, welcome to the show.

[00:02:22] KB: Thanks. Thanks for having me. I’m really excited to be here.

[00:02:25] TU: Well, this has been a long time in the making. We just celebrated your two-year anniversary here with YFP. So Kim is one of our financial planners that works with the team at YFP Planning. Today, we’re going to be talking all about why our financial planners are all CFP, certified financial planners, and why we believe so much in the CFP designation. The reason we’re putting Kim on the hot seat to talk about this topic is Kim just completed all of the components of the CFP to be able to use those marks. So, Kim, congratulations officially. Exciting to see that to the finish line.

[00:02:57] KB: Yeah, thanks. Thanks so much. It was a long journey. It took me – If you counted like my school and everything, it was about a six-year journey that it took to have the three little letters put behind my name.

[00:03:11] TU: We’ll talk about why that takes so long and why those three letters are so important. But before we jump into learning about the CFP requirements, a certified financial planner requirement, tell us more about your career journey leading up to and including the work that you’re doing with YFP Planning.

[00:03:26] KB: Yeah. So my career journey in the financial planning industry actually began with YFP. YFP is the first financial firm that I have ever worked for. Before Tim found me, I had applied and interviewed with a couple of big corporate financial firms, and I had just realized like that’s not really where I want to be. Like that didn’t feel like home to me. Prior to the financial planning industry, I actually worked for the University of Alabama. I was an office administrator in their maintenance department. So I kind of already had experience with like the customer service piece and like invoicing and paperwork and the admin part of the job.

[00:04:03] TU: Where did that interest come from, Kim, in terms of that pursuit of a career in financial planning?

[00:04:08] KB: So I was actually four months from graduating from college with an English major when I realized I want to be a financial planner, not an English major. So it started way back probably when I was like 16 and first started working. So I learned at a pretty young age how to semi-manage my finances since I had a car payment and insurance and things like that. Then I went through college thinking I was going to be an English major, and I realized in my thesis analysis class that that’s not where I wanted to be.

So I went and talked with my college advisor. Just through like brainstorming different jobs that I could have, I had kind of come up with the idea of a finance major. A finance major and a financial planning major are – It’s similar, but they’re very different. The finance major is more broad than the financial planning major. So you get pretty like concentrated when you do just a financial planning major. So when I had first mentioned finance to my advisor, we were going through the different jobs that I could have with that degree and everything, and we eventually just realized that I wanted to help people with their finances, and I wanted to help people be able to retire and live a financial-free life.

Then that’s when we decided that financial planning is what I wanted to do. So four months before graduating, I changed my degree to be financial planning. It added a year and a half onto my schooling, but it was completely worth it, and now here I am, being a financial planner.

[00:05:39] TU: I think for those, Kim, that have not worked with a planner, it can be hard to understand, like what do I expect? What is actually involved in that relationship? What does it look like? One of the things we’re going to talk about is how different this service can be. Certainly, that term financial planner, that term financial advisor, wealth manager, lots of terms that are used, it does not mean that all things are created equal. So there’s a variety of ways that it can be done.

But I think for folks that have not worked with a planner, it can even just be hard to wrap your arms around what does this actually look like. So as it relates to your work with YFP Planning and working alongside lead planner, Robert Lopez, give us a sneak peek into what your day-to-day, what your week-to-week looks like, as you help support the financial planning process for over 100 pharmacist households.

[00:06:23] KB: Right. So day-to-day, we’re pretty much in the nitty-gritty financial planning. So day-to-day, I’m helping Robert get prepared for meetings, making the presentations for him. So if you are a client of YFP and you’ve ever seen any kind of slideshow or slide deck, that is definitely me and Savannah, working behind the scenes to kind of put that together for him. Working with Robert to help make any kind of recommendations, usually like the two of us brainstorm together to make the best recommendation for the client based on their certain situation.

Then from a week-to-week perspective, that’s kind of when you get a bigger picture, and you have like more projects coming in. So right at this moment, it looks like transitioning our clients into like a quarterly meeting schedule and kind of what that looks like for them, what that involves from us from like a workflow perspective, and really kind of catapulting that into existence and moving clients into a quarterly schedule.

Overall, I directly support Robert and just make sure he’s prepared to give the client the recommendation, and I help him do any kind of research that is needed so that we can make sure we’re making the right call on different financial scenarios.

[00:07:37] TU: Robert, for folks that have not heard him on the podcast before, Robert Lopez is one of our lead financial planners, along with Kelly Reddy-Heffner. We had Robert on the podcast most recently on episode 248, where he talked about some public service loan forgiveness, PSLF, success story. So if folks are wondering, “Who is Robert,” that is who Robert is.

I think you highlighted well, Kim, that there’s a lot of work that goes on behind the scenes. I think about as we bring on a new client into YFP Planning, there’s a lot of work involved in terms of the onboarding, making sure we have all the information and then, of course, in the ongoing basis, preparing for meetings, following up for meetings. There could be transactions that need to happen, tasks that we need to make sure that we follow up on.

Even as one example, myself that you help, so I’m a client of YFP Planning, and Tim Baker is my financial planner. As I made the transition from Ohio State to working full time at YFP about a year ago, I had to do a rollover of my 401(a). So I had some questions as I looked at those forums. I wanted to make sure I did it right. I wanted to make sure there was no implications in terms of taxes or penalties. So you helped me execute that transition and that rollover. Lots of things that are happening that people may not see at face value, even for those that are engaged with the planning, where they jump onto an hour meeting or so with the lead planner.

Kim, one of the things we’ve touched on in the past is the importance of understanding, as I mentioned just a few moments ago, that not all financial planners are created equal. So they can have varied educational experiences. They can carry different designations. They can be regulated in different ways. They can charge in a variety of ways. We’re going to link to in the show notes an important resource that we have available to download for free, and that is the nuts and bolts of hiring a financial planner that I would encourage listeners to check out.

In that resource, we cover what are the different types of planners, how do they get paid, what are some questions that folks may consider asking when they hire a planner. Again, that’s the nuts and bolts to hiring planner. You can get that and download that at yourfinancialpharmacist.com/nutsandbolts, and we’ll link to that in the show notes as well.

So we’re going to focus our time on the CFP designation, the certified financial planners. We believe that that is the credential that’s an important criteria to do comprehensive financial planning and to do it well. We’re proud to have five CFPs on the YFP Planning team that collectively serve over 250 pharmacist households for one-on-one planning. Kim, let me punt this to you since you’re the most recent designee of the CFP on the YFP Planning team. Why does YFP believe so much in the CFP designation?

[00:10:10] KB: So the CFP designation, if you do any kind of research on it, you’ll see that it’s kind of titled the most prestigious financial designation that you can have within the industry. I really think that YFP believes in the CFP designation the way that we do, simply because when you have the CFP designation or you’re working towards that designation, you’re really proving to yourself and you’re proving to others how high of standards you have for yourself. So when someone is either in the process or has a designation, they are being extensively tested and quizzed on their knowledge of financial planning.

The questions and the coursework that you go through, it really digs deep and it makes you apply those financial planning concepts to real-life scenarios. So even though like you may be answering a multiple choice question when you’re being tested or when you’re doing like practice quizzes and everything, if you don’t understand how to apply the concept to a real-life scenario, then chances are you’re not going to be able to answer that question correctly. So the CFP designation really just sets you aside from everybody and shows how serious you are about your career in the financial planning world.

Another part to that is CFP designation requires that you be a fiduciary, which in short means you put the client’s interest above your own, even if that recommendation doesn’t necessarily benefit you. It just benefits the client. This would come into play, for example, like if a financial planner had recommended that somebody go out and get like a $1 million life insurance policy. There are scenarios where if you’re not a fiduciary, you could be recommending that to that client because it’s in your best interest, because you possibly get a commission off of that.

Here at YFP, it’s really important to us that our clients are comfortable with our recommendations. We want the clients to feel that the recommendations we make are made because it is in the client’s best interest. We don’t want that client to think like, “Hey, are they just making this recommendation because it benefits them, not because it benefits me?” So that’s really the big picture why I think YFP takes the CFP designation and so serious, is because it gives our clients that peace of mind. It gives them that level of comfort with us that we are working in their best interest, and we are doing what’s going to benefit them more than what’s going to benefit us.

[00:12:35] TU: Yeah. That was a great explanation, Kim, the fiduciary piece. We’re actually going to link that in the show notes. If people want to learn more about what the fiduciary standard is, why it matters, how it’s different from what’s known as the suitability standard, John Oliver has a great segment on this topic, and we’ll link to that in the show notes. Kim, you explained it well. So I think the highlights there would be the fiduciary piece, the rigors we’ll talk about in a moment, what makes up the CFP designation.

As Tim Baker often says, “The bar of entry into financial advising and hanging a shingle to be a financial adviser is fairly low.” So being able to have some rigor, some documented evidence of the work that’s been put in, the seriousness of that training, and obviously being prepared to then provide comprehensive financial planning, that’s something we see often that traditional financial planning services might not necessarily be serving at folks in all different phases of life. Are they well-versed in things from retirement planning to debt management and everything in between? I think if you look at the CFP curriculum, very intense but also very comprehensive.

So to that point, in terms of the rigor and the intensity, Kim you mentioned several years it took you to obtain that designation. So talk to us about the requirements that one must go through in order to be able to use those three letters by their name.

[00:13:52] KB: Right. So there’s a couple of different ways that you can be qualified for the CFP exam. The most common is for someone to go through the CFP board’s coursework. In my situation, my college degree qualified me for the CFP exam. So you either have to have a bachelor’s degree that qualifies you for the exam, or you have to go through the CFP board’s coursework. Then once you have completed the education piece, you were then allowed to sit for the exam. The exam is 170 questions. They give you a six-hour limit, and it’s broken into three-hour segments. So three hours and then they let you leave for 30 minutes, and then you come back for the remaining three hours. Yeah, it’s pretty brutal.

When I was taking mine, the lady that was working the front desk at the testing center when I left or when I was leaving, she told me, she said, “You’ve been here a long time today.” I’m like, “Yes, I just took a really long test.” Then once you pass that exam, which again during that exam, you’re tested on the ability to apply financial planning to real-life scenarios, and then you’re given a few different case studies where you have to dig through. It’s like a multiple answer question that you have to really look at.

Then once you have passed the exam, you are then required to fulfill an experience requirement. So if you are working directly underneath another CFP, which in my case, I was working directly under Robert and Tim Baker, so working underneath them, I was required to get 4,000 hours of experience, which comes in at almost two years of work in the financial planning industry. Once all that is complete, then you basically sign your life away, saying you will be a fiduciary from here on out, and you will uphold to the CFP board’s like ethical standards and their standards of conduct.

Then every year, we have some CE courses that we have to do. It sounds simple, but it’s really complex. After you’ve done all that, so the education, the exam, the experience, and then once you agree to the ethical requirements, you become a CFP.

[00:16:02] TU: Yeah. So I think pharmacists, they can relate to this, right? You described an educational component, you described an examination, and then you described what I would consider like an experiential component. So you mentioned 4,000 hours of practical experience and not until all of those have been completed and plus the acknowledgement that you’re going to uphold the fiduciary standard. Then at that point, you can use the certified financial planner marks.

We think about pharmacy education. You’ve got the doctor pharmacy program. You’ve got the experiential rotations, which are typically throughout school, and then the final year of pharmacy school. Then we have the licensure examination. So we have a NAPLEX exam, and then we have a state law examination. However, what I’ll point out here is that I won’t say the NAPLEX is easy, but the pass rate of the CFP is much lower than the NAPLEX. I’m looking at the March 2022 examination of the CFP, and the pass rate was only 65 percent, so a very rigorous exam.

Typically, we see board pass rates in pharmacy – I think the last I looked at it, we’re closer to 85 to 90 percent, so very rigorous exam. Then to my comment earlier, it’s a great benchmark, certainly not the only thing folks should be looking at as they’re shopping for a planner, but a good indicator that someone has gone through a rigorous process, educational component, examination, and an experiential piece that demonstrates their ability to do planning.

Kim, I mentioned this briefly earlier, but I want to talk more about it in this concept of are all CFPs created equal in terms of types of services and how fees are assessed. Really, when you get the CFP marks, you have demonstrated that you’ve gone through all the things that you just talked to, but that may not mean that all CFPs are operating in the same way in terms of the services that they offer or as well as in the fees that they’re charging, correct?

[00:17:44] KB: Yeah, that’s right. So it’s really a wide range of like different services and different fee structures that you can have. Kind of to be brief with it and not go down a rabbit hole, you can have CFPs that are comprehensive planners. So that’s like us here at YFP, where we go from one end of the spectrum to the other. We can help you buy a house, we can help you invest your 401(k), or we can help you improve your credit score, anything along the lines. So it’s really everything under that financial planning umbrella.

Or you can have CFPs that strictly do just investment management. This is going to be CFPs that worked directly with your investments, so like that employer retirement plan or that traditional IRA or Roth IRA that you may have. Just another different spectrum that you could be on is you could simply work at an insurance company, and you could be the financial planner that is selling the insurance, whether it’d be life insurance, disability, umbrella insurance. It’s a big world out there, and so your options are kind of limitless on what kind of services you provide.

Then as far as fees go, so really the three most common that most people have probably heard is a fee-based, commission-based, or a fee-only. So fee-only is what we are here at YFP. I’m sure we’ve mentioned it a few times on the podcast but fee-only basically. When you come on board with us, and we quote you your price to work with us, that is the price. That is what we are paid. We don’t get any kind of commissions or any kind of kickbacks or anything like that. Whereas with commission-based fees, that planner is going to work strictly off of the commissions that they make from selling you products.

Then fee-based gets a little sticky because it is where it can be a flat fee, but then you also receive kickbacks off of people’s investments or insurance policies or things like that. So fees and services can get a little bit sticky and can be a tad complicated, but that is in short are like the major ones that are the most common.

[00:19:44] TU: Yeah. As you described, Kim, it really is the Wild Wild West in terms of how services are constructed, how often you meet with a planner, what to expect, what they’re managing, what they’re doing, as well as the fees, and how those fees are assessed and charged. So that really means there’s due diligence on the client side to be asking the right questions as they’re conducting that search. We talked about this in detail in episode 54. Several other resources we have as well available at yfpplanning.com. Folks can look for more information there. But it really talks more about the model that we do at YFP Planning, as well as the concept of fee-only.

I want to just for a moment give an example, Kim, of fee-only and why we believe that matters. So you gave the definition of it. Let’s say you’re working with a client, Kim, and you determine that there’s a need for, let’s just say, long-term disability insurance on top of some employer coverage they may have. Well, under the fiduciary standard, under the fee-only model, as you work with that client to determine what the benefit need is, you’re not selling the insurance policy, number one, and you’re not getting any direct kickback for the recommendation of any specific product that you would be recommending.

In that case, you can really help evaluate objectively what does the client need, what does the client not need, and then help look at a variety of different options as they shop those policies around. So I think that many pharmacists that will resonate with them in terms of wanting to have unbiased recommendations as possible. To that point that I made that it’s important, we’re asking good questions to understand what do people do in terms of services and how do they charge. What are some questions that you would recommend, Kim, folks ask as they’re looking for a planner that is hopefully a good fit for them?

[00:21:25] KB: Yeah. So I think the first question you should ask is are you a fiduciary? Because simply, you want somebody that is going to give you advice based on your best interest, not the planner’s best interest. The second big one is like what qualifications do you have. You want to make sure that your planner is qualified to actually be giving you financial advice, and it’s not just somebody like posing as a financial planner. Then how are you paid is going to be another big one. So that’s going to tell you like, “Do they receive commission off of me like. Is this a fee-only relationship?” So how are you paid is a big one.

Then another one would be like how is our relationship going to work. So you want to make sure that you and the financial planner are on the same page about how the relationship will work between the two of you. So like how often will you meet? Like how will you manage my assets? How do you plan to help me buy a house? Like kind of what does the relationship look like? Other than those big questions, I would simply just make sure that you jive with that financial planner.

Talking about your finances is a very intimate conversation, so you want to make sure like you are comfortable with that financial planner because you’re going to have some intimate talks about your finances. So you want to make sure that you’re comfortable opening up with that person and that your personalities kind of go together. In that way, you feel comfortable talking to them, and you feel comfortable sharing details about your finances, and you don’t feel like you have to hold back because either personalities clash or because you’re not really comfortable opening up with them.

[00:23:03] TU: Great overview. As we always say, shout out to Justin here who does our business development and our discovery calls on the front end, it has to be a good fit from both ends, right? If you as a client are going to make an investment of time and money, and our planning time is going to make an investment in that relationship as well, there has to be a good fit, and that starts with expectations in terms of folks being on the same page. I think that starts with making sure you’re comfortable what that relationship looks like and by asking some good questions, as Kim just highlighted there.

Kim, do you have an anonymous success story or two that you can share of clients of YFP Planning that really highlights the impact that a CFP can have and that the planning team can also have at large?

[00:23:46] KB: Yeah. I actually have a really good example. I had even mentioned it to Robert to make sure he was okay with me sharing. When I told him the example that I was going to use, he was completely on board with it, so I’m excited. But we had these long-term clients. They’ve been around with YFP I think longer than I have, but they had gone through residency. The wife had already graduated, and she was in her career. But the husband was still in residency. It was cool to be able to watch him finish his residency program.

Then once he had finished, they moved states to be closer to where he had received a job. They were living in a townhome, and they had done a couple of budgeting meetings with us, make sure they were saving correctly and make sure that they were saving enough for retirement. Then the question came about. They were like, “Well, we want to buy a house.” Behind the scenes, they had done all the math to figure out how long they needed to save in order to have that 20 percent down payment that we always hear about when it comes to home buying.

They had figured out that it was going to take them five years to save a 20 percent down payment, and they were really in the dumps about it. Like they enjoyed where they live, but they also wanted to be homeowners. They wanted to get that next chapter in their life started. So we had a call with them. We could kind of tell that they were down in the dumps about it being five more years before they could even really begin to seriously look at houses and put in offers and everything. Then we made the recommendation to them. We told them like, “You are eligible for a doctor loan, which with the doctor loan, you don’t have to have the 20 percent down payment.” So we went through the whole process of educating them on what a doctor loan is and what those terms look like and like why they don’t need the 20 percent down payment.

Then it was literally like 30 days to the mark after that conversation. They were closing on their first house without a 20 percent down payment. At this point, they’ve probably moved in. I haven’t talked to them lately, though. But it was awesome to be able to help them realize like, “Hey, we don’t have to wait five years to buy a house. We can buy a house now.” So they were over the moon, they had found a home and that the home ownership chapter was beginning. It was awesome to watch, and it also just made me realize, and they even mentioned it. Like without the YFP Planning team, like who knows if they would have ever even known what a doctor loan was, and that it could have been five more years before they actually got in the home. So it was awesome to be able to help them make that transition into the next chapter of their life.

[00:26:24] TU: I love that story. Thanks for sharing. What I love about that too is when we think about the pharmacists home loan, doctor loan products, we’ve talked about them on the podcast before, one of the I think challenges that can be there is if folks aren’t really evaluating that home purchase in the context of the rest of the financial plan, is that home-buying can be exciting. It can be emotional. It can be stressful. We can easily find ourselves down a path of the home purchase that may not jive with the rest of the financial plan.

You are here. Robert is with a client and not only being able to open up a new avenue that maybe wasn’t considered to make this home purchase a reality, but also considering and evaluating that and the rest of the financial plan. So how does a home purchase fit with also making sure we’re progressing for retirement and with other financial goals as well? So really cool story to share, and I think one of the things that you and the planning team do so well is striking this balance between taking care of our future selves but also living a rich life today. Both are really important, and that’s a great story and example of why it is.

Kim, thank you so much for taking time, number one, to come on the show, and excited to get you in front of the YFP community, if folks don’t know who you are, aren’t familiar with you yet. Again, congratulations on all the hard work that went into getting the CFP. I would remind folks that we’ve got a great guide an overview of the nuts and bolts to hiring a financial planner. You can download that for free at yourfinancialpharmacist.com/nutsandbolts.

Then for folks that are hearing this and saying, “Hey, I’d love to learn more about the planning services offered by Kim and the rest of the team at YFP Planning,” you can book a free discovery call with Justin Woods, our Director of Business Development. You can do that by going to yfpplanning.com. So, Kim, again, thank you so much.

[00:28:11] KB: Yeah, thank you for having me.

[END OF INTERVIEW]

[00:28:13] TU: Before we wrap up today’s episode of the Your Financial Pharmacist Podcast, I want to, again, thank our sponsor, Splash Financial. If you’ve ever considered refinancing your loans, check your rate now through Splash Financial. If you qualify, refinancing could help get you a lower monthly payment on your student loans or get a lower interest rate. Splash helps you shop and compare loan refinancing offers across lenders nationwide. Browsing rates through Splash Financial is fast, free, and won’t impact your credit until you complete a full application.

Now, when you successfully refinance $50,000 or more, Splash Financial will give you an extra $500 in cash bonus using our link, splashfinancial.com/yfp. So check your rate today and see what you might be able to save at splashfinancial.com/yfp.

As we conclude this week’s podcast, an important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding material should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment.

Furthermore, the information contained in our archived newsletters, blog posts, and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist, unless otherwise noted, and constitute judgments as of the date published. Such information may contain forward-looking statements which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward-looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer.

Thank you again for your support of the Your Financial Pharmacist Podcast. Have a great rest of your week.

[END]

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