Individually Tailored Financial Planning
By: Brandon Schleter, July 17, 2018
We talk a lot in these weekly newsletters and blog posts about creating financial plans that are unique to each client and tailored to that person or family's individual situation, goals and needs. But what does that mean, exactly? What is it that our team can do for you that a Google search cannot? Good question, and I have a few examples for you.
First, one thing I've seen a few times is clients who either have already purchased real estate, or who are planning to purchase large real estate holdings with the purpose of creating an income stream. They think they'll buy a few buildings that will bring in twenty grand a month and they can sit back and relax. Now, real estate in and of itself is not necessarily a bad investment. However, it's not the easy way to easy income many people imagine.
When we sit down with clients who are interested in real estate, we always walk them through the numbers very carefully. We'll review what's invested, costs associated with maintenance, etc., and the rate of return, which the investor usually hasn't thought about. Our team will walk you through exactly what you have invested (or plan to invest), expected monthly expenses, monthly income, and help determine if this is a wise use of your money.
Second, we see many clients who don't realize that they are allowed to contribute to both a Roth and a traditional IRA if they don't have a work-sponsored retirement plan. Many mistakenly think it's one or the other when they could be taking advantage of both. Along these same lines, we've seen people contributing to a Roth even though their income is over the limit. This often occurs when automatic contributions have been set up (good job!), and then income increases (congrats!), but the auto drafts continue and it slips through the cracks. Penalties can result if this is not caught and fixed in time. We are always happy to provide these kinds of financial double-checks to your financial plan.
Third, many, many people invest and make financial decisions based on emotions. How many people wanted to go to cash after the last presidential election, based on their emotions at the time? How many people read a gloom and doom newspaper article and decide they immediately need to sell everything because the next big crash is almost certainly imminent? These kinds of knee-jerk, emotional decisions rarely pay off in the long term. Our team is constantly keeping an eye on market movement and making adjustments to our client portfolios as we see fit and necessary, so you can channel those emotions in healthier ways.
Fourth, did you know a good financial planner will help you with your employee benefits? That's right. Bring in your enrollment package when your HR department gives it to you, and we'll go over what all of it means. Many people are paying too much for certain benefits, or they don't even know what's in their benefits package in the first place. Do you really need cancer insurance, or identity theft insurance? Are you paying for legal services each paycheck that you've never used? Are you ignoring what you're paying for life insurance instead of shopping around for the best option? Benefits packages are often full of bits and pieces that are hard to decipher. Let us help.
Finally, I know lots of people who always buy extended warranties. Folks, those warranties are specifically designed to get money out of you. That said, there are times when an additional warranty is a good idea, and we can talk that out during your next meeting. But please, before increasing your car payment by buying that warranty, talk to us first. (Actually, talk to us before you buy a car no matter what.)
These are just a few of the ways we create financial plans that fit the unique needs of our clients. Yours might include these scenarios, and it will definitely include others that you and only you bring to the table. That's what makes our job fun. No two people are alike in how they envision their future, or in how they want their money to work for them. It's our job to help.