1. Please tell me about the financial planning process.
Financial planning is a multi-step process that provides you with two important benefits: (1) An in-depth review of your current financial situation, and (2) a blueprint that shows you how to pursue your financial goals and objectives for the future. It is important to remember that financial planning is a process, not an event.
2. How do you create this blueprint?
First, I focus on your goals, objectives, priorities, and values. For instance, the reduction of current and future income taxes may be an immediate goal; funding a quality education for your children and/or grandchildren may be an intermediate goal; and enjoying a secure financial future in you retirement years is likely to be one of your most important long-term goals. Another great goal in life for some people is creating wealth and/or leaving a legacy for your chosen beneficiaries or charities.
You may already be on the road to meeting these objectives and simply need a new strategy, professional insight, or someone to help you fine-tune your plan. You may just be starting out, or you may be somewhere in between. Whatever your unique situation may be, everyone needs a periodic assessment of where they are on the road to meeting their financial goals. That's why I do an in-depth review of your current financial situation. Next, you need to know how you can go about pursuing (or continue working toward) your financial goals. By focusing on cash flow, investments, taxes, pensions and retirement plans, estate planning, insurance issues, savings opportunities, and other general financial matters, I design a customized financial plan for you. Finally, to achieve the intended results, you must implement and monitor your plan.
3. Sounds like a lot of work!
It may seem like that at first, but the good news is, if you follow your plan and maintain a disciplined approach, you can rest well knowing you are striving to reach your stated goals. I try to make the process as easy as possible for you. In addition to receiving professional advice on your most important financial concerns, I can also provide implementation and ongoing asset management services, if appropriate for your needs.
4. Who can benefit most from your services?
Any individual seeking financial discipline and peace of mind can benefit from my services. I serve clients at all income levels, from all walks of life. Clients have the flexibility to work with me on either a one-time, "as needed" basis, or an ongoing basis. I welcome clients who simply need a one-time financial consultation or a second opinion, as well as those who need comprehensive financial planning and ongoing investment services.
5. Do you only provide comprehensive financial planning, or can I ask you to address a specific concern or a particular situation I am faced with?
I do both. Although a comprehensive financial plan can provide the greatest benefit, I can limit my advisory services to your specific needs, such as cash management and budgeting, investment analysis, retirement planning, or college education funding.
6. My spouse and I are just beginning to plan for our financial future. There is so much to learn! We need help and guidance to get started. Will you accept us as clients?
Yes. Some planners have income levels and/or minimum net worth requirements for clients, but I realize that everyone has financial needs. I love working with people from all income levels, and all walks of life. Remember, "You don't have to have a fortune to start building one." Call me today and let's get started.
7. I have already accumulated substantial assets and think I am doing quite well. But as I progress and build for the future, things seem to be getting more complicated. I want to be sure I am on track, but I don't always have the time or inclination to manage the myriad details by myself. Can you help me?
Yes. People who need more sophisticated financial planning or advice will find my services appealing and beneficial. If you have a desire to simplify your financial affairs, my ongoing retainer may be right for you . If you are looking for a professional review or a second opinion to ensure that you are on the right track, I can provide that service for you as well.
8. I'm in charge of the retirement plans and employees benefits at my firm. I would like to increase the number of employees who participate in our benefit programs. How can you help us?
Corporate education is key to building employee participation. I can help your employees understand the benefits of your programs. Please call to discuss your specific needs. I can custom-build an educational program for your company.
9. For what types of securities do you provide advice?
I provide advice for all types of securities, including mutual funds, stocks (as they are related to your portfolio holdings), bonds, bank deposits, variable and fixed annuities, limited partnerships, and tax shelters. I also provide advice on mortgages; budgeting and cash flow issues; 401(k), 403(b) and IRA rollovers; lump-sum distributions and other retirement programs; stock options, life and disability insurance; and so forth. If it has to do with money and finances, I can provide counseling, guidance, and/or resources for you.
Because I want my clients to know that they can call me with any and all of their financial concerns, I use the slogan "Financial Planning and Advice for Everyday Life." Clients are encouraged to call me when they have a major life event, such as getting a new job, having a baby, getting married or divorced, purchasing a new home, or starting a new business. I also encourage my clients to call me with more common everyday questions, such as "How should I invest within my 401(k) or 403(b) plan?" "How can I reduce my taxes?" "What advice can you offer on refinancing my home?" "How can I minimize my flexible spending account, Cafeteria plan, or Section 125 plan at work?"
10. If I use your services to develop a financial plan, am I obligated to purchase the recommended products from you?
No. I will offer recommendations, which, in my professional opinion, will meet your needs and objectives, but you are under no obligation to purchase them from me. In today's competitive market, it makes sense to shop around for the best available product or service. For instance, if you need to obtain a life insurance or disability policy, I will suggest the type of policy that may be best for you, as well as which riders you may wish to consider. I will then direct you to a choice of companies that can provide a quality product at competitive prices for you. If you wish, I can help you purchase investments through my broker/dealer, Commonwealth Financial Network, Member NASD/SIPC, and/or show you how to set up your own account with a third-party custodian, such as a discount broker.
Please refer to my Form ADV Part II for a detailed explanation of my exclusive affiliation as a Registered Representative with Commonwealth Financial Network, Member NASD/SIPC.
11. Tell me about your investment philosophy.
As a financial planner and investment consultant, I believe in the following fundamental principals with regard to designing an investment portfolio and make specific recommendations:
The purpose of a client's investment portfolio is to fund current and/or future financial objectives. The design of the portfolio must take into account the client's financial objectives, tolerance for risk, needs for current income and liquidity, and special considerations, such as income and estate taxes. The important thing to remember is that no one can predict the future.
It is a difference of opinion that makes a market. Investment and economic "experts" provided with the same information often come to different conclusions. I do not suggest that I, or any of the money or mutual fund managers that I recommend, can make the correct decision every time. I do believe, however, that studying the historic trends and relationships of investment classes and the philosophies and approaches of successful investment managers can provide valuable insight. The appropriate allocation of investment assets for your goals and risk tolerance is the most important component in developing an investment portfolio. I believe that having a diversified, well-balanced portfolio, following long-term strategies, and having patience will increase the likelihood that one will achieve his/her long-term financial objectives.
12. How do you select investments for a client?
Before I recommend any investments, I consider the current economic conditions, the outlook for that asset class or type of security, and how this investment fits within your portfolio given your objectives and tolerance for risk.
I am an advocate of utilizing no-load mutual funds with high-caliber management and above-average track records.
For equity investments, I focus primarily on the philosophy, experience, and track record of the management team. With fixed income investments, I look for the best yield available for a given quality of security.
In summary, I strive to obtain the most appropriate investment vehicles to meet your objectives, while being very conscious of total expenses and risk exposure.
13. How do you price your financial planning services?
The fees are based on the actual time involved in meeting with you in person or over the phone, researching and analyzing your current situation, and providing specific recommendations and implementation assistance (if appropriate). My standard rate for financial planning services is $150 per hour. Ongoing retainer clients pay a fee that is based upon a percentage of assets under management (the percentage rate may be adjusted based on the size of the portfolio and the complexity of each client's unique situation). Please refer to my ADV Part II document for a detail explanation of my fee structure.
14. How much will my financial plan cost?
Financial planning fees are determined on a project basis. The total fee for a financial plan will vary from client to client based on the specific needs and complexity of your situation. My typical fees range from $500 (minimum) to $2,000.
15. Are your financial planning fees tax-deductible?
Generally speaking, yes. Section 212 of the Internal Revenue Code permits an itemized deduction for tax and/or investment advice in the miscellaneous deduction section of Schedule A. It is subject to a 2% floor of the adjusted gross income on a personal tax return.
16. Once my financial plan in completed, will our relationship end?
Some of my clients choose to maintain an ongoing relationship with me because they realize financial planning is a process, not an event. Others seek my services from time to time and on an "as-needed" basis. All my clients receive my quarterly newsletter. In addition, from time to time, I prepare market commentary or financial or tax updates that I mail out to my clients.
17. How do I get started?
The first step is an initial inquiry from you. Call me at (301) 220-1973 or e-mail me at planner@edramseycpa.com . I offer a 30-minute no-cost/no-obligation "Get Acquainted" meeting, either on the phone or in our offices. "Get Acquainted" appointments are scheduled based on availability during regular business hours of 9:00 to 5:00, Monday through Friday. Expanded office hours are available to accommodate special needs or emergency situations. Should you decide to engage my services, I can discuss which of my services are appropriate for you. Most clients find the financial planning process to be stimulating and enlightening. The end result, of course, is greater peace of mind. I am looking forward to helping you pursue a brighter financial future!
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