Episode 12: Deciding to Work with a Financial Advisor

Episode 12: Deciding to Work with a Financial Advisor

Deciding to Work with a Financial Advisor

Questions to Consider When Thinking About Working with a Financial Advisor

Dave Nelson and Stacy Harris are thinking it may be time to sit down with a financial advisor. They think the time is right but they're not sure. They don't know what to expect when they meet with the advisor and they are more than a little nervous about opening up their financial lives. Listen in as Thom addresses their questions and assures them that their pre-meeting jitters are much scarier than the actual meeting will be.

TRANSCRIPT:

Thom: [00:00:18] Hi, I'm Thom Allison in your host for the Financial Wheel Podcast, welcome to today's episode. This is gonna be a little different episode than we've done before and kind of a special one. And just to give you a little background. Yeah. When we started these podcast, I asked my niece to listen to these and give me some feedback, you know, because she's 20 something and young and lives in a different world than I do. So I thought it might be helpful to hear about that. And she came back with a really interesting suggestion. She said. If you're talking about how people learning to have the right types of conversations about money, maybe you should have a conversation with an average Joe, as she put it, or with somebody other than just the experts that we bring in all the time. We still want to bring the experts in, because I think that gives you some really useful information. But today, we're going to talk to a couple of, quote, average Joes, if you will. You're going to recognize the voices. These are the producers of the podcast that we're doing, Dave Nelson and Stacy Harris. Really happy to have them on board. And so, Dave and Stacy, welcome.

Dave: [00:01:23] Hello, Thom

Stacy: [00:01:23] Thanks, Thom

Dave: [00:01:24] We're about to make this average.

Stacy: [00:01:28] It's always interesting sitting on this side of the mic too, but yeah, the tables have turned. I'm looking forward to it.

Thom: [00:01:33] Yeah, yeah. So we are we are bringing them over the other side. What we're going to do today is really address some key questions that people commonly have when they're thinking about should I go to an adviser, should I not go to an advisor? And why is it maybe that I would hesitate to go to an advisor? So let me just start off with are you two thinking about working with a financial advisor? And if you are. By the way, I happen to have a good one. I recommend.

Dave: [00:02:03] Oh, only if they have a podcast.

Stacy: [00:02:07] Well, the answer the short answer is yes, and the slightly longer answer is we need to because we recognize that while we have similar philosophies around money, I think we're managing a very busy household, busy businesses, busy lives. And as we get beyond our fourth decade, we need to make sure that we're set up for success for our future. And it's always been something that I think that I personally have thought, well, that's so far away. And now that I'm approaching my mid 40s, I'm like, oh, wait a second. That's really not that far away. And I'm not talking about, you know, hitting 65 and then just all of a sudden punching out and playing golf and eating bonbons. It's not that's not what retirement is. But at the same time, I want to be able to know that we can live within our lives, our preferred lifestyle, for a really long time, and that we don't find ourselves running out of money. But we know how to pay our bills today. But we actually need to know how to live our life for the rest of our lives. So we absolutely the answer is yes. We absolutely need to work with an advisor.

Dave: [00:03:14] Really looking forward to doing something about that so we can get ahead of where we are today and have a better understanding what's going on.

Stacy: [00:03:21] Well, and I also think that it's important for us to be able to serve as role models financially for our children. And we do that every day in our behaviors and the way we live our lives. But we want to be able to make sure that they're set up for success and quite honestly, actually better success than we are because we want them to know all this stuff before they get to their mid 40s. So bringing them along on that journey is really important for us as well. Yeah.

Thom: [00:03:45] This is going to be fun because one of the questions that we always ask people is what did you learn from your parents about money? And usually the first answer is nothing because they never talked about it. So we just sort out either by conversation or by observation. But then when people have kids, I love to turn the question around and sit there and say, OK, imagine your kids are 35, 36 years old and they come into my office because I'm ageless. I'm still going to be working. And, you know, I asked them that question. What did you learn? How do you want them to answer that question?

Stacy: [00:04:20] Oh, I think I just started sweating.

Thom: [00:04:23] I'm not going to put you on the spot. I just said I'm just saying that that's that's I'm sort of throwing that out there just so that our listeners can maybe think about.

Dave: [00:04:29] Well, I think that's a great question, too, because I think as far as the kids, there's been a number of times in raising these kids where you realize even as a little kids, they're really intuitive and they're understanding and observing certain things that you had no idea that they that they knew. So when it comes to finances, I think if we're not specifically teaching things, they're going to pick it up and they're going to know, oh, well, dad always did this when this was going on or some some other thing that we don't think they understand. But they're picking up on just by watching this.

Stacy: [00:05:04] Well, and there's perceptions that they have, right, based on the neighborhood we live in. The cars we drive, the vacations that we go on and we have talked to them about high level numbers. But those high level numbers can be really scary because when you're talking about mortgage payments to a 15 year old, a mortgage payment like they can't even conceive earning enough money to be able to make one mortgage payment, let alone, you know, 12 a year. So it's one of those things where we absolutely need to approach it in a way that's not scary for them, but that we are partners with them in understanding what's appropriate for their age, whether they're going into college or finishing up the last four years of high school. What is it? What are the goals that you have? And then let's look a little bit further out from that as well. Our youngest is not thinking about retirement. It'd be great if she was because she'd be a CEO of, you know, a multimillion dollar company. But it's not to say that that's not on the cards for them. But what's the realistic nature of her being able to feel comfortable? So it's not this big scary conversation that she's afraid to talk about because we've been afraid to talk about it to.

Thom: [00:06:10] So I'm sensing that maybe one of the motivations that you have for wanting to talk with a financial adviser is to think about how can you teach your kids about money or maybe be a better role model for your kids about money. What other considerations would motivate you to seek out a financial adviser?

Stacy: [00:06:30] Well, you know, when we look at retirement, I personally don't have great role models, and the definition of a great role model is subjective, right? It's up to the individual to determine what that is. I have an idea of what I want my retirement to look like, but I don't have anyone in front of me that's actually living that right now. And so I look at, you know, what our income or our lifestyle costs might be today. And I know intellectually that that's not going to be the case in 20 years or 30 years. And so how do I actually plan for that? And the answer is, I don't know. And I need help. But how do we also make sure that because life is short and we don't know what's going to happen? How do we make sure that we're able to enjoy the life that we're living today? So it's this kind of trying to find that balance of how do you plan enough for the future, for the unforeseen or the unknown, but also make sure that you're not so worried about the future, that you're not enjoying the present.

Dave: [00:07:27] How you plan for that future and still enjoy today? Because I know enough people that are so focused on getting everything locked down so that to have this retirement and it's like, why don't you Just have a good weekend? or I like enjoy today. And then the flip side is somebody people just like I'm just gonna do whatever I want now. And they're not having any thought that you can tell. You know, you're going to be living for another 30 to 40 years. Like, have you thought that far ahead?

Stacy: [00:07:59] We also don't want to be a financial burden on our children either, because and it's not to say that that's wrong. We'd like to have your children in a position to be able to help you later in life. Is is is fine. But we want to be able to decrease the chances of that happening, not knowing exactly what's going to happen. But saying, okay, when we look at assisted living facility costs when we're 40, 50 years down the road. What's that going to look like for us? And are we gonna be in a position to be able to handle that on our own? Because if we're not, we're going to have to look at other sources in order to be able to help us with that. That's going to be a plan G, right. So what we really need to focus on is A, B and C to be able to make sure that we understand what our options are. Yeah.

Thom: [00:08:45] So I'm kind of curious. It sounds like you're at the point right now, you think. OK. We should probably get some help. Would we get some professional help? Get us organized, get us structured, get us going and all of that. How do you go about deciding what kind of questions, what kind of conversations do you have between the two of you to say this is the type of person or type of adviser that we're looking for?

Dave: [00:09:09] Have we had that conversation?

Stacy: [00:09:11] Well, it turns out we know someone, so I think the biggest thing and this goes back to the fear factor of talking about this kind of stuff is a trusted and safe environment where we can't change anything about our past financial decisions. We can only start from today. And so to be able to go in and work with a team of people that will be like, yeah. You got to leave that at the door because we're just going to keep we're going to look forward. Right. You're not going to be judged by what you've done in the past because we can't do anything to change that. So I think that's number one for me.

Dave: [00:09:45] Yeah, and I think for me in a previous conversation we all had, I described all of these reasons why I'm primed ahead of time to not talk to people about finances. One of them is I think I had this this seated thought or fear that someone's just gonna want to take my money to do whatever they want to do for them. And I've you know, I walk around sort of putting that at arm's length. But to be able to know that the person that we talk to or company that we talk to really does have our best interest in mind and that we're not going to be getting down the road and having quarterly financial statements that we cannot read. Right. Like so complicated that I would rather go read my cell phone statement, because that somehow makes more sense in that context, because I think we're still at a place where we kind of have a good intuition as far as like, oh, that ad is a scam on the Internet. Right. Or these people trying to sell something that's just a bunch of you know, that's a bunch of bull and it's not. But later on, am I going to be able to understand that? And so do I have the intuition to be able to understand if I'm being taken advantage of when talking to a financial adviser? Or is this is this personal really going to understand where I'm at, where I want to go?

Stacy: [00:11:00] And I think along those lines, it really comes down to someone that's willing to educate us in a way that we are able to consume because we have plenty of examples around us of people that say, oh, I go to my financial planner or my advisor, and I have no idea what they're talking about or they give me a statement and I can't read it.

Dave: [00:11:19] Or they just say, don't worry about it, it's fine.

Stacy: [00:11:21] We got this right. And but also in in parallel with that, it's also someone we appoint, Dave, about best interests, right? Someone that's a partner and a champion. Right. To be able to say it's not just about the number on the statement or, you know, life doesn't happen in relation to the stock market. Right. Life happens because you've got kids that go to college. You've got parents that need medical care. You have, you know, houses that you're going to buy and sell and all these kinds of things. And they're major, major milestones. And to be able to have just even more people in our corner is going to be really key to be able to make sure that we're successful and we feel like they are also a part of our success as well.

Thom: [00:12:08] So I think this is probably a good spot to take a quick break right now, and when we come back, I'm going to turn the tables a little bit and invite Dave and Stacy to ask questions that they would like to have answered, maybe ahead of making the decision to go in and talk with a financial adviser. So we'll take a quick break right now.

Thom: [00:13:07] Welcome back to the Financial Wheel Podcast. Again today my guests are Stacy Harris and Dave Nelson. They are the producers of this poadcast, but they're also people who are out there thinking about working with a financial adviser. And that's what we're having the conversation with today during the break. We started having a little bit of a conversation. I told you that we were going to get to their questions than we are. But before we get to their questions, I got one more that I want to get kind of put to them, because, you know, we started talking about what is it that keeps people from really being active and seeking out financial advice? What are what are some of the things that hold people back? So let me just put that question to you guys.

Stacy: [00:13:47] Fear and shame.

Dave: [00:13:49] Yeah. Being embarrassed. It's sort of sort of like when we talk about like you get a housekeeper coming over to clean up and we'll do a lot of people do they clean up the house before the housekeeper cleans up because they don't want them to see like, oh, my gosh, what a you know, what a filthy, disgusting house that you run. If you if you don't have everything already picked up was like, what's the point? So it's similar with, you know, getting a financial adviser, somebody who's gonna see all of our dirty corners, all of our big giant mistakes and things that could be embarrassing because we made some big mistake or something like that.

Stacy: [00:14:22] Well, and I I I would challenge us to maybe think of them as missteps maybe vs. mistakes, because I think we learned from those missteps. Right. But then what we learned from that is what not to do in the future. We haven't necessarily zeroed in on exactly what we need to do differently in order to be able to make sure that that outcome is different. And so for us, it's important for us to be able to bring more people into our corner. Like when someone comes to us and says, I don't know the first thing about producing a podcast. Well, that's not your business to know how to do that. That's our business. And that's why our clients hire us. So it makes sense for us to be able to kind of practice what we preach and actually reach out to the right people that know finance's way better than we do in order to be able to get us back on

Dave: [00:15:12] Well, I and I think to the dream is somebody like you Thom come in and take a look at everything. Go, Yeah, you guys look pretty good. Yeah.

Stacy: [00:15:20] It's not so bad.

Dave: [00:15:21] Nothing really to do here. You guys are it. Oh. And that the only thing that happened in 2008. Good job on navigating that. I like that sort of the dream. But like the reality is like that's not going to happen.

Stacy: [00:15:33] Well, you know, you talk about 2008 and everyone knows for the most part over the age of probably 18 what that was, and that was the financial crisis, the housing crisis, the the recession that followed. And, you know, someone that was directly or indirectly impacted by that and history tells us that that will happen again. And so for especially for me, it's got this there's this tingle of fear that's always sitting in my spine about, oh, is this year going to be the year that it happens? And what happens? Because we've made some pretty big taken some pretty big risks in our career and our finances. And we just need some time to get those, you know, kind of going. But we don't have any control over these bigger things that happen. So how do we gain that control back? That's a question. Right. Like, how can we kind of get control back of our financial future and still be able to weather what external factors happened that are totally out of our control?

Dave: [00:16:32] Now, I want to be able to say, yeah, I knew that before I go talk to somebody who's going to tell me how all this works. So.

Stacy: [00:16:39] And the answer is we don't.

Dave: [00:16:40] And that's I think that's what's keeping me. Yeah, hold that up, that's what holds me back. I think.

Stacy: [00:16:44] Well, you know, we often we've. You open the kimono, no one wants to see that. Right. And, you know, talk to us about pretty much anything else. Thom.

Dave: [00:16:59] We could start a podcast about.

Thom: [00:17:01] Yeah, maybe we should do that. Good idea. Yeah, except I know absolutely nothing about producing a podcast. I have no idea where it even started on something like that. It looks good.

Stacy: [00:17:10] But it is one of those things or we we absolutely have to end, and the reality is, is that we're getting we're at an age where it's becoming almost a need vs. a want and it should. I think it probably should always be a need. You've talked about financial management. Is the new survival skill, right? Is the survival skill that everyone needs now. Because 100 years ago, it was very different. Or, you know, five hundred years ago. But where bippin along in our lives and keeping the lights on and the water flowing and, you know, gas in the cars. But that's just the daily stuff. We need to take it out to the next level. And we just we need the right people in our corner to be able to do them.

Thom: [00:17:50] So I asked you for a question, and I think you just gave me five. And that's good. But let me just address that fear first, because that's I think that holds a lot of people back. I mean, the fear that they're going to be exposed, that they made some stupid mistake and all of that. The reality is that most people make the best decisions for themselves at the time. They make them with the information that they have. Now, those decisions don't always work out. I would love to say every decision I made worked out. It did not, you know. You know, and so you can call mistakes, you can column missteps. You can column whatever you want. Probably not a good idea to put a negative twist on them, because the reality is, as I said, it was the best decision that you could make. It felt right at the time. It seemed right. It didn't work out. And if it didn't work out, it probably didn't work out because you didn't have the right information at the time. So, you know, it's just forget about that other than what you can learn from it and then move forward. As I was saying during the break, you can look at that thing and say, well, what we did in the past didn't work. So we don't want to do that in the future. But, you know, if that's all you have, then all you're going to do is pull something out of the air that's different. And if you're lucky, that's going to work. But, you know, if you're not lucky, then you're going to be trying it again. And so the advantage of working with an adviser is, you know, first of all, the adviser you go to should not be judgmental. I mean, if they are, then I say go find another adviser. Just walk out the door. You've got the wrong person. But there should be someone who has seen this before, because you might love to think you're unique. You're not. Hate to burst your bubble.

Dave: [00:19:36] I'm not special?

Thom: [00:19:39] You might be special, but you're not unique.

Dave: [00:19:41] I don't understand.

Thom: [00:19:44] Yeah, yeah, yeah, yeah. Somebody has been doing this for a while, has seen it before, and they have seen what works, they've seen what doesn't work doesn't mean that they're going to get it 100 percent right when they advise you because they know life happens. You've mentioned 2008 actually started in 2007, the downturn. Yeah, that's going to happen again. Statistically, it's not going to happen again in our lifetime. That's the good news. Now your kids have a problem, but we're OK. You know, statistically. But the other thing about statistics is that they're averages and so they averages can go awry. So what you want to do is work with someone who says, OK, I've seen this before, and rather than just arbitrarily picking a course of action out of the air can pick out a course of action that seems to be appropriate for you. Which course means they need to know who you are and they need to know what you want to do and they need to know where you want to go. And that's where visioning skills become very, very important. At the beginning. And that's something that can be taught and that's something that a good adviser is going to teach you and helping guide you through so that you get a good, clear picture of where you're going as you're going forward.

Stacy: [00:20:52] When I think one of the earlier questions that you asked at the top of the show, Thom, was what was our childhood experience? Great. And we are as a couple, both in business and in life. We're bringing our childhood experiences together. And to go back to that education piece, whether it's through observation or education. What are all the pieces that we're bringing together into this into this partnership and how we're kind of educating each other based on our own biases of what happened up until our life when we got together. And really, it's like getting a financial advice from someone in the schoolyard. Like, no, no, no, no, no, that's not that. Whatever Timmy told you is not right. Like, he needs, you know, find someone that actually knows what they're talking about. And so back to that education piece and making it makes me feel better to be reminded. Intellectually, I know it's okay that the decisions that we've made, whether they're worked out or not in the past, it's okay if they haven't because we've learned from those. But it's really important for us to be able to make sure that we do get more educated and that we have the right people to teach us that professors, if you will, about to be able to say, how can I do this differently? Or because we're not we're not that special. And there's something actually very coming about that because you don't want to be the person in the doctor's office where all of a sudden you have five doctors standing around you going, we've never seen this before, are not right about it. So it's reassuring to know that there's a likelihood that we will come in and sit down and it will be okay.

Dave: [00:22:33] To be boring.

Stacy: [00:22:34] You're right to be average, right, and to be able to say, you know, we have we have seen this before and we know the steps to be able to get you through this or to get you to those goals. And that only comes when you're working with someone that's in that every single day and working with a lot of people that are very similar to us in life stage in career path. You know, one of the kind of interesting things that we're in and I haven't been able to articulate it very well, then it's still come, apparently. But it's we have we spent 20 years in corporate America getting the paycheck every two weeks, getting the pharaoh and K getting the medical benefits. And now we're business owners. And so for us, it's also like, wait a second, we're really not even trying to get our finances in our financial future. Not only back on track, but definitely moving forward and have great momentum. But we're trying to do that when we have removed that, quote unquote, security. And I use, quote unquote, just because security is there's just no security. Right. Right. But to do that. Right. And are we bringing a unique situation to a financial adviser? Well, no, because there are businesses across America and the globe that people are managing quite successfully. Right. And so it's new territory for us. And it's that's where I think it's actually more important than ever that we actually bring a team of people in that we'll be able to help us kind of recognize our vision and now our goals and how we can actually do that with the additional goal of having our own business in mind.

Thom: [00:24:10] You know, as a business owner, you bring up a really interesting point, and that is the idea of bringing a team of people around you. You know, when you're in corporate America, you have a team of people that's just it's automatic. It's built into the process there. But when you're not in corporate America, you have to create your own team. And the member of that team that a lot of people don't think about is the personal financial adviser. But the problem with that is that if you just say, well, I'm so busy with my business, I'll take care of my personal business later, it's going to be always gnawing at you. And you're not even going to be as effective in your own business as you could be if you were to sit down and say, oh, yeah, my personal finances are under control. You know, I've got them organized. I know how to manage them. And once you get it set up, it doesn't take as much effort as you think it does. You know, it does take some effort, but it's not as much as you think once you get it set up. Yeah, there's a lot of heavy lifting to get it going. But once you get it going.

Stacy: [00:25:10] I feel so much better.

Thom: [00:25:12] Going in the right direction. That's good.

Stacy: [00:25:14] Well, and I think that lends itself to the next question is, is it too late? And I'm sure as heck hoping that the answer is no.

Thom: [00:25:24] The answer is no. Yeah, we've actually found it's never too late. People have various transitions that they go through and when they hit that, then they that's typically when they come and start talking to us. Right now you're in a transition. You've already started it. But, you know, transitioning from corporate America to being your own business owners. So there's that's probably a lot of what's motivating this conversation. Consciously or subconsciously, you know, people transition from getting a paycheck to not getting a paycheck. They call it retirement. We call it financial independence. Call it what you want. There's a reason for calling it something different than retirement. But the reality is they go to not getting a paycheck. And, you know, whether it's voluntary or involuntary, you know, that's going to be a transition that motivates people. And that can happen at anytime. There's any number of different things that can happen. Somebody goes from being a couple to being a single person because of a, you know, death of an elderly spouse. There's a transition and we've got to know how do we deal with that. So. So the answer is no, it's never too late. There's always a chance to get things under control to feel a little bit more comfortable. In another podcast that we did with Doug Peterson talking about cash flow management, he made the comment telling the story about his son who went from, you know, four thousand dollars in debt to 5000 dollars in surplus over a 10 month period. And that's simply getting control of cash flow. Well, you can be 70 years old and get control of your cash flow and bill. Yeah, yeah. And you're gonna be an awful lot more comfortable. So.

Stacy: [00:27:01] But if you don't know where your cash is going, you can't. You have to know where your cash is going.

Thom: [00:27:06] You have to know where your cash is going, but you also have to know that not being in control of your cash flow is what's what's eating at you is what the problem is. And some people don't even realize that's what their problem is. So that's where a good adviser can sit down and say, well, yeah, here's the area that you need to work on and here's how you do it in a in a positive effective well.

Stacy: [00:27:23] I also love the fact because, you know, in many instances when we have a new client come to us and they say, I don't know how to start this or I need some help in and in designing the show. It's easy for us to be able to come in because we're not emotionally tied to it, because it is a in most senses, it is a business project.

Thom: [00:27:42] Are you suggesting that money is emotional?

Stacy: [00:27:46] As I sit here and weep, not that nervous laughter that you hear, but it's really one of those things where, you know, we as the the experts are able to come in and see it with a different perspective and a clearer vision, because we don't have this emotional connection to it, because while we're definitely invested in making sure that our client's success is our success and vice versa, it's one of those things where as a financial advisor, we recognize the benefit of having someone come in and saying, you know, I see this through different glasses because I don't have that emotional attachment to that because it is emotional. It is. It is. It's very personal and very vulnerable.

Dave: [00:28:29] And I think, too, as that has business owners now. I've always as a kid growing up, it's not like I want to learn how to do everything I could by myself. And I'm pretty capable of putting my mind to something and learning how to do it. Doing it on my own. I don't have time. And so when we're working with our clients, there's certain things where we just tell him, don't worry about how to do that. We know how to do that. And then there's things that we need done that we contract to other people. Can you do this for us? We could do it if we had time. But you're better at it. You're gonna get it done faster and better. And we don't worry about it. Then we can focus on the things that we're really, really good at. So I think in terms of funding a financial adviser, we could probably just learn all the stuff on our own, but it would take months and years and then to get good at it. And why not just cut that part out of the loop and go to somebody who already knows that that has that base foundation?

Stacy: [00:29:27] Well, we're also not going to stitch ourselves up if we get it. You know, we break a femur right leg. We're going to go to the people that went to school for that kind of stuff. And so we're finally where we're ready. We're ready. It's it's like bungee jumping, though. You have to step off the platform. We know it's gonna be okay and the rope is gonna catch us, but we're the ones that actually have to step off that platform. So, yeah, we we're. I mean, of course, we also have, you know, a million other questions that come up, too. And. And being able to have a casual conversation that speaks to the reality of the bumps that come along in life, too. Because you talk about the milestones that that just we as humans go through. It's it's relationships. It's it's babies, it's health, it's jobs. And we can build this predictable linear path that right hand the life happens when you're busy planning it. Right. And so what we want to do is make sure that our foundation is rock solid. So when those things come along and are unexpected, that we're in a position to be able to weather those and they're not going to completely devastate us.

Thom: [00:30:37] What other questions do you have?

Dave: [00:30:40] When can we start?

Stacy: [00:30:42] Yes. Well, and you know, we've talked about this in an in preshow calls and in conversations as well. But, you know, it goes back to how do we get our business straight and make sure that our kids are going to come out on the other side. Having gone through this journey with us, either directly or indirectly, and they're actually going to be in a way better position than we are. Right. How do we start those conversations with them? And, you know, setting up a consultation with a financial advising team is when do we include them in the conversations as well? I feel like our parenting style is that we kind of get a lay of the land first and then we also that we make sure there are no bears around. And then was there, OK? Now we can go over here them together. Come along, kids, it's safe. And I feel like that should be our approach. But I'm not sure. Right. Like, what's the best

Thom: [00:31:33] You know, that's not a bad approach, really. I mean it we've done this with a number of our clients. I guess it's the advantage of having been at this as long as I have been that, you know, sort of going through generations here. Little side note, it reminds me of a high school chemistry teacher that I had who when I was going through school, I was part of the second generation that he taught. He remembered teaching the parents of those kids. And his comment was, when he hits the third generation, that's when he's going to retire. And I think it happened about a year after I graduated. So. So it's you know, it's kind of like that. So I'm doing the multi generation thing. But what we have found is that, you know, we work with the parents and they get a feel for how the whole process works. And then we invite their children and their kids to come in. And what we do is we work with their kids on an age appropriate basis, because the starting point is to kind of create a vision of what do you want your life to look like? Well, when you're 19, 20, 21 years old, you know, you want your life to look like I get a paycheck so that I can move out of the house and be able to buy a beer after work.

Thom: [00:32:37] But, you know, I mean, that's about as much as your vision really is. And we realize that. So. So let's just get the basics down. Let's just make sure that you've got control of your cash flow, because that's the starting point for everybody. You've got to have control of your cash flow. You've got to know where your money is going. So let's start with that. If you're in corporate America, you're going to have a 4 or 1 K. What do I do with this for a loan? How much do I put into it? How do I know? And that's the money that's in there now, writing about investing. So we'll kind of guide them and get them started on that. They've got some extra money for savings. Where do I save it? And what kind and how should I be building it up? And what should I be saving for first before I do this? What's the sort of the sequence? So those are the things that we would start with their real basic things to get a foundation for somebody that they can then start to build on as life gets to be more complicated. And as you know, life gets to be more complicated.

Stacy: [00:33:32] Well, I'm one of the other things you had an entire episode on this was insurance, and so that's actually something that keeps me up at night because we have it. I just don't know if we have the right one. And I've tried talking to our insurance broker about, you know, do we have the right one? I believe that it was. Well, I know for sure it was a hurried decision because I felt like there was more a massive need for us to be able to just have it right. Because, you know, we travel quite a bit and we want to make sure that, you know, the kids are in a position to be able to make sure things are taken care of. And I think I made a decision based on what sounds good. Right. And it wasn't because it was the right thing for us. It was the right thing on the at the time based on the information that I had. So but at the same time, now, I'm like, we're paying a lot of money for this. I'm trying to figure out whether we're actually investing that money in the right policy for us and our needs in our family. And so that's one of the big things I think is really going to be key for us to be able to get. And I don't wanna rush the process, but it's really important for us to be able to address that sooner than later, because we are putting, you know, a sizable amount of money into that every month. And, you know, one of the things that comes along that I just had a conversation with a broker and I was like, remind me again why his Dave's premium is way bigger than mine. And it's because he's getting his private pilot's license. And so they see his lifestyle as a higher risk. And I'm like, well, that's fine. We're not going to stop that. But at the same time, it really just comes back to the decision of do we have the right one? And so is that something you know, that's something that you're your team and other advisers do as well? Yeah.

Thom: [00:35:11] Yeah, definitely we would take a look at that. Yeah. You know, so and by the way, that was a really good response that that agent gave you. So we did a... Insurance is often used for a buy sell when there's two partners that own a business. And we were a situation where one was 10 years older than the other. And his premium was that. And they asked him, well, why is your premium so much higher? He said, well, I'm worth more.

Thom: [00:35:33] So at least you have the right response.

Dave: [00:35:37] So you get into a relationship management and counselling here.

Thom: [00:35:41] I'm not. I'm just telling. I'm just telling a story here. That's all. I hadn't planned anything.

Stacy: [00:35:46] Well, and I think one of the things that's really come out of this conversation, Thom, is that we probably actually have more questions than we realized as well, because we've been on not willing to necessarily lean into these conversations. We just think, oh, we've just got a couple of questions. When in actual fact, when you start scratching the surface, that's when the waterfall happens.

Thom: [00:36:05] Your insurance question is really kind of a good one to point out that what a lot of people tend to do is sort of compartmentalize their finances, so they sit and say, well, OK, I need life insurance, so I've got life insurance. OK. And, you know, I need to get an estate plan done. So they get an estate plan done and I need to have homeowner's insurance. So they get that. And oh, by the way, I should be saving for retirement. So let's do this. The reality is, all of these things are interconnected. That's why we talk about the spoke conversations and the hub conversations. That's why the whole thing of the wheel is that all of those things you're talking about are part of those spokes. And if those spokes are not tuned up. Right. If one's a little too tight and another is a loose, you wheel is going to start wobbling. And so that's the situation that you're in with the insurance. Again, it was the right decision at the time. But once we take a look at the whole wheel here and we see, OK, there's this insurance spoke over here, is this thing tighten the right way or does it need to be adjusted as we go forward?

Stacy: [00:37:07] Well, because I feel like we're getting into a speed wobble, right?

Dave: [00:37:12] And I'm wondering if our boat insurance is correct.

Stacy: [00:37:15] We don't have a boat. We're not getting a boat now. The answer is Thom. It's recorded. We're not getting a boat.

Thom: [00:37:25] So the airplane insurance.

Stacy: [00:37:29] Now, this has been really helpful. Thank you, Thom.

Thom: [00:37:32] So I just want to wrap this thing up with just kind of a comment, because one of the questions that hasn't come out now, what you shared with me earlier was, you know, how do we get started? And I think one of the best ways to get started is the old Stephen Covey. Things start with the end in mind. What I would ask you and what I ask everybody when we first sit down with them is to sit down and say, let's assume that we are a year down the road and we've been working together for a year now. And you look back over this year and you say, you know, that was the best decision we ever made to go and start working in our case with Allison Spielman Advisors, with the advisor, you're working. What will have happened that makes you make that decision? And I'm not gonna put you on the spot to answer that right now, but I just want to float that out there for our listeners to that. That's what you should think about. You know, before you go and interview any advisor and when you're there, share with them the answer to that. Tell them this is what should happen, because the reality is that there is has to be a match both ways. And if that person listens to you and says, that's not what I can do for you, then they should be honest and say, that's not what I can do for you and go to somebody else.

Stacy: [00:38:47] Well, I think it would be important for us to get on the same page about what it is that we want as a couple and as individuals as well.

Thom: [00:38:53] But that's a good starting point as you sit down, say, a year from now. Best decision I ever made. What happened that made me come to that conclusion?

Stacy: [00:39:02] I like that we got it. We are doing some chatting in the car on the way home. Thank you. Thom.

Thom: [00:39:08] Well, thank you, Dave and Stacey, for being a part of this park, has been a great conversation, really enjoyed it. If you would like to learn more, you can go to FinancialWheel.net net. There'll be a transcript for this. Also at FinancialWheel.net. Now there's a section there called Test the Water. Stacy made a comment about being in transition and a number of transitions. And you may be in transition transitions that you have thought about. There might be transitions that are going to come in the future, including their test. The Waters section is a form that you can fill out. It's actually a list of transitions that people go through. Most of them aren't going to apply with you. Just ignore those, but you can market the other ones. Are you going through that transition now in the short term or in the long term? And if you send that back to us, we'll send you some resources to help you think through those transitions. That's FinancialWheel.net. So hope you had enjoyed this episode. We'll look forward to the next one. And until then, keep your conversations positive and constructive.

RESOURCES



The Value of Financial Planning

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A Comparison of Retirement Strategies and Financial Planner Value

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Nine Areas of Life Balance

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TEST THE WATERS

Want to test the financial planning water? Click on the links below and spend no more than 5 minutes completing the two surveys. When you send them in, we'll respond with information and resources to help you think through the issues and transitions you've identified.

Life Transitions Survey »
Financial Satisfaction Survey »


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Financial Satisfaction Survey

 


Directions: The statements below will help you to think about and assess how satisfied you are with many aspects of your financial life. Indicate your level of satisfaction for each statement with stars.
(1 star = "Not Satisfied", 3 stars = "Moderately Satisfied", 5 stars = "Very Satisfied")

I am satisfied with...

1. ...with my ability to meet my financial obligations

2. ...with the income my current job or career provides me.

3. ...with my spending habits.

4. ...with the level of debt I carry.

5. ...with the “extras” that I am able to buy for myself and/or loved ones.

6. ...with the level and quality of insurance protection I currently have.

7. ...with the amount of money that I save and invest on a regular basis.

8. ...with my current investment choices.

9. ...that I am on track to build a sufficient retirement nest egg.

10. ...with the level of employee benefits I receive.

11. ...with my style of personal bookkeeping and financial record management.

12. ...with my ability to provide financial help to family members.

13. ...with my estate plan.

14. ...with my level of charitable giving.

15. ...with the level of financial education I have attained.

16. ...with how I respond emotionally to my personal finance issues.

17. ...with my ability to communicate about my financial matters.

18. ...with the feelings I have about my money life.

19. ...that financial issues do not cause stress or strain in the relationships that are important to me.

20. ...with the working relationships I have with my financial service providers (i.e., insurance agent, banker, broker, financial planner, accountant).


© 2002 - 2018 Money Quotient, Inc. All Rights Reserved. This document is available via licensing arrangements with Money Quotient and is protected by federal copyright law. No unauthorized copying, adaptation, distribution, or display is permitted - moneyquotient.org.

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Life Transition Survey

 


Directions: In each section, select the transitions that you are currently experiencing and those you are likely to experience in the future. In addition, check transitions in the short to mid-term and long-term columns that you either hope to experience or anticipate with concern.

Work Life Transitions

1. Change in career path:

2. New Job:

3. Promotion

4. Job loss

5. Job restructure

6. Education / retraining

7. Sell or close business

8. Transfer family business

9. Gain a business partner:

10. Lose a business partner:

11. Downshift / simplify work life

12. Sabbatical / leave of absence

13. Start or purchase a business

14. Retire:

15. Phase into retirement

16. Other


Financial Life Transitions

1. Purchase a home:

2. Sell a home:

3. Relocate:

4. Purchase a vacation home / timeshare:

5. Re-evaluate investment philosophy:

6. Experience investment gain:

7. Experience investment loss:

8. Debt concerns:

9. Consider investment opportunity:

10. Receive inheritance or financial windfall:

11. Sell assets:

12. Other:


Family Life Transitions

1. Change in marital status (marriage):

2. Change in marital status (divorce):

3. Change in marital status (widowhood):

4. Expecting or adopting a child:

5. Hire child care:

6. Child entering adolescence:

7. Child with special needs:

8. Child w/pre-college expenses:

9. Child going to college:

10. Child getting married:

11. Empty nest:

12. Family special event (Bat/Bar Mitzvah, anniversary party, trip):

13. Helping and/or gifting grandchildren

14. Concern about aging parent

15. Concern about health of spouse/partner or child:


Legacy Life Transitions

1. Increase charitable giving:

2. Give special financial gifts to children/grandchildren:

3. Give parental pension (monthly stipend):


© 2002 - 2018 Money Quotient, Inc. All Rights Reserved. This document is available via licensing arrangements with Money Quotient and is protected by federal copyright law. No unauthorized copying, adaptation, distribution, or display is permitted - moneyquotient.org.

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