Next Mission Answers Ten Questions For A Financial Planner
In a previous article, I discussed why it’s important to perform due diligence when you’re hiring a financial planner and how military members have unique requirements they should seek to address because of their benefits.
Based on the questions I compiled, I believe it’s only fair and transparent that I publish my answers.
1) Will you have a fiduciary duty to me?
Yes. I will always put your interests first with any recommendations. I have taken this pledge as part of my membership in several organizations and as part of my certification. While this doesn’t preclude potential conflicts of interest, I will always be fully transparent so that you can make the best-informed decision.
2) What is your education, qualification and experience?
After my 25-year Air Force career, I decided I wanted to do something different so most of my formal education is not in finance. I have a Bachelor of Science in Computer Engineering from Rochester Institute of Technology. The Air Force also set me to get Masters’s degrees from the Naval Postgraduate School, Air Force Institute of Technology, and Air War College.
I am a Chartered Financial Consultant® having completed my coursework and certification through the American College of Financial Services.
I am a licensed financial advisor having passed the Series 65 examination. This qualifies me to legally serve as investment advisor. Next Mission Financial Planning is registered in the state of Missouri, but I can work with clients in other locations.
3) What services do you offer? Would you say you’re more planning-focused or investment-focused?
Next Mission Financial Planning offers both financial planning/advising and investment management through ongoing client relationships. Our goal is to understand your goals and dreams and partner with you to make them reality. We believe comprehensive financial planning should be the basis for any long-term investment decisions so the plan should always come first.
4) What type of clients do you typically work with?
We primarily work with military members and families and retired military members or families and this is our core area of expertise. We do have some clients who don’t have any military affiliation. That doesn’t disqualify you. See up a time to talk (LINK) and we can discuss your situation and assess the fit.
5) Do you understand military benefits? Can you advise on the Thrift Savings Plan (TSP), Blended Retirement, Tricare, Survivor Benefit Planning, as well as lesser-known programs like the Savings Deposit Program during deployments?
As a 25-year Air Force veteran, I’m intimately familiar with military benefits. I’ve invested in the TSP since it was open to military in 2001. I can also advise on military transition and retirement through the Transition Assistance Program (TAP) and the Veterans Administration (VA) process as well as available resources.
6) What is your approach to financial planning?
Comprehensive financial planning should look at your complete financial life as well as understand your goals and intentions for your resources (time, talent and treasure). Comprehensive financial planning should typically cover insurance, tax, investment, retirement and estate planning areas that applicable to your situation. Some planners will do this at the beginning of an engagement in a few meetings over 1-2 months while others may systematically work through all the areas over 6 months or up to a year.
7) What is your approach to investment management or what is your investment philosophy?
There are probably almost as many ways to invest as there are investment advisors so understanding this is critically important. If you don’t, there is a good chance you’ll decide to change strategies at exactly the wrong time. Strategies can vary between short-term, actively traded investments to long-term, targeted asset allocations that will only be rebalanced every 6 months. It’s also important to understand any fees associated with investment management as these can dramatically effect your overall investment returns.
8) How do you get paid?
There are two primary ways you will pay for services: Fees or commissions. Fee-only advisors typically have less conflict of interest than commission-based advisors (see question 1. Fiduciary duty). Commission-based advisors typically sell some subset of financial projects that may or may not be the best way for you to achieve your goal.
Fee-only advisors usually charge on an hourly, project-based, flat-fee, subscription or retainer, or based on the assets under management (AUM). Depending on the complexity of your situation, amount you intend to invest and income each of these may or may not make sense.
9) How much do you charge? What are my all-in costs?
Based on the services the advisor will provide and their fees how much will it cost you? Additionally, understand how much the investment management and product fees will add to this bill or are they included. Fees can vary widely, but it’s important to understand the value you’ll be getting for the money you pay.
10) Have you been disciplined by a regulatory organization or have any complaints on your record?
Advisors are required to disclose infractions and complaints made against them. It is always a good idea to check FINRA’s Broker Check (https://brokercheck.finra.org/) or the SEC’s Investment Advisor Public Disclosure (https://adviserinfo.sec.gov/) websites. It’s important to understand that not all complaints or issues are major red flags, but any advisor should be able to explain the situation to your satisfaction.