FAQ

Questions Related to Fees

How can my financial planning fee be deductible through my business?

We advise our clients on EVERYTHING included in the financial life, this includes your business if you are self-employed.  Because we are providing business planning you can treat our fee as a professional service to your business and pay for our service through your business.

Can I deduct my financial planning fee?

For individuals, no. The Tax Cuts and Jobs Act of 2017 eliminated the deductibility of financial advisor fees. 

If you own a business, YES!  We advise our clients on EVERYTHING included in their financial life, this includes your business if you are self-employed.  Business planning services when paid through your business accounts are treated as a tax deductible professional service.

Do you charge a % of investment assets managed?

No! We strongly believe in transparent, fixed annual fees for 3 primary reasons:

Your fee should not constantly change based upon how your portfolio performs. Let’s say you have $500,000 in investment assets and a firm charges you 1%. Your fee would be $5,000/year, or $1,250/quarter. If your portfolio increases 10% to $550,000, it means your fee would increase to $5,500/year, or $1,375/quarter. Did you feel the value you received increased by 10%? Probably not.

There are conflicts of interest if you charge a % of investment assets managed. Let’s say you’re considering withdrawing money from your investment portfolio to pay off your mortgage. Well, if a financial planner charges a % of assets managed, it means their fee will go down if you pay off the mortgage. We believe that a financial planners fee should not change based upon the advice they provide you.

You need investment assets to work with a financial planner. This excludes a very large % of the population who have income, but not assets, to pay a financial planning fee.

We partner with Altruist Financial LLC to custody your non-employer investment accounts. When we mutually agree it is in your best interest to utilize a Third Party Asset Manager within the Altruist platform, you would pay their fee directly which does not change how we are compensated.

Why do you charge based upon income and net worth? Will my fee ever change?

We believe our fee should be directly tied to the value that we provide. Based upon our experience, we believe that income and net worth are the best indicators of complexity. As your income and net worth grows, your complexity grows, and our value grows.

Your fee will not increase unless there is a significant change in either your net worth or income. You will always know exactly where you are in the fee level range. If you enter into a new fee level, you will graduate to that new fee evenly over two years.

For example, if your current fee is $416/month and you’ve entered the next fee level of $625/month, you would pay $520/month in the first year of the new fee and $625/month in the second year of the new fee.

How do you calculate net worth?

Your net worth is your total assets minus your total liabilities. We will calculate this for you.

Total assets include:

  • Cash
  • Investment accounts
  • Vested stock options/restricted stock
  • Personal and rental real estate

Total liabilities include:

  • All debt – student loans, credit cards, car loans, mortgages, HELOC, etc.

Excluded assets include:

  • · Personal property
  • Cars
  • Business assets/valuation
  • Unvested stock options/restricted stock

Assets and liabilities are measured based upon their fair market value.

Can I cancel my ongoing planning relationship?

Yes, of course. You can cancel the relationship at any time. Our clients pay their annual fee on a monthly or quarterly basis. It is your choice to continue the relationship at each annual renewal. Our intention is to always bring more value to you than the ongoing fee for our services.

Questions Related to Services

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What is your investment philosophy?

Passive, low cost and tax-efficient. According to S&P Dow Jones Indices, 85% of active managers failed to outperform the S&P 500 index. We do not want you to pay higher fees and higher taxes to try to be that 15% that outperforms the market. We strive to track the index and make sure that your investment strategy is customized to your goals.

We help you select the best investment funds in your employer sponsored plans and then partner with Altruist Financial LLC approved asset managers for your non-employer sponsored accounts (taxable accounts, Roth IRAs, etc.) when it is in your best interest.

Where are my assets held? How do I keep track of everything?

Wherever you want! We are completely indifferent on where your assets are held. You don’t need to uproot your financial life to work with us.

If you want to use Altruist Financial LLC, then your accounts will be held at Altruist Financial LLC, which is insured by the SIPC for up to $500,000 per account type and are protected against losses resulting from the failure of the broker-dealer. Please note, unlike FDIC insurance for banks, SIPC does not protect against losses due to normal swings in the market. An explanatory brochure is available at http://www.sipc.org.

Regardless of where your assets are held, you will have your own customized client portal to show your entire financial life in one place. You can see all of your accounts, net worth, spending, etc. in one place via your computer or phone.

Why should I work with you instead of doing this myself?

We think working with us vs. doing it yourself is like completing a home renovation. You can watch YouTube videos, read articles on google, etc. and try to do it yourself to save money, or you can hire a professional to do it for you. If you do it yourself, it will likely a) take a lot of time, b) cause added stress/frustrations and c) result in missing things you didn’t know to look out for.

Some people are naturally gifted with finances which is great. You probably could do this, but it comes down to determining the best use of your time. We can’t go to your kid’s soccer game for you, but we can free up your time so you can.

In addition, money is emotional. It is really hard to make objective financial decisions when you are so close to the situation. People’s brains are hard wired to buy high and sell low. According to DALBAR, the average equity fund investor earned 4.88% vs. the S&P index of 8.5% over the 10-year period ending in 2017. The major reason? Investor behavior. We help you reduce this gap, especially when markets are tough.

How do you make referrals to other professionals (estate planning, CPA, etc.)?

A very valuable aspect of working with us is the ability to tap into our professional networks. We know experts, or know how to find experts, in nearly every field related to your personal financial situation. We have spent substantial time getting to know these experts – their ideal client, how they charge, scope of services, etc. so that we can make the referrals that best fit your situation.

We will never accept any type of fee sharing arrangements. We pride ourselves in always eliminating conflicts of interest, so you have the peace of mind that the referrals we make are always in your best interest.

Questions Related to Who We Serve

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I don’t really fit exactly into one of the example clients – can I still work with you?

Yes, of course! The example clients are meant to provide common situations that we see. You may have different goals, pain points, life circumstances, etc. which is great. However, if you don’t buy into our core beliefs, we will not be the best fit for you. We pride ourselves on not being for everyone, but we will help you find someone who is a better fit for you.

We help you select the best investment funds in your employer sponsored plans and then partner with Altruist Financial LLC approved asset managers for your non-employer sponsored accounts (taxable accounts, Roth IRAs, etc.) when it is in your best interest.

Do I need to have a certain amount of money to work with you?

Absolutely not. We don’t have investment asset minimums because we don’t charge based upon solely investment assets. Our fee is based upon your income and net worth.

We do have a minimum fee of $292/month or $1,250/quarter for ongoing, retainer clients. If this fee would be too high for you, then we are happy to make referrals for lower-cost alternatives.

Do I need to live in Kansas to work with you?

No! Our firm is both virtual and in person and the plan is always offer these choices. Technology enables us to work with clients from all over the country. We have clients in 9 different states and counting!

However, our network of experts is strongest in the Kansas, Missouri, and Colorado areas.