Assembling Your Financial Team

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Assembling Your Financial Team

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It’s always best to trust an expert who has your back!

Most people wouldn’t dare attempt fixing plumbing problems without the help of a plumber. It is simply too important to not do correctly. The same is true when it comes to categorizing your expenses, preparing your will or filing your taxes. The good news is that there are professionals available to look out for your interests.

A fiduciary is a person who holds a legal or ethical relationship of trust with one or more other parties (person or group of persons).

Certified Financial Planners (CFPs) are required to have fiduciary relationships with their clients. That means they are legally obligated to act in the best interest of the people who use their services. Another example of a fiduciary relationship is the relationship I have with my clients as a daily money manager. Examples of how I act in the best interest of a typical client include:

  • Reviewing bank accounts to ensure there are no errors
  • Paying close attention to insurance policies
  • Coordinating with family when necessary
  • Acting as a Power of Attorney when needed

CFPs pick up where my expertise ends; they are most concerned with wealth planning. Since their area is inherently forward-looking, it often makes sense to involve younger generations in the planning process. CFPs refer to this as generational planning, and it encompasses:

  • Looking at the whole picture over a number of years;
  • Anticipating the future tax ramifications of family investments; and
  • Setting up different instruments like retirement accounts or donor-advised funds.

An important distinction to note is that, contrary to CFPs, stock brokers are not fiduciaries. A stock broker’s loyalty is not with the consumer, but rather the company they work for. They are offered inducements to sell products according to their employer’s priorities, not yours.

Financial Team Checklist

  • Accountant: Accountants spearhead the tax planning and strategy of a household
  • Insurance Broker: A broker (not an agent) can find the best policies from every insurer
  • Certified Financial Planner: These professionals are best able to assist with retirement planning and wealth preservation
  • Attorney: A qualified attorney (not an app) is best to draft wills, trust and estate plans and other important documents
  • Daily Money Manager: A professional bookkeeper or daily money manager pays bills, categorizes expenses, organizes file systems, balances the checkbook and acts as a liaison between the client and the rest of the financial team

As you can see, there is ample help available to organize your finances and free up your time. I encourage you to consult with friends and family about their experiences and see if you can get some referrals to the professionals they use. If you’re unable to find someone who is the right fit, contact me to see if I can help!

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