Do-it-yourself or phone a friend?
I have been listening to some amazing financial podcasts on my long walks, like Bigger Money Podcast (like this episode) and I just finished reading Tony Robbins book Unshakable. A little extra educating made me consider hiring a fiduciary financial advisor for a one-time review of where I stand today and what I should focus on improving to reach my financial goals.
Years ago, I picked 52 out of the hat as the age I wanted to stop working (at least at my job in DC) . That means 10.5 years from now, and a 10 year gut check sounds like a great idea.
First I contacted Kyle Mast from the episode linked above, but he has a long waiting period and really isn’t accepting new clients. But as he suggested on the podcast, I tried researching other advisors on the XY Planning Network.
I contacted five advisors from the site and got responses from only three agreeing to meet with me virtually to discuss my goals. One day this week I set aside time for the three phone interviews.
The first advisor did not listen to me at all. He thought it was antiquated that I use Excel and enjoy tracking my finances and net worth a few times a week. He could not stop telling me how great HELOCs are (like this came up at least three times). He was the only advisor who asked me to fill out a brief survey where I very clearly stated my number one goal is for Mr.Cabbage and I to pay off our damn mortgage and be 💯 debt free. He also told me how selfish the FIRE movement was. He is listed as a specialist in FIRE, so… perhaps he should rework his marketing strategy.
According to Wikipedia, a HELOC is a high equity line of credit or a loan in which the lender agrees to lend a maximum amount within an agreed period, where the collateral is the borrower’s equity in their house (similar to a second mortgage). So…it’s MORE DAMN DEBT.
For anyone confused, when I tell you my TOP priority is to pay off my house and be debt free, don’t try to sell me on MORE DEBT.
The second interview went much better and she was a lovely woman, although her rates were triple what the first advisor’s were. I did not feel confident that I would receive a $2,500 value from any plan she could draw up after only a few hours of meetings and reviewing my statements. Mr. Cabbage seconded these sentiments and highly encouraged me to review, focus and educate myself on the plan section by section and and to do my own checks and balances.
Components of a financial plan:
- Goals & objectives
- Income tax planning
- Balance sheet
- Issues & problems
- Risk management & insurance
- Retirement, education & special needs
- Cash flow statement
- Investment planning
- Estate planning
- Implementation plan
Key questions to answer:
- What rate of return risk do I need to take in order to enjoy the same standard of living in retirement that I enjoy today?
- How long will I need to work before I can afford to retire?
- How much can I afford to spend and not run out of money?
- Am I saving enough to reach my retirement income goals?
So there are the 12 sections to review followed by answering four key questions.
I’ll try to cover each of these in upcoming posts, so stay tuned!
Tell me: Are you a DIY planner with your finances, or do you phone in an expert from time–to-time?