In today's complex financial landscape, planning for retirement, managing wealth, or navigating the intricacies of running a small business can be challenging. It's crucial to have a trusted advisor who can guide you through these financial decisions, ensuring your best interests are always prioritized. 

This is where a fee-only Certified Financial Planner (CFP) becomes invaluable. Let’s explore the benefits of working with a fee-only CFP and how they can help you achieve your financial goals with confidence.

1. Fiduciary Duty and Putting Clients First 

Firstly, it is important to understand exactly what fiduciary duty means, and why it is a benefit to working with a fee-only CFP. Fiduciary duty refers to the legal and ethical obligation for someone like a CFP to prioritize their client’s best interest above their own. The CFP should act with integrity, and exercise skill and care in their recommendations. 

One of the primary advantages of working with a fee-only CFP is their fiduciary duty to their clients. Unlike commission-based advisors, fee-only CFPs are legally obligated to act in their clients' best interests at all times. 

This means they must provide unbiased advice, recommend suitable strategies, and disclose any potential conflicts of interest. By working with a fee-only CFP, you can be confident that their recommendations are aligned with your goals, not driven by commissions or sales incentives.

Ultimately, the fiduciary duty ensures that the customer can trust that the CFP is acting in their best interests and providing advice that is suitable and beneficial for their financial well-being.

2. Comprehensive Financial Planning 

A fee-only CFP takes a holistic approach to financial planning. They consider all aspects of your financial life, including retirement planning, small business needs, and wealth management - all of which are areas of specialty offered at Outside the Box Financial Planning. 

By analyzing your current financial situation, understanding your long-term goals, and evaluating potential risks, they can create a personalized financial roadmap tailored to your unique circumstances.

There is never a bad time to start planning for your financial future. At Outside the Box Financial Planning, we work with you and your individual circumstances to create a comprehensive plan - whether you are starting a family and wanting to protect your nest egg, getting ready to send your kids off to college, thinking about starting a small business, and everything in between - we are here to help you make the best financial decisions to ensure your success in all of your endeavors.

So whether you are planning for retirement, starting a small business, or seeking to grow your wealth, a fee-only CFP can help you develop a comprehensive plan. They will assist you in establishing realistic goals, identifying tax-efficient strategies, and ensuring your investments are diversified to manage risk effectively.

3. Objective and Unbiased Advice 

Outside of their fiduciary duty, since fee-only CFPs don't earn commissions or sales-based compensation, their advice remains objective and unbiased. 

They focus solely on providing you with the most suitable recommendations based on your financial objectives and risk tolerance. This eliminates potential conflicts of interest and ensures that the advice you receive is aligned with your best interests and will help you to reach your financial goals. 

By working with a fee-only CFP, you gain access to their expertise, knowledge, and experience. They can analyze complex financial products and market trends, helping you make informed decisions. 

Additionally, they can provide guidance on optimizing your investment portfolio, managing debt, and minimizing taxes, enabling you to achieve long-term financial success. At OTBFP, our main goal is to help you to maximize your wealth with little effort on your part. 

4. Transparent and Understandable Fee Structure 

Fee-only CFPs are transparent about their compensation structure, which typically involves a flat fee, hourly rate, or a percentage of assets under management. 

This transparent fee structure allows you to understand the cost of their services upfront, without any hidden charges or commissions. Furthermore, it aligns their interests with yours, as their compensation is not tied to specific products or transactions.

Working with a fee-only CFP ensures that you receive value for your money. They prioritize building long-term relationships with clients and focus on providing ongoing support and guidance. This commitment to transparency fosters trust, allowing you to have open discussions about your financial goals and concerns.

At OTBFP, we offer flat rate pricing for our services with absolutely zero hidden fees or charges. Because our job is to help you manage your finances responsibly, we want you to get the most bang for your buck! 

5. Ongoing Monitoring and Adjustments

Financial planning is not a one-time event; it's an ongoing process that requires periodic review and adjustments. Fee-only CFPs recognize this and provide ongoing monitoring and support to help you stay on track.

If you’re not quite sure where to start in assessing your finances, Outside the Box Financial Planning offers to develop a one-time Comprehensive Financial Plan for yourself and your family. We will work with you for 8-12 weeks, depending on your needs to cover all the major topics. 

Oftentimes, after the development of the Comprehensive Financial Plan, many clients choose to retain our services for the implementation of every aspect of the plan, as well as for ongoing support and revisions. The truth is, your finances can be an ever-changing area of life and OTBFP is there to offer support at any time. 

As your life circumstances change, your financial plan may need to be adjusted. A fee-only CFP can help you navigate major life events such as marriage, a child entering college, or the sale of a business. They will reassess your goals, update your financial plan, and ensure that it remains aligned with your evolving needs.

Conclusion 

In summary, partnering with Outside The Box Financial Planning offers numerous benefits for individuals seeking retirement planning, small business support, wealth management, and beyond.  With their fiduciary duty, comprehensive approach, unbiased advice, transparent fee structure, and ongoing support, OTBFP act as a trusted advisor who prioritizes your best interests. Click here to schedule a complimentary “Fit” meeting to determine if we would make a good mutual fit.

Remember, financial decisions have long-lasting implications, and working with a professional can provide the expertise and guidance necessary to make informed choices that align with your financial aspirations. 

However, if you would like to take a shot at building a financial plan on your own, we offer our financial planning software, RightCatital, free of charge. Click here to get started.

Many large companies offer employees a 401(k) plan with some degree of matching contribution. Although this is a good employee benefit to have, you always should pay attention to the fees involved in your plan. Your plan provider charges various fees to invest, manage and administer the plan, and those fees are passed on to the participants who invest.

The Center for Retirement Research at Boston College reports that, in recent years, the fees charged by actively managed mutual funds — including those in 401(k) plans — have dropped. Since 2015, the average fee dropped from 0.78 percent to 0.75 percent. Around 15 years ago, fees averaged about 1 percent. However, fees for passively managed index mutual funds, generally referred to as index funds, average significantly less at 0.17 percent. Index funds passively track the investments of a specific market index; there is no manager actively choosing investments for the fund on a day-to-day basis.1

If you have a 401(k) plan through a current or former employer, I’d happy to help you determine what you are paying in fees and help you assess your financial situation. In many cases, the more investors learn about fees, the more they start choosing investments that cost less. The Center for Retirement Research suggests this by sharing that U.S. investors withdrew $627 billion from actively managed funds that charged the highest fees and invested $429 billion into lower-fee index funds in 2015 and 2016.2

The Department of Labor’s fiduciary rule, which took partial effect in June, has made it easier for investors to know what they are paying for by requiring the disclosure of all fees and commissions. This information must be in dollar form.3 In addition, FINRA, a self-regulatory organization that regulates broker-dealers in the United States, offers a Fund Analyzer tool on its website that can help investors estimate the impact of fees and expenses on an investment and research applicable fees and available discounts for specific funds.4

Are fees really that important? It can depend. If you are paying a money management firm to select investments and it does a great job of providing consistent performance over time, it may be worth what you pay in fees. But it may also be worth considering how your investments compare with the overall market. For example, over the past three years, the S&P 500 has increased by 26 percent (as of mid-June 2017).5 If you were invested in a low-expense S&P 500 index fund, you would have experienced impressive returns. But if you had been paying a high fee for an active manager yielding the same performance, it may not have been worth the expense.

Speaking of fees, be aware that the IRS permits investors to deduct certain expenses incurred on taxable investments, such as:

• Fees for investment counsel, including subscriptions to financial publications
• IRA or Keogh custodial fees (if paid by cash outside the account)
• Transportation to your broker’s or investment advisor’s office
• Safety deposit box rent if you use it to store certificates or investment-related paperwork

If you have a 401(k) plan through a current or former employer and would like help determining what you are paying in fees, I’m happy to help you assess your financial situation. Using a variety of investments, I can create a financial strategy that can help put you on the path toward your financial goals.

Content prepared by Kara Stefan Communications.

1 Center for Retirement Research at Boston College. June 29, 2017. “Mutual Fund Fees: Here’s What Matters.” http://squaredawayblog.bc.edu/squared-away/mutual-fund-fees-heres-what-matters/. Accessed July 5, 2017.

2 Ibid.

3 Investopedia. July 5, 2017. “DOL Fiduciary Rule Explained as of July 5th, 2017.” http://www.investopedia.com/updates/dol-fiduciary-rule/. Accessed July 13, 2017.

4 FINRA. “Fund Analyzer.” http://apps.finra.org/fundanalyzer/1/fa.aspx. Accessed July 5, 2017.

5 Dayana Yochim. Atlanta Journal Constitution. July 5, 2017. “This May Be Why You’re Down in an Up Market.” http://www.ajc.com/business/consumer-advice/this-may-why-you-down-market/hQWTwwUWlBhEKX8tJoyNHL/. Accessed July 5, 2017.

6 Rande Spiegelman. Charles Schwab. March 15, 2017. “Investment Expenses: What’s Tax Deductible?” http://www.schwab.com/insights/taxes/investment-expenses-whats-tax-deductible. Accessed July 5, 2017.

Neither the firm nor its agents or representatives may give tax advice. Be sure to speak with a qualified professional about your unique situation.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.
 

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