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Financial Advisor? CPA? What to do for parents?

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  • jfoxcpacfp
    replied
    Originally posted by Tim View Post

    Very reasonable to have a "check-up". Actually a "check-up" including the whole plan even if he thinks he knows what needs to be done. The question is would they handle the execution of the consolidation? I am not sure this is available on a one shot basis if that is what he is actually wanting. That is the reason for suggesting a CPA service on a loan staff basis. Do any planners actually offer the loan staff? I do not know but it seems unlikely. This is not a criticism by any means, the FP seems to be in the business of loaned staff is my understanding. Just doing the work because it is so interrelated.
    Well, our perspectives will just have to differ, I suppose. Perhaps if you could see it from the inside of how our offices work, it would help (maybe that's an idea for a series on our blog, if I ever get time to write again A Day in the Life Of... - could make a good substitute for Ambien, I guess).

    Anyway, a checkup involves implementation after review and discussion of the goals, perspectives, situation, resources of the client. I think it could be very well suited to this situation. However, as with all prospective clients, I would want to have an initial consult to determine the fit and would have no hesitation in telling them if we would not be able to accomplish what they were hoping to accomplish. I would hope any other fiduciary planner, especially promoted on the WCI site, would do the same.

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  • Tim
    replied
    Originally posted by jfoxcpacfp View Post

    Point WELL TAKEN on the popups - I just read your message and told Michelle to take them down, as they no longer benefit us or anyone else. They have annoyed the h3ll out of me, too, but just never got around to doing anything about it, so TY for the "gentle" nudge!

    In this case, I would recommend a Financial Checkup for the parents and it could be tailored to their needs - I cannot think of any client who has gone through this who has not expressed that it was a good value. I also have yet to see a client situation limited to only one issue because so many other areas are impacted. Another thought is that they might want to use an hourly fee-only planner. Garrett Planning Network is a great place to start. I don't know if they have advisors who are doctor-focused but that wouldn't be an issue in this situation.
    Very reasonable to have a "check-up". Actually a "check-up" including the whole plan even if he thinks he knows what needs to be done. The question is would they handle the execution of the consolidation? I am not sure this is available on a one shot basis if that is what he is actually wanting. That is the reason for suggesting a CPA service on a loan staff basis. Do any planners actually offer the loan staff? I do not know but it seems unlikely. This is not a criticism by any means, the FP seems to be in the business of loaned staff is my understanding. Just doing the work because it is so interrelated.

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  • jfoxcpacfp
    replied
    Originally posted by Tim View Post

    Would your FP practice take this on? Or is the requirement to purchase the whole package? You have a business model and are free to offer a bundled package.
    By the way, the popup signup for the "emergency financial kit" makes foxwealthmgmt.com unusable. Blocks the left side of the screen and can't be closed. Constructive suggestion only. Just to point out, I don't think student loans ad value and the task seems to involve very little insurance advice. A la carte would be helpful, but that is between you and your potential clients. Consoliation of accounts was the service being requested.
    You are "full service" or I might misunderstand.
    Point WELL TAKEN on the popups - I just read your message and told Michelle to take them down, as they no longer benefit us or anyone else. They have annoyed the h3ll out of me, too, but just never got around to doing anything about it, so TY for the "gentle" nudge!

    In this case, I would recommend a Financial Checkup for the parents and it could be tailored to their needs - I cannot think of any client who has gone through this who has not expressed that it was a good value. I also have yet to see a client situation limited to only one issue because so many other areas are impacted. Another thought is that they might want to use an hourly fee-only planner. Garrett Planning Network is a great place to start. I don't know if they have advisors who are doctor-focused but that wouldn't be an issue in this situation.

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  • Tim
    replied
    Originally posted by jfoxcpacfp View Post

    Both FAs and CPAs offer professional services and have administrative support staff. It is important to understand what each type of advisor offers. For ex, our OM on the FP side has been trained to open, close, and consolidate accounts and handle related paperwork. One of our paraplanners is a QSLP (Qualified Student Loan Planner), trained to help with paperwork and decisions for clients who have SL’s. Our OM came to us with 18 yrs working in insurance and understands how to review and advise on ins policies. These qualities are by plan, not accident, and fit very well with financial planning. Other than what I mentioned above, we d/n/h equivalent advisors on the CPA side - this is not what we hire bookkeepers do to. I certainly don’t refer to our employees as worker bees.

    Perhaps our setup is unusual, I don’t know. Everyone here, on both sides, is a valued team member working toward the same goal - happy clients who are both respectful and respected.
    Would your FP practice take this on? Or is the requirement to purchase the whole package? You have a business model and are free to offer a bundled package.
    By the way, the popup signup for the "emergency financial kit" makes foxwealthmgmt.com unusable. Blocks the left side of the screen and can't be closed. Constructive suggestion only. Just to point out, I don't think student loans ad value and the task seems to involve very little insurance advice. A la carte would be helpful, but that is between you and your potential clients. Consoliation of accounts was the service being requested.
    You are "full service" or I might misunderstand.

    Leave a comment:


  • jfoxcpacfp
    replied
    Originally posted by Tim View Post

    What were the services he was requesting? Filling out forms and making calls. He said he knew what to do and needed "staff to do it". Now he needs an attorney?
    He said he knew exactly what he needed to be done, did not have time. "Loan staff" is a service many CPA firms will provide. Hourly rates. The staff can work at the client or in the office. He was talking about paperwork to consolidate accounts, much similar to bookkeeping. 25 accounts trimmed down to five. It is a project to be staffed with a very small manpower requirement. I would he can sign 25 forms in 30 minutes and be done. What is the work he wants to get done? It was not FP or FA or tax.
    Trusted manpower to do the work of getting the paperwork done. Maybe a FP would do the same. From experience it gets very expensive to pay professional fees for administrative work. Read the quote I copied, he is looking for trusted administrative support not professional services. I don't think it is wise to abdicate if he knows what he wants.
    Both FAs and CPAs offer professional services and have administrative support staff. It is important to understand what each type of advisor offers. For ex, our OM on the FP side has been trained to open, close, and consolidate accounts and handle related paperwork. One of our paraplanners is a QSLP (Qualified Student Loan Planner), trained to help with paperwork and decisions for clients who have SL’s. Our OM came to us with 18 yrs working in insurance and understands how to review and advise on ins policies. These qualities are by plan, not accident, and fit very well with financial planning. Other than what I mentioned above, we d/n/h equivalent advisors on the CPA side - this is not what we hire bookkeepers do to. I certainly don’t refer to our employees as worker bees.

    Perhaps our setup is unusual, I don’t know. Everyone here, on both sides, is a valued team member working toward the same goal - happy clients who are both respectful and respected.

    Leave a comment:


  • Tim
    replied
    Originally posted by jfoxcpacfp View Post

    Tbh, unless you are talking about bookkeeping, payroll, IRS communications, etc, our FAs do far more hands on assisting than do the CPA side. When it comes to analyzing, comparing, and making recommendations on investments, reviewing ins policies, etc., those services are 100% in the FA realm. Maybe I’m misunderstanding what you are saying - perhaps you could give an example of what you expect from a CPA?

    As for POAs, we have a POA with the IRS (and some state goat’s) on file for every client. This gives us permission to speak with the agencies on the client’s behalf. This is different from the POA prepared by your attorney giving a financial power of attorney to an individual or institution.
    What were the services he was requesting? Filling out forms and making calls. He said he knew what to do and needed "staff to do it". Now he needs an attorney?
    He said he knew exactly what he needed to be done, did not have time. "Loan staff" is a service many CPA firms will provide. Hourly rates. The staff can work at the client or in the office. He was talking about paperwork to consolidate accounts, much similar to bookkeeping. 25 accounts trimmed down to five. It is a project to be staffed with a very small manpower requirement. I would he can sign 25 forms in 30 minutes and be done. What is the work he wants to get done? It was not FP or FA or tax.
    Trusted manpower to do the work of getting the paperwork done. Maybe a FP would do the same. From experience it gets very expensive to pay professional fees for administrative work. Read the quote I copied, he is looking for trusted administrative support not professional services. I don't think it is wise to abdicate if he knows what he wants.

    Leave a comment:


  • jfoxcpacfp
    replied
    Originally posted by Tim View Post
    A CPA firm can provide a "loaned staff" to actually do the legwork. Would not suggest you give POA. You don't want advice, you want trusted "worker bees".
    Any FP or any FA is not interested in being a worker bee. A clear outline of the work required and the CPA might provide you with the manpower.
    You simply sign the forms.
    Tbh, unless you are talking about bookkeeping, payroll, IRS communications, etc, our FAs do far more hands on assisting than do the CPA side. When it comes to analyzing, comparing, and making recommendations on investments, reviewing ins policies, etc., those services are 100% in the FA realm. Maybe I’m misunderstanding what you are saying - perhaps you could give an example of what you expect from a CPA?

    As for POAs, we have a POA with the IRS (and some state goat’s) on file for every client. This gives us permission to speak with the agencies on the client’s behalf. This is different from the POA prepared by your attorney giving a financial power of attorney to an individual or institution.

    Leave a comment:


  • Tim
    replied
    Just to clarify: "(I know what to do with them) or can they actually open and close accounts on behalf of a customer (what I actually need)? Sorry, I have absolutely no clue of the scope of practice for financial advisors, CPA's, insurance sales folks since I've done my own taxes since and investing since college."

    A CPA firm can provide a "loaned staff" to actually do the legwork. Would not suggest you give POA. You don't want advice, you want trusted "worker bees".
    Any FP or any FA is not interested in being a worker bee. A clear outline of the work required and the CPA might provide you with the manpower.
    You simply sign the forms.

    Even delegation or outsourcing is a management function. You need to communicate and not abdicate. The work can be done by others. Sign the papers as needed.

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  • Hatton
    replied
    Originally posted by jfoxcpacfp View Post
    As the above posters have suggested, I’d suggest an independent, experienced third party FA to review, analyze, and advise on a plan of action for your parents. This can be a one-time (series of meetings, aka Financial Checkup) engagement and/or ongoing planning if you prefer to step back and turn their advice over to a trusted advisor. You can also join and participate in meetings to ask questions and be involved in the decisions.

    You can also hire an hourly advisor to review, analyze, and advise if you want to then take over the project. Results will vary in either situation, particularly if you are very cost-sensitive. You’ll likely get a broader scope of information regarding tangential issues with the flat fee and lower costs (depending) on the hourly service focused on a single issue.

    A CPA is not likely to be as helpful in this situation, as they have a more singular focus on taxes that result from the options your parents may choose rather than understanding and advising on the implications of the options open to them. Iow, CPAs tend to focus on what has happened and financial planners tend to focus on what will/may happen. Both are extremely important in the right situation. You just need to understand their purpose and your needs and make sure they are aligned.
    I just read this comment and it is good. I find that my CPA is not focused on the future but the past is a good way to put it.

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  • Hatton
    replied
    I would think a fiduciary FP could help you or a trusted CPA. An annuity might not be a bad thing at his stage it is all in the details. You sound busy. Someone less busy in the family? It might help to link all his stuff somewhere like personal capital to make it easier to track.. You could post more details here for better advice.

    Leave a comment:


  • jfoxcpacfp
    replied
    As the above posters have suggested, I’d suggest an independent, experienced third party FA to review, analyze, and advise on a plan of action for your parents. This can be a one-time (series of meetings, aka Financial Checkup) engagement and/or ongoing planning if you prefer to step back and turn their advice over to a trusted advisor. You can also join and participate in meetings to ask questions and be involved in the decisions.

    You can also hire an hourly advisor to review, analyze, and advise if you want to then take over the project. Results will vary in either situation, particularly if you are very cost-sensitive. You’ll likely get a broader scope of information regarding tangential issues with the flat fee and lower costs (depending) on the hourly service focused on a single issue.

    A CPA is not likely to be as helpful in this situation, as they have a more singular focus on taxes that result from the options your parents may choose rather than understanding and advising on the implications of the options open to them. Iow, CPAs tend to focus on what has happened and financial planners tend to focus on what will/may happen. Both are extremely important in the right situation. You just need to understand their purpose and your needs and make sure they are aligned.

    Leave a comment:


  • Tim
    replied
    +100
    Opening new accounts is not difficult.
    It sounds like frustration is with the DI.
    You want transition help. Hire that.

    Once it is complete, are you going to be comfortable managing the “new streamlined” structure?
    Before doing anything, you need a list of all the assets, a starting point. No one else can do this.
    I would suggest your goal is getting the plan, then having a CPA review and getting the forms or contacts ready for signature, the legwork.

    The POA (even limited) is signature authority. That is the risk that you/Dad can sign. I think you have two projects:
    • Consolidation
    • Ongoing management
    Your frustration is from the DI crap. If you know what to do, it sounds like you need administrative support rather than professional support. A CPA firm will provide that at a lower rate as well. You don’t have staff, the CPA does.
    You say you know what to do with them. My guess is you don’t have the forms or have time to make the calls. That is not hiring a FP or an FA, that is hiring administrative support. A whole lot cheaper. Slow down. It doesn’t take long to sign a form.

    Big benefit is much easier and cheaper than an estate attorney. I would suggest you get yourself signature authority on all the brokerage and bank accounts. Not possible on 401k’s, insurance, annuities etc. For those the beneficiaries need to be checked.

    Larry points out an important point, consider what is in your Dad’s best interest in this effort to simplify. You can hire administrative help a lot cheaper through a CPA than and ongoing FA.

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  • Larry Ragman
    replied
    There are reputable financial planners that will consolidate your father’s various accounts under their management. In my area they charge on a sliding scale that averages ~1% of the assets under management. It is a bit more for lower amounts, and a bit less for larger amounts. (And it is possible to negotiate a discount if they are using fund families that already have a management fee in the expense ratio, but this requires you to pay attention to the fund structures.) might be worth it if your father is unable to manage the accounts and you don’t have time.

    Words of caution: 1) Vet the prospective companies thoroughly, especially if granting limited power of attorney; 2) there will very likely be costs (e.g., surrender fees) associated with the consolidation you are seeking, so be sure the value of simplification is worth it; 3) you are not going to get out of this without some time commitment. If I were you I’d insist on a session upfront to understand the plan, and quarterly reviews at least until the accounts were all transferred and stabilized.

    Another way to do this, and the one I prefer but may take more of your time, is to hire a planner by the hour to review the accounts and recommend a comprehensive plan both for consolidation and subsequent withdrawals. Ideally your financial planner will work hand in hand with a CPA to minimize tax implications as well. Some planners are also CPAs, or have one that works with them. I’d look for that situation. Anyway, my guess is this will cost you ~3-5k.

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  • DLSQ
    started a topic Financial Advisor? CPA? What to do for parents?

    Financial Advisor? CPA? What to do for parents?

    Hi all - I just have a quick question regarding the extent of control financial advisors, CPA's etc., have with actual accounts. My father transitioned to long-term disability several months ago, and I have *just* recently finished a fax war with the DI company to make sure his monthly payment is correct. He has a significant amount in scattered pensions, 401k, annuities, unused taxable accounts that were for education, etc.

    I recently went over all of these with him in hopes of consolidating and getting out of some of the scammier sounding ones (I think there's a whole life or annuity of some sort thrown in there), but after my battle with the DI company, I'm not sure I can stomach consolidating all of his retirement assets into a streamlined asset plan. Since I've been on this site since medical school, I literally only have a 401k, Roth IRA, and brokerage account (all through Vanguard!) and don't have to deal with all of this nonsense. However, I feel terrible leaving him in this position and I will gladly pay someone to do all of this work since I am also very busy.

    Do financial planners only tell you what to actually do with these accounts (I know what to do with them) or can they actually open and close accounts on behalf of a customer (what I actually need)? Sorry, I have absolutely no clue of the scope of practice for financial advisors, CPA's, insurance sales folks since I've done my own taxes since and investing since college.

    Thank you!
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