Frequently Asked Questions
the Fiduciary standard
+ Are you a fiduciary?
Yes, we are fiduciaries. That means we are required by law to put your interests first. We are governed by the Investment Advisors Act of 1940 and therefore the fiduciary standard.
+ Aren't all financial advisors fiduciaries?
No. In fact, most are not. Only independent Registered Invesment Advisors (RIA) are. Investment salespeople (who call themselves Financial Advisors) at large Wall Street firms are not fiduciaries. Neither are insurance salespeople (who call themselves financial advisors) at insurance companies. They are paid by their employer to make money for the firm and the firm's shareholders, not necessarily their clients. They operate under the suitability standard.
+ What's the suitabilty standard?
It means they can't sell high-risk penny stocks to grandma. But they can sell Mutual Fund ABC to a client because it pays them a bigger commission than Mutual Fund XYZ.
+ How is that different than the fiduciary standard?
A fiduciary can only recommend Mutual Fund ABC because it is better than Mutual Fund XYX. To ensure this fiduciaries are not allowed to earn comission from selling investments. We are only paid by our members.
+ How can I tell if my current advisor is a fiduciary?
All fiduciary financial advisors are required to keep a specific form updated annually called an ADV Part 2. If your advisor is a fiduciary, then are required to provided you an updated copy annually. If they do not have an ADV Part 2, then they are not a fiduciary.
+ Do I have to give you my money to work with you?
No. If you have an investment gal you love, keep em. If you love Betterment or Wealthfront, keep it. If you want us to manage your money, we can and will (and for only a 0.25% annual fee). Most of our members like to keep it all in-house, but that's entirely up to you.
The one caveat - your money must be managed in a way that will give reliable, predictable returns over the long-term. That means a well-allocated, diversified portfolio of index funds (not stocks). During the financial planning process, we'll analyze it for you and let you know how it looks.
+ If I do give you my money, how would you invest it?
Our members' portfolios are invested in well diversified, low-cost index funds. They have no transaction fees and charge the lowest expense ratios available (0.05% - 0.1%). We have 6 different portfolio models ranging from conservative to aggressive and we determine which one is right for you based on your risk assessment.
+ What's a risk assessment?
We use cutting edge technology to determine your risk tolerance which determines how your long-term money (retirement accounts, college savings, etc.) should be invested. Click here to check it out!
+ Is my money safe?
Safer than hiding it under your mattress. Charles Schwab is our custodian. That means any members we manage money for have accounts with Charles Schwab. Charles Schwab is a member of SIPC and FDIC which are sort of like insurers for your investments and cash.
+ Do you work for Charles Schwab?
No, we (and therefore you) are clients of Charles Schwab.
How we’re paid
+ What does "fee-only" mean?
Fee-only means that we are only paid by our members in the form of subscription and investment management fees. As a firm registered with the state securities board of California, we are prohibited from collecting commissions for selling investment products or kickbacks for referring business to other professionals.
+ Why is "fee-only" good for me?
You will never need to second guess if we are recommending a course of action because it's truly in your best interest or because we are being paid a commission for recommending it.
+ What's your cancellation policy?
Members can cancel at anytime in writing with 30 days notice. We do, however, ask our new members to commit a minimum of 6 months. Our job is to get you in the best financial shape of your life and it's not possible to accomplish that in less than 6 months.
Do you know what you’re doing?
+ How much experience do you have?
Rick graduated with a finance degree from the University of Texas at Austin in 1998. He began his financial career as an investment banking financial analyst at CIBC World Markets. He started his financial planning practice at Wachovia Securities in 2008.
He has also achieved his credientials as a Certified Financial Planner and a Chartered Retirement Planning Counselor.
He's helped over 100 families achieve financial freedom.
+ What is Certified Financial Planner?
A Certified Financial Planner is the most highly respected designation you can attain as a financial planner. To earn the credentials, you are required to take the equivalent of 3 semseters of graduate level course work covering all subject areas of personal financial planning including investments, estates & trusts, insurance, tax and college planning. After completing the education component you are then required to sit for an 8 hour examination. To maintain your crediential you are required to complete 16 hours of continuing education each year.
Suffice to say, if you're working with a CFP professional, you're working with someone who knows what they're doing.
+ What areas do you help with?
We help with every aspect of your financial health. Some are on your radar, some are probably not. Check out all the planning services included in your Financial Boot Camp
+ Do you sell insurance?
We do not sell insurance. However, as part of your new member onboarding we review your insurance portfolio to make sure you have the right policies and not too much or too little. That includes the big 4:
1) home & auto
+ Will you do my taxes?
No, we do not complete our members' tax returns. However, we do help with tax planning (i.e. strategies to reduce your taxes). And we also know some great tax professionals who can complete your taxes for you.
+ Do you do my estate plan?
No, an estate attorney will complete your estate plan. However, we help our members think through the most important estate planning decisions. Then we loop in an estate planning attorney to draft the documents and make it all official. We also know some great estate planning attorneys we work with regularly.
+ What kind of technology do you use?
We are able to provide Ritz Carlton service for Netflix pricing because we leverage so much technology.
We utilize a CRM, trading and performance reporting technology, risk assessment technology, and a financial planning and client portal.