Common Questions Q. Are you a fiduciary? Yes. All Certified Financial Planners ™ that are engaged in the practice of financial planning are held to the fiduciary standard. This is a very important point as many people in the industry are not fiduciaries and are not held to the fiduciary standard. The fiduciary standard is the highest standard of care. Conflicts of interest between advisor and client are avoided or if they cannot be avoided, disclosed in writing. Others are held to the suitability standard which means from a legal perspective that their guidance must be suitable. Here is a link to the CFP® web site for more information: CFP Board Fiduciary DutyQ. How many years of financial knowledge do you have? I have been in financial services continuously since 1993. Q. What is your educational background? I have a B.S. in Business Administration from the University of Colorado Boulder December, 1992. I have a M.S. in Personal Financial Planning from the College for Financial Planning May, 2011. Both are accredited universities. Q. Do you have any disclosures or a criminal record? No disclosures, no criminal record.Q. How are you compensated for your services? I am primarily a fee based planner. I work with clients in a few ways:Plan only: If the client is interested in a financial plan, I will provide a financial plan for a cost of $2500. This will include as applicable goal identification and prioritization, budget analysis, Social Security maximization, pension maximization, current investment allocation, suggested investment allocation, analysis of stock options and restricted stock, college planning, Monte Carlo analysis to determine if you are on track for meeting your goals, strategy recommendations, estate planning strategy, debt analysis, and insurance needs analysis.Portfolio Management: Includes a financial plan and the cost of the plan is waived. If the client is looking for ongoing help with the management of their assets I can manage the accounts and do all trading for them. For this, I charge a percentage of assets, generally 1%. I typically reduce the fee to .7% for assets over $1 million. I reduce the fee further to .5% for assets over $2 million. When acting in this capacity, the account will need to be transferred to Pershing/Bank of New York Mellon.Portfolio Consulting: Includes a financial plan and the cost of the plan is waived. With a consulting agreement I charge a flat fee for guiding the client. With a consulting agreement, the client is placing their own trades and holds the account at a firm they choose. I will provide ongoing portfolio recommendations for what to buy and when and what to sell and when. The client can choose whether or not to implement my recommendations.Q. How much will be deducted from my account on an annual basis? Let me give an example. If your investable assets were $1,000,000 and I was charging you .7%, the total amount being deducted from your accounts annually would be $7,000. If I’m doing the trading for you and acting with discretion, the fee is paid quarterly in advance, and if we’re on a consulting agreement where you do your own trading at your own brokerage firm, the fee comes out in arrears. As an example, if I’m doing the trading for you and the account is held at Pershing/Bank of New York Mellon the quarterly fee would be $1,750 ($7,000/4=$1,750) and this fee is taken out at the beginning of each calendar quarter approximately 2 weeks after the quarter begins. If we start working together in the middle of a quarter, the first quarter would be prorated for the number of days I was helping you. Please be aware that I do everything in my power to keep your expenses low. I typically use no- load, index based, Exchange Traded Funds which typically have very low costs. For example, say a client is currently paying .8% for a no-load no-transaction fee mutual fund. I begin helping this client diversify their portfolio using index based no-load exchange traded funds with an average cost of .2% and I charge them 1% for my services. In this case, they were paying .8% for the mutual fund and self management and they are now paying 1.2% all-in for an incremental cost of just .4%. Q. What services and written reports will you provide? I always start with a full financial plan. The plan is something I put together with you over our first two meetings and I don’t charge for this assuming I will be managing your portfolio for you. I will of course send you the full plan electronically. If I’m doing the day to day management for you (not a consulting agreement) we would transfer your investment accounts to Pershing/Bank of New York Mellon. Assuming you had $1 million the fee would be $1,750 per quarter payable at the beginning of each quarter. I would provide all of the service, management, and trading for your accounts. So if you have any questions or service needs on the account you would call me. This would include any service item such as sending a wire, changing a beneficiary, or requesting a duplicate statement. You will receive statements from Pershing monthly in the mail or electronic your choice. Pershing also has quarterly performance reporting that provides a complete breakdown of your specific account level performance. My goal is to work with a small number of clients and provide customized management and high quality service. Q. Please document your credentials, ethics, and business practices in writing. Credentials: I am a CFP® and have a Master’s of Science in Personal Financial Planning. I am held to the highest ethical standard which means I must exemplify principles of integrity, objectivity, competence, fairness, confidentiality, professionalism, and diligence. My process is to get to know you and you to know me, gather information about your situation including facts hopes and fears, analyze where you are today and where you should be, then make recommendations as to how we can improve your financial situation. From there I will help you implement the solutions we agree on and monitor and update them on an ongoing basis. Q. Can you continue to work with me out of my home? Yes, many of my client meetings are at the client’s office or residence. Q. I have an annuity. If I work with your firm, who will handle the paperwork for the annuity? I will need to take a close look at the annuity before we decide what to do with it. Some questions I would ask you are: Which carrier actually holds the annuity (Met life, Pacific Life, etc)? When was the annuity opened? Does it have any surrender charges if you moved the money out? How much does it cost? What benefits does it provide to you? There are many different kinds of annuities. I generally try to avoid any surrender charges. If we worked together, usually I can be listed as your agent of record if we decide to keep what you have. Also, I should point out that annuities are usually commission based and if so I would not be charging a fee on top of it. Q. I have retirement and non-retirement accounts. Will these accounts be transferred to your firm? Most likely, yes if I am managing the account for you on a discretionary basis. The firm I use is Pershing/Bank of New York Mellon. If we utilize portfolio consulting, you can hold your assets at a firm of your choice. Q. How do you transfer my accounts to your firm? There are forms (known in the industry as ACAT forms) that I would provide to make the transfer. The forms, along with a copy of your most recent statement for each account, are sent to my firm for processing. Our operations processing group contacts your prior firm directly and pulls the accounts from your prior firm to Pershing. The process generally takes about one week and no trading can occur during this week long period. Your prior firm can either sell the investments and send the cash proceeds or move the shares to Pershing without selling anything. The election to sell or move shares is made on the ACAT form. If we choose to sell, we would want to look closely at any tax consequences and trading costs before we make that decision. There is sometimes a closeout fee to close the prior firm accounts which you should be aware of. The industry standard is usually a $50 per account close out fee but they may be higher or lower than the standard. I would of course help you with this process to make it as smooth and easy as possible. Q. Why should I use you as my financial advisor? I think people pick me as their advisor because they want someone they like and trust. As a fiduciary, I am required to have your interests above my own. I have the experience and technical knowledge to help you with almost any aspect of your personal financial needs having worked with retail investors just like you for the last 22 years. From a credentials standpoint, I think the CFP® and M.S. in Personal Financial Planning separate me from many of my peers. My ultimate goal is to help you maintain your standard of living while keeping you safe from risks you will face including market risk, inflation, health care expenses, and withdrawal rate. Q. Do you have training in financial planning? Yes. In a prior role, before going independent, I advised the advisors when they found themselves in a planning scenario that was complicated such as maximizing Social Security, creating lifetime income, concerns with estate planning, stock options, or large family wealth. This gave me an opportunity to see many really interesting planning scenarios and I can of course bring this experience with me as I help you. Q. Who is my typical client? I have a small number of clients currently, some are families in the accumulation phase and some are already retired and taking income from their investments. Average assets per client is around $300,000. Q. Will anyone else be working with me? No, not that I foresee. I am a sole practitioner. I do have backup office support in the event I am unavailable. Q. Do you have discretion to act without my approval? Some clients grant me this authority, yes. Other clients don’t like this and prefer that I get their permission before each trade or give them specific instructions of what to do and when so for those clients the answer would be no. Either is an option. Q. Do you have or have you had any unhappy clients? I have no customer complaints on my record and this can be verified on FINRA's broker check: FINRA Broker Check. That said, I hope that clients feel comfortable enough to tell me if something isn’t working for them. For example, if a client tells me that they feel there were too many positions in the account and wonder if we could consolidate them without hurting returns, making this kind of adjustment is really very easy as long as we are in close communication. Q. How often will I hear from you and what will prompt your calls? How often do you re-evaluate or change my portfolio? Under what conditions would you change my portfolio? I find clients have different preferences here but generally I talk to each client about once a quarter about one thing or another. Perhaps it is a change I made to the portfolio or a question they have about their financial plan, or a trade we need to discuss. I prefer to have a quarterly review call to check in and make sure we are progressing nicely. I want to have a formal review of the full financial plan annually. However, some clients really don’t want to talk about this much so I acquiesce to client preference. Portfolio changes will happen as market conditions warrant. Each portfolio is unique and slightly different but expect a few trades each quarter. Q. If you are a Registered Investment Advisor, may I have a copy of your form ADV part II? Certainly! I am required to send it to you if we work together. Q. Do you or your company have a vested interest in any financial products and are you required to sell them even if they do not meet my personal needs? Good question and the answer is a definite no. This is why I prefer a fee based approach. If I charge you a fee I have a sustainable business model and can focus on the investments that I believe are in your best interest. I try to avoid commission based products (except insurance when it is in the client’s interest such as term life insurance or long-term care). Q. Do you have an investment philosophy and if so what is it? Yes. I believe in a tactual version of Modern Portfolio Theory. This involves a diversified portfolio of index-based funds. I will start with a basic asset allocation (which is a mix of stocks, bonds, cash, and alternatives) that is appropriate for your risk tolerance, income needs, and time frame. I use a questionnaire and my knowledge of your full situation to determine this. Next I further diversify using a sub-asset allocation model dividing stocks into large, medium, and small companies, value and growth styles, foreign and domestic, short, medium, and long term bonds. Finally, I will try to overweight areas currently doing better and underweight areas doing worse. I will also take your tax situation into account with qualified accounts using strategies such as tax loss harvesting or holding positions with low basis and building the remaining portfolio around them.Q. In addition to my personal financial needs/plan, what other factors do you base your investment decisions on? Fundamentals, technical, i.e. charts, third party research? All of the above. The plan clearly comes first. I am an avid reader of both fundamental research and technical patterns as well as macro-economic factors. Q. Under what conditions, should I leave and seek services elsewhere? You would have the option of leaving at any time for any reason you see fit. There are no long term requirements. Please be aware that markets fluctuate every day and that ETF investing carries risks including the potential for loss of principal. The use of stop orders cannot eliminate the risk of loss. Investing in options carries substantial risk and may not be appropriate for some investors. Asset allocation, which is driven by complex mathematical models, should not be confused with the much simpler concept of diversification. Asset allocation cannot eliminate the risk of fluctuating prices and uncertain returns. Additional risks are associated with international investing, such as currency fluctuations, political, and economic stability, and differences in accounting standards. Rebalancing may be a taxable event. Denton Olde nor Olde Wealth Management, LLC provide tax advice. You may wish to consult your tax professional regarding your individual circumstances.