We strive to make an impact in a number of ways at Weatherly. Your financial plan is an important component and roadmap to success developed with a team of professionals. Taking into consideration your current financial situation, goals and aspirations, and using well thought out and reasonable assumptions, we seek to create an accurate evaluation of your financial plan to help you to see the big picture, while we prioritize a short list for forward progression.

It is important to have a financial plan, but sticking to it during times of volatility can be critical. Having a plan built with accurate information and conservative assumptions takes into consideration periods of volatility, and makes our clients long-term goals a priority.

Each financial plan is customized with numerous factors, and by implementing the following steps, we are able to create an extremely in-depth analysis that addresses your specific goals and needs.

1. Ask.Share. Repeat.

Weatherly’s responsibility is to consider all relevant information to our client’s respective plans and seek out any additional information that could impact that plan. By asking the important questions, sharing information with your team of professionals, and repeating this process to keep the flow of information relevant, we create a foundation for planning.

2. Dialogue for Impact

We collaborate with each client on a personal level to drill down into your financial situation to become a part of your plan. Having an initial Dialogue for Impact, we seek to identify the main considerations to include in your financial plan including, but not limited to:

• Financial statement preparation and analysis
  • Cash flow analysis and budgeting
    • mint.com is a great resource for consolidating financial accounts and creating and tracking your budget.
    • For a more simplified budgeting tool, use this chart to help understand and categorize your budget
  • Insurance planning and risk management
    • Fidelity offers a free life insurance calculator to estimate your life insurance needs.
  • Employee benefits planning
  • Investment planning
  • Income tax planning
  • Retirement planning
  • Estate planning
    • Use this worksheet for your digital estate planning where you can securely store your usernames and passwords, and location of assets.

Your goals are important to you, and we want to help you reach them. Common goals to think about and make a focus in your financial plan include:

• Emergency fund
• Pay off credit cards
• Retirement spending
• College funding
• Wedding funding
• New house purchase
• Car purchase
• Home remodel or repair
• Charitable giving
• Leave behind inheritance

By having a deep understanding of your current financial situation, a Ripple Effect naturally occurs throughout, where each aspect of your plan affects the next. As a cohesive, fluid process, your financial plan becomes the driver towards reaching your short and long-term financial and personal goals.

3. Prioritize for Progress

Once we understand your current financial picture and your most important financial and personal goals, we are able to Prioritize for Progress by reviewing and analyzing the data that has been provided to us. We review current investments and asset allocation, cash flow needs, assets and liabilities, education funding, insurance needs, tax strategies, retirement needs, estate planning, and any other relevant information you have provided.

4. Developing flexible recommendations and/or alternatives

When creating a financial plan, we want to give you options and allow for flexibility for your goals and life expectations to change and evolve. We typically create a base case as well as 2-3 alternative scenarios to show how small changes in your plan can have a large impact on the success.

• Base case: We take your current situation and project if maintaining this course of action will result in a successful plan. If assets are sufficient, what is your safety margin?
• Alternative Scenarios
  • Whether the base case scenario succeeds or illustrates a need for adjustments, we typically show how various changes in the plan can affect the outcome. Some of these scenarios are things you can control while others are simply out of your control:
    • Longer life expectancy
    • Utilize primary residence for additional equity
    • Increased/decreased living expenses
    • Additional gifting

By making these assumptions and making your financial goals a priority, we begin to build a clear picture of what your plan will look like. By adding in alternative scenarios, we go beyond your base case, and plan for potential risks that may arise during the course of your life in order to protect your primary goals and to be prepared for the unexpected.

5. Implementing recommendations and working with your team of professionals

By working with your team of professionals, including attorneys and CPA’s we can help to implement the recommendations we have made. We have discussed the importance of working with your team of trusted advisors in our previous blog post focused on estate planning and how to leverage these professionals.

Please take a moment to print and fill out Weatherly’s Client Information Release Authorization Letter – CIRAL so that we have the contact information of your team of trusted professionals on file to help coordinate the important aspects of your life.

The process that we implement when developing financial plans for our clients is central to what our client’s ultimately take from those plans. By using accurate, yet conservative assumptions and illustrating the impact that various changes can have on the success of those plans, clients should understand how their long-term goals are influenced by different factors. Our ultimate goal during the financial planning process is for our clients to feel assured that market volatility, a below-average market year, or unexpected expenses are buffered into the long-term success of their plan.

By working with our team to develop and revise your financial plan, we hope that you better understand the big picture, feel as if you have a roadmap to stay on track to help create a Ripple Effect that extends beyond your individual situation.

** The information provided should not be interpreted as a recommendation, no aspects of your individual financial situation were considered. Always consult a financial professional before implementing any strategies derived from the information above.

As Weatherly embarks on our 24th year of business, we wanted to thank our clients and colleagues who have contributed to our mutual success as a Firm and partner in the community. Since our founding, we have maintained a client base that is invigorating to work with and our team continues to create The Ripple Effect with every client we serve – our ultimate goal is to create and implement a strategy that is impactful for our clients, so they can impact their families, businesses and communities.

We welcome you to a planning model in which you can drop your stone of inquiry, and together we can explore The Ripple Effect. The real impact of our work comes from navigating the interconnected nature of life and livelihood.

Together with our clients and colleagues, we explore outliers of opportunity, solving problems and maximizing potential in unexpected ways. Conversations become a series of concentric circles – each influencing the next, impacting areas that had not appeared connected to wealth or planning.

Over the years, our client base has organically fit into three niche groups and we’ve tailored our education and services to provide dialog and expert advice that progress our clients forward. We learned through experience that the depth and relevance our of advice is directly connected to how much we learn about our clients.

The Small Business Owner

As a small business ourselves, we understand the intricacies involved in creating, maintaining and eventually implementing a successful plan and the agility associated with the planning process. We touched upon the life stages of a business in a previous blog post. We find clients in this niche have a focus on tax mitigation – you’ve created a stream of income that has grown significantly, so what type of retirement plan is right for you? Let us explore your estate plan and how it relates to your business. Do you have enough insurance coverage for you and your business? Is key man life insurance right for you? Many business owners want to transfer ownership to their successor or heirs or work part time in retirement. Have you had your business valued recently – if not, do you know how often you should?

The Working Wealthy

Many of our clients are in their peak earning years, and much like the small business owner, minimizing taxes are on their minds. We tailor our investment strategies for each client individually, creating custom portfolios that are tax and fee efficient and implementing strategies for concentrated stock positions. Individuals who have worked many years at large corporations often have stock option plans, deferred compensation plans and 401(k) allocations to consider. You’ve worked hard for your money, and we want to ensure your money is working hard for you. We work to answer the age old question “when can I retire” with confidence by creating a plan to manage longevity that is adaptable to life’s nuances. Estate planning is paramount for individuals and families in the high net worth area – we explore what estate planning tools are right for you given your assets and goals for you and your beneficiaries.

The Women in Wealth

As a Firm with a strong female presence, we have naturally fostered relationships with women in the community, including entrepreneurs, executives and women in transition through retirement, death or divorce. Estate planning is paramount for individuals and families in the high net worth area – we explore what estate planning tools are right for you given your assets and goals for your beneficiaries. We provide a “good health check-up” annually for our clients to ensure your estate plan is up to date and beneficiaries are in line to plan for life’s big events. We also encourage clients to incorporate charitable giving into their planning conversations.

The Middle Generation

We often work with clients who are in the “sandwich generation,” and are caring for aging parents and planning for the futures of their children. We enjoy working with clients at all stages and offer progress that is both robust and contiguous at all levels, incorporating the family conversation. Elder abuse is on the rise and we monitor unusual activity to help our clients spot unusual behavior that may demonstrate diminished mental capacity.

The millennial generation also has a separate set of considerations as they’re planning for their families. We encourage clients to discuss gifting strategies with us – what financial assistance can you provide to your children while allowing them to maintain independence. If you have grandchildren, does a 529 plan make sense?

How Weatherly Can Create Impact

We find ease and vitality in aligning with growth-minded people who are highly engaged in life. We foster a culture in which you actually understand your plan, and over time, you’ll find yourself navigating daily life with a peaceful sense of awareness. We want to take an inventory of the services that will derive value and Prioritize for Progress to allow you to apply your bandwidth to areas that can be most impactful given where you’re at in life.

As we share our story, we’re looking to widen our circle of people who enjoy pushing past the status quo and are forward-thinking. We welcome the opportunity to connect with you and others whose vision aligns with our capabilities to work synergistically together. Please feel free to contact us about any of the topics that pertain to you or someone you know so we can continue to put our Ripple Effect into motion.

** The information provided should not be interpreted as a recommendation, no aspects of your individual financial situation were considered. Always consult a financial professional before implementing any strategies derived from the information above.

As the ebbs and flows of everyday life run their course, it is often easy to stress and fixate solely on our financial ambitions. During these times, it is important to remember that money is not the only answer, but it can help make a difference. Not just in the obvious sense of benefitting you and your family, but in a broader sense as well. If you think of your money as a tool to help achieve equanimity, you’ll find that its possibilities are endless. Just as ripples spread when a small pebble is dropped into water, your financial plans and goals can positively influence other aspects of your life and help create your own ripple effect. Weatherly challenges you not only to think about your financial goals, but your life ambitions as well. We encourage you to complete the survey below so we can best utilize our services to help you do well, live well, and give well.

1. What are your core values?
2. Do you feel like you are able to make an impact?
3. What kind of legacy would you like to leave behind?
4. How can you leverage your financial situation to achieve your life goals?

After you have considered and answered the above questions, we encourage you to discuss your responses with us so we can help put your ripple effect into motion.

Putting the Ripple Effect into Motion

There are a few ways you can create your ripple effect with your financial success. Consider the following:

• Beneficiaries: It is important to have your life savings and assets passed on to those aligned with your will and wishes. Maybe you want to pass on your wealth to the next generation or follow in Warren Buffet’s tracks by donating 100% of your wealth to charity, or maybe it is a combination of the two. Regardless of what boat you are in, we recommend reviewing your beneficiaries, trust document, and overall estate plan on an annual basis or when certain life events- such as birth or death in the family, divorce, or remarriage- occur. It is also good practice to review your beneficiaries and your intended ripple effect side by side. If your beneficiaries need to be updated or changed as a result of your review, we are happy to discuss and help implement these changes for you. We also encourage you to discuss your wishes in a general sense, not necessarily including specific dollar amounts, with your elected beneficiaries as a way to start the family conversation about wealth, instill family values, and emphasize the importance of planning for the future.
• Socially Responsible Investing (SRI): Socially Responsible Investing (SRI) allows you to invest in causes, corporate practices, and communities you support and avoid those you do not. This investment strategy enables you to create positive social change, while potentially receiving a financial return on such investments. To effectively implement a socially responsible investment strategy, we recommend the following steps:
  • Step 1: Determine what causes, corporate practices, and/ or communities are important to you. Some common SRI areas include, but are not limited to: environmental stewardship, customer protection, human rights, animal rights, and alternative energy.
  • Step 2: Make a list of products, companies, or causes you want to avoid. A few examples may include: alcohol, tobacco, fast food, gambling, and weapons.
  • Step 3: Discuss your SRI goals with Weatherly. We value and encourage your efforts to create positive social change as reflected in some of our current holdings, including one of our top holdings, Guggenheim Global Water ETF (CGW). We can also work to add or remove positions in those stocks, mutual funds, and/or ETFs to accomplish your SRI goals and needs.
• Charitable and Education Initiatives: Maybe you always wanted to see the world, but did not have the opportunity to do so until now. We encourage you to incorporate your charitable endeavors while traveling. A few ways to accomplish this include missionary trips, teaching abroad, or donating school supplies or clothes to local schools while on your trip. You can also impact your own community by volunteering your time or donating your assets from afar. One way you can donate your assets is through a Donor Advised Fund (DAF). The DAF allows you to donate cash, publicly traded and privately traded appreciated stock, real estate, and other acceptable assets. Once donated, you receive an immediate tax write off for donations to qualified public charities. To help facilitate your charitable giving, Weatherly can assist you in setting up and managing your DAF. For more information regarding DAF, please refer to our charitable giving blog at the following link: http://www.weatherlyassetmgt.com/blog/39tis-the-season-of-charitable-giving-and-tax-planning. We encourage you to involve the next generation in your charitable initiatives to emphasize the importance of giving back to the community, thus continuing the ripple effect.

Please do not hesitate to reach out to Weatherly with any questions or suggestions on how to start your Ripple Effect.

** The information provided should not be interpreted as a recommendation, no aspects of your individual financial situation were considered. Always consult a financial professional before implementing any strategies derived from the information above.

January often stirs a jump start on New Year resolutions as people wipe the slate clean from the year before.  Ranging from nutrition and exercise to reading and traveling, goals for the New Year can enhance our overall well-being.  We want to help our clients, colleagues and friends with goals and resolutions relating to our area of expertise.  Here are some ideas to get you on the track for an organized and well-balanced 2017:

Clean up Clutter- I’m sure by now many of you are familiar with The KonMari Method popularized by Marie Condo’s book The Life-Changing Magic of Tidying Up.  The premise is simple – if an item in your home doesn’t bring you joy, get rid of it!  This is a great time of year to donate gently used books, clothing and household goods to local charities.  The KonMari Method also states that a decluttered space helps with clarity and focus; so you may also be inclined to take on the often daunting task of organizing your office, which lead us to our next idea.

Purge and Catalog- This site is a great tool outlining how long you should keep certain documents, like bank statements and tax returns.  You can divide your documents into a “purge” and “catalog” stack, and either scan or file the items to be cataloged in a manner that works for you.  Please be sure to shred any documents that are in your purge pile or those that you’ve scanned and archived.  You can take documents to Staples to be shred for a low fee or check what local services may be offered to you – for example, in San Diego, SDCCU hosts an annual “Super Shred” event.

Streamline and Automate- Now that you’ve gone through your physical documents to purge and catalog, sign up for electronic statements for your various accounts.  You won’t have to worry about the paper pile-up and you can either download or keep your statements on the service provider’s site.  Weatherly also offers a client portal where you can view your current and historical quarterly statements; we can sign you up if you haven’t already.  Our portal is also home to our client vault where you can post documents, like your estate plans and tax returns, and we will download and save them to our secure server indefinitely.  We also recommend aggregator sites like Mint to track your monthly spending and budgeting.  You can link multiple accounts for easy viewing of what you’re spending each week, month or year.

Create a Roadmap for Yourself- Tracking your monthly budget may lead you to question how much you should be putting away for retirement, or if you’re spending or gifting too much or too little.  We work with our clients on detailed financial plans to answer these questions and more.  We touched on this topic briefly in a previous blog on Managing Longevity and financial planning is one of the keys to managing your assets in a manner during your working years that would allow for comfortable and seamless retirement later in life.  We analyze income and spending, assets and liabilities and the various buckets you’re putting funds into each year to come up with a plan for the future.  Just like going to your doctor for your annual physical, we want to review your plan at least annually for accuracy and a good financial health “check-up.”

Create a Roadmap for your Heirs- Reviewing your estate and legal documents are just as important as reviewing your financial plans.  Each year brings updates to our tax codes and even changes to laws pertaining to estates, which could translate into a change for your current estate plan.  There are a multitude of reasons to re-evaluate your plans, in addition to changes in tax codes, like changes to your family or wealth.  A basic will may not suffice if your financial plan shows that you’ll amass substantial assets throughout your lifetime.  You can review our blog on Estate Planning to see if an update is appropriate for you – or you can give us a call to discuss (and possibly share your estate documents electronically via our portal if you have completed your electronic cataloging!)

Upgrade- As much at it sometimes pains us, it may be time to upgrade some of your technology.  If you’ve been writing your passwords down on sticky notes, you could benefit from an app like Keeper that manages your passwords in one secure place.  Make sure you also use complex passwords and change them with some frequency to prevent hacking.  Log out of any secure website after use and don’t send sensitive information via email.  If you need a refresher on our cyber security tips, you can check out the post we wrote here.  If you want to re-evaluate or change the RIA you’re working with, you can use sites like Investment Advisor Public Disclosure to view regulatory information and ADV filings for advisors.  Also make sure you’re reviewing the type of advisor and fees, if your advisor adheres to fiduciary standards  and performance, as these all make an impact in the long-term success of your financial plan.

We wish you all health and wealth in 2017 and success with all of your goals and resolutions!  Please don’t hesitate to contact us if we can be of assistance.

** The information provided should not be interpreted as a recommendation, no aspects of your individual financial situation were considered. Always consult a financial professional before implementing any strategies derived from the information above.

New Department of Labor (DOL) regulations regarding fiduciary standards and the financial industry make it increasingly important to understand the different types of services and fees within the umbrella of the financial industry. Each sector of the financial industry operates, collects fees, and most of all interacts with clientele differently.

We have addressed some frequently asked questions and common concerns of clients about the investment community. With this blog, we want to aid in eliminating the confusion of the global who, what, where, when and whys when differentiating financial professionals.

Wealth Managers and Investment Advisors

Wealth managers or Registered Investment Advisors (RIAs) provide the greatest range of advice within the industry. From money management to creating financial plans, the comprehensive nature of this type of advisor offers unique and specialized services to each and every client. Each advisor offers a different range of services at their Firm and may charge fees accordingly.

RIAs typically work with high net worth clients to offer high quality, high touch services in every aspect of the client’s financial picture. The most common services offered are retirement planning, tax planning, philanthropic planning, financial planning, college planning, estate planning and wealth transfer guidance.

RIAs are required to register with the Securities Exchange Commission (SEC) or their state securities regulator, depending on the size of the Firm. Typically, fees are charged based upon a percentage of assets under management and can be located in a firms ADV I or plain English brochure.

Broker Dealer and Stockbroker

A broker is typically a person or company in the business of buying and selling securities on behalf of their clientele. They fall into two categories: full-service and discount, which indicate how fees will be charged and the level of service one will receive. Largely based on research and trading, the scope of a broker service is limited in comparison to an RIA.

Full service brokerage firms provide investment recommendations based on extensive research done on the client’s behalf. In addition, costs may be higher than discount brokerage firms due to extra commissions and expense ratios attached to the products that they sell. Discount brokerage firms are only responsible for completing a transaction on the client’s behalf. They offer online resources for clients to complete their own research but do not provide recommendations. Commissions can vary widely among brokerage firms and are typically based on the type of security traded (stocks, bonds, or funds). Mutual funds and exchanges-traded funds also have underlying fees called expense ratios which can vary widely. Information on expense ratios can be found on sites like morningstar.com.

Financial Planners

Financial planners offer a robust amount of advice ranging from cash flow management to tax and estate planning. Planners typically work with clients to assess their current financial situation and plan for future goals. If a financial planner is not registered with the SEC or state, and hasn’t passed licensing exams, they are legally restricted from giving advice on what securities to invest in and when. Therefore, a financial planner of this nature can only give advice regarding asset allocations and investment strategies.

The term financial planner is broadly used in the industry, so it is important to differentiate professionals by their credentials and titles. Financial planners who are registered through the SEC as Certified Financial Planners™ are held to a fiduciary standards, similar to Registered Investment Advisors. By combining the CFP certification, as well as industry exams Series 7 and Series 63 or 65, financial planners are then legally able to advise on investments.

Robo-Advisors

Robo-advising could be considered the “millennials” of the financial world. This up and coming method of asset allocation, portfolio construction, and financial planning capitalizes on the low cost and online accessibility of services. The financial planning that once was distributed via human interaction has now been automated to use algorithms to recommend portfolios and asset allocations according to the clients risk tolerance, financial goals, and long term plan.

The multitude of options robo-advising offers comes with pros and cons. Most robo-advisors have eliminated the required minimum portfolio size, which combined with advanced technology, welcomes a younger generation of investors who perhaps can’t afford to onboard with a professional advisor.  While streamlined, online access to financial databases and information may be attractive, it comes with downfalls that are important to consider. The imminent cybersecurity threat is present when populating personal financial information on the web. Simultaneously, as the experience is automated, investors lose touch with human interaction, dialogue, and perspective. Fiduciary requirements are not typically met by Robo Advisors.

To review the scope of service, fee’s, and credentials offered by these different types of professionals, please review the services chart, click here.  

How Weatherly Fits Into the Picture

Weatherly Asset Management, L.P. is a SEC Registered Investment Advisor. Our primary business focus is wealth management, with each account individually managed to maximize wealth preservation and growth over time. We also provide comprehensive advice related to retirement planning, tax planning, philanthropic planning, financial planning and college planning, as well as estate planning and wealth transfer guidance. Weatherly implements a tax and fee-only efficient structure. Please reference our Areas of Expertise on the bottom of Weatherly’s homepage.

To view more about Weatherly, and our listed competitors, check out the Top 10 Best Advisors in San Diego published by Advisory HQ, listed on our Weatherly in the News page.

To research our Firm via the SEC.gov website, please click http://www.adviserinfo.sec.gov/IAPD/IAPDFirmSummary.aspx?ORG_PK=106935.

Useful Tools to Help Gauge Your Financial Professional:

The Securities Exchange Commissions offers a vast database to explore different Firms, services and financial professionals. Please reference https://www.sec.gov/.

The Financial Industry Regulatory Authority (FINRA) can be used to narrow your focus and designate which type of financial professional is right for you. Please reference http://www.finra.org/.

To research brokers specifically please reference http://brokercheck.finra.org/. Here you can obtain background information including registration and licensing.

** The information provided should not be interpreted as a recommendation, no aspects of your individual financial situation were considered. Always consult a financial professional before implementing any strategies derived from the information above.