| 1. Please tell me about the financial planning process. Financial planning is a multi-step process that provides you with two important things: (1) An in-depth review of your current financial situation, and (2) a blueprint that shows you how to achieve your goals and objectives for the future. At C. B. Bond Financial Planning, Inc., the financial planning process consists of seven distinct steps (see Building a Brighter Financial Future for details on our unique financial planning process). It is important to remember that financial planning is a process . . . not an event.
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2. How do you create this blueprint? First we focus on your goals, objectives, priorities and values. For instance: the reduction of current and future income taxes may be an immediate goal, funding a quality education for your children and/or grandchildren may be an intermediate goal, and enjoying a secure financial future in your retirement years is likely to be one of your most important long-term goals. Another great goal in life for some people is creating wealth and/or leaving a legacy for your chosen beneficiaries or charities. You may already be on the road to meeting these objectives and simply need a new strategy, professional insight, or to fine-tune your plan. You may just be starting out, or you may be somewhere in between. Whatever your unique situation may be, everyone needs a periodic assessment of where they are on the road to meeting their financial goals. That’s why we do an in-depth review of your current financial situation. Next, you need to know how you can set about achieving (or continue working toward) your financial goals. By focusing on cash flow, investments, taxes, pensions and retirement plans, estate planning, insurance issues, savings opportunities and other general financial matters, we design a customized financial plan for you. Finally, to achieve the intended results, you must implement and monitor your plan.
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3. Sounds like a lot of work! It may seem like that at first, but the good news is, if you follow your plan and maintain a disciplined approach, you can rest well knowing you can reach your stated goals. At C. B. Bond Financial Planning, Inc., we try to make the process as easy as possible for you. In addition to receiving professional advice on your most important financial concerns, we can also provide implementation and ongoing asset management services, if appropriate for your needs.
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4. Who can benefit most from your services? Any individual seeking financial peace of mind can benefit from our services. We serve people at all income levels, from all walks of life. Clients have the flexibility to work with us on either a one-time, as-needed basis or an ongoing basis. We welcome clients who simply need a one-time financial consultation or a second opinion, as well as those who need comprehensive financial planning and possible ongoing asset management services. In addition, any corporation or organization seeking quality, unbiased financial education for their employees or members can benefit from our financial education programs
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5. What is ''Fee-Only'' financial planning and why should that be important to me? With fee-only financial planning, all compensation is paid directly by the client to the planner for services rendered. Because we do not sell financial products such as investments and insurance, there are no third-party relationships or outside influences to color our thinking and financial recommendations. Fee-only financial planning separates the fee for financial advice from any transaction costs required to implement the advice. Brad Bond, President of C. B. Bond Financial Planning, Inc. is a member of the National Association of Personal Financial Advisors (NAPFA), a professional organization of fee-only financial advisors. For more information on Fee-Only financial planning, including our Code of Ethics, Fiduciary Code and member requirements, please visit www.NAPFA.org.
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6. Are there any regulatory requirements related to financial planners? Financial planning firms that provide investment advice for compensation must generally register with and be regulated by the appropriate regulatory authorities. C. B. Bond Financial Planning, Inc. is registered as an Investment Advisor with the Commonwealth of Pennsylvania. Registration does not imply that the regulatory authority has evaluated the competence of the advisor. It simply means that the advisor has met regulatory requirements designed to protect the consumer. One of these requirements has to do with disclosure of key information such as business practices, investment services, and compensation structures. This disclosure is contained in a firm's Disclosure Statement, or Form ADV Part II. You should ask for a copy of this document from any financial planning firm you are considering. We would be happy to send you a copy of our disclosure statement. Please contact us to request your copy.
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7. I understand the benefits of working with a Fee-Only financial planner, but I might need to obtain financial products. How will I be able to do that? While we do not sell financial products, we will offer specific recommendations and opinions regarding the purchase of the various financial products that may be appropriate for you. So, if you need to obtain an insurance policy or a new mortgage, invest into a portfolio of mutual funds, or find an estate planning attorney or tax professional, we can direct you to the resources you need and/or help you obtain these products and services. If appropriate, we can also help you implement your plan and set up your accounts.
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8. Does C. B. Bond Financial Planning provide only comprehensive financial planning? No. Although a comprehensive financial plan can provide the greatest benefits, we can limit our advisory services to your specific needs, such as cash management and budgeting, investment analysis or college education funding.
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9. My spouse and I are just beginning to build for our financial future. There is so much to learn! We need help and guidance to get started. Will you accept us as clients? Yes. Some firms have required income levels and/or net worth minimums but at C. B. Bond Financial Planning, Inc., we realize that everyone has financial needs. We are proud to work with people from all income levels, and all walks of life. Remember, ''You don't have to have a fortune to start building one.'' Call us today and let's get started.
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10. I have already accumulated substantial assets and think I am doing quite well. But as I progress and build for the future, things seem to be getting more complicated. I want to be sure I am on track, but I don’t always have the time or inclination to manage the myriad details by myself. Can you help me? Yes. People who need more sophisticated financial planning or advice will find our services appealing and beneficial. If you have a desire to simplify your financial affairs, our Ongoing Retainer Client Program may be right for you (see Building a Brighter Financial Future.) If you are looking for a professional review or a second opinion to ensure you are on track, we can provide that, too.
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11. I’m in charge of the retirement plans and employee benefits at my firm. I would like to increase the number of employees who participate in our benefit programs. How can you help us? Corporate education is key in building employee participation. We can help your people understand the benefits of your programs. Please call to discuss your specific needs. We can custom-build an educational program for your company.
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12. What types of securities do you provide advice for? We provide advice for securities including mutual funds, stocks (as they relate to your portfolio holdings), bonds, bank deposits, and variable and fixed annuities. We also provide advice on mortgages, budgeting and cash flow issues, 401(k), 403(b) and other retirement programs, stock options, life and disability insurance, etc. Clients are encouraged to call us when they have a major life event, such as a new job, a baby, a marriage or divorce, or if they are planning to buy a new home or start their own business. We also encourage clients to call us with more common everyday questions, such as: "How should I invest within my 401(k) or 403(b) plan?" "How can I reduce my taxes?" "What advice can you offer on refinancing my home?" "How can I best use my Flex Spending Acount, or Cafetera Plan at Work?"
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13. If I use C. B. Bond Financial Planning, Inc. to develop a financial plan, am I obligated to purchase the recommended products? No. We will offer recommendations that in our professional opinion will meet your needs and objectives, but we do not sell products. You are under no obligation to purchase any products we recommend. In today’s competitive market, it makes sense to shop around for the best available product or service. For instance, if you need to obtain a life insurance or disability policy, we will suggest the kind of policy, which riders and what amounts may be best for you. We will then direct you to a choice of companies that can provide a quality product at competitive prices for you. If you wish, we can help you purchase investments and/or set up your accounts with a third-party custodian such as a discount broker.
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14. Tell me about your investment philosophy.
As a financial planner and investment consultant, C. B. Bond Financial Planning, Inc. uses the following fundamental principles and philosophy when designing an investment portfolio and making specific recommendations:
- A client’s investment portfolio funds current and/or future financial objectives, such as retirement, college funding, or purchase of a home. Client needs for current income, liquidity, or growth, and special factors such as income and estate taxes are also considered. Different financial objectives need to be met at different times in the future. Obtaining a higher return on investments makes it easier to achieve financial objectives. The two major categories of investments that will make up the majority of most portfolios are equities (company stocks or mutual funds), and fixed income investments (bonds or bond mutual funds). Historically, equities have provided higher returns to investors over time than fixed income investments. However, history has also shown that it sometimes takes 10 years or more to experience these higher returns. Along the way, equities typically provide a rougher ride than fixed income investments, with wider variations in value both up and down. Thus, the client’s tolerance for investment volatility is the third major input evaluated when designing a portfolio.
- Once we know the client objectives, time horizon, and volatility tolerance, we can develop an investment policy and begin the portfolio design process. This starts with allocation of the investment assets to the equity, fixed income, and other broad categories (such as real estate, or money market funds) as appropriate. Within these broad categories, allocations are further subdivided into different asset classes, such as large company stocks, or short-term bonds. The appropriate allocation of investment assets for your objectives, time horizon, and volatility tolerance is the most important component in developing an investment portfolio. Asset allocation provides diversification to the portfolio. Diversification helps to reduce the volatility of a portfolio over time.
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Only after the objectives, time horizon, volatility tolerance, investment policy and asset allocation are defined do we begin to select the actual investments for the portfolio. See question 15 for more information on investment selection.
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The key to the investment philosophy described here is the asset allocation. Once an asset allocation and investments are chosen, the different investments will perform differently over time. Therefore, a crucial but often neglected part of the investment process is periodic review of the portfolio. Omitting the periodic review can cause the asset allocation of the portfolio to change significantly and possibly make the portfolio more volatile over time. This relates directly back to the client’s objectives, time horizon, and volatility tolerance. The periodic review is used not only to rebalance the portfolio and realign it with the original parameters, but also to review the ongoing performance and suitability of the individual investments, and incorporate any changes in the client’s financial situation. These periodic reviews typically occur once or twice a year.
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15. How do you select investments for a client? Before we recommend any investment, we consider the current economic conditions, the outlook for that asset class or type of security and how this investment fits within your portfolio given your objectives and tolerance for volatility. For equity investments, we focus primarily on the philosophies, experience and track record of the management team. With fixed income investments, we look for the best yield available for a given quality of security. As a fiduciary for our clients, we strive to obtain the most appropriate investment vehicles to meet your objectives, while being very conscious of total expenses and volatility exposure.
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16. How do you price your financial planning services? Financial planning fees are determined on a project basis; the total fee for a financial plan will vary from client to client based on the specific needs and complexity of your situation. An estimate is provided after the Get Acquainted Meeting, when your personal needs are fully identified. Once your financial plan is complete, there are three possible approaches for implementation and periodic review (please see our diagram Building a Brighter Financial Future to learn about our financial planning sequence and the client service options available). Self-directed and Continuing clients pay on an hourly basis for implementation and periodic review services. Ongoing retainer clients pay an annual retainer fee that is based on the complexity of the services offered.
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17. Are your fees tax deductible? Section 212 of the Internal Revenue Code permits an itemized deduction for tax and/or investment advice in the miscellaneous section of Schedule A. It is subject to a 2% floor of the adjusted gross income on a personal tax return.
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18. Once my financial plan is completed, will our relationship end? Depending on your client track, the actual engagement of services may end, but the majority of our clients choose either our Continuing Client or Ongoing-Retainer Programs. Because financial planning is a process, not an event, we offer ongoing services, periodic reviews and day-to-day consultation as requested and/or needed.
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19. How can I get started? The first step is an initial inquiry from you. Call us at 724-733-2280 or email us at info@cbbondfinancialplanning.com. We offer an initial no-cost, no-obligation Get Acquainted Meeting, either on the phone or in our offices. For Get Acquainted Meetings, appointments are scheduled based on availability during regular business hours of 9-5, Monday through Friday. Expanded office hours are available to accommodate special needs or emergency situations. Should you decide to engage our services, we can discuss which of our services and client tracks is appropriate for you. Most clients find the financial planning process to be stimulating and enlightening. The end result desired, of course, is greater peace of mind. We look forward to helping YOU build a brighter financial future!
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