Recent Event Update: 6/28/11

We would like to thank all of those who attended the most recent Young Financiers event on June 28th, 2011. It was definitely a success in getting local Phoenix planners to meet and get better acquainted in a casual setting. We definitely want to acknowledge our host for this event, Walton International Group, a local real estate investment firm. We appreciate them allowing us to use their suite at Chase Field for the D-Backs game as well as provide food and beverages to complement the festivities. There was also a charitable component to this event. We want to recognize those who made a contribution to the Foundation for Financial Planning which provides pro-bono financial planning services to those in need.

The next meeting will be over the coming month or two and details will follow with an invitation over email. The date, location and topic are to be announced.

Why an up-and-coming financial planner in Phoenix should not join the Young Financiers

There has been talk recently with other individuals in the financial realm about the Young Financiers group. There is some surprise that people aren't knocking down the door to ask to be a part of the group. A tremendous amount of benefits can be recieved by being part of the group that should make it a no brainer for an up-and-coming professional serious about the industry to join and participate. Here are some reasons why one would not join the Young Financiers or a NexGen related organization:

-they don't care about lifelong learning

-they aren't interested in becoming acquainted with their colleagues

-they are not open to new ideas

-they are afraid of competition

-they want to keep their best practices to themselves

The Young Financiers is a group committed to the success of the next generation financial planner in Phoenix, AZ. NexGen is a group committed to the success of the next generation financial planner in the world. These groups foster collaboration, sharing, discussion, openness, growth, support, and many more characteristics.

Someone who is serious about their profession needs to be part of an organization that can help them get to the next level of their ability. The Young Financiers is that group for the next generation financial planner in Phoenix, AZ.

NexGen Gatherings for 2009

We wanted to make an announcement about the upcoming NexGen gatherings in 2009. There are actually two this year that will be taking place. One is occurring at the end of the month of July in Moline, IL. Fellow NexGenner Eric Kies from The Planning Center will be hosting a roundtable gathering where planners can share their thoughts and ideas on their businesses and life. More information can be found on the Yahoo Groups discussion board. The next event occurring this year is a piggyback on the FPA National conference held in Anaheim, CA. The formal NexGen sessions will be held on Friday, October 9th and Saturday, October 10th. More information can be found on the NexGen page at http://www.fpanexgen.org such as the brochure with the lineup of speakers and agenda, the registration section, and details on the National conference held after the NexGen event.

Why I Hired a Financial Planner

This post may seem like a routine piece on a Yahoo Finance or CNN Money page, but there is a twist to this. Typically, people who hire a financial planner are not planners themselves. That’s where this is different. I am on the path to become a certified financial planner and you would think that I deal with the nuances of this industry on a day-to-day basis. That is true, but what makes this unique is the value a third party perspective has on your life. There is more on that later in the post.

My inspiration for hiring a planner came from Rick Kahler, a CFP practitioner in South Dakota who wrote an article in the November 2008 edition of the Journal of Financial Planning entitled, “Becoming Consumers of the Profession we Practice”. After I read this, I came to the realization that we planners need to practice what we preach. We cannot tell clients/prospective clients to do as we say and not as we do. Once I had this epiphany, I chose to take action. The following describes the path of how I did so:

I think in today’s day and age, it can be difficult to find a competent and ethical planner. It seems as though all the good ones have minimum asset/ net worth requirements and individuals like me as an investor/consumer get second tier assistance. I feel the issue stems from the model of our business. The way the majority of the industry that targets my demographic is currently setup is advice sold within a product. I wanted to separate the product from the advice and keep the advice as objective as possible. One way for me to do that was to look for a planner who charged by the hour or charged a flat fee to do a comprehensive plan. There are a group of individuals across the country who follow this same philosophy. They have formed a network to assist the wealthy as well as the not-so-wealthy on improving financial situations. I thought I would start there and see where it took me. I found out there were a handful of individuals across town who were in alignment with this group. I reached out with an email introducing myself and what I set out to accomplish. Below is a sample of this email:

Good day Mr./Ms. Planner,

My name is Darin Shebesta. I came across your name recently from the X Network. Here is why I am contacting you:

I am part of the next generation of financial planners in the country. I work with X in Scottsdale. I am an Associate Planner with them and am working on my CFP courses currently. I read an article recently from Rick Kahler in the Journal of Financial Planning about planning for the planner (see attached). This got me thinking: why shouldn't I have a financial planner myself? Since I am just beginning the accumulation stage of my life, it is difficult to gain unbiased advice because the traditional business model is not set up to cater to consumers like myself. The brokerage side and the insurance side are biased because the compensation is built into the product and the advice is ancillary. I was looking for someone who was a CFP that I can sit down with and work on an hourly basis. I would be receiving professional advice and the planner would be getting paid for his/her time. This would also help me in my profession as I would see what it is like from a client's standpoint.

There were 4 planners that came up in the X Network search in Arizona. I am reaching out to each one of them (including you) to figure out who would be the best fit for our situation. I am getting married within two months and thought that now is as good a time as any to gain a third-party perspective. I would like to set up a phone appointment with you to have a conversation and ask a few questions. Let me know some days and times this week that would work with you.

I look forward to learning more about you and your insight. I look to those in our industry as comrades as opposed to competition. Take care and talk with you soon.

Darin

After sending out this email, I followed up with phone calls to each of the recipients. I believe any of them would have been appropriate to work with, but one stood out. Even though there is a generational difference between us, we still felt they were the best fit. The other candidates seemed to naturally fall out of the running. After the initial consultative meeting, my fiancee and I were comfortable with the relationship and chose to move forward with the fact finding and data gathering process.

Here is how I see the concept of a planner hiring a planner as a beneficial relationship. For one, we all have our own perspective on the world. If we have filters on this, our view is only one piece of the pie. To step outside of our mindset and look at it from another angle is valuable to notice blind spots. I do not know everything there is to know about financial planning or any other topic for that matter. What I do realize is everyone has their own particular experiences and value can be added by applying learning from those experiences to other situations such as my financial situation. We may have differing views on investment philosophy or budgeting, but it is good to hear another’s perspective because this gives you options you wouldn’t otherwise have. Why wouldn’t you have other options had you not been exposed to other perspectives? Because you wouldn’t know the other options existed. Our planner has given us a perspective which we can choose to apply or choose not to apply. There is freedom in this situation.

One of the biggest reasons why planners have resisted hiring planners is the idea that they can do it themselves. If you ask an investor/consumer who does not have a relationship with a planner, the number one reason is “they can do it themselves”. If we are not following the advice that we give clients, how can we expect them to listen to us and follow our advice? There also may be a sense of awkwardness or embarrassment with this situation. All I can say is when you open up your financial life to someone you know and trust, this will go away and you will realize that they are here to help you. There is much more potential benefit from working with a planner versus not interacting with one.

If we want to consider financial planning a profession rather than just an industry, we need to move in the direction of hiring certified financial planners to help us with our financial lives (I am speaking to the planners of the world). Let me close with these questions: Would a doctor operate on him/herself? Would an attorney represent him/herself in court? Take an opportunity to think about this and see if it makes sense. If it makes sense, you have the chance to take action and make a difference in your life.

This topic will be discussed at our next Young Financiers meeting on Tuesday, April 7th, 2009.

Overview of Last Meeting in 2008

The Young Financiers met one last time before the end of the year on Tuesday, November 11th. There have been some newcomers this year to the group and they have contributed to the conversation significantly as well as provided office space for the meeting.

The most recent meeting was meant to discuss topics such as:
-Asset Allocation
-Re-Balancing
-"The Bailout"

These items were discussed as well as other items that came onto topic. It is interesting to see how different the views are on various ideas. There is definitely "more than one way to skin a cat" as they say. For example, one member discussed using single position stocks to build portfolios, while other members delegated the investment task to portfolio managers outside the firm. One member dealt with Tenants In Common for his clients and others used REIT's.

One topic of discussion came up that was fairly significant: variable annuities. This was interesting because they have been a very controversial financial product and there is a mix of advisors who use them and those who don't. The majority of the members at the meeting used VA's for a portion of their clients' assets. The group that this conversation may outcast would be the fee-only RIA group. Since VA's payout commissions, in the past it was not something they used. There are more and more products entering the marketplace that are catering to the fee-only channel. The question is: are they as competitive in cost and in benefit to their counterparts? One favorable benefit that was mentioned was the guaranteed lifetime income stream that could be provided to clients so they would not run out of income. This will definitely continue to be a topic of interest moving forward in the profession.

There was also discussion of the various Financial Planning Programs that students had been enrolled in. Members who were involved in these programs were present: DePaul, Boston, and Florida State. Members who were not present had taken the AFPP at ASU, the College for Financial Planning, and Jeff Rattiner's Fast Track. The main item people got out of this particular part of the discussion is it didn't necessarily matter which program you went through because the student ultimately determined how much they wanted to get out of it. They all provide similar material. It is a matter of the drive of the individual.

Looking at future meetings, there is definitely a need for more of what the Young Financiers do. This is especially important in trying times like these. This is about the camaraderie that is developed between members. When someone has a question, they know they can turn to this group to help answer it. The members need to be resources for one another and they will grow in the process.

Overview of the 2008 NexGen Conference

What an amazing experience this conference was! There is something to be said about the camaraderie between those in our field, especially when you have the same demographic together in one place. There is tremendous synergistic opportunities with the NexGen folks.

There are a couple of great articles written on the NexGen Conference that provide an overview of the topics presented as well as the breadth of attendees:

http://www.financial-planning.com/asset/article/642811/notes-nexgen.html

http://www.investmentnews.com/apps/pbcs.dll/article?AID=2008162623074

The topics chosen for sessions were timely, relevant, and fulfilling. There were two types of tracks with each set of presentations: a technical track and a practice management type track.

There was a nice mix of work and play at the conference. Many opportunities arose to meet fellow NexGenners. There are many benefits of this experience. The chance to connect with other planners across the country opens the door to meet up in the future. Job opportunities arise out of getting to know one another. Being resources for each other is valuable as well. It does not hurt to know people. The face to face interaction solidifies the relationship.

It is great to have media cover these types of events. They do a good job of painting a pleasant picture which is verifiable by talking with attendees about their experience.

The topic of ownership is a big issue in this profession. Especially when the average age of a Financial Planner is 54-57 years old and most of those individuals will be out of the business in 15-20 years. They need some way to transition themselves out of the workforce into retirement. The potential is tremendous in this industry as the demographics of our country shift. I don't know of a more rewarding and fulfilling profession than the one the NexGenners are in.

A special thanks is given to all the individuals who made the NexGen Conference possible. The event could not have happened without the attendees as well.

There will be a Young Financiers meeting in August. A post will be created shortly to announce the logistics.

NexGen Information

The time is here and now for NexGen to arrive. Over the past two conferences, there has not been a representative from Arizona present (as far as I know). This year is different. I've got my skin in the game now fully and I am ready to learn as well as contribute.


NexGen will be held in St. Cloud, MN at St. John's University from July 25-27, 2008. This is an opportunity for planners across the country to get acquainted with one another, learn from each other, and learn about the industry and how it relates to the next generation of financial planners. NexGen is not about replacing the Financial Planning Association. This is about supplementing it with a group that caters to our generation.

More information on this event can be found at the brand new FPA National website. The roster for this event can be found here. Also important is the registration form, which provides the sign up sheet. The other item on this section of the site is the brochure that describes the agenda and schedule for the event.

There is a lot to be said about building a network of like minded individuals that act as support and a resource to help us achieve our goals. Every single person has something to contribute and I am looking forward to seeing them shine.

I will provide a full report upon return from the conference of take-aways at NexGen 2008. This trip will help strengthen the Young Financiers as a group, which is a benefit in its own right.