Frequently Asked Questions
1. What is financial planning?
Financial planning involves three basic steps — determining where you stand today, where you want to be in the future, and the best way to get there. With our firm, the process involves an initial in-depth review of your current financial situation and then recommendations on how to achieve future goals and objectives.
2. What is a financial planner or advisor?
Anyone can say that he or she is a financial planner or financial advisor. That’s why it’s essential to be sure of the qualifications and credentials of any “planner” or “advisor” before you pay them a fee or entrust them with your financial matters. NAPFA-Registered Financial Advisors have completed a broad-based advanced education program in financial planning.
They have comprehensive planning experience and are trained to provide coordinated advice on issues surrounding a client’s entire financial picture. NAPFA members adhere to a rigorous code of ethics, have extensive continuing education requirements, and are committed to the National Association of Personal Financial Advisors Fiduciary Oath.
3. What is the difference between fee-only and fee-based?
Fee-based compensation is a confusing and potentially misleading term. Fee-based advisors are different from fee-only advisors. Whereas fee-only advisors are paid only by the client, fee-based advisors may receive fees both from the client and from the sale of products, as well as other non-client compensation.
Fee-based compensation includes commissions, 12b-1 fees, referral fees, and other indirect forms of compensation. Such payments may represent conflicts of interest and are not always disclosed clearly to clients.
Campbell Financial Partners, LLC is a fee-only firm. Period. We receive no fees of any kind other than those paid by our clients. Our financial planning and investment advice is dictated by what is best for you and you alone. If there is a potential conflict of interest, we will disclose that when we give you advice so that you are able to make a well-informed choice.
4. How can a financial advisor help me?
Many investors are looking for financial peace of mind. Fee-only financial planners like Campbell Financial Planners, LLC are here to help. Each individual’s situation is unique. Someone just starting out may need a detailed, long-term plan of action, whereas someone already on the road to achieving their goals may need a new strategy, ongoing professional guidance, or better implementation of an existing plan. We customize our services to meet each individual’s needs.
The long-term goal for most clients is to enjoy a secure retirement. Most of our clients are pre-retirees or retirees, as Retirement Planning is an area in which we specialize. There are a myriad of complex planning issues and choices, including portfolio design, withdrawal strategies, Social Security claiming decisions, pensions, employer plan rollovers, and tax efficiency, just to name a few.
Making the right choices, both initially and ongoing, is critical to retirement success. Hiring the right financial advisor to guide you generally pays for itself many times over.
5. How do you charge for your financial advisory services?
We charge a one-time fee for the initial work and an annual fee for the ongoing service. The annual fee is generally a percentage of assets, billed quarterly. The asset-based fee is .9% on the first $1 million; .7% on the next $2 million; .4% on the next $2 million; and .3% on balances over $5 million. These are tiered fees, so each tier is added to the next. The minimum annual fee is $10,000.
Details will be discussed in our initial meeting and are also available in our ADV Part 2 Disclosure Brochure, which will be provided prior to signing a Client Agreement. There is no charge for the initial consultation meeting, which will generally take 1-2 hours.
6. What is your firm’s investment philosophy?
As financial advisors and investment consultants, we believe in the following fundamental principles when it comes to designing an investment portfolio and making specific recommendations:
- The purpose of a client’s investment portfolio is to fund current and/or future financial objectives.
- The design of the portfolio must take into account the client’s financial objectives, tolerance for risk, needs for current and future income or liquidity, and special considerations such as income and estate taxes.
- The appropriate allocation of investment assets for your goals and risk tolerance is the most important component in developing an investment portfolio. Investments should be allocated among different asset classes in an attempt to maximize returns and lessen risk.
- Investments selected within each asset class should be based on modern portfolio theory, utilizing passive management techniques which have the benefit of minimizing unnecessary transaction costs, overall portfolio fees, and taxation.
- We believe that a diversified, well-balanced portfolio, combined with long-term investment strategies, affordability and patience, increases the likelihood that one will achieve his or her long-term financial objectives.
The important thing to remember is that no one can predict the future. Difference of opinion makes a market. Investment and economic “experts” provided with the same information often come to different conclusions.
We do not suggest that we, or that any of the money or mutual fund managers that we may recommend, will make the correct decision every time. We do believe, however, that studying the historic trends and relationships of investment classes and the philosophies and approaches of successful investment managers can provide valuable insight.
7. How do we get started?
Most new clients come to us as referrals from existing clients, but we do accept a limited number of new clients without a referral. Our process begins when we receive either a phone call or an email, with a detailed explanation of your situation and what type of financial advisor relationship you are seeking.
Email is encouraged, through our contact form. You may also call us to discuss your situation and possibly schedule a meeting.
Note that the initial phone call is usually 15-20 minutes long, since much information is exchanged in order to determine whether a meeting should be our next step. If we schedule a meeting, we ask that you complete our Financial Planning Questionnaire and fax or email it to us at least a week in advance of the meeting date.
We may also request account statements or additional information prior to the meeting. While no advice is given at the initial meeting, we want to have a clear picture of your current financial situation in order to make the most productive use of the meeting time. We will explain our services in detail and will determine an initial fee at that time.