How I Begin Working With Financial Planning Clients: Part 1

By Michael Hathaway, CFP®, CFA®, AIF®

Many people ask me, “What would it be like to work together in a financial planning relationship?” I think this is a very important question to answer because “financial planning” has become the new buzzword in the financial services industry. Like crypto and NFTs, people jump on the bandwagon without truly understanding what it means to enter into a financial planning relationship. Similarly, many financial advisors claim to provide this type of relationship, but what they really do is manage investments, or they create a watered-down version of what a comprehensive financial plan is supposed to be. 

That’s why I’ve put together this two-part article. My hope is that by outlining my process, it will better inform my clients about what to expect and how it might differ from other financial advisory relationships they’ve had in the past. In this first article, I will go through the first three steps in my process and how it informs the ongoing nature of the client-planner relationship.

What Is Financial Planning?

Financial planning is a comprehensive and ongoing process that seeks to help people make informed decisions about their long-term financial goals. It is a collaborative effort between the planner and the client, and recommendations will be tailored to each individual’s unique personal and financial circumstances. 

As a CERTIFIED FINANCIAL PLANNER™ professional, my process is rooted in the CFP Board’s planning framework. The CFP Board is the governing body of the CFPⓇ certification, and they developed the seven-step planning process, which is continually amended to reflect the latest innovations in the financial planning profession. I have built my process on the fundamental steps they outline:

A picture containing text, sign, sale Description automatically generated

Step 1: Understanding the Client’s Personal & Financial Circumstances

This step is really broken down into two substeps. First, I will formally establish a professional financial planning relationship with a client by outlining a detailed list of services I expect to provide, as well as how I will be compensated. I charge a flat annual fee for financial planning services broken into quarterly payments, and I also offer investment management as an optional add-on. This is an additional annual fee (also paid quarterly), expressed as a percentage of the assets I will manage.

Clients will also receive a copy of all appropriate disclosure documents as required by law. Neither my firm nor I accept any compensation from any third party. This is strictly to reduce potential conflicts of interest. We always adhere to a fiduciary standard for our clients, and our duty of loyalty is always to them. We are paid for our best, conflict-free advice.

Once the financial planning relationship has formally begun, I will schedule “Discovery” meetings in order to learn more about my clients from both a personal and financial perspective. This process usually takes several meetings to thoroughly assess a client’s current circumstances, including work, family life, health, income, expenses, investments, insurance, personal values, and financial goals. I also strive to learn more about how their attitudes and beliefs around money have been formed or shaped by past experiences. 

A key objective for me during this time is to identify a “financial purpose,” which can be articulated, refined over time, and used to help guide the clients through the significant (and potentially difficult) financial decisions they will make during our relationship together. I believe that getting to understand my clients in this way early in our relationship allows me to be the most effective consultant, coach, and guide to them throughout our journey together.

This is a very detailed process that involves gathering many documents that contain sensitive financial and personal information. It is of utmost importance that our relationship is founded on mutual trust so that collection of this information does not become uncomfortable or awkward. Here is a basic list of the documents you can expect to provide as part of the initial discovery process:

  • Personal information for everyone involved in the engagement, including any people for whom the clients provide material support (parents, children, other relatives, etc.)
  • Current health status and any issues that might impact life expectancy
  • Current employment status(es), including copies of recent pay stubs, any employment-related benefit information
  • Any business investments, as well as corresponding tax, returns, organizing documents, any succession plans, etc.
  • Any owned real estate, whether for personal or investment purposes, and corresponding mortgage information
  • Information related to any current insurance
  • Any current estate planning documents including wills, trusts, powers of attorney, any advanced medical directives
  • Copies of the previous two years’ tax returns
  • Recent statements for all bank, savings, investment, and retirement accounts, including any employment-related investment accounts, such as 401(k), 403(b), or 457 accounts
  • Most recent statements from Social Security; recent statements from any other defined-benefit pension provider; information related to any other “retirement” income source (e.g., annuities)
  • Information related to current spending 
  • Information related to any other sources of income or cash flows in or out.

This is an extensive list of documents that takes time to gather. It can be overwhelming for many clients, but this is by far the most important step of the whole process. The financial plan will only be as accurate and thorough as the information provided. I help my clients gather this information in whatever ways I can, but much of it relies on their efforts.

Step 2: Identify & Select Goals

The next step is to identify and select the financial goals that we will be working toward throughout the relationship. This process often happens in tandem with the first step. 

Together, we will develop a Statement of Financial Purpose that will help us develop goals that the client is motivated to accomplish. The information on past experiences and values around money will help me uncover the “why” behind what a client wants to achieve. I have found that many times it is better to work together with clients to identify their goals (the “what”) once I have learned more about them (and their “why”). 

This step is accomplished through a series of probing questions and follow-ups during each of our first meetings together. We continue to revisit and revise (as needed) the client’s goals regularly.

Step 3: Analyze the Client’s Current Course of Action & Potential Alternatives

After receiving the bulk of the information required in steps 1 and 2, I will produce a detailed analysis of a client’s current situation within two to three weeks of receiving the data. This analysis will be provided and discussed in our first “Financial Planning” meeting and will be updated regularly. 

The analysis will be structured to cover the following topic areas: 

  • General Financial Planning
  • Risk Management & Insurance Planning
  • Estate Planning
  • Tax Planning
  • Investment Planning
  • Retirement Planning 
  • Education Planning

There is usually a great deal of discussion during the presentation as clients ask questions, provide feedback, and remember additional information. Regardless, this meeting will provide significant movement forward in the overall organization of the clients’ financial lives and the development of a comprehensive financial plan. 

At this stage, our analysis and discussion have usually uncovered many areas of the clients’ financial lives that need attention. However, many clients struggle to ever reach this stage. Either they do not complete the required document gathering, they procrastinate in providing documents or scheduling follow-up meetings, or “life happens” and things drag out, and clients lose momentum. 

Once we reach this stage, I believe it is important to step back, take a deep breath, and congratulate the clients on taking a significant step toward improving their financial lives.

Learn More

These first three steps are just the beginning “onramp” of the ongoing financial planning process. To learn more about how I work with my clients, be sure to read next month’s article, “How I Continue Working With Financial Planning Clients.” I will describe how I partner with them to complete steps 4 through 7 of the process and develop an ongoing process for helping clients make sound financial decisions.

If you would like to discuss how financial planning can benefit you and improve your financial life, email me a Mike@wealthmatters.com or call (707) 428-5500 to get started.

About Mike

Michael Hathaway is a fiduciary financial advisor at Epsilon Financial Group, Inc., an independent, fee-only wealth management firm. Mike has worked in the finance industry for more than 20 years and brings a broad wealth of knowledge and experience in sophisticated financial planning to help his clients make sound financial decisions. He is known for being compassionate, caring deeply for his clients’ well-being, and thinking creatively to help clients attain their financial goals. He prioritizes building long-term relationships and takes the time to listen, understand, and explain so that his clients feel confident in their financial plan. Mike is a CERTIFIED FINANCIAL PLANNERTM, Chartered Financial Analyst® (CFA®), and Accredited Investment Fiduciary® (AIF®) professional; he has a bachelor’s degree in cybernetics from UCLA and an MBA in finance and accounting from the University of Virginia. When he’s not working at Epsilon, you can find Mike enjoying anything related to exercise and fitness. He especially loves activities in the great outdoors, such as mountain biking, camping, hiking, and snowshoeing. In the fall of 2016, Mike successfully climbed to the top of Mount Whitney in a single day, the highest peak in the continental United States. To learn more about Mike, connect with him on LinkedIn.

Print Friendly, PDF & Email
Facebook Linkedin
Download Form CRS (PDF)
©2023 Epsilon Financial Group. All Rights Reserved.
Website by Whitefrog Design

Michael Hathaway, AIF®, CFA®, CFP®

Mike joined Epsilon in 2018 after spending most of the previous 20 years working in the corporate finance arena. He enjoys bringing the benefits and lessons learned from his time in corporate finance to Epsilon’s individual and private wealth clients. His deep experience with investments and personal taxes also allows him to help clients develop tax-efficient retirement income and distribution strategies, as well as helping to optimize the tax locations of clients’ accounts during the accumulation and pre-retirement phases.

Mike has a B.S. in Cybernetics from UCLA, and an MBA in Finance from the University of Virginia’s Darden School of Business. He is a CERTIFIED FINANCIAL PLANNER professional, a Chartered Financial AnalystTM, and is a holder of the Accredited Investment Fiduciary designation.

Institute for the Fiduciary Standard
Real Fiduciary™ Advisors Code of Ethics

February 22, 2019

The Institute for the Fiduciary Standard’s Real Fiduciary™ Practices describe how conscientious and competent advisors serve clients today. The practices reflect principles that underlie fiduciary law and focus on the three overriding advisory duties of Loyalty, Due Care and Utmost Good Faith. The Institute defines these terms as follows:

  • Loyalty means steadfast and uncompromising devotion to a client’s best interest.
  • Due care means following a prudent process and applying the necessary professional skills as evidenced by appropriate education, expertise and experience.
  • Utmost good faith means acting at all times with honesty, integrity and transparency.

Many advisors and brokers talk like a fiduciary, though relatively few act like one. These Real Fiduciary™ Practices provide guidance for advisors. They also help investors distinguish advisors who work for and are paid only by clients—from sales representatives who work for and are paid by firms to distribute products. That is, these practices help separate brokers and advisors who merely talk like a fiduciary from advisors who really act like one.

Real Fiduciary™ Advisors stand apart because they:

DEMONSTRATE LOYALTY

  1. Act as a fiduciary at all times. Affirm this commitment to the client in writing. Affirm that the fiduciary standard under common law and the Investment Advisers Act of 1940 (and when applicable, ERISA) governs all professional advisory client relationships at all times at both the advisor and the firm level.
  1. Decline any sales-related compensation. Accept compensation that is paid by the client in the form of a percentage of assets under management, retainers, fixed fees or hourly fees. Decline any compensation associated with transactions and product sales such as commissions, shelf space payments and 12b-1 fees.
  1. Avoid conflicts of interest. Understand that a conflict of interest occurs when the interests of the advisor or the advisor’s firm interfere with the advisor’s fiduciary duties to clients. A conflict is material when it could reasonably be deemed to affect how a client who understands the conflict decides to act. Material conflicts are inherently harmful. Eliminating or avoiding these conflicts when possible has been the cornerstone of fiduciary law for centuries.
  1. Mitigate unavoidable conflicts. Mitigating material conflicts means, at minimum, receiving appropriate client consent before executing the recommendation. The advisor will:
    • Explain the conflict in sufficient detail, both orally and in writing, so the client fully understands the conflict. Disclosure of conflicts of interest is a well-established obligation of the Investment Advisers Act of 1940 and a key requirement of Form ADV.
    • Ensure that the client understands the implications of the conflict. This includes the relative merits of options not recommended by the advisor and any additional compensation that may be earned by the advisor.
    • Receive informed, intelligent and independent consent from the client in writing before any advice is implemented.
    • Document and be prepared to demonstrate that the conflicted advice remains reasonable and fair and consistent with the client’s best interest.

ACT WITH DUE CARE

  1. Maintain professional knowledge and competence. Demonstrate baseline competence by holding a recognized designation which requires significant study and knowledge, experience and ongoing continuing education requirements, such as the CFP®, CPA/PFS or CFA designations. Decline to provide advice, regardless of its scope, unless the advisor possesses the appropriate expertise.
  1. Explain agreements and disclosures clearly and truthfully, both orally and in writing. Put all important client agreements and disclosures in writing. Do not make oral or written statements that are misleading. Client understanding of the advisor’s actions is important in relationships of trust and confidence.
  1. Establish and document a reasonable basis for advice. Document relevant facts and circumstances supporting the advisor’s advice in a manner that is appropriate for the scope and nature of the client engagement and for the client’s goals and overall circumstances. Upon client request, provide a brief summary written in plain language of each recommendation and its respective reasonable basis. Having a “reasonable basis” for investment advice is a well-established obligation of the Investment Advisers Act of 1940.
  1. Follow and document a prudent due diligence process for rendering investment advice. Research and analyze investment vehicles in a responsible manner. Use an investment policy statement that is based on a clear understanding of the client’s circumstances and preferences and that clearly specifies assumptions regarding objectives, risk, and performance. Report performance based on data supplied by an independent third party and calculated using industry standard methods.

 ACT IN UTMOST GOOD FAITH

  1. Decline gifts or entertainment or other benefits unless minimal in value, occasional in frequency, and consistent with the advisory firm’s gift and vendor relation policies. Decline any gifts or third-party compensation or other benefits received by the advisor or the advisor’s firm that could impair advisor objectivity. Upon request, provide the firm’s policy on gifts and entertainment. Explain clearly, both orally and in writing, any ongoing benefits the advisor or the advisor’s firm receives from other entities.
  1. Charge reasonable fees and incur reasonable investment costs. Disclose and fully explain. Provide in writing at the outset of the advisory relationship, and upon request throughout the client engagement, a good faith description and estimate of anticipated fees, investment costs and tax implications. Have procedures to check that client expenses are reasonable. Be aware that controlling investment expenses does not require the least expensive alternative; it does require a reasonable basis for selecting a more expensive alternative.
   

REAL FIDUCIARY™ PRACTICES BOARD

Christopher W. Cannon, CFA, FirsTrust

Paula H. Hogan, CFP®, CFA, Hogan Financial

Stephen D. Johnson, MBA, CFP®, Johnson Lyman Wealth Advisors

William C. Prewitt, M.S., CFP®, Charleston Financial Advisors

Knut A. Rostad, MBA, Institute for the Fiduciary Standard

Daniel Bernstein, JD, Associate General Counsel to the Real Fiduciary™ Practices Board

Clark M. Blackman II, CFA, CPA/PFS, AIF®, Alpha Wealth Strategies (Emeritus)

 

NOTE: These practices and their guidance comprise the Real Fiduciary Practices. For additional guidance on the practices see the practices with background endnotes at:

https://thefiduciaryinstitute.org/wp-content/uploads/2019/03/Real-Fiduciary-Practices-2019-02-22.pdf

Pete Mattei, MBA, CFP®

Pete is a full-spectrum financial planner, investment advisor, analyst, investment fiduciary, and retirement plan consultant. Pete earned his BS in Fermentation Science from UCD in 1974 and his MBA from Stanford University in 1980. 

Prior to becoming a financial planner he had a thirty-year career as the senior winery and vineyards executive for Robert Mondavi and was an Epsilon client for many years. 

His role at Mondavi included extensive planning, budgeting, analytic, business process improvement, and financial responsibilities. 

Pete completed the CFP® (Certified Financial Planner) certification process in 2013.

Dennis Park, MBA, CFP®

Dennis is a founding Principal with Epsilon Financial Group, Inc. (EFG). Dennis utilizes his wealth of financial and business experiences to help clients attain their financial goals. 

Dennis received his Bachelor of Science degree in Economics from the United States Air Force Academy in 1978. 

During his flying years with the USAF, he obtained his MBA with an emphasis on finance. Subsequent to leaving the Air Force, Dennis worked in technical and financial management positions in Silicon Valley while continuing his education at Stanford University. 

He left Silicon Valley in 1990 to fulfill his career goal of becoming a financial planner serving individuals and small businesses. In 1992, Dennis attained his Certified Financial Planning (CFP) designation. 

In 1995, Dennis and Mark Sievers joined their businesses in a partnership that eventually incorporated as Epsilon Financial Group, Inc. in 2004. Dennis has three sons and two stepchildren. 

He and his wife, Glenda, enjoy many outdoor activities as well as the cultural activities offered at nearby cities. They are active in their local church and community organizations. Besides his family, one of his greatest joy’s is helping clients reach their retirement and financial goals.

Mark Sievers,
MBA, CFP®, AIFA®, CIMA®, CIMC®

Mark is a founding Principal of Epsilon Financial Group, Inc. He is a fee-only, independent financial advisor. 

For three decades, Mark has been helping individuals and their families realize their investment and financial goals. 

Mark is the trusted advisor to a diverse group of individuals and families, including business executives, attorneys, physicians, engineers, professors, retirees, former professional athletes, and many others. His clients are located in the San Francisco Bay Area and across the United States.

He had built his advisory business by combining a sound asset class investing methodology with financial planning and first-class client service.

Leo Martinez, AIF®, CDFA®, MBA

Leo Martinez began his career in the investment industry working on the trading floor of the Pacific Options Exchange. While working part-time as a clerk during the day he completed a Bachelors degree in Economics at UC Davis. Upon his graduation from the university, he returned to the trading floor full time to become a market maker and trader. He occupied a seat and was a member of the exchange for several years before the trading floor dynamics began to evolve into the currently popular day-trading format. After leaving the trading floor in 2002, he traded from home while obtaining licensing to work in the broker dealer industry. After a couple of years working in that industry, Mr. Martinez felt very disenchanted by the experience and was ready to leave the industry altogether. Leo obtained his Accredited Investment Fiduciary® (AIF) designation in 2007 and left the broker-dealer model. Intent on prioritizing clients’ interests above his own, he entered the registered investment advisor industry as an analyst and planner and joined Epsilon Financial Group. There, Mr. Martinez specializes in fiduciary consulting regarding retirement planning, trust administration and nonprofit advising. Mr. Martinez is also active in the community as a father to his three little girls and serves on various boards and committees.

Institute for the Fiduciary Standard
Real Fiduciary™ Advisors Code of Ethics

Name of Firm: Epsilon Financial Group
Source: Institute for the Fiduciary Standard
Topic: Real Fiduciary™ Advisors
Type of Registration: Registered Investment Advisor (SEC or State)

Fiduciary: A fiduciary is an individual or firm occupying a special position of trust and confidence, the highest standard in law. A fiduciary must act in the best interest of the client, without regard to the fiduciary’s financial interest.

Fee-Only: The advisor’s only method of compensation is a fee: Asset-based, fixed, or hourly. Real Fiduciary™ Advisors do not accept any type of commission for the sale of financial products, transactions, or revenue sharing.

Validation: Real Fiduciary™ Advisors validate their fiduciary practices by publishing:

  • The Institute’s Real Fiduciary™ Practices.
  • Online content that educates investors about fiduciary issues.

 

Real Fiduciary™ Advisors agree to:*

  1. Serve our clients as fiduciaries at all times.
  2. Only accept compensation paid to us by our clients.
  3. Avoid conflicts to the best of our ability.
  4. Disclose and explain important information and agreements verbally and in writing.
  5. Maintain our designations with ongoing education of knowledge and skills.
  6. Provide advice based on clients’ goals, circumstances, concerns, and tolerances for risk.
  7. Disclose clients’ fees and expenses in writing.

 

Acknowledged By: Epsilon Financial Group

*The Real Fiduciary™ Code of Ethics summarize the Real FiduciaryTM Practices of the Institute for the Fiduciary Standard. Our advisors commit to meet these practices. Email info@thefiduciaryinstitute.org. View the Real Fiduciary™ Practices, at: https://thefiduciaryinstitute.org/wp-content/uploads/2019/03/Real-Fiduciary-Practices-2019-02-22.pdf.

063020

Fiduciary eBook – 080120, Fiduciary Common Sense: View PDF

The Epsilon Name, Explained

Why do we have a spiral as a symbol in our logo and website? 

It comes from a strong historical and mathematical background.

The spiral is often called the Fibonacci Spiral that was developed by Leonardo Bonacci of Pisa, a twelfth-century Italian mathematician, considered by many historians to be the most talented Western mathematician of the Middle Ages.

Fibonacci is remembered for two important contributions to Western mathematics: helping to spread the use of Hindu systems of writing numbers in Europe (e.g. 0,1,2,3,4,5, etc.) in place of Roman numerals (e.g. I, IV, V, VI, IX, etc.), and developing the series of numbers which define the spiral that occurs so very often in nature (the Fibonacci Sequence).
The number series that describes the spiral and its significance was later adopted and further developed by Blaise Pascal, a seventeenth-century French mathematician, who created Pascal’s Triangle and its importance in probability theory.

Within the architecture of the spiral lies the foundation for the Golden Mean, a ratio which has proven to be significant in many natural, biological, and architectural designs.

We have chosen our firm name “Epsilon” because of its use in statistical analysis to indicate how well a mathematical formula explains an analysis. Our objective is to explain as much as possible to our clients, enlisting them as partners in their success, and enabling them to make sound financial decisions.

Retirement Plan Solution​

Whatever your vision of the ideal retirement, you will need a long-term plan that ensures stable and sustainable income regardless of unexpected life events or market circumstances. If you are a corporate plan sponsor, we offer modern, lower-cost solutions to meet your employees’ goals and your fiduciary responsibility. We work with independent third-parties to provide record-keeping and third-party administration services to your plan. Our plans contain many of the latest plan design features, including auto-enrollment and auto-escalation, traditional and Roth 401(K) features, loans, etc. We work together with any necessary third-parties to make changes to an existing plan, or to design a plan from the ground up. We provide fiduciary investment advisor services to your plan, in accordance with ERISA section 3(38), and we accept our fiduciary responsibilities in writing. For participant-directed 401(K) plans, we have developed a prototype investment menu that we customize according to your preferences. Our prototype menu includes, and allows participants to choose from the following:
  • Well-diversified, low-cost, professionally managed mutual funds across may asset classes, allowing participants to build an efficient and robust investment portfolio in the plan;
  • Model portfolios that manage to a targeted level of investment risk
    • These model portfolios are built entirely with mutual funds available to the participants generally, and do not incur additional fees for managing the models
    • These model portfolios are rebalanced regularly to ensure they maintain their advertised levels of risk; and
  • Target date funds (TDFs), that allow participants to make a single decision (the Target Date), and then allow the professional investment manager to maintain and manage levels of risk across time (as the Target Date approaches, and passes).
As fiduciary advisors to the plan, we are compensated only with fees from the plan. We do not accept any other form of compensation, including from any third-party financial firms for any reason, including for putting particular investments in our clients’ plans. We conduct initial and ongoing due diligence on the investment choices, and provide regular reports to plan sponsors on the activities and performance of their plans, including participant activity and utilization, performance, and the ongoing due diligence we perform on the plan’s investments.

Generational Wealth Counseling​

While each family experiences generational wealth challenges differently, three areas, in particular, require thoughtful consideration and proactive guidance: managing the founder’s transition from wealth accumulation to legacy planning; preparing successor generations to be responsible stewards; and creating a unified vision for the family’s legacy.

We have decades of experience advising multi-generational families at every stage of the wealth lifecycle, from accumulation through protection and into distribution and estate. We are able to share our observations and strategies for overcoming common challenges and creating enduring legacies.

From Accumulation to Protection
to Distribution and Estate

It is human nature to delay thinking about the future. Transitioning from wealth builder to wealth distributor can be difficult, especially for baby boomers whose life expectancy and work ethic are redefining the concept of retirement.

This can manifest, for example, in a tendency to emphasize asset growth over legacy and philanthropic planning. A founder’s inclination to maintain the status quo may also narrow the window of opportunity to expose the next-generation to the principles of responsible wealth management. Additionally, founders who themselves grew up without wealth have difficulty knowing how or when to discuss family values around money and family legacy goals.

In order to achieve their goals as successfully and efficiently as possible, founders must eventually consider the distribution of their wealth. Initial and annual activities can be designed and implemented that will accomplish their goals.

Preparing the Next Generation
for Responsible Stewardship

Many parents are uncomfortable discussing wealth and inheritance planning, but failure to do so can create other challenges. Successor generations must be prepared for the challenges and responsibilities that come with inherited wealth, both to assure their personal financial sufficiency and to assume stewardship of the family legacy. Younger family members need to develop sound financial management habits, understand family values and become familiar with the family’s investment, estate and philanthropic strategies. Age-appropriate education and ongoing family conversations are essential.

Creating a Unified Vision
for the Family Legacy

The most successful intergenerational wealth transfers occur when the family has a unified vision for the legacy they want to preserve. Yet, identifying a common purpose can be a challenging process. Should assets be distributed to heirs, protected for future generations, used to fund philanthropy or some combination?

The answers to these questions are shaped by the objectives of the founders and individual family members. In the ideal case, family values, attitudes and objectives align. In reality, they usually do not.

Healthy family communication is critical. Our advisors have experience facilitating family meetings where differences can be aired and reconciled, and common ground can be discovered, and implementation strategies can be established.

Epsilon Financial Group exists to help our clients make sound financial decisions. Our advisors have experience providing families with the forward-thinking advice and solutions necessary to pave the way for a smooth transfer of family wealth, laying the groundwork for future generations.

Portfolio Management for Trustees and Fiduciaries

Epsilon Financial Group offers expertise and guidance to help a fiduciary fulfill the sacred trust to clients while managing the professional risk arising in their practice.

Fiduciary Responsibility

Your role as a professional fiduciary covers many areas and requires expertise in many fields, including the advanced principles and tools of prudent investing.

You have obligations to beneficiaries, to the court and to yourself. In today’s litigious atmosphere you have significant legal exposure as well. Following established fiduciary standards and methods will help you manage investment risk for clients while reducing your own professional liability.

You are now required to implement an ongoing investment process that is more complex, sophisticated and demanding than under prior law. It is not enough to deliver good investment results. Indeed, the quality of the result may be in the eye of the beholder. You must justify your decisions according to the rules of fiduciary prudence.

This duty extends beyond a knowledge of Modern Portfolio Theory, or portfolio diversification, or investment manager selection. Fiduciary prudence is satisfied by incorporating the legal standards of care into an investment management process. It’s not enough to know the law. You must apply the law through fundamentally sound investment decisions. Balancing these efforts takes knowledge and resources.

The principals of Epsilon Financial Group are investment fiduciary experts and experienced investment advisors. We are uniquely qualified to help you apply the standards of fiduciary care in portfolio design and investment management.

An investment fiduciary manages property for the benefit of another, exercises discretionary authority over assets or controls investments outright, or renders comprehensive and continuous investment advice for a trust or other entity. The sources that define fiduciary responsibility are extensive and include, among other, the probate code, the Uniform Prudent Investor Act, the American Law Institute Restatement Third of the Law on Trusts and Prudent Investor Rule.

 

Benefits to Your Fiduciary Practice

A comprehensive and objective investment decision making process leads to greater financial organization, empowerment, confidence, fulfillment of duties, better results and ultimately, peace of mind for the fiduciary who uses a prudent process.

 

We can help you:

  • Establish written evidence of stewardship.
  • Improve communications between all parties through meetings with minutes and written reports.
  • Document investment practices.
  • Discover investment or procedural risks not previously identified or understood.
  • Uncover procedural omissions or shortcomings – and prioritize investment management projects.
  • Determine whether applicable “Safe Harbor” provisions have been satisfied.
  • Incorporate prudent fiduciary practices that may increase long-term investment performance. These may include
  • Reducing fees across the entire investment management program.
  • Aiding in the selection of more appropriate managers.
  • Terminating inappropriate managers.
  • Provide an excellent educational forum to assure that all involved parties are familiar with their duties and responsibilities.
  • Identify more appropriate fiduciary procedures, pricing venues and investment vehicles to better manage an increasing asset base.
  • Compare your practices and procedures to those of your peers.
  • Establish benchmarks to help measure the progress of an investment committee or consultant.
  • Use a prudent process to negotiate a lower premium for Errors & Omissions ( E&O ) insurance coverage.
 

We are Independent, Fee-Only Advisors

Just as you want your other professional advisors (accountants, attorneys, physicians, etc.) to advise based on what they know to be best for you rather than what pays the highest commission or fee, Epsilon Financial Group only receives compensation through advice fees our clients pay us directly. We do not use investment tools that pay commissions or other forms of compensation. We do not have any conflicts of interest impacting the advice we give regarding your financial goals and investment management needs. We fully disclose our fees in the initial documentation we prepare and with each subsequent reporting cycle. Only through this form of compensation can you be sure your advisor keeps your best interest at the forefront of all recommendations and decision making.

 

Personal Financial Planning and Wealth Management

Epsilon Financial Group provides comprehensive wealth management advisory services to employees, independent contractors, professionals, business owners, retirees, and their families. We help clients organize, plan and manage their wealth to achieve their unique goals. Our solutions are customized to each client’s individual spectrum of financial planning needs.

We provide ongoing financial advice to help clients achieve their goals. Financial decisions impact other aspects of a financial picture.  We encourage our clients to communicate with us regarding all of their financial issues to fully integrate solutions with needs.

We provide advice in the following areas of:

We work with clients to develop an overall understanding of how the global capital markets operate generally, how financial returns are determined largely by the amount of related risk, and how investors can reap the rewards of investing as long as they are willing and able to accept the risks that go along with investing in the financial markets.

We develop investment portfolios that are tailored to a client’s unique investment time horizon, goals and constraints

We monitor and maintain these portfolios over time to ensure they continue to meet our clients’ unique needs, as they progress through the various life stages.

We work with clients to understand their retirement investments, any pension or retirement plans to which they have vested interests through their employment, and Social Security, as it applies to their personal situations.

With a broad understanding of these retirement cash flows “in”, and in consultation with clients to understand their goals for (and planned expenses in) retirement (cash flows “out”), we help our clients make sound financial decisions in planning for this significant milestone.

We do not prepare tax returns for clients.

Through our professional and continuing education, we remain aware of the significant tax effects on investments and family wealth, and work with clients to implement strategies to optimize after-tax wealth.

We are not attorneys, and we do not prepare estate plans.

Through our professional and continuing education, we remain aware of recent innovations in estate planning techniques, and we work with local attorneys specializing in Estate Law in order to provide coordinated service to our clients.

We are not licensed to sell insurance, and we do not sell insurance or related products.

Through our professional and continuing education, we are able to work with our clients within a comprehensive planning process to identify key areas of risk, and identify representative insurance techniques and products that could serve to manage these risks to levels our clients find acceptable.

We understand that higher education represents an important goal for many individuals and families, and can also have a significant impact on financial resources.

We work with individuals and families who are currently struggling to manage education debt, as a part of their overall financial and wealth picture.

We also work with individuals and families who are planning for future educational activities (usually for their children and grandchildren), and who want to consider the impact on their financial situation of paying for them, and strategies for planning ahead to do so most efficiently.

A significant factor in a family’s long-term wealth and financial health is their ability to save regularly.

We work with clients to understand their monthly cash flows, and to help them develop spending targets and savings strategies that help them achieve their financial goals.

As independent, fee based financial planners we are not limited by particular company products in addressing our client financial needs. Our solutions are based on what makes the most sense for our clients and offers the greatest probability of success.