I’m big into rowing – I’ve competed in quite a few boat races as the coxswain. For non-rowers, it’s pronounced “cox-en” and as Business Insider puts it I’m the “motionless member in the back of the boat.” But don’t let that fool you – even though I’m not powering the boat, I’m playing an important role steering it and directing my teammates.
As a research analyst at Parsec, I’m similarly steering our investment strategy and directing our financial advisory teams based on my research and that of my teammates.
Thus, I see a large part of my job (both in the office and on the water) is to provide guidance for people to get from where they are to where they want to go. And regardless of the goal, you need a plan.
Plans can be daunting to start, especially for those who don’t enjoy the upfront work. But, when it comes to your financial plan, we can help. All that we need from you is an understanding of your priorities and then our team works to develop a financial plan that supports your current needs and your future desires.
To help craft the best financial plan we will ask you questions such as:
- What is your risk tolerance? Your ability to accept risk is a very strong driver of what your portfolio should look like. Additionally, your level of risk tolerance is highly personal. This is an extremely important part of your portfolio and leads to personalized portfolio construction. As investment advisors, we know that the instruments in your portfolio should reflect your return/risk objectives and give you the peace of mind you desire while at the same time helping you reach your goals.
- If you are currently retired, what are your liquidity needs? Liquidity needs are spending requirements from a portfolio. Capital to fulfill those regular, anticipated withdrawals are ideally funded by more liquid investments. This is because more liquid assets, such as money market funds, can be sold more quickly and with less price impact than those of illiquid assets. It helps to have an appropriate level of liquid versus illiquid assets because each have their own advantages and disadvantages.
- How many dependents do you have? As we all know children are expensive! US News & World Report quotes that the price of one child is more than $230,000. Setting up accounts to help assist with medical (HSA accounts) and educational (529 plans) expenses is generally a good idea – we’ll confirm once we put together your specific plan.
- What are your special circumstances? For example, oftentimes a business owner may have a majority of his or her assets tied up in the business so it may be vital to look for ways to lower this risk and diversify. As I mentioned earlier, a financial plan must be personalized and address these unique circumstances for it to work.
Then, once a plan is set, it is critical that it is reviewed periodically. It is not a “set it and done” approach. This is because while goals may remain steady over time, circumstances and unforeseen developments can occur along the way. A plan that continues to adapt to your life is useful as this connects our financial strategy with your lifestyle so that you can rest assured your plan will serve you – and your family – long into the future.
Oftentimes if rowing teams win, they celebrate by throwing the coxswain in the water. I hope I can help you win financially but in return please don’t throw me in the water!