Disrupting the Broken System
Old School Advisor: “How old are you?”
Client: “I’m 40 years old.”
Old School Advisor: “I see, well it clearly shows in our sophisticated proprietary computer model that your optimal asset allocation is 35% fixed income and 65% equities.”
Client: “Oh. Uh, ok, sure”
Old School Advisor: “Now do you see how we add value? AND…we only charge 1.50% per year in addition to these expensive commissions that you don’t even see!”
This old-school, antiquated form of financial planning serves to benefit the advisor, not the client. Commissions. Pesky Fees. Not being in control of your assets. Lacking unbiased guidance. This is THEIR model, created for THEIR profit while keeping the consumer in the dark. There has to be less conflict of interest for you as the client, where you feel empowered and educated without being taken advantage of.
At Financial Optimist, we want to make sure you feel a better sense of direction with your finances while providing peace of mind for you and your family. We will never sell products or receive commissions/kickbacks from third parties. You will always receive objective, independent advice from a dedicated fiduciary, advice-only advisor that wants to help you navigate life’s uncertainties. In plain words, your needs come first, ahead of anything else. It’s simple. To us, that’s the way it should be and why Financial Optimist was born. Financial Optimist is an advice-only/fee-for-service comprehensive financial planning firm. This is what sets us apart from our competitors. But what does “advice only” mean, and why does it set us apart? There are two primary forms of compensation for financial advisors.
The first way is through earning commissions on sales of financial products like stocks, annuities, mutual funds, and life insurance. In this case, the advisor is paid by the company that sells the products listed above.
The second way a financial advisor can be compensated is through the client paying a fee directly to the advisor for services provided. Think of it as paying for “advice” in the form of billable hours or a retainer instead of commissions, fees, and/or a percentage of assets under management. So why should advice-only matter to you? If a financial advisor is paid a commission, they're being paid by a company for selling a product to you. So they’re incentivized to sell you that product, whether it is best for you or not. On top of this, these advisors can also charge additional fees for assets under management, 12b-1 fees, and so much more. An advisor that receives commissions isn't necessarily bad; however, the financial advisor is not considered to be acting in a fiduciary capacity when they receive commissions due to conflicts of interest that may exist (they may be acting in their best interest, not yours). This is not to say that financial advisors that receive a commission cannot act in your best interest; however, they are not considered fiduciaries and will not be held to a fiduciary standard.
Financial Optimist was created because we didn’t want to toe that line. The old-school model doesn’t work for us because it doesn’t effectively work for you. We want to stand out from the crowd and proudly make a living through increasing financial literacy and being a teacher of personal finances. This is our passion.
A financial advisor that is compensated only through a fee-for-service is considered both “fee-only” and “advice-only.” As mentioned above, the client pays the fee directly to the advisor for their professional services. We do not sell any products; therefore the fiduciary standards apply to everything we do and allows us to avoid the conflicts of interest you will find at other advisors. Financial Optimist is a family-oriented firm that was created to prioritize ethics and education above profits.
Our Promise For G.O.O.D is to give you unbiased Guidance. To coach and hold you accountable, while providing you with the tools to achieve your goals. To be Organized. Our intention is always to invest in you and your family’s personal happiness while helping you Optimize your finances. A commitment to you and your family, with trust and loyalty, that’s just true Dedication. To make sure you know we mean it, here is a signed oath with that promise.
We chose this profession and this fee structure to be a fiduciary and to be someone that our clients can trust to do what's in their best interest, not our own. If you feel that you are not accomplishing your goals or not living the life you want to live because financial decisions are difficult for you, please reach out; we would love to assist you in any way that we can.
