Steve Answers FAQs

Question: What happens on an initial appointment in your office?

Steve: The first meeting with a prospective client is really to get acquainted, discuss what they are looking for and what we provide... to find out if it's a good fit. In fact, I have had a standing rule in my practice for 31 years that no one is asked to sign anything or make any type of commitment on the first appointment.

Question: Is there anything I should bring to make our first appointment more productive?

Steve: Bring only yourselves and one hour of time. As mentioned before, the first meeting is really to get acquainted. However, many prospective clients come to me by referral, and seem sure ahead of time we will be a good fit. If the prospective client wishes to come prepared to begin the planning process, what will be needed is a full description of their Employer Benefit plan, including all retirement plans, both present and past; account statements for all investments, life insurance, disability insurance, long term care; and details of their mortgage financing and all other debt. The details of all this allows me to find the most cost efficient ways to reach their goals. It also allows me to determine the "holes" in the planning they have done so far. Often the answers that seem obvious to me are not recognized by the client, usually because they are too "close" to the situation or simply are not aware of the solutions. One wouldn't expect them to be, because it is not their profession.

Question: How are you compensated?

Steve: Great question. All financial products acquired in the marketplace have costs associated with their acquisition. Whether obscured in fine print legalese or openly disclosed in easy to understand English, the plain truth is that no financial institution or financial advisor works for free. Obviously, the consumer pays one way or the other. Having said that, the number of different fee and commission arrangements available to the consumer are numerous and designed to appeal to different investors given their different situations. It goes without saying that financial products offered by an experienced professional in the context of coordinated planning has a different price tag than financial products acquired through a discount broker after spending ten minutes on a toll free line with someone you've never met face to face. In any case, my approach is to explain all these choices to the client and let them choose. The key here is transparency...nothing hidden, nothing left for the client to discover later regarding fees and expenses.

Question: I noticed that you do not list individual securities as products offered. Why?

Steve: It is my belief that trading individual securities in the context of serious financial/investment planning is a losing proposition for most people most of the time. I know that is a generalization and has exceptions. But for my clients, it would most often be a distraction. In my opinion, serious investment planning requires me to suggest portfolios based upon diversification and asset allocation strategies which will both reduce risk and enhance return over the long term. While no assurance can be made of a particular outcome, I believe this is best done through mutual funds, managed accounts and other types of pooled arrangements. It's important to note that I avoid recommending any investment that is managed by only one manager or any managers who have less than ten years of experience. The capital markets are much too complex to place "serious" money with anyone too young or inexperienced. On rare occasions, clients may "park" individual securities with us that they plan to hold indefinitely. But to summarize, my clients have me handle their serious money... their IRAs, their 401(K) Rollovers, their recent inheritances, their children's college funding, life insurance proceeds...the money they can't afford to make mistakes with.

Question: Are you claiming you never make mistakes?

Steve: Of course not! But, I try hard to recommend strategies and products which are most likely to mitigate the affects to my clients of any inadequacies I may have. Let me explain. First, I never practice beyond the scope of my knowledge and experience. Other professionals should always be included on the "team". Secondly, diversification can greatly reduce the impact of a few bad choices. Some ridicule this concept by saying, "put all your eggs in one basket, then watch that basket very closely." They are wrong, in my opinion. The problem is they can never watch that basket closely enough! By this I mean the average investor can rarely gather adequate information on individual companies to determine the risks inherent in the securities of that company. Thirdly, I recommend only financial products I would, and frequently do, own myself. After thirty one years, I have seen every conceivable financial fad come and go. Wisdom, time, discipline and integrity are the keys to success. There is no substitute for these.