Managing personal financial affairs can bechallenging, much like completing a complexjigsaw puzzle. Each aspect of yourpersonal financial situation—whether taxes, investments,insurance, charitable giving, estate planning,or retirement planning—is just one piece of a largerpuzzle. An overlooked or incorrectly positioned piececan have unintended results, or worse, prevent thepuzzle's completion. The ultimate goal is to assemblethe pieces of your personal financial puzzle into a picturethat reflects your overall financial health. Sowhat specialists should you consult to assemble yourpersonal financial puzzle? The answer lies in thenature of your personal financial situation.
•Tax accountant. Beyond preparing your personaland business tax returns, an accountant can bea valuable resource for developing a strategy for mitigatingyour tax exposure. All accountants who practiceas certified public accountants (CPAs) must belicensed by the states in which they practice. Not allCPAs are tax specialists, so make sure your CPA is anexpert in discussing complex tax matters.
•Attorney. Many specialists can provide adviceon estate taxes and asset management at the time ofyour death. Only attorneys, however, are authorizedto draft legal documents such as trusts, wills, andpowers of attorney. Practicing attorneys must belicensed in the states in which they practice.Attorneys specializing in estate planning should besought for advice on estate tax and administrativeplanning matters and asset protection strategies.
•Insurance agent. Insurance products such aslife, health, disability, property, personal liability, andcasualty are important pieces too. Although there aremany specialists qualified to review your needs toensure you and your family are properly protected,only state-licensed insurance agents are permitted tosell insurance products. Many insurance agents haveobtained the Chartered Life Underwriter designation.
•Stockbroker. Investment products such asstocks, bonds, and mutual funds form the backboneof many investment strategies. Stockbrokers are thetraditional source for buying and selling securities.The advent of discount and Internet-based brokersand no-load mutual funds, however, has expandedthe available options. Brokers are licensed and registeredwith the National Association of SecuritiesDealers and the states in which they do business.
•Wealth management advisor. For most personalfinancial situations, the best solutions are generatedonly when all aspects of an individual's circumstancesare incorporated into a comprehensivestrategy with the help of a financial planner/wealthmanagement advisor. Unfortunately, the title of"financial planner" requires no specific education orexperience. As a result, the Certified FinancialPlanner Board of Standards has aggressively soughtto make the Certified Financial Planner™(CFP®) designationthe industry standard for financial planners.
In addition to possessing specific education andexperience, CFP®s are required to pass a rigorousexamination, adhere to a code of ethics, and participatein ongoing continuing education. Withthis background, CFP®s are generally well positionedto coordinate most activities of your personalfinancial situation. No one individual has allthe answers. Successfully completing your personalfinancial puzzle requires the coordination ofmultiple experts.
Timothy Wendt, CFP®, provides high-net-worth individuals andretirement plans with a wide range of services, including assetallocation, investment policy, and investment consulting. A specialarea of his expertise is with serving physicians. He welcomesyour questions and comments at 269-567-4621 orTimothy.Wendt@plantemoran.com.