Subtitled “What You Could Reasonably Expect a Good Financial Planner to Do for You”
People who are considering working with me sometimes ask, “So, Meg, what do you do, anyway?” Considering how much time I spend doing what I do, and perhaps given how I wasn’t trained as a marketer, I can struggle to boil it down to a few punchy bullet points. Nevertheless, it’s a very worthwhile question to ask (and have answered), so I’ve been mulling over how to answer it. Fully. And at length. Behold.
Why Is It Such a Mystery What Planners Do?
My communication inadequacies aside, I think the very existence and frequency of this question reflects the fact that the financial planning profession is not well defined. In fact, practitioners debate whether it actually is a profession yet (this video is interesting, but Beware The Giant Hands).
When you are finding a new doctor, you don’t ask her, “So, what do you do, doctor?” Or “So, what do you do, lawyer?” Everyone basically knows what doctors and lawyers do. Very few people know what financial planners do. Why? As I explain in this blog post, there is:
- No minimum training or education necessary to call yourself by that name
- No minimum set of competencies we can rely on such a professional to have
- A bewildering variety of companies that employ professionals who pitch themselves as financial planners or similar
- No easily quantifiable way to judge success
- A large trust deficit to overcome
What You Might Think Planners Do
So, thanks to this lack of “profession”-ism for financial planning, I find that most people looking to work with a planner for the first time (which is to say, most of my clients) either have no idea what financial planners do or think that financial planners manage money.
Well, at least I don’t have to disabuse you of any wrong notions! And to be sure, what I do as a financial planner is not the same as what other financial planners do, so what follows isn’t a template. But it should give you a flavor for the possibility of a financial planning relationship.
You Invest Money, Right?
Yes, I will invest your money for you. And that’s a useful, valuable service to provide. It is also the thing that has dominated the profession for the last few decades, so it’s no surprise you think it’s what financial planning is.
To get back to the original question: investing your money is one thing, of many, that I do. It’s a necessary but not sufficient part of being a good planner.
The technical aspects of investing have basically become a commodity. You can get reasonable (in investing, “excellent” or “successful” is determine only in retrospect) portfolios easily, without much investing knowledge, and inexpensively through stand-alone robo advisors like Betterment or Ellevest or all-in-one funds like Vanguard’s LifeStrategy or Target-Date Retirement funds. And the tools I use in my practice through TD Ameritrade make trading similarly efficient, easy, and inexpensive. I would therefore not encourage you to pay anyone much money to simply manage your money.
Specific Financial Issues I Help Clients With
The easiest way of explaining what I do is to list the financial opportunities, risks, or challenges that I help clients understand, make a decision about, and act on. What follows is one such list, long but not exhaustive. Feel free to skim. Ultimately what I do with you depends on your specific situation. But this list should give you a good flavor.
- Figure out how much of a cash cushion (emergency fund) you need, and how and by when you’re going to grow it
- Figure out what to do with extra cash
- Choose how much to save to your 401(k) and how to invest it
- Review your investments in all your accounts and suggest changes based on an assessment of your financial situation, goals, and attitude towards risk
- Identify your need for estate planning documents (a will, power of attorney, etc.) and help you find an estate planning attorney to create them
- Identify your need for tax-planning and tax-prep help and help you find an accountant
- Identify your need for life insurance or disability insurance and help you find an insurance broker
- Identify your need for a career coach, leadership coach, or recruiter and help you find one
- Remind you to designate beneficiaries on your retirement plans and insurance policies, and use “transfer on death” designations on bank accounts (kind of the same thing)
- Answer the question, “Should I exercise my stock options? When? And how many of them?”
- Make a plan for your Restricted Stock Units. What should you do with the stock when it vests (becomes yours)? What should you do with the cash if you then sell the stock?
- Figure out what to do with your stockpile of company stock. Sell it? (When and how much?) Keep it? Donate it?
- Make a plan for the money distributed from your Employee Stock Ownership Plan (ESOP)
- Provide ideas to your employer for retirement plans they could provide to their employees, emphasizing ease and low cost (if you work for a tiny startup, oftentimes there’s no retirement plan)
- Figure out how you can participate in your company’s Employee Stock Purchase Plan (free money!)
- Create a savings plan that simultaneously makes progress towards multiple goals: retirement, buying a home, and … whatever the hell is going to happen in your life 10 years from now
- Help you make the “Rent vs. Own” decision
- Figure out how buying a home fits into your current finances
- Figure out how to best come up with the down payment for a home purchase
- Pay down your debt–be it student loan or credit card or mortgage–in a way that balances tax effects, your need for cash flow, your emergency cash reserves, your desire to save, and your desire to get the hell out from under that debt
- Tax-savvy ways to help you support the charitable causes you care about
- Figure out how to share your financial good fortune with your family in a way that won’t put you at risk
- Fit a rental property into your financial picture
- Set up an automated savings plan that “pays you first” and doesn’t give you a chance to mindlessly spend the money you could be putting towards a better future
- Determine if you are currently in a good financial place or whether you need to play catch-up
- Evaluate employee benefits
- Evaluate a job offer
- Help you create a plan for professional networking and job skills development
What You Might Not Think Of. AKA, The Most Important Stuff.
That list above is an easy but rather simplistic way of understanding what I do. The second level, shall we say, of what I do for people is a little squishier than those very straightforward, tactical decisions above. But it’s where the magic happens.
- I bring clarity to what might feel like “an abyss of uncertainty,” as a client recently described it. Possibly you know quite a lot about personal finance. Google will gladly give you more information about personal finance than you can consume in a lifetime. And now you know 1000 things that should maybe do…but which ones are important for you and your family?
- I help you focus on the one, maybe two, things that you should be working on Right Now. No more ineffectually “boiling the ocean” in an attempt to fix everything in your financial life at one time.Here’s a common situation for my clients: She had several old 401(k)s from former employers. And she needed more disability insurance. And she had stock options to decide about. And she had almost no cash cushion. All these things are very important. I told her to ignore everything until she had set up automatic deposits to her emergency fund to get it fully funded within a year. Only then did we tackle the other parts.
- I help identify when your stated values and priorities aren’t reflected in your financial behavior. Does that mean you simply don’t have the right systems set up to work towards your goals? Or does it mean that those values and priorities aren’t as important to you as you thought?I spent the first 10 months with one client trying to save for a down payment on their first home. That was definitely priority #1. But the downpayment fund never got much bigger. Meanwhile, they were spending a lot of money on travel. We talked about this disconnect a few times, and ultimately they decided that, you know what? We value travel over owning our own home for now. We’d rather delay owning a home and travel more now. Now, their financial choices and their expressed values are aligned, and that feels good.
- I provide you with accountability to help you stick with the plan we make together. Behavioral change is hard, be it for your diet, exercise, finances, or relationship.I don’t know about you, but I can learn a whole lot from reading books, watching webinars, reading blogs, etc. But I actually get stuff done when I am working with someone on it. I’ve been working with a business coach since late last year, and knowing that we’ll be talking again about this decision or that priority encourages me to actually do the work.
- I help you learn about personal finance and so be more confident in your own finances. Not knowing about personal finance is pretty scary for people (for good reason!). My clients love finally understanding financial concepts that had been a mystery to them.One client practically did a happy dance the other day when she announced she’d moved her old 401(k) into her newly established IRA and invested it all by herself. That stuff just can’t be un-taught. Now she is permanently more equipped to understand and handle her finances.
- I give you “permission” to do the things you want to do or think you should do anyway. Not everything you want to do, of course, but if I don’t think it’ll put your finances at undo risk, I will likely give my stamp of approval.
I have a client who wants to buy a home but whose cash for down payment is a little light. I recommended she stop saving to her retirement account and HSA immediately and funnel all that money into a savings account for the next few months to build up her downpayment. She was so happy because she had thought of doing that but wasn’t sure it was the proper thing to do.
- I listen. Funny how when you start talking about your money, it’s got fingers into Every Other Part of Your Life. I’m not a mental health counselor, but I can tell you, simply having a trusted (hopefully) expert (no really) you can vomit all your financial anxieties and confusion on to can be worth the price of admission all by itself.
Does this fit your notion, however vague, of what a financial planner does? Or does it surprise you in some way? If it’s in a good way, reach out to me at or schedule a free consultation.
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Disclaimer: This article is provided for general information and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. I encourage you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Meg Bartelt, and all rights are reserved. Read the full Disclaimer.