The First Financial Consulting Podcast

One of my favorite movie quotes is from a film called Miracle. If you’ve seen that movie, you know it’s about the 1980 U.S. Men’s Olympic Hockey Team, a team that was comprised of a bunch of college-age boys who were given no chance as they entered Lake Placid, NY in the Olympics. They ended up stunning the world by taking gold.

The scene that’s my favorite scene is the night when the U.S. is getting ready to play the Soviets. The U.S. coach, Herb Brooks, who’s played by Kurt Russell, gives what I consider the greatest pre-game speech. He says this, “Great moments are born from great opportunity. And that’s what you have here tonight, boys. That’s what you’ve earned here tonight. One game. If we played them 10 times, they’d probably win nine. But not this game. Not tonight. Tonight, we skate with them. Tonight, we stay with them because we can, and we shut them down. Tonight, we are the greatest hockey team in the world.”

He goes on, but as I’ve seen that clip probably about 50 times I am always impressed with the influence that a great coach can have on their teams. In my opinion, great coaches know their players. They know their weaknesses, they know their strengths. Great coaches know how to cast vision, and great coaches get their players to accomplish things that maybe they never even dreamt of.

I find there are a lot of similarities when it comes to coaching as there are when it comes to financial advising. Those same traits, I believe great financial advisors know their clients, and they know their clients by how they ask questions. And maybe more importantly how they listen to those answers. Great financial advisors know how to cast vision. They know how to come alongside their clients and help them accomplish their dreams and goals.

So, in this brief Bench Talk, I want to leave you with three questions to ponder. As it pertains to your financial plan, number one, what’s your vision? Two, what are your dreams? And thirdly, have you shared that with anyone? I’m absolutely convinced, whether it’s in the athletic arena or the financial planning arena, a great coach can make all the difference.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/

It’s important to assess the health of your estate plan. More often than not, people do not adequately prepare for estate planning and retirement. In order to make it easier, we compiled together 10 simple yes or no questions to help you assess your estate plan.

1. Does your family have a mission statement?
2. Can your heirs participate in decisions?
3. Do all your heirs have an option to participate in the management of the family assets?
4. Do all the heirs understand and want to fill that particular role?
5. Have your kids actually reviewed the estate plan?
6. Are you distributing your assets based on age or readiness?
7. Are you creating opportunities and incentives for your heirs?
8. Do the younger children participating in the family’s philanthropic decisions?
9. Does your family consider family unity to be as important as financial success?
10. Does your family communicate well and meet regularly to discuss major changes?

If you answered yes to 7 or more, you are doing great. If you answered yes to 4 – 6 of these, you are well on your way, but there are some holes that you need to review. And lastly, if you answered yes to 3 of less of these questions, that makes you normal. Most people don’t transition assets from one generation to the other successfully. Wherever you happen to be in this journey remember, completing the journey successfully means assessing first where you are and where you are starting from.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/

For today’s episode, I’m going to be talking about beer and financial plans. I know what you’re thinking, those two things don’t go together. But, the similarities may surprise you. As an avid home brewer I’ve spent countless hours trying to perfect different recipes. However, the process as a whole is actually quite simple and requires only four ingredients. You have water, grain, hops and yeast. From those we can produce hundreds of different beer styles with different colors, smells and flavors.

When creating a financial plan you only have a few main ingredients as well. Everyone has assets, income, and living expenses but everyone’s financial picture looks quite different. Just like with beer only a few ingredients can create many different outcomes. It is the craft of the brewer or the financial planner to then take those different ingredients and mold them into something special.

When it does comes time for your financial plan you’ll be glad to know that someone has thoroughly reviewed your financial ingredients and custom brewed a plan for financial success.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/

This episode is all about understanding your 401(k) plan. At its core, a 401(k) is a type of retirement savings plan that companies will offer to their employees to help save for retirement. The general consensus and what most of us have been told is that you should contribute to a 401(k). This is true for many of us, but a lot of people follow this advice blindly and don’t ask the right questions when it comes to their 401(k) plan. The goal of this BenchTalk is to provide you with a few tools that can help you maximize your 401(k) and ensure that you are saving as efficiently as possible for retirement.

In a typical 401(k) plan, your employer will contribute to your account on your behalf. These employer contributions mainly appear in two forms:

Outright Contributions

With this method, a company will contribute to an employee’s 401(k) as a straight percentage of the employee’s paycheck.  For example, the company might contribute 3% of your income into your account, regardless of any contributions you might make. If your employer does this, it will help you tremendously.

Employer Matching

This is the more common method of employer contributions that we see. With employer matching, an employer will match your 401(k) contributions dollar for dollar up to a given amount. For example, if you contributed 3% of your paycheck to your 401(k) your employer would match this and also contribute 3%.  It is basically free money going into your account. If your employer offers a 401(k) plan with employer matching, you need to make sure that you are maxing out the matching contributions every month.

Employee contributions are the contributions that you specifically make into your 401(k). These contributions are typically contributed as pretax dollars. This means that the money you contribute to your 401(k) today is not taxed. However when you withdrawal that contribution in retirement, you will be fully taxed at whatever your tax rate is in retirement.

The Roth 401(k)

On the flip slide, many companies are turning towards a tax-deferred retirement vessel called a Roth 401(k). A Roth 401(k) allows you to contribute to your retirement on a tax-deferred basis. This means that you are taxed on any contributions you make into your 401(k) at your current tax rate. When you want to withdraw money out of your Roth 401(k) in retirement, any withdrawals you make are 100% tax-free. All the earnings your 401(k) made throughout the years are also tax-free. The Roth 401(k) allows you to maximize the earnings in your account while also providing you with better tax flexibility. If you are familiar with a Roth IRA account, the Roth 401(k) is almost identical.

401(k)s are known for having a lot of fees. A huge part of understanding your 401(k) is being aware of these fees and how they might affect you. There are two main categories of fees in a 401(k).

Management Fees

In short, these are the administrative fees that you pay for being a part of the 401(k) plan. If you are lucky, some companies will absorb these fees for you but oftentimes, these fees are passed along to you, the participant. You should check your 401(k) policy to see how much, if anything, you are paying in management fees.

Investment Fees

Investment fees are arguably the most important fees in a 401(k) because you can control them. In a 401(k), your employer will typically have picked a number of mutual funds that you can invest in. Each mutual fund has its own investment fees associated with investing in the fund. These fees can be really low or really high depending on the mutual fund that you choose to invest in. Our advice is to look at each mutual fund you are currently invested in or plan to invest in to minimize your investment fees. If you are paying more than 0.05%, you might want to reconsider investing in that fund. Of course, there is more decision making that needs to go into this, but generally, this is a good place to start.

So whether it’s understanding the different types of contributions or how the fees and investment options work, you should have a better understanding of how your 401(k) works. In order to maximize your 401(k) and save as efficiently as possible for retirement, it all begins with analyzing your 401(k) plan. Some people are better at this than others, and we understand that. If you think you might need help, your HR department should be able to answer some of the questions you might have. If they can’t answer all of the questions you have, or even if you want to review the entirety of your retirement plan while you’re at it, feel free to reach out. We are always here to help.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/

One of the biggest concerns couples have is how to talk about their finances. When it comes to money and finances, this question almost always hits the top five list.

So, how should couples talk about finances? Well first, it’s important to ask these three questions: What? How? and When?

First, you need to determine what you are specifically going to talk about when it comes to your finances. Start by asking questions like what are you goals together?  What are your dreams?  What are your concerns?  Questions like these are crucial for you and your spouse to get on the same page.

Next, it’s important to ask how. How will you talk about your finances? The environment in which you talk about your finances needs to be open, safe, and honest.

Lastly, you need to ask when.  When should you talk about your finances. You need to set up a consistent time for you to discuss your finances together. Whether it be weekly, monthly, or even quarterly, you need to set apart specific time to talk about your finances.

Finances are not easy to talk about, but they are a crucial part to any relationship. You can’t stick your head in the sand and hope they will somehow sort themselves out. Learn how to effectively talk about your finances.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/

Do you want to be a millionaire? Of course, that’s a silly question because most people would answer yes. When we think of millionaires, we think of people with big mansions, fast cars, and elegant clothes and jewelry. We also tend to have an image in our heads of how they became millionaires. If you Google “how to become a millionaire,” you will see numerous results for how millionaires acquired their wealth. According to Google, here’s how people think millionaires acquired their wealth:

1. They Inherited their money
2. They got Lucky in the stock market
3. They are a brilliant high-tech Genius
4. They have a fancy Ivy League Education
5. They have a high paying Job
6. They are Dishonest and stole their way to the top

However, the reality of the situation is entirely different. Most are rarely flashy. In fact, people that look like they are rich are often times over spenders and have tremendous debt. Our preconceived notions of how the rich look and behave are entirely different from how most millionaires actually live their lives.

So how did millionaires get to where they are today? Well thanks to a guy named Chris Hogan and his team, we now have a pretty good understanding. Chris and his team interviewed 10,000 millionaires and in doing so, they debunked most of these myths.

• Inheritance? It turns out, 80% of millionaires today didn’t receive a dime from their parents.
• Luck? Roughly 75% of the interviewed millionaires said that nothing extraordinary happened in their life.
• Fancy Education? 60% of millionaires attended public schools and a lot of them didn’t even graduate.
• High-paying Job? Yes, some earned a decent living. However, roughly 33% never earned a six-figure income.
• Dishonesty? If we look at police statistics, the vast majority of all millionaires have never even been accused of committing fraud or a crime.

In their research, Chris and his team were able to identify three real ways on how to become a millionaire. Our own experiences at First Financial also closely mirror these three things. The top three ways people become millionaires are through their hard work, discipline, and attitude towards money. That’s it.

All these things are in your control and we’d be happy to help. Surveys show that over 60-80% of millionaires use a financial advisor. The reason? It’s actually a lot easier to influence all of these financial factors by allowing a financial advisor to help. Creating a financial plan with an advisor not only allows the advisor’s expertise to impact your finances, but it also keeps you accountable for your goals and work laid out ahead. If you think this might benefit you, give us a call. Our first consultation is always free and we’d love to see how we can help you achieve your goals.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/

After being in the business for a while now, I have found that most people really don’t know what we do. Of course, our clients know, because they see it on an on-going basis, but does the general public really know the value that we add?

Let’s take a step back…

Most of us are familiar with the traditional relationship with a stockbroker. He/she would call you about some “hot new stock” or tell you to “buy this!” or “sell that!”. That is NOT what where the business is today and it certainly is not what First Financial stands for.

First Financial has committed to giving 100% fee-only objective advice. Which means we don’t push any product, we are never selling clients anything, we simply receive an agreed upon fee for the advice that we give.

There are thousands of firms out there that do this very same thing and have committed to upholding the highest of standards when it comes to giving financial advice. Which leaves us with a question. How in the world do we differentiate ourselves? The answer is this.

Yes, we can help you decide if you can buy that new house, figure out when you can retire, or manage your investment assets, but we believe that a relationship with a financial advisor is so much more than that. Every single fee-only firm should be doing the exact same thing. What separates us is our ability to let our personalities shine through.

Clients should genuinely enjoy being around us. The enjoyment of each other’s company first leads to a greater sense of trust and then ultimately to a highly successful relationship. In our opinion, trust and comfortability are the two most important things. We could give the BEST objective advice possible, but if you don’t feel comfortable with us, why in the world would you listen or better yet, why would you act on that advice.

Here at First Financial Consulting, we aren’t trying to push you to do anything that isn’t right for you. We truly want what’s best for you. That’s why we’re so adamant about building incredibly strong relationships with our clients that will result in long-lasting and successful relationships. You deserve an advisor who will walk through life with you. That’s what we do with our clients, and we would love to do that with you, too.

The information discussed in this episode is intended for educational purposes only and should not be considered individualized financial, investment, tax, or legal advice. Everyone’s financial situation is different, and the strategies discussed may not be appropriate for every investor.

First Financial Consulting is an independent, fee-only fiduciary financial advisory firm providing comprehensive financial planning and investment management services.

Learn more about First Financial Consulting:
https://firstfinancial.is/