Offering affordable financial planning is the mission of Humanity Wealth Advisors, along with making the world a better place. We are passionate about providing every person and family with the opportunity to be financially successful. If you are seeking professional help to get ahead in life financially, take this article seriously, and make the first move to gain access to financial literacy to make smarter money moves.
What is financial planning?
Financial planning is the process of managing your money. It can encompass a few things:
- Setting goals for yourself (e.g., buying a house, retiring early, or paying off credit card debt)
- Take stock of where you are now (e.g., how much money you have in the bank, whether or not your investments are on track)
- Deciding what to do next (e.g., setting up an automatic savings plan with one lump sum each week versus making small changes here and there)
Financial planning for DIYers
If you want to do it yourself, there are many ways to do so, but how will you know you are doing it correctly? Of course, there are software and web-based tools from companies to help manage your money, but do you have the time or will to do so? If you are a DIY investor and prefer to stay that way.
In addition, many books available on personal finance and investing provide a good starting point for those who want to learn more about financial planning without hiring an advisor. A quick search online will net numerous titles that cover everything from setting up budgets to choosing mutual funds and other investments — even how 401(k) plans work!
At Humanity Wealth, we have a strategy that supports the efforts of DIY financial planning. It’s called subscription-based financial planning, in which we can support your efforts as needed, to help you keep your finances aligned with your life goals.
Financial planning for newbies
If you are just getting started with financial planning (no matter your age), you can make smarter decisions by getting comprehensive support from a professional, and there are many options out there. Finding support that fits your budget is essential if you seek in-depth advice from someone who’s been through the process for years – and knows about investments, savings, taxes, and retirement planning.
What is fee-for-service financial planning?
The fee-for-service model is a flat fee you pay to your financial planner for the planning process. This means that there are no hidden fees or commissions taken out of your money, and there’s no percentage of your assets, income, or portfolio that the advisor receives a percentage of. A subscription model can access affordable financial planning in the Bay Area.
What is a subscription model for financial planning?
If you want to work with an advisor but do not have many assets to invest in, then the subscription model may be for you. Isn’t it nice to know that hiring a financial advisor can be in your immediate future?
Subscription models are growing in popularity because they are designed for DIYers and newbies. You pay a monthly fee instead of paying for each service separately. This can be helpful if you’re just starting out investing or if your financial situation frequently changes (for example, if your business grows).
How do I know if a fee-for-service financial planner and/or a subscription model is right for me?
It is important to consider a few factors to make an informed decision.
- You should know your financial goals. Are they short-term (i.e., saving for a vacation), medium-term (i.e., paying off some debt), or long-term (i.e., purchasing a house)?
- What is your current financial situation? Are you saving enough for retirement? Is there anything that needs to be addressed immediately?
- What do you know about investment options beyond index funds and ETFs? Do you understand how money market accounts work and why they might be useful for some people but not others?
While some may find one model more appealing than another because of personal preference alone—such as preferring paper statements over online access—you should always consider whether one method will better serve your needs than another before deciding which way forward will work best in helping reach those goals.
How to find a financial advisor without a minimum asset requirement?
There are a few ways to find a fee-for-service financial planner without a minimum asset requirement.
- First, you can search for one through the National Association of Personal Financial Advisors (NAPFA). NAPFA is an organization of independent fee-only financial planners that limit their practice to advice, education, and coaching. They do not sell insurance or any other products and have stringent criteria for membership, including a fiduciary standard, professional experience requirements, and ongoing re-certification exams.
- Second, if you don’t want to work with someone who is not required to adhere to the fiduciary standard (which means they put the client’s best interests before their own), then consider asking friends and family members if they know anyone who can help with your finances. Keep in mind that their financial situation may differ from yours and that you may not be in the same position to get that help.
Fee-for-service financial planning may be the best fit for you if:
- You are new to the world of financial planning
- You are in the early stages of your career
- You don’t have the assets to justify working with an advisor who charges based on a percentage of your assets
Team up with Humanity Wealth Advisors
We hope this article has helped you better understand the fee-for-service model for financial planning. If you’re a DIYer or newbie and don’t have the assets to justify working with an advisor who charges based on a percentage of your assets, then fee-for-service may be the best fit for you.