HOW WE GET PAID
College planning is a service of Financial Management, Inc. an Independent, Fee-Based, Registered Investment Advisory and Wealth Management Firm based in Central Washington. Since 1991, we have grown to three offices with ten advisors and staff specializing in helping our clients achieve financial security and independence. Our planning, wealth management, and advisory services founded on our overriding principles of independence, integrity, and commitment allow us to be client-centered in providing our planning results.
Because we are Fee-Based all of our planning services are customized to be objective and meet the individual needs of our clients. Our goal is to give you value far in excess of your planning fee. We do this through tax savings, improved cash flow, and investment strategies designed to save you money and increase your net-worth.
Our college and retirement planning pricing is usually a fixed fee depending upon your needs. This fee is usually determined at the end of the first meeting, by agreeing to the scope of services in writing before proceeding. This allows for complete and fair disclosure and clarifies expectations for our clients and our advisors. If we are managing client's assets we charge a small percentage of the assets managed. In some cases we charge by the hour.
Sometimes it is in the best interest of our client to use commission-based products such as life insurance, annuities, disability and long-term care insurance.
Here is an example of how you may benefit:
Brandon and JoAnne - Business owners who repositioned their assets and helped their son establish residency to lower costs.
Brandon and JoAnne owned their own business, with an annual income of $65,000. Their assets included $90,000 in home equity, $110,000 in a retirement account, $140,000 in business equity, and $9,000 in savings. Their consumer debt totaled $15,000. Their son Bryce had an additional $8,000 in Certificates of Deposit (CDs).
Goal: Brandon and JoAnne wanted to maximize Bryce's eligibility for financial aid and establish residency at a $24,000-per-year public university in another state.
Plan: To maximize Bryce's eligibility for financial aid, Brandon and JoAnne followed the recommendation of their college financial planning advisor and repositioned certain assets. They also employed specific tax strategies to lower their business income.
Result: Brandon and JoAnne saved $17,500 a year for Bryce's college and increased his financial aid eligibility by $7,500 a year. A well-planned series of steps helped their son establish residency in the state where he attended university, which reduced the cost of attendance by $10,000 per year.
Net Improvement: $47,000
Net Cash Flow Improvement: Increased by more than $6,000 per year
Net Retirement benefit: Contributions to retirement fund actually increased
Jim and Nancy reduced college cost despite having 1 student in college and 2 in high school and with very little saving.
Jim and Nancy had a student in their second year of college and a junior and a freshman in high school. They have incomes of $180,000 and they're paying for college from cash flow. They own income real estate and have equity in their home of $150,000. Qualified retirement assets are $310,000; investment assets are $33,000, and a savings of $9,000.
GOAL: Jim and Nancy want to send their children to a private university, but are not sure how to fund three kids in college at the same time.
Plan: Jim and Nancy's college advisor developed a plan showing them how to make the best use of different savings options and then projected the best way to pay for college utilizing their assets in their home and protecting their current assets while continuing to contribute to Jim's pension at work.
Result: Jim and Nancy have a plan to pay for college that can be updated as the kids enter college. At the same time, they were able to continue to fund retirement while reducing their overall taxes and maintaining their established lifestyle.
Net Improvement: $53,000
Net Cash Flow Improvement: Increase by more than $7,500 per year
Net Retirement benefit: No reduction as no retirement savings were diverted to pay for college
By investing in professional fee-based planning you may increase your ability to pay for college and without sacrificing your retirement assets, saving potentially thousands of dollars per year in education costs.
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