Frequently Asked Questions Q 1  How many clients do you serve and what is the size of the average portfolio? Q 2  Do you provide hourly advice? Q 3  How do your services compare with those provided by brokers and other providers? Q 4  How do you compute fees? Q 5  What are your criteria for accepting clients? Q 6  What is a CFP®practitioner (Ted Kutscher, Cameron Barsness)? Q 7  What is a CFA (Scott Rhodes)? Q 8  What is NAPFA? Q 9   How often do you review clients' portfolios and do you provide a comprehensive report? Q 10   What services do you provide in-house? Q 11   What services do you provide through professional relationships? Q 12   What is the significance of "fee only" financial planning? Q 13   What is "Comprehensive Financial Planning"? Q 14   What is your relationship with Kutscher Hereford Bertram Burkart PLLC? Q 15   What is an "Investment Policy and why is it so important? Q 1  How many clients do you serve and what is the size of the average portfolio? A We have approximately 75 clients whose investment assets range from about $600,000 to $8 million. Of these, about 90% are individuals, 10% are trusts and corporations. Individuals range in age from their early 30s to their 90s. back to top  Q 2  Do you provide hourly advice? A Our commitment is to provide the highest level of comprehensive financial counseling. We are convinced this works best when the relationship is long-term. We typically do not provide "one-time" reviews (although we receive requests for this frequently) because the time and effort involved in developing a temporary understanding of a new client's financial terrain detracts from our ability to focus on our long-standing clients. back to top  Q 3  How do your services compare with those provided by brokers and other providers? A Please see Services Comparison Chart. back to top  Q 4  How do you compute fees? A Our fees are determined by the size of each client's investment portfolio (which encompasses all assets other than residential properties, personal use items such as cars and business assets). Special arrangements are typical for employee stock options and concentrations in a particular investment. We typically do not charge an hourly fee because we believe fee-for-time contracts detract from our focus on long-standing clients. Typically, our services are cost-effective for clients whose investment assets exceed $600,000 due to our minimum annual fee arrangement of $5,000. back to top  Q 5  What are your criteria for accepting clients? A Given our objective of providing personalized guidance with a relatively small, close knit professional staff, we selectively add clients who can benefit from our services and have a high likelihood of developing a long-term relationship with us. back to top  Q 6  What is a CFP® practitioner (Ted Kutscher, Cameron Barsness)? A The CFP® certification is a financial planning credential. Financial planners generally offer advice concerning estate planning, investment allocation, taxes, retirement planning, risk management, and insurance. Requirements -- The CFP® certification is awarded exclusively by the Certified Financial Planners Board of Standards. In order to use the designation, the CFP Board equires the following three E's of its candidates: Education: The Board of Standards requires that certain academic courses be fulfilled before one can sit for the CFP® exam. Examination: The actual CFP® exam is given over a two-day period and covers numerous topics within the financial-planning field. Unlike the CPA exam, a candidate must pass all portions of the test in one sitting before the CFP® certification will be given. Ethics: Like most other professional organizations, the CFP Board requires its members to abide by a stringent code of ethics and professional standards. Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame design) in the U.S., which it awards to individuals who successfully complete initial and ongoing certification requirements. back to top  Q 7  What is a CFA (Scott Rhodes)? A The CFA designation is often thought of as the pinnacle credential in the investment field. It is a difficult professional designation to obtain, involving a rigorous battery of tests to be passed as well as an experience requirement. As such, CFAs are sought on Wall Street. Most individual investors will come into contact with CFAs when they read research reports published by various investment firms. The CFA credential may also be found among portfolio managers, investment consultants, and a wide variety of others within the finance and banking industries. Requirements -- In order to qualify for the CFA designation, one must pass a series of three tests administered by the Association for Investment Management and Research (AIMR). The exams are given sequentially, and are only administered once a year, typically in June. Roughly half of those attempting the first level fail the exam. The CFA exams are geared toward testing skills in investment decision-making and cover the broad subjects of accounting, finance, statistics, and economics. Among the specific topics tested are asset valuation, portfolio-management theory, and various quantitative skills. As with most other professional designations, CFAs are required to sign a code of ethics and professional standards. This form is submitted to and kept on record by AIMR. All CFAs are also required to be members of AIMR as well as a local chapter of the Financial Analysts Federation. back to top  Q 8  What is NAPFA? A Founded in 1983 and devoted to the objectivity of fee-only financial advice, the National Association of Personal Financial Advisors is the largest professional association of comprehensive, fee-only financial planners in the United States. The 750+ members and affiliates, in 45 states, provide consumers and institutions with comprehensive and objective financial advice on a "fee-only" basis, keeping foremost in mind the best interests of the client-- with neither the advisor nor any related party receiving compensation contingent on the purchase or sale of a financial product. NAPFA members define their role in terms of "The Three Cs" of financial planning: COMPREHENSIVE planning that takes into consideration all of a client's needs and goals, and is regularly reviewed and updated. The highest standards of COMPETENCE. COMPENSATION untainted by receiving any type of fee from vendors of financial products. back to top  Q 9  How often do you review clients' portfolios and do you provide a comprehensive report? A Following the yearly review and rebalance, we provide our clients with a custom tailored comprehensive annual report. This report provides budgeting information, tax and cash flow analysis, retirement and savings projections, investment performance and market analysis. We prepare the report after extensive consultation and a thorough review of each client's assets and liabilities. We include specific financial and investment recommendations that our staff can implement with the client's approval. back to top  Q 10  What services do you provide in-house? A Among the standard services we provide are the following: Balance Sheet Preparation Cash Flow Preparation and Analysis Estimation of Taxes and Tax Planning Investment Goal Determination Investment Policy Determination Asset Allocation Analysis Portfolio Optimization, Rebalancing and Review Retirement Needs Projection Savings Needs Projection Investment Recommendations & Review Investment Advice to Trustees and Fiduciaries (including Retirement Plans) Employee Stock Options Strategies Insurance and Risk Management Analysis and Recommendations (Life, Property, Auto, Health, Long Term Care) College and Educational Finance Planning Budgeting and Spending Analysis Comprehensive Annual Written Report back to top  Q 11  What services do you provide through professional relationships? A While our firm provides most financial planning services in-house, the following additional or complementary services may be provided by other professionals and businesses not affiliated with our firm, depending on your needs and desires: Accounting Brokerage Services Trust Services Custodial Services Insurance Tax Return Preparation Bookkeeping Specialized Legal Services Money Management and Stock/Bond Selection back to top  Q 12  What is the significance of "fee only" financial planning? A We do not accept commissions or compensation from any source other than our clients. We are convinced this significantly reduces conflicts of interests. A word of caution and discrimination is appropriate in this regard : so-called "fee based" or "fee off-set" planners may charge both a fee and receive commissions from selling products. We believe that in arrangements other than "fee-only", a conflict of interest can arise which may motivate an individual to favor certain financial products over others or to recommend an inappropriate transaction. back to top  Q 13  What is "Comprehensive Financial Planning"? A Comprehensive planning, as we envision and practice it, means committing ourselves to learning and digesting the details and issues of your financial life, or what might be termed your unique "financial DNA," not just the investment selection issues attended to by many planners. These include written projections and analysis, at least once a year, of your: Cash flow Tax situation Savings for education commitments and retirement Spending and budgeting (assessing each year what is a responsible and sustainable amount to use from your investment portfolio) Insurance and risk management Estate plan In addition to planning, we assist in implementing your financial plan. We coordinate with your other professionals, such as lawyers and accountants, as applicable. back to top  Q 14  What is your relationship with Kutscher Hereford Bertram Burkart PLLC? A Kutscher Hereford Bertram Burkart PLLC ("KHBB") is a law firm with whom we share office space. Two of our principals, Ted Kutscher and Scott Benner, are lawyers and are part of KHBB. For more information about that firm, see www.khbblaw.com. We believe that the experience of Ted and Scott with estate planning, trust operations, negotiated investment transactions and similar legal matters adds a distinctive complexion to our professional advice and enhances our ability to counsel clients on financial matters. We also believe we are attuned to legal issues and encourage clients to consult with their legal counsel, whether that be KHBB or the many other law firms with whom clients maintain relationships. back to top  Q 15  What is an "Investment Policy and why is it so important? A An "investment policy" describes your expectations about investment performance and how much volatility you are willing to accept in achieving your investment goals. In a sense, your policy embodies long-term guiding principles that, once established, should be retained unless your long-term investment goals change. We anticipate your policy will remain consistent from year to year, unlike your short-term strategic asset allocation and tactical asset allocation that are adapted intermittently in response to your financial needs and market opportunities. Your policy is expressed in terms of your portfolio's ratios of cash equivalents, bonds, and equities (stock and real estate). back to top  © Copyright 2010 - Frederic T. Kutscher Associates, Inc. All Rights Reserved. | Disclaimer