Below you will find answers to common questions. If your question does not appear in this list, please email or call us. Someone from our office will reply personally.
What is financial planning?
Financial planning is a process for achieving the future you envision. It begins with a snapshot of where you are today, and what your specific goals may be. Your goals may include buying a house, funding education, managing risk, reducing tax liability, planning for retirement or for the disposition of an estate. Financial planning considers all aspects of your financial picture carefully, including potential obstacles to your goals; and it develops strategies and recommendations to improve the chances of your success.
Why use a financial planner?
A financial planner is a professional who understands all aspects of your finances to help you avoid pitfalls and find optimum solutions more easily. A financial planner works with you to identify goals and take action to achieve them. Ultimately, the most important benefit of working with a financial planner is your peace of mind.
What is involved in a financial planning relationship?
We strive to know you personally; the better we know you, the more value we can provide. Once we enter into a relationship with you, we first review all aspects of your situation and help you set realistic, measurable goals. We identify potential obstacles to your goals and develop strategies to overcome them. As our client, you get attention to detail and prompt replies to your phone calls and emails; clear reasoning behind recommendations and follow-through; agreed-to recommendations; and complete confidentiality and honesty in all matters. Most of all, you get peace of mind knowing you are not alone.
What are the major areas of financial planning?
The major areas of concern in financial planning are: setting goals and objectives, and identifying issues that may affect their attainment; creating a net worth statement; developing an income tax strategy; reviewing insurance policies; reviewing current and proposed investments; planning for educational funding; planning for retirement; reviewing estate plans; and specific recommendations for action.
When is the best time to plan?
It is never too early or too late to start planning. No matter your age, your situation can improve by implementing a financial plan. The degree of success depends on your circumstances. The most important step is the first one: to acknowledge room for improvement.
What about other professionals?
A financial planner orchestrates the many facets of personal finance. In this role, we often work with other professionals, including attorneys, accountants, insurance agents, and trust officers. If we need to consult others and you do not have an existing relationship with a professional whose input you require, we will make professional referrals based on our considerable experience. We make referrals to independent parties with whom we have no economic ties.
What about my employer’s retirement plan?
We strongly support taking full advantage of your employer-sponsored retirement plans. We can assist you by making certain you are using them in the most effective manner possible in terms of contribution levels and investment selection. In addition, changing jobs can complicate the transfer of your plan’s proceeds. Expert advice in this area is crucial to achieving the retirement you envision.
Can you help me with my company stock options?
Incentive Stock Options (ISOs) and Nonqualified Stock Options (NQSOs) can be confusing. When should you exercise them? When should you sell? What should you do with proceeds?
The decision to exercise an option hinges on the current stock price and the company’s growth prospects. A deliberate exercise program can reduce some of the emotion tied to owning company stock. You must address Alternative Minimum Tax (AMT) issues when you exercise an ISO; selling too many ISOs in one year can result in a disqualifying disposition, thereby reverting an ISO to NQSO status.
Selling company stock often depends upon your current cash needs and your tax bracket, now and in the future. The exercise of additional options in the near future sometimes governs how you invest the proceeds. Pettinga Financial can help you optimize the exercise and sale of your company stock options.
What about taxes?
Your financial planning and investment management must include a solid tax strategy. We work closely with your accountant to make certain you are in the best tax position possible.
Is implementation help provided?
Following through with recommendations is crucial to the success of your financial plan. As a fundamental part of our relationship with you, we provide ongoing support and reminders when you need to take action. Frequent contact is a hallmark of our service. (Note: Clients for whom we prepare a financial plan, but whose money we do not manage, are responsible for implementing investment recommendations at their own discretion.)
What does an initial meeting involve?
The initial meeting provides an opportunity to ask questions and explore how financial planning and investment management will help your particular situation. We work according to your schedule and comfort level. You are under no obligation to commit to a relationship at the initial meeting. Regardless of whether you enlist our services, we hold your personal information in strict confidence.
Do you have a minimum account size?
We do not have a minimum account size.
How are fees determined?
Fees vary according to the work performed. Before we commence our work, we specify in writing the services we will be providing and the fee. The value of the work measured in tax savings and improved investment performance is often many times greater than the cost, bringing you a tremendous return on your investment. Most importantly, retaining our services buys you peace of mind and a good night’s sleep.
Why use professional investment management?
Your investment manager at Pettinga Financial stays abreast of events and changes in market conditions that affect your investments. Your investment manager reviews your portfolio regularly and makes adjustments when necessary. Pettinga can coordinate both regular and retirement account investments and provides you with periodic performance reports. We define investment objectives in simple terms and customize your asset allocation to ensure you have a clear understanding of your investment goals and limitations.
How are investments selected?
First, we determine asset allocation guidelines for your portfolio based on your goals and risk tolerance. Then we use fundamental analysis to select specific investments for your portfolio. We implement the investment plan after we have an agreement with you on the changes we will make to your portfolio.
How am I kept informed?
The custodians of your assets—brokerage firms, banks, and retirement plan providers—provide regular portfolio reports directly to you. Pettinga Financial provides you an integrated periodic report of your portfolio holdings and performance. We hold regular portfolio reviews with you to discuss your portfolio and confirm that your investments continue to reflect your objectives. You may also view your accounts online through the custodian’s website.
What makes you different than financial advisors at brokerage firms?
We are fee-only advisors. Commissions do not influence our advice because we do not accept them. Equally important are our professional qualifications and experience. When you are looking for a financial advisor, we urge you to look carefully at the backgrounds of the people you are considering. We are proud of our accomplishments, and are confident we are qualified to provide you with the counsel you need to reach your goals.
Why should I work with you?
Pettinga Financial is a fee-only firm that provides comprehensive, integrated financial planning and objective advice. You receive expertise in investment management and reporting, including online access to your portfolio. You can also get help with estate planning, which is too easy to put off. As our client, you get the insights of a collaborative team with its diverse strengths and varied experience.
Who are your clients?
- Business Owners
- Retirement Plans
- People of all ages (from 25 to 95, children and parents)