Welcome to episode 100 of ThimbleberryU, where we're diving into the integration of financial planning and wealth management at Thimbleberry Financial. Amy and Jag are also reflecting on the journey of the podcast over the past four years.
Amy emphasizes the importance of combining financial planning and wealth management. Financial planning is not solely about investment management.She highlightsthe various elements involved, such as goal identification, cashflow, debt management, insurance, real estate, education, retirement, estate planning, and taxes. All of these components are like pieces of a puzzle, with each piece interlocking to create a complete financial picture.
In discussing the challenges of managing multiple financial goals, Amy provides a real-life example of someone wanting to buy a new home while planning for early retirement. She explains how the integration of financial planning and wealth management allows them to navigate complex situations, ensuring that all financial pieces work together harmoniously.
Jag raises the question of what happens if a client prefers one service over the other. Amy emphasizes the importance of educating clients and guiding them toward making informed decisions that align with their financial goals. If a client remains set on one specific approach, Amy is open to referring them to other advisors who may better suit their preferences.
Costs in financial advisory services vary widely, and Amy clarifies that Thimbleberry Financial has a transparent fee structure, charging separately for financial planning and wealth management. She highlights the value of saving clients time by integrating these services, as it allows for a one-stop, comprehensive approach to financial decision-making.
Jag shares his own experience transitioning from a wealth manager to an advisor like Amy, appreciating the ability to have more encompassing conversations about the implications of various financial decisions. Amy adds that Thimbleberry Financial's ideal clients are retirement-focused professionals in healthcare and tech sectors, who value financial independence and holistic financial planning.
Regarding client communication, Amy explains Thimbleberry's team-based approach, with dedicated service teams working closely with clients to ensure smooth and efficient communication. The episode concludes with a shout-out to Sara, Amy's Chief of Staff, who plays a crucial role in podcast production and client relations.
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Jag Gay: Welcome to episode number 100 of ThimbleberryU. Woo. Woo. I am Jag Gay. I'm joined by Amy Walls of Thimbleberry Financial. Amy, we started this in what, 2018, '19, and here we are in Episode 100.
Amy Walls: 2019, four years.
Jag: You are so organized. I knew you would have that right at the tip of your tongue to know when we started this. In commemoration of our special 100th episode, we're going to peel back the curtains a little bit on the integration between financial planning and wealth management right here at Thimbleberry. We'll jump right in.
Amy, I know you and your team do both. Obviously, the integrated approach to these two things, again, financial planning and wealth management, is important to you and your team. Talk a little bit about why you feel that way and what that does for your clients.
Amy: Well, first of all, it's been so fun over the last four years recording with you.
Jag: Likewise.
Amy: I feel strongly. I am passionate about financial planning and wealth management being combined. I saw a meme recently that talked about what most people think financial planning is, and that's investment management. What it really encompasses is goal identification, cashflow evaluation, cash management. Those are two different things. Debt insurance, real estate investments, so there it is. Education, retirement, estate planning, and taxes. How I think about it is all of those different things that I just named, they're pieces of the puzzle.
Jag: Yes.
Amy: Some of the puzzle pieces even go deeper. Let's say an investment account is an IRA versus another investment account is a Roth IRA. They're separate puzzle pieces. Same thing is true on cash flow. There can be multiple puzzle pieces. Different real estate has multiple puzzle pieces. Why I believe it needs to be integrated is to make someone's financial picture the way they want it to be. We have to look at all of these things together and see how they're playing together in order to make that picture beautiful.
Jag: To further your puzzle piece analogy, you listed 10 or 11 items off the cuff right there. If we had this spread out on our dining room table, this is not really a 10-piece puzzle. This is one of those 1,000-piece puzzles of the Portland skyline, right?
Amy: Absolutely. It has so many different pieces. Recently, I was looking at a situation for someone who is wanting to purchase a new home. They also have a goal of retiring early, quite early compared to when most people think they could retire. Maybe retirement might be the wrong word here. They'd like to achieve financial independence at a very young age and they're very much on track for doing so.
Jag: Okay.
Amy: In looking at the home purchase, they wanted, unfortunately, dollars would be getting used twice. Because when you're retiring and needing cashflow, well before 59 and a half, that money needs to be in taxable accounts. That's ideally the same money you'd be using to pay off a house. With today's higher interest rates, those dollars need to be used twice. How do we make the puzzle work in that situation? Because you've got both things trying to use the same dollars. That's cashflow management, it's real estate, it's debt, it's investments, it's retirement, it's taxes. Just in that one question, it's all of those things.
Jag: Right.
Amy: I'm also passionate about this because I have an obligation and a responsibility, and I take that very seriously, to do what's in our client's best interests. Let's say someone wants to invest and they have a mortgage at 5.5% or 6%, or 7% given today's new rates. In my world, it is very likely. I can't imagine a scenario where I wouldn't say that it's better for them to pay that debt down than it is for them to invest, for example, in a taxable account. Because if we're looking short-term, the growth rate they may have over a few years versus paying down that debt may not exceed the interest rate. That was different when the interest rates were 3%.
Jag: Oh, for sure.
Amy: What I'm really getting at and probably oversharing is that passion that the pieces tie together because we can't give great advice if we only look at a portion of the picture.
Jag: That's fair. In several years of doing this podcast with you, it's been very clear to me and I'm sure our audience as well, the passion that you have for this. Again, those two pieces of it, financial planning and wealth management. What happens if a client comes to you and only wants one of those two?
Amy: Well, I have two answers to this. I didn't use my favorite words, it depends. [laughs]
Jag: Okay. Appreciate that.
Amy: The first is, it's going to be a teaching moment. That happens through questions and information, that could be a teaching moment for them or for me. I look at our role as we are a provider of financial education first, and if we provide right and proper education, clients are going to choose the right thing for them. In doing that, in providing this education, we're going to ask a lot of questions about what's going on in their thought process. The reason that they might think they don't need planning.
Maybe for example, they're retired and they think, "Well, gosh, if I'm already retired, I don't need planning." Then from understanding that we can educate that well in retirement for a successful retirement, we need to know cash flow evaluation. We need to know and have factored in retirement distributions and where they're coming from. That plays a role in taxes. All of that plays a role in estate planning when you're wanting to leave the money to a charity or your kids and have a set amount. All of that ties to cash management and basically the recreation of a paycheck.
If someone's still saying, "It doesn't sound right for me," that's okay because our relationship first has to be about fit. If our dual approach doesn't sit well, we're happy to recommend another advisor who might be a better match or the CFP board if we don't know someone personally, where people can find advisors that may have a different philosophy.
Jag: It really seems like you're not going to take on a client if they're dead set on doing one or the other, because doing both really is central to the way you operate. How do the costs compare when doing both?
Amy: It's a little bit hard to say because all advisors charge differently.
Jag: Yes.
Amy: It varies across the board. We have a transparent fee structure. We charge separately for financial planning and for wealth management. We charge for financial planning based on complexity of what we're doing. Through this and once we know a client situation, clients will know exactly what it is they're paying for and see how each service is shaping their financial journey. Some advisors I know add the cost of financial planning into their wealth management fees. I've heard the opposite too, that some advisors won't charge for asset management costs, but they'll charge it as an upfront financial planning fee.
Jag: Okay.
Amy: There's just variety, and so I can't say for certain, but we know that our costs are in alignment with other advisors. We check that regularly. The other thing that I'd say when you ask about costs that it's easy to forget about is that time is money. By us doing both, we save our client's time. Now, let me explain what I mean by that. If there's a question that's planning-related. Let's use this example earlier that I talked about where someone's looking at buying a new house. That's a planning-related question, but it ties to investments,
Jag: Right.
Amy: As I look at that, I actually get to go look at the investments and the consequences of what that's going to do to their investments, and how they may be able to realign the investments to fit with the strategy as well as make contributions going forward, so that then when I talk to the client, we're able to talk about all the pieces at once. It's not us talking about the planning, and then the client needs to go figure out with their investment advisor or on their own, if they're doing their investments, "Now, how do I adjust all of my investments to evaluate one?" We've already evaluated the other.
Jag: That makes a lot of sense that you're not having to go between two different people. I know the first financial advisor that Ellen and I had was more of a wealth manager and was looking at investments and things like that, but didn't really get that much into the financial planning piece of it. Then we actually changed advisors and went to somebody who, similar to the way you do it, does both. Because we can now have more of an all-encompassing conversation with this advisor about how we'd like to do X, but how is it going to affect Y?
He has all the data in front of him that he can have a conversation with us, and save, like you said, that time is money on all the back and forth. It does make sense why you do both. You look at the big picture to give advice based on facts and client feelings, and ensure the various pieces of the financial plan, like you said, those puzzle pieces fit together. You said you're not a fit for everyone, Amy. Who would you say is the ideal Thimbleberry client?
Amy: It's a great question. You're always good at coming up with some great questions. Our sweet spot really lies with retirement-focused professionals in healthcare and tech sectors. The reason for that is they have a steady income flow and are keen on smartly navigating through their financial path, whether it's planning for kids' education, buying a new home, or transitioning into that comfy retirement. Goal focused, positive good cash flow and assets and ultimately, they're focused on that financial independence or retirement.
Jag: We talked about being centralized here for one conversation where you have access to all the information in front of you, how does that client communication work in your case, Amy?
Amy: We try to keep it as simple and client-focused as possible. I am currently the only advisor at Thimbleberry. Each of our clients has a dedicated team, we call them service teams that work with a client group. Not everybody works with everybody in our office. We do that so that the team working with our clients knows that client, the ins and outs. Outside of me, there's our paraplanner. That person really acts as a go-to person to make sure all of our clients' data's intact. They're doing account openings, and money movements, and things for that client so they can see all the pieces tying together.
We have a chief of staff. She's really my right hand. She plays a role with all clients in making sure communication flows smoothly, things are scheduled appropriately, she knows if a question comes up, which team member can answer it best and get an answer fast if I'm in meetings all day or all week. We do that just simply so that clients aren't lost in a maze of contacts, and they really get the attention and information they need as accurately and as quickly as possible.
Jag: We're into our 100th episode. Have we ever shouted out your Chief of Staff? I'm not sure we have.
Amy: I'm not sure we have either, but I think we probably should.
Jag: She listens to the podcast for you, doesn't she?
Amy: She does. Yes, she listens when I don't.
Jag: Shout out to Sara for also being my point of contact with all the production pieces once Amy and I do record this podcast. Thanks for your help, Sara, for all that you do to help keep the wheels moving with this podcast, too.
Amy: Yes, thank you, Sara. I think at some point, we should bring Sara on and have her talk about her experiences.
Jag: I'd like to see her face when she hears this part of the podcast. For those who are interested in working with you with the approach that you take to all of this, Amy, for your team, you and Sara, and everybody there at Thimbleberry Financial, how do they best reach you?
Amy: They can reach us and they will probably reach Sara by giving us a call at 503-610-6510, or by chatting with us at thimbleberryfinancial.com.
Jag: If you do call and you do talk to Sara, please say to her, "Oh, you're Sara that I heard about in the podcast."
Amy: Yes, she is awesome.
Jag: Thanks again for 100 great episodes. Amy, here's to 100 more and we'll talk soon.
Amy: Sounds great, Jag. Thank you for the 100 episodes.
Jag: Securities offered through registered representatives of the Cambridge Investment Research, Inc., a broker-dealer, member FINRA/SIPC, advisory services through Cambridge Investment Research Advisors, Inc., a registered investment advisor. Cambridge and Thimbleberry Financial are not affiliated. Discussions in this show should not be construed as specific recommendations or investment advice. Always consult with your investment professional before making important investment decisions.
Securities offered through registered representatives of Cambridge Investment Research Inc., a broker-dealer Member FINRA/SIPC, advisory services through Cambridge Investment Research Advisors Inc., a registered investment advisor. Cambridge and Thimbleberry Financial are not affiliated.
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