Frequently Asked Questions...

1. Please tell me about the financial planning process.   Financial planning is a multi-step process that provides you with two important things: (1) an in-depth review of your current financial situation, and (2) a blueprint that shows you how to achieve your goals and objectives for the future.

See "How We Work" for more details on the six-step process that we typically follow. You'll notice that the last step involves periodic reviews, or checkups... because we believe that financial planning ultimately is a process, not a one-time event.

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2. How do you create this blueprint?   We start by focusing on your goals, objectives, and priorities. For instance: the reduction of current and future income taxes may be an immediate goal, funding a quality education for your children and/or grandchildren may be an intermediate goal, and enjoying a secure financial future in your retirement years is likely to be one of your most important long-term goals.

Next, you need to know how you can set about achieving (or continue working toward) your financial goals. We develop a set of strategies - combining cash flow, investments, taxes, retirement plans, estate planning, insurance, and other general financial matters - to get you there. The result is a customized plan that's designed around your personal goals and financial situation.

Finally, to achieve the intended results, your plan must be implemented and monitored. The initial implementation may involve quite a few "action items", and we'll help you prioritize and set a realistic schedule for working through them. Then, once all of the pieces are in place, the ongoing maintenance of the plan will typically be relatively straightforward and require only a few hours a year.

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3. Isn't that a lot of work?   It may seem like that at first, but the good news is, if you follow your plan and maintain a disciplined approach, you can rest well knowing you can reach your stated goals. We do try to make the process as simple as possible for you. We may need for you to gather quite a bit of data in the beginning, but then we'll do most of the heavy-lifting during the initial planning process.

We will also provide guidance to help you implement the plan yourself, or if you prefer, we can actively coordinate the implementation of your plan for you.

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4. Who can benefit most from your services?   Anyone seeking financial peace of mind can benefit from our services. We serve people at all income levels, from all walks of life. Clients have the flexibility to work with us on either a one-time, as-needed basis or an ongoing basis. We welcome clients who simply need a one-time financial consultation or a second opinion, as well as those who need comprehensive financial planning and possible periodic review and management services.

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5. What is ''Fee-Only'' financial planning and why should that be important to me?   Because we are Fee-Only financial planners, all conflicts of interest regarding compensation are removed. We do not accept sales commissions; we work solely for our clients. Because we do not sell financial products such as investments and insurance, there are no third-party relationships or outside influences to color our thinking and financial recommendations.

What this means in simple terms is that we charge (only) for our time, either on a fixed-fee or an hourly basis. The disadvantage with this arrangement is that, unlike the broker who also wants your business, we will actually ask you to write us a check! The upside is that it will typically cost much less to work with us in the long run, and you can feel confident that you'll get honest and objective advice.

In addition, BFA is Registered Investment Advisor regulated by the Texas State Securities Board. As such, we must comply with a host of regulations that are designed to protect you as a consumer. Among other things, the state regulations require that we provide all clients and prospective clients with a disclosure document called a "Form ADV Part II". You should always ask for a copy of this document when considering any financial planner's services... since it contains important information about the planner's qualifications, fiduciary duties, history of any past violations, etc. If they can't provide it or don't know what you're talking about, then they're not a Registered Investment Adviser and they are not required to act as a fiduciary (who must act only in your best interest).

We would be happy to send you a copy of BFA's Form ADV Part II, or you may download a copy directly from this page.

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6. I understand the benefits of working with a Fee-Only financial planner, but I might need to obtain financial products. How will I be able to do that?   While we do not sell financial products, we will offer specific recommendations and opinions regarding the purchase of the various financial products that may be appropriate for you. So, if you need to obtain an insurance policy or a new mortgage, invest into a portfolio of mutual funds, or find an estate planning attorney or tax professional, we can direct you to the resources you need and/or help you obtain these products and services. If appropriate, we can also help you implement your plan and set up your accounts.

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7. Does Brazos Financial Advisors only provide comprehensive financial planning?   No. Although a comprehensive financial plan can provide the greatest benefits, we can limit our advisory services to your specific needs, such as cash management and budgeting, investment analysis or college education funding.

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8. We are just beginning to build for our financial future. We need help and guidance to get started. Will you accept us as clients?   Absolutely. We have no minimum income levels or net worth requirements. We realize that everyone has financial questions, and we're proud to work with people from all income levels, and all walks of life. You don't have to have a fortune, or even want a fortune to become a client. Whether you want to work towards long-term financial independence, or just want to make sure you're making the best possible financial decisions today, we'll be glad to help.

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9. I have already accumulated substantial assets and think I'm doing quite well, but things seem to be getting a lot more complicated over time. I want to be sure I am on track, but I don't always have the time or inclination to manage all of the details by myself. Can you help me?   Yes. People who need more sophisticated financial planning or advice will find our services appealing and beneficial. If you have a desire to simplify your financial affairs, we can help you get things in order, and then provide whatever amount of ongoing support you want. If you are looking for a professional review or a second opinion to ensure you are on track, we'll be happy to do that as well.

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10. I'm responsible for the retirement plans and employee benefits at my firm. I would like to increase the number of employees who participate in our benefit programs. How can you help us?   We believe that many employees just don't understand how valuable their benefits actually are, and that education is therefore the key to building employee participation. We can help your people understand the benefits you offer, the choices they have to make, and the value of your programs. Please call to discuss your specific needs. We can custom-build an educational program for your company and, if you wish, can provide one-on-one counseling for your employees.

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11. What types of securities do you provide advice for?   We provide advice for most types of securities, including mutual funds, ETF's, stocks (as they relate to your portfolio holdings; we're not stock pickers), bonds, bank deposits, and variable and fixed annuities. We also provide advice on mortgages, budgeting and cash flow issues, 401(k), 403(b) and other retirement programs, stock options, life and disability insurance, etc.

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12. If I use Brazos Financial Advisors to develop a financial plan, am I obligated to purchase the recommended products?   Absolutely not. We will offer recommendations which in our professional opinion will meet your needs and objectives, but you are under no obligation to purchase anything. In today's competitive market, it makes sense to shop around for the best available product or service. For instance, if you need to obtain life or disability insurance, we will suggest the type of policy, various riders or additions, and the amounts that best fit your situation. We will then direct you to a choice of companies that can provide a quality product at competitive prices for you. If you wish, we can also help you purchase investments and/or set up your accounts with a third-party custodian such as a discount broker.

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13. Tell me about your investment philosophy.   As financial planners and investment consultants, we believe in the following fundamental principals with regard to designing an investment portfolio and making specific recommendations: The purpose of a client's investment portfolio is to fund current and/or future financial objectives. The design of the portfolio must take into account your financial objectives, tolerance for risk, needs for current income or liquidity, and special considerations such as income and estate taxes.

It is important to remember is that no one can predict the future. It is difference of opinion that makes a market. Investment and economic ''experts'' provided with the same information often come to different conclusions. We do not suggest that we, or any of the money or mutual fund managers that we recommend, will make the correct decision every time. We do believe, however, that studying the historic trends and relationships of investment classes and the philosophies and approaches of successful investment managers can provide valuable insight.

The appropriate allocation of investment assets for your goals and risk tolerance is the most important component in developing an investment portfolio. We believe that having a diversified, well-balanced portfolio, minimizing costs, and following long-term, low-turnover strategies will increase the likelihood that you will achieve your financial objectives.

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14. How do you price your financial planning services?   Our fees are based on the amount of time involved in meeting with you in person or over the phone, researching and analyzing your current situation, and providing specific recommendations and implementation assistance (if appropriate). You may choose to engage us on an hourly basis at our billing rate of $180 per hour. In many cases, however, we will estimate the time required to complete the work you've requested, and quote you a flat fee instead.

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15. How much will my financial plan cost?   Financial planning fees are determined on a project basis; the total fee for a financial plan will vary from client to client based on the specific needs and complexity of your situation (please see "How We Work" to learn about our financial planning sequence and the client service options available). We'll provide an estimate after the Introductory Meeting, based on our understanding of your needs and the specific services you would like for us to provide.

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16. Are your fees tax deductible?   Technically, the answer is "Yes". Section 212 of the Internal Revenue Code permits an itemized deduction for tax and/or investment advice in the miscellaneous section of Schedule A (lines 21 and 22). However, these miscellaneous deductions are only allowed to the extent that they exceed 2% of your adjusted gross income, or AGI. This means that - if your income is relatively high, and/or if your other miscellaneous deductions are small - deducting our fees may result in a fairly limited tax savings (or even none at all). See IRS Publication 529 for more details.

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17. Once my financial plan is completed, will our relationship end?   We hope not. Because financial planning is most valuable when viewed as a process, rather than a one-time event, we offer ongoing services, periodic reviews and day-to-day consultation as requested and/or needed. We will typically recommend periodic checkups, and we would like to see most clients on an annual basis, but the nature of our continued relationship is up to you.

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18. How can I get started?   The first step is an initial inquiry from you. Just contact us when you're ready, and we'll schedule a brief introductory meeting (no cost or obligation). Appointments are scheduled based on availability during regular business hours of 8-4, Monday through Friday. Should you decide to become a client, we can discuss which of our services are most appropriate for you. Most clients find the financial planning process to be stimulating and enlightening. The end result, of course, is greater peace of mind. We look forward to helping you!

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