What We Stand For
An integrated view of capital
“Remember that your real wealth can be measured not by what you have, but by what you are.”Napoleon Hill
When considering the domain of personal financial planning, generally only one form of capital takes front stage – financial capital. Unlike most, we don’t view the world or your life through that narrow of a lens.
By definition, capital is “Wealth in the form of money or other assets…“. There are many frameworks that attempt to organize and articulate all of these forms of capital. In one that we like, Ethan Roland and Gregory Landua do an excellent job of using a permaculture context to discuss what they call the Eight Forms of Capital. If you are not already familiar with permaculture and/or the eight forms of capital we encourage you to use the links within to learn more.
We recognize that financial capital is only one of many potential forms of wealth. It is a tool that is not inherently good or bad. It is our relationship with our financial capital (money) that makes it one or the other. If we design our lives in a way that puts our money in a position of service to us (not the other way around), it quickly becomes obvious that there are many forms of wealth that are at least as worthy of pursuing as financial capital. In fact, all of these forms are interchangeable with one another over time.
We are willing and able to help individuals and families build financial wealth, and we believe it should be done within a context of an integrated, balanced, and sustainable budget of capital exchange along with a well thought out wealth accumulation and distribution strategy.
and yes, maybe even a little altruism
Spoiler Alert:You may not like what you read next – especially because it is true…brace for impact.
No one likes a free-rider – you know, someone that benefits from a situation or activity without bearing the actual cost(s) associated with the activity?
Sadly, our entire current way of life makes us all free riders. Whether directly or through involuntary association, we are literally robbing the future generations ahead of us in order to have the luxurious, convenient, and financially inexpensive lives that we have been accustomed to. Nearly everything that we have, do, and enjoy is artificially less expensive and/or easier to access than it should be. How is that possible you ask? One word – DEBT. Actually let’s rephrase that in three words – EXPONENTIALLY GROWING DEBT.
Our very own United States government is a case in point. They have proven that there is truly no (willful) end to the ponzi scheme that they have chosen to design and run via a fiat currency scheme, neverending deficit spending, and money printing by the Federal Reserve. Do you know how the government makes payments on its debt? They borrow more money to make payments on the debt that they already can’t afford to have. No one (not even the all powerful USA) can get away with this forever. This has been done on the backs of U.S. taxpayers, all who invest in U.S. debt, and anyone that uses and/or stores wealth in U.S. dollars.
Did you know that since the 1980’s total US debt has grown about 2x as fast as total US income? It doesn’t take a rocket scientist to determine that to be a very bad idea.
By definition, anything that is not sustainable will end. We (individually and collectively) have a choice to make. Are we going to:
- Voluntarily square up to the reality of the situation and start making some difficult but prudent decisions for the future benefit ourselves, our children, and their children?
- Are we going to let inertia do its thing and just wait for our entire civilization to become a fly on a windshield?
This story goes way beyond money and economics. It impacts human health, the environment that sustains us, and the integrity of our culture. In fact, the problems are so large and systemic that it is easy to feel overwhelmed and even apathetic about the situation. That is how we felt after coming to terms with the predicament that we are in. The reality, however, is that each of us have a choice at the individual and household levels to give a middle finger to the status quo and make a genuine effort to start becoming the change that we would like to see in the world.
So what does becoming the change you would like to see in the world look like? Regardless of where you are today, a great place to begin sentimentally is to position yourself to not be a burden on others (family, friends, community, government, etc.) if you can help it. If you truly can’t help it right now, don’t beat yourself up about it – be grateful and begin developing a plan to change those circumstances in the future.
In financial terms a good place to start is to gain control of your income statement and balance sheet, build up liquidity, pay off debt, and save adequately for the future. Believe it or not, if this alone was done at scale across the nation the needle would be significantly moving in the right direction. Sounds simple, but there is a lot to unpack even in just those few items.
After putting on your own oxygen mask we can begin progressing further into financial strategies and lifestyle modifications that could have a meaningful impact on the quality of your life, the health of the natural world, and the generations ahead of you. We believe that the progress that this world is yearning for is going to come from the bottom up – not the top down. Each of us is a critical piece to the puzzle.
Fiduciary Responsibility Means Something
“Show me the incentive and I’ll show you the outcome.”Charlie Munger
We’ll just come out and say it…the financial services industry is broken and riddled with conflicts of interest. Peter Parker’s (Spiderman) uncle Ben told him that “With great power comes great responsibility”. We think that someone should have told our industry that “With great profit comes great responsibility”. In that same conversation they would have also explained the concept of a zero-sum game – that for every dollar they got to keep there was a dollar that their client didn’t get to keep. Oh, and not only does the client lose that hypothetical dollar today, but also all of the compound growth that they would have gained on that dollar over time if it were otherwise invested.
We aren’t saying that financial advisors have no value. If we thought that we wouldn’t exist. The industry just isn’t professionalized. In what other white collar profession (medical, legal, accounting, architecture, etc.) are there such low barriers to entry in terms of education, examination, and experience? In which of these professions is there such an asymmetric risk/reward tradeoff to the advice/service provider in the form of commissions and/or asset management fees? In which of these professions does the advice or recommendations provided determine whether or not the provider even gets paid?
The financial services industry has a long way to go before we will be able to honestly say that we are proud members of it. With that said, we are proud to be affiliated with certain subsets and groups within the industry. For example, the only advisors within the firm that are permitted to give clients direct financial advice are CFP® professionals. Our firm also has affiliations with organizations such as the XY Planning Network and the National Association of Professional Financial Advisors (NAPFA), both advocating for fee-only financial planning advice and services.
Our advisors are held to a code of ethics and standard of conduct by the CFP Board and take the idea of fiduciary responsibility very seriously. In fact, while we do offer clients an option for investment management based on a traditional asset management fee schedule, we discourage clients from taking this path and currently do not serve any clients in this capacity. It is our preference to work with clients in such a way that our advice is not connected in any way with our compensation. We feel that we have accomplished this through our service offering.
We don’t discriminate based on age, income, investable assets, or net worth
Our services are accessible and affordable for just about everyone…and if they aren’t, we will provide them for free.
We aren’t kidding. If you seek us out and cannot afford our advice we will give it to you for free…period.
Setting the issue of pro-bono financial planning services aside, the truth is that the vast majority of all of the good advisors only want to work with wealthy and typically older clients. Why? Because it is profitable to work with them and not profitable to work with you. This problem was identified by Sean a long time ago when working in the life insurance space. He realized that the only people that wanted to work with the Gen-Xers and Millennials were life insurance agents that were hoping to sell commissioned insurance products and move on – incentives create outcomes.
We have constructed several options for clients that make our advice and services very accessible and affordable. Whether you want to hire us one meeting at a time with no further commitment or are looking for a long term, structured engagement we can help you regardless of your financial status.