Sound Financial Advice by Paul Adams by Paul Adams - Read Online
Sound Financial Advice
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Summary

People, as a rule, will work hard within cultural common sense and just assume that all will go well. But, “right now, 90 million Americans are faced with the most critical investment challenges of their lives.” They are not prepared and are unsure how they will support themselves when they retire. That cultural common sense must not be working.

Financial advisors are taught to advise the majority of people. The median household income in this country is $46,000 a year. Financial institutions are organized around acquiring the masses as clients. The clients of Sound Financial Group are the top 10% households as defined by annual income and net worth. We are committed to building a firm that will help our clients in areas that matter to them most.

Many of our clients have questions like:

Am I making the best use of the dollars I am saving? Will I be able to retire and be okay given I may live 25-30 years in retirement? Am I exposed to losing a great deal of my wealth or income if I were to be sued? When I leave this earth what kind of impact will I leave behind?

Sound Financial Group was created as a result of its founder realizing that many people feel as though they have been taken advantage of when meeting with a traditional financial advisor. Often these people are pushed toward a set of pre-packaged investments that aren’t tailored to their desires. These potential clients can feel they have lost control of their money and aren’t involved in the process. We offer a process that gives our clients the tools to succeed and supplies them with the guidance on achieve a GOOD LIFE FOR THE REST OF YOUR LIFE.

Published: Made for Success Publishing on
ISBN: 9781613398449
List price: $5.99
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Author

Chapter 1

Meet the Chandlers

¹

The noise from the construction site was almost overwhelming as we rode the construction elevator higher and higher into the sky, until we were finally sixty-eight stories into the air, the Puget Sound glinting in the sunlight far below us on this perfect spring day. My work as a financial advisor has taken me to some pretty unusual places, but never to the top floor of a construction site of a new commercial high rise here in my home town of Seattle. As I thumped my mandatory hard hat and scanned The Olympic Mountains in the distant horizon, I wondered why my new clients, Jim and Lisa Chandler, had chosen to conduct our first meeting high in the sky.

This will be the newest high rise on the Seattle skyline, Jim was saying. One good thing about being up so high was that you could hear each other talk without shouting, unlike the frenetic work situation unfolding beneath us. Now all the workers looked like ants, busy ants, building a new multibillion-dollar anthill.

And this is where the retail shops and restaurants will be, Lisa added, pointing to the building plan spread out on a large drafting table. And down there—and she pointed to an area about 30 floors below us, where there is a new rooftop and the remainder of the building is thinner than the base—that’s going to be the most luxurious spot this city’s ever seen. I’ve designed every element of it myself.

Jim and Lisa Chandler are something of a legendary force in cutting edge building design. Their CPA had referred them to me a few weeks earlier. If you live in Seattle, you know them, or more likely, you just know about them. They’re a young power couple—he’s thirty-six and she’s thirty-three—and whenever a new major project is announced, you can be sure that the investors are trying to line up Jim and Lisa to do the designing. They met at the Cornell School of Architecture, opened their firm, Chandler & Chandler, announced a specialty in commercial design, and got a couple of big deals right off the bat. In the last decade, they have designed half a dozen huge projects here in the Pacific Northwest as well as in Macao, Singapore, London, Monte Carlo, and in eight states here at home. Their privately held firm, is said to gross millions of dollars a year, and they have a beautiful home in the best part of Seattle, where they live with their two small children, Kira, five, and Jim Jr., two. I knew all this simply because the Chandlers are the kind of people you see at charity events and pretty much any gathering of important people here in town.

The only thing I couldn’t figure out was why they wanted me at the top of their new project.

The plateau on the top of the 40th floor, Jim was saying, is one of two Olympic size pools. It’s going to have a retractable sunroof, for winter, so people can hang out pool side even in January and February, even if it’s raining. It’s something new in a town that has pretty much seen it all.

Jim turned toward me. We met with a few financial advisors a couple of years ago, Jim said, abruptly turning his focus from the project to the reason for our visit. But it just seemed like they all wanted to sell us something.

Most people don’t know this, Lisa said, but we’ve gotten involved with some pretty bad investments, and we got seriously burned. We lost a lot of our net worth simply because we were taking on too much risk.

Jim reddened. Maybe it’s because we spend all this time around tall buildings, he said, with a small chuckle. But seriously, we want to do things the right way. We heard some really good things about you. We hear that you really take time to get to know people, instead of just plugging them into a computer program that spits out some numbers and gives them financial products to buy. We’ve been through all that. We’re looking for something very different.

The Chandlers getting burned on bad investments? This was news to me. Everybody in Seattle assumed they had a Midas touch with money. Maybe they really did need some guidance. After all, many people who are fantastic at trying to maximize wealth often do not have the time or experience to manage, invest, conserve, and grow their finances at the same high level. They’re using all of their resources to work inside of their soul’s purpose—and money management sometimes takes a back seat.

It’s a long way down to the foundation of this building, I said. That’s why we’ve got these hard hats, and that’s why this elevator is a reinforced steel cage. At least I hope it is.

They both smiled. It’s safe, Lisa assured me, with the smile I recognized from half a dozen magazine covers. If anything had anything to do with the green building industry, the Chandlers were always front and center. It wasn’t because they necessarily sought publicity. It was simply because they were the best at what they did.

If your financial advisors in the past, I began, put you into risky investments, they weren’t doing you much of a service. Did any of them ever ask you about how much car insurance you had? Or disability insurance? Or even life insurance?

Lisa rolled her eyes. They all wanted to sell us life insurance, she said, looking moderately annoyed at the memory. Once they saw our net worth, it was like they had dollar signs in their eyes. Jim and I kept thinking all they wanted to do was figure out how they could turn our wealth into their fees. But to answer your question, nobody ever asked us about car insurance. Or disability insurance. I don’t think we’ve raised our deductibles on our car insurance since college. What does that have to do with financial planning?

It doesn’t have anything to do with traditional financial planning, I said. "But it has a lot to do with the most important starting point for a solid wealth creation and conservation program. The starting point is protecting the assets you already have, even before we start building for the future. Look at the size of the foundation they’ve created for this building. Do you remember how much concrete it took to build that foundation?"

Oh, my gosh! Jim exclaimed. Don’t remind me! They had concrete trucks lined up around the block! The line stretched for over a mile!

And who gets to see the concrete in the foundation? I asked.

No one, Jim replied.

So why’d you spend millions of dollars on concrete that no one will ever see? I asked.

Because otherwise the building wouldn’t be stable . . . I see your point, Lisa said.

That’s why the foundation of wealth building is protecting what you already have, I explained. It’s not something your neighbors will ooh and aah over. But without protection, the edifice you’re creating can’t stand.

Jim shook his head. Nobody ever talked to us about protection, he said. They just wanted to get us into this annuity or that hot stock.

So nobody talked to you about protection, I said, shaking my head, although I wasn’t really all that surprised. "What did they talk to you about?"

Whether we were trying to maximize our 401(k)s, Lisa said. Their whole focus was on trying to save us a few thousand dollars on taxes. Was that so wrong?

If you think that casinos have an edge when it comes to taking people’s money, I replied, you should see what kind of edge the government has when it comes to these retirement plans. You may pay a little less now, but it’s possible you may pay much more later.

That’s what I always thought, Jim said. But every financial advisor I’ve ever met was all about us maxing out our retirement plans. He turned and looked directly at me.

What can you do for us that these other people haven’t done?

I wasn’t used to being put on the spot like that, especially on a narrow walkway on a construction site fifty stories above the Seattle waterfront. So I figured I’d better make my answer short, sweet, and to the point.

I can show you how traditional financial planning has absolutely no shot of getting the two of you where you want to go, I began. Which, I assume, is peace of mind now, creating wealth strategies tailored to your specific needs, a comprehensive approach to protection, a new way of thinking about making financial decisions, a review of whether it makes sense for you to be in qualified plans like 401(k)s in the first place, new ways to think about buying and owning real estate, including the mortgage on your own home, building a portfolio that is appropriate for who you are as individuals and as a couple, and what you want out of life. Not just some cookie-cutter model. You want an approach to pay for college that’s going to end up teaching your kids more about financial responsibility than any class they might take. How’s that for openers?

Jim and Lisa looked at each other for a moment and nodded.

"That sounds a lot better than what we’ve been