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  • Writer's pictureNicholas Pihl

What does a (great) advisor actually do?

Updated: Jan 19, 2022

I thought it would be fun to share some of the things I do for clients throughout the year. Notice that intelligent portfolio management is a part of my process, but note that it is only a part, and that there are many other things I do to help clients save money on taxes, grow their net worth, and achieve their goals. Not all of these are relevant to every client, and many of these are done behind the scenes. But I hope this will be an interesting high-level summary that what a year of working together might look like.

December & January: Cash Flow & Liquidity Planning

  • Which tax forms should you (the client) expect to receive in the coming months?

  • Review cash on hand

    • Personal Emergency Fund (3, 6, or 12 months of cash)

    • Business Capital (1 year of cash)

  • Review major expenses for year ahead

  • Cash flow timeline for the next two to five years

    • Sources of cash flow

    • Uses of cash flow

    • Is cash available when needed?

    • Does surplus cash have a productive plan?

  • Review cash reserve adequacy

    • Does it cover expenses for the timeframe planned?

    • Can it be invested productively? To what extent?

February & March: Retirement contributions for the prior year

  • Employer plan contributions (self-employed)

  • IRA contributions (Trad or Roth)

May & June: Life Planning, Estate Planning, and Distributions

  • 6 Month Financial Journal Update

  • Do all accounts have a designated beneficiary? Is it up to date?

  • Are all life insurance needs covered?

  • Are wills and trusts in place?

  • Is existing Property and Casualty Insurance, Business Insurance coverage adequate? Reasonable price?

  • 10 Year Vision (Best Life in 10 Years Exercise)

  • 5 Year Goals, 3 Year Goals

  • Actions for the Next 90 Days

  • Review and Update "Bucket List"

  • Take distributions from retirement accounts to fund another great year of retirement

October & November: Retirement Planning & Tax Planning

  • Review Goals and Vision

  • 6 Month Financial Journal Updates

  • Review Net Worth Statement

    • Portfolio allocation and performance

    • Major assets and debts

  • Touch base on retirement plan, are things on track?

  • Is savings rate on track? Is there opportunity and/or need to increase it?

  • Review estimated income and taxes for the year

    • Eligibility for Roth?

  • Review 401k, IRA contributions

  • Any major tax credits to make sure they are eligible for?

  • HSA eligibility and contributions

  • Assess opportunities to reduce taxes into year-end

    • Harvesting losses

    • Pre-Tax Contributions

  • Assess opportunities to take advantage of a low-tax year

    • Roth Conversions

    • Harvesting gains

  • Gifting

    • Cash

    • Appreciated Assets

    • Donor Advised Funds

Ongoing and As-Needed:

  • Loss harvesting in portfolio

  • Opportunistic rebalancing for portfolio

  • Monthly newsletter content (available for free to non-clients as well)

  • Proactive outreach for planning opportunities

    • Tax law changes

    • Property purchases and sales

    • Business quality improvements

    • Mortgage refinancing

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