Sound wealth management practices are critical for people who want to protect their financial health and strengthen it regardless of what economic conditions may be at play. Working with some of the New Hampshire’s foremost wealth management firms is a great bet for those who want to meet these goals. New Hampshire Business Review reached out to four experts to glean their expertise.
Our panel: George Raftopoulos, president, Nvest Financial, planwithnvest.com; Christina Krakoff, associate, Trusts and Estates Department, McLane Middleton, mclane.com; David Weed, assistant vice president of business services, Service Credit Union, servicecu.org; and Paul Provost, president, NHTrust, nhtrust.com.
George Raftopoulos, President, Nvest Financial
Q: At what point should someone seek out a wealth management advisor to protect their assets?
A: Wealth management needs, or better referred to as financial planning needs, are needs people have at all stages in life. Whether someone’s starting out of school, making a career change, planning for a home purchase or college tuition, preparing to retire or getting their financial and estate matters in order later in life, seeking out a certified financial planner (CFP) practitioner is probably a wise path to assuring your goals will be met.
Q: What are some of the most important things a wealth management advisor can provide to their clients to safeguard their assets?
A: Financial planners, especially those who hold the CFP designation, evaluate a number of aspects of one’s financial situation that will mitigate risk, not only for their assets but also for their overall lives. For example, properly diversifying your investments and actively adjusting the allocation of your investments during changes in the economic and business cycle is one way that financial planners can address risk for a client’s savings. However, CFP professionals also evaluate ways to reduce liability exposure, assess a person’s property and casualty coverage, evaluate and recommend life insurance and long-term care needs. Statistics show that an overwhelming number of people have their homes under-insured due to the increase in values over the last several years. A financial planner reviews all aspects of a person’s financial situation, not just their money.
Q: What kind of a difference does it make to have a good wealth management advisor in your corner when we find ourselves in an economic downturn?
A: An experienced, talented and well-educated advisor can make a significant difference to one’s overall investment management during economic downturns. For one thing, a professional can help take the emotion out of investing and guide you with an unbiased approach, especially if the advisor is a true fiduciary financial advisor. In addition, although the buy-and-hold theory is good for some, active management and strategic and tactical allocation changes to a portfolio, as the economy changes can be a prudent way to manage your money. These changes are different in nature than trying to “time the market.”
Q: What should a prospective client look at the most when they want to hire a wealth management advisor?
A: Whether you’re hiring a wealth management advisor or a CFP professional, you just have trust in that individual. And trust begins with good communication and full disclosure. Too often in the industry, advisors have conflicts of interest that may not be fully disclosed or fully understood by the general public. A good advisor will make sure they’ve had a conversation with the public about any conflicts that may exist, and a good advisor listens more than they talk, especially in getting to know their prospective client.
Q: What are the most critical things a wealth management advisor must do to maintain the highest level of trust with their clients?
A: Trust is built on communication, as mentioned above. Communication must be easy to understand without technical phrases that may intimidate a client.
And an advisor must fully disclose all conflicts of interest that may potentially exist. This may be as simple as an affiliation the advisor may have with a particular vendor, or as complex as a kickback or trip that the advisor may qualify for if a specific investment is used with clients. At the end of the day, every investment advisor must provide a client with a Form ADV Part II, which typically lays out any potential conflicts of interest that may exist.
Securities offered through Commonwealth Financial Network, member FINRA/SIPC. Advisory services offered through Nvest Financial, LLC, a Registered Investment Adviser, are separate and unrelated to Commonwealth. Fixed insurance products and services offered through CES Insurance Agency.
Christina L. Krakoff, Associate, Trusts and Estates Department, McLane Middleton
Q: Should people create a Living Will and grant healthcare power of attorney and financial power of attorney in case they are incapacitated?
A: Appointing an agent to make healthcare and financial decisions for you if you are ever incapacitated is critically important. Naming an agent (and successor if the agent is unable to serve!) under a Health Care Power of Attorney or a Durable General Power of Attorney (for financial matters) ensures someone is there to make important decisions on your behalf and avoids the need to obtain a court-appointed guardian. Further, a Living Will informs your healthcare agent and your healthcare providers of your wishes regarding end-of-life care. Without a Health Care Power of Attorney and a Living Will, the providers may defer to all lifesaving measures even if you do not want them. Putting those wishes in writing ensures your wishes are known, and appointing the appropriate agents helps make sure your wishes are respected.
Q: For estate planning, what are some of the best ways people can improve the chances that their long-term commitments to beneficiaries or nonprofit groups will be met?
A: Do not assume that your family knows or will follow through on your commitments to certain beneficiaries or charities. The families of NH decedents who pass away without a Last Will are often surprised (and disappointed) in the statutory disposition of the decedent’s assets. Provide for them in writing in your legal testamentary documents: Last Will, Revocable Living Trust or other testamentary designations, such as life insurance or retirement plan assets. These documents and beneficiary designations direct how your assets are distributed upon your death. Including provisions for charitable and other bequests in your testamentary documents will help ensure that your wishes are met.
David Weed, Assistant Vice President of Business Services, Service Credit Union
Q: What is the most underutilized savings product for businesses?
A: By far, share certificates! Share certificates are like CDs (certificates of deposit), but in the credit union world, because we are member owned, your investment pays dividends, not interest, which is why the names are different.
Many people think of certificates as an old-school way to stash away money for personal purchases, but there’s no reason businesses shouldn’t also take advantage of certificates as a savings vehicle, especially with current rates higher than they’ve been in years. At Service CU, we have many flexible options when it comes to term length, including six and 12-month options, so you can grow your money without it being inaccessible for too long of a time. Plus, the money in a certificate is safe up to $250,000 with the NCUA (National Credit Union Administration). It’s a low/no-risk way to easily grow your funds.
Q: Should businesses have a savings account?
A: Yes, absolutely! Having a dedicated account for savings can help you reach your financial goals while also ensuring that you have enough money tucked away in case of an emergency. We all know that unexpected expenses can arise any time in business. By maintaining a separate savings account, you can build up an emergency fund to handle costs such as equipment repairs, unexpected bills, or sudden dips in revenue without adding to your debt.
A savings account also allows you to accumulate surplus funds and earn interest on your balance. Instead of keeping all your business earnings in a checking account, transferring excess funds to a savings account helps your money grow passively over time. This way, you can leverage the power of compounding and potentially earn additional income from the interest generated by your savings.
Last but not least, a savings account can serve as a backup in case of unexpected overdrafts in your checking account. If you accidentally make a payment or write a check for more than your available balance, you can transfer money from your savings account to your checking to avoid potential overdraft fees and maintain a positive cash flow.
Q: What’s the best type of savings account to have?
A: In addition to putting some money in share certificates, I recommend having both a standard primary savings account as well as a Money Market account, which will help grow interest on larger balances.
Q: What happens if you do need to make a large purchase that you don’t have enough saved up for?
A: Having a revolving line of credit (LOC) is a great way to get access to short-term funding for large purchases, or even to cover payroll. For the first three years of an LOC, you can repeatedly draw on available funds and pay them down. You will pay interest on the amount borrowed, with interest-only payments due monthly. This is followed by a four-year repayment period with fixed monthly payments.
Q: When does it make sense to use an LOC vs. a credit card?
A: A business credit card should be used for everyday purchases that can be paid off at the end of the card’s billing cycle. It’s also great for earning points for those everyday purchases. An LOC, on the other hand, will carry a lower interest rate than a credit card in the case that you cannot pay off the card right away, which is why it should be reserved for higher-cost purchases, or for a time when you do not have immediate access to funds to pay for those purchases.
Paul Provost, President, NHTrust
Q: What are some of the most important things a wealth management advisor can provide to their clients to safeguard their assets?
A: NHTrust offers comprehensive investment management services for individuals, families and nonprofit organizations and endowments. Every client is assigned their own dedicated team led by a relationship manager and trust administrator. We work hard to offer peace of mind through customized financial solutions designed to meet your unique objectives. Our approach is client-centric, and it’s built on getting to know you as well as we can so that any idea, suggestion or alternative we come up with together resonates with your goals. From there, tailored solutions are provided for where you’d like to be in the future. For our nonprofits and endowments, we provide investment management (portfolios can be customized to adhere to specific protocols such as environmental, societal and governance screens), custody services, and nonprofit and foundation accounts.
Through our partnership with FCI Advisors, NHTrust offers comprehensive investment management. From one-on-one consultations, we actively manage your portfolio, and we weave together a fine tapestry of seamless solutions, with your needs, goals and preferences in mind. Our professionals work together as a team, taking into consideration the macroeconomic environment, sectors of the economy and security-specific issues, which we then apply to your custom portfolio.
Q: What differentiates you from other wealth management organizations?
A: NHTrust is an affiliate of New Hampshire Mutual Bancorp (NHMB), a shared services company that comprises the 150-year-old Meredith Village Savings Bank (MVSB), Merrimack County Savings Bank (The Merrimack), and the Savings Bank of Walpole. NHTrust’s roots may be traced back to these three 150-year-old mutual community banks that are strong, stable and communally beneficial. Thanks to their strengths and capital backing, NHTrust is able to offer financial experience and an understanding of the communities we serve throughout the state of New Hampshire and beyond.
Our companies operate with seven core and common values and two of those values are mutuality and stewardship. Our mutual ownership translates most simply into the reality that we are not a publicly traded stock company and instead, for more than 150 years, we have remained focused on our clients, our employees and our communities. We believe local companies have an obligation to continuously invest talent, time and treasure in our local communities and as local citizens, we see the positive impact of our efforts to support our community on a daily basis.
NHTrust continues to optimize the strengths of each founding bank, serving clients with leading-edge advice, enhanced technology, as well as a continued focus on local, personal service in our communities throughout our state.
Q: What are the most critical things a wealth management advisor must do to maintain the highest level of trust with their clients?
A: NHTrust has our exclusive T.R.U.S.T. is earned approach. Here’s how we earn your trust: The T is for your Team of community-based advisors supported by world-class professionals providing premier innovative insights personalized specifically to your needs; R represents the Results measured against your unique goals and benchmarks, whether you are an individual, a family, a nonprofit, a municipality or a business; the U means we put “U” at the center of everything we do, providing an assuring, accessible and educational experience as we guide you along the way of your chosen path to success; S is symbolic for Strategies and sound solutions personalized to help you plan, protect and prosper, now and in the future; and, T is for the Tools and advanced technology built to augment, not replace, our people.
Transfer excess funds to a savings account to help your money grow passively over time. Earn additional income from the interested generated by your savings.
