Hello Rochester: SixPoint Financial Partners

Marshal Scheidt is a Partner at SixPoint Financial Partners and knew he wanted to be a financial advisor at 14 years old. Previously, he worked at an insurance company with his current coworkers. Together, they started SixPoint Financial Partners in 2018. "Now, things are great, I love my clients and I could not be happier/luckier with where we are at."

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1. What are the top three reasons someone should work with a financial advisor?

1. Organization! Sounds simple, but there is immense value in just being able to see everything in one place. Let’s be honest- “financial planning” can be extremely overwhelming. When you see all of your assets in one place in an easy-to-read format it definitely helps get the process started and helps with tracking. This doesn’t have to be a 45-page financial plan with charts, data, projections, etc. This could be a simple and straight forward one-page financial plan with actionable steps to take to steer you towards whatever it is that you are trying to accomplish. A one-pager that you can reference and update as goals and objectives change.

2. There is just too much to know! You need someone to explain what to do when it comes to not only saving for retirement, but how to efficiently use every dollar that you earn. That could mean paying down debt, saving for a house, whether to be contributing to a company 401k, how (and how much) to contribute (roth or traditional), making sure there is a will in place, what do when you change jobs, how to pay as little in taxes as possible (now and in the future), I could go on for hours about this but mainly just having a “go-to” person for this anytime you have a question you can easily shoot them an email, message, or phone call and you can get a reliable answer. That is a great resource

3. Accountability! Knowing you’ll be hearing from someone on a systematic basis helps hold you accountable for you and your goals. Accountability can also mean something as simple as actually defining those goals in the first place. Understanding what you are doing and (more importantly) why you are doing it is so crucial. Accountability is also keeping your investment plan on track. There is so much in the news about investing and it is so easy to get caught up in what you see on tv or on the internet. Sifting through that and deciding what is relevant and what it means to you is something that can be challenging. You might be tempted to change your investments/ allocations/ stop contributing/ etc. if you see unfavorable news in the market but how it affects you directly will differ and a financial advisor will help you decide what to do (if anything). The value is typically keeping you from doing the wrong thing at times like that!

2. Is it ever too early or too late to seek the advice of a financial advisor? Explain.

I truly do not think it is ever too early or late, but some might disagree. When you get your first job and start earning an income that’s when somebody would benefit from starting a relationship with an advisor. There’s a lot of value that can come from that in terms of what I referenced above. Saving early can mean a huge difference down the road. For example:

A 22-year-old saving $200 per month (assuming 7% return, compounded monthly) could expect to have around $525,000 at age 62 (40 years of saving $200/mo).

Somebody who waits until age 42 to save the. Same $200 per month (7% return, compounded. Monthly) will have $104,000 saved at age 62. That’s a huge difference!!!

We also start working with people who are nearing the end of their career or even have been retired for years. While it might be “too late” to determine the most efficient savings plan, it is never too late to figure out a way to manage their retirement dollars. This could mean the obvious 401k/403b/457/IRA portfolios, but also making decisions on pension options, when and how to take social security, making decisions on Medicare, how to draw down on retirement accounts to efficiently use the money that is saved as to not waste money on taxes, required minimum distributions and making sure we are not only taking RMDs to avoid the huge tax penalty associated, but doing it in the most efficient way possible. A financial advisor should be helping to establish certain estate planning items such as a Will, Healthcare Proxy, and Power of Attorney.

3. Are all financial advisors the same? Why or why not?

All financial advisors are definitely not the same. Financial advisors might have different areas of expertise where one might specialize in working with dentists, and one might specialize in working with public school employees. The one who works specifically with dentists could probably work with the school teacher, but could be unfamiliar with how the State Pension works or how to choose a 403b plan from a list of providers.

The advisor that specializes in working with school teachers could probably work with the dentist, but would be unfamiliar with the immense student loan debt that typically comes with being a new dentist along with the higher income threshold.

Aside from specializations, there is also what company/broker-dealer/RIA that the advisor is affiliated with. Like I mentioned, our group was at an insurance company and then went independent. Being at an insurance company with proprietary products could create conflict of interests as there are different proprietary sales goals. The person might be obligated to recommend one product over another as to meet their sales goal, win trips, etc. Being independent or at a company without proprietary products will usually eliminate those inherent conflicts.

Advisor’s processes differ greatly as well. Usually everyone has some sort of process to take new clients through to get them “onboarded,” but after they are a client is where advisors can set themselves apart. If you’re thinking of working with an advisor be sure to understand certain aspects of their process and make sure it aligns with your expectation. How often will you expect to hear from your advisor? How often will you meet? What do they do for you in between meetings? These are all things that are relevant.

4. What is financial wellness and how can someone achieve it?

Financial wellness could mean a lot of different things and I think everyone has their own definition to an extent. To me, financial wellness is the ability to have the confidence of knowing that the way you live your life is within your means and having a strong understanding of where you want to be in one, five, ten years and beyond. Financial wellness does not necessarily mean making a bunch of money.

Someone achieves financial wellness when they first understand their goals and their relationship with money. From there I usually recommend finding your “net worth.” This can be eye-opening, but it is a good way to find where you are starting and makes it easier to track progress. Establishing realistic, measurable goals is an important next step. This is where I strongly recommend enlisting the help of a financial advisor. I say this because, for example, sometimes people want their “financial wellness” definition to mean being completely debt free. If you know me you’ve probably heard me talk about the “math answer,” and the “human answer.” While being completely debt free may seem like a great idea and a great feeling (human answer, makes you feel better), it could make more mathematic sense (math answer) to be allocating more to saving retirement or keeping more in an emergency fund to avoid having to swipe a credit card in case of an emergency. That idea flips if the debt in question is high interest debt like a credit card- then it probably makes sense to pay that off as quickly as possible.

To answer your question:

• Determine your goals or what wellness means to you

• Where are you now (net worth)/ where do you want to be

• Budget/Cash flow analysis

• Pick a reasonable date with periodic “checkpoints” along the way to measure your progress along the way. Example : You want $10,000 is savings in 12 months. Maybe you want checkpoints to be $700 in 1 month, $1,500 in 2 months, $2,400 in 3 months and so on.

• Ask for help

5. What do you believe is the biggest misconception about financial advisors and how do you combat that myth?

The biggest misconception that I hear is that financial advisors are boring, old, stock pickers that only handle investments. I do my best to combat that by setting the expectation that we have an emphasis on planning rather than picking stocks. I do my best to make meeting with clients as fun or interesting as it can be. I really truly care about every person that I meet with so the last thing I’d want is them to be dreading a “boring financial planning” meeting. I save the “technical” speak for behind the scenes, while explaining sometimes complex financial concepts in easily digestible ways so clients feel empowered and actually understand why they are doing what they are doing and why I’m recommending what I’m recommending.

6. Anything else you would like to add?

The one main thing I’d like to add is that if you are thinking of working with a financial advisor or already are working with a financial advisor, you need to trust them and have an open dialect. We have a series of questions that you should be asking your financial advisor or at least know the answers to. It may seem uncomfortable to ask some of these questions, but any financial advisor should be able to comfortably answer each of these questions and if they aren’t… run!

If you think you are “all set,” or are considering changing advisors these questions are going to be very useful. Some people think that if they opened an account with someone that means they already have a financial advisor. If that person isn’t really doing anything else with them or they can’t answer any of those questions that isn’t really a financial advisor - it is just somebody they opened an account with.