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  • Maria Alejandra Cova Terán

Why Working With A Financial Advisor Is So Important



Sharon: Hello, this is Sharon Heller with Network in Action, and I'm here today with Sarah Caruso. Hi, Sarah.

Sarah: Hi, Sharon. How are you?

Sharon: I'm good. Thanks for joining me today. Sarah is with Prudential Advisors and we're going to be talking a little bit about why it is a good time to reach out to a Financial Advisor. And some viewers out there might be similar to me and people I know, who think maybe it's something to do down the road, when we're grey and ready to retire. Probably something that gets put off for many, many reasons. But I think that question is a great starting point. Why is it good to reach out to someone like you sooner than later?

Sarah: Yeah, absolutely. Well, and thank you, I really appreciate the opportunity for us to chat and chat about these things. A lot of times, one of the biggest reasons why people come and talk to a financial advisor is because something has already happened.


Unfortunately, a death in the family and inheritance, a job move, they're ready to retire. And a lot of what we do is the planning, we make plans for those things. We make plans for the unknown. We make plans for the known. But we can't do much if we are already at that event. We can do a lot of things to help mitigate, especially if someone passes away, there are things we can do.


But really coming and talking to a financial advisor in the beginning, as you build in your life, we build plans to grow with people. It's not just to say, "Hey, this is what we're going to do, so you have to do these specific things." But they grow with you. And that's why it's so important to talk to a financial advisor early, because we can start getting those things in place now, to help you in the future.


Because a lot of times we put it off, and people put it off for a lot of reasons, the main one is they just don't want to deal with it. It's a lot, it can feel overwhelming to a lot of people because there's this expectation that we're going to come in and we're going to pick through everything that you've ever done in your life financially and say you did this wrong and you did that wrong with these things wrong.

Sarah: But in the reality of it, I just need to understand where you're at, where you want to go and then let's navigate some paths to get there. But it's when people react to and after the fact, and said "Gosh, I wish I would have, I wish I would have talked to someone 10 years ago, now I would be in such a different place."


One of my clients is the perfect example. And she's an amazing, amazing person, has been through a lot in her life, and when this last event happened to her, that was the first thing she did. She said, "You know what, I've made my mistakes in the past, I'm going to talk to someone right away." And her and I were able to connect.


And now her life was set up for sure on her daughters for the next six years. Where I'm like, we don't really need, there are not any major plans that need to change, but something could come up. So you call me, we laid the groundwork. I mean, it's no different than building a house, buying a house. You don't just go buy a house and say OK, that's a good one.

Sharon: Right.

Sarah: So it's the same principles and the same ideas that we're really here just as a guidance factor of, here are some options that you have, and here are some different ways to save money, to build for retirement, to plan for the unknown.

Sharon: Yeah, that's a great explanation. And going back to something you said a little bit earlier, I think a lot of people are very private about their money, maybe have shame about it or uncomfortable talking about it. They think maybe when I have this sum, then I'll go talk to a financial adviser.


Can you talk a little bit about what a first meeting with you might look, like so that somebody could know what to expect and what kinds of questions would be asked?

Sarah: Absolutely. So for me and I say us because I actually have a team that I work with and that team is built with specialists and people to really help elevate all of our clients. So they're getting the best of the best. If I'm out of town, they have someone to call. So it's not just me doing everything.


But our first meetings. Really the first thing actually that I ask is, that I want to understand people's values. I want to just understand who they are. Because your upbringing, how you have had relationships with people, with money, what the feelings were around that is so important.


Because if I recommend something to you that wouldn't fit your value profile, meaning if you're very thoughtful about your family, so you're very family driven, you're very loyal, you're very conservative and not in, again, not to get any other way other than just, you don't like taking on a lot of risks. Well, if I then recommend something that doesn't align with that, you're not going to be happy as a client.


And so that's the first question I ask. And we go through a little value exercise of, who you are. Because that helps me understand what really you're looking for. And from there, I want to know what your short term goals are. What's something that you want to have happened in the next three to five years, because that's cash flow management. So now we need to talk about that.

And then from there, what are your long term goals, 10 plus years down the road. What do you want to see happen? And a lot of times we always talk about retirement as OK, I'm going to retire. I'm going to venture to guess most of us. I mean, we don't have an end date of when we necessarily want to retire, but it's more of when we want to reach our financial independence to do what we want to do.

Sharon: Right.

Sarah: And so that's really that's my first meetings with people. If I want to understand where you're at now, where you want to go in the short term, where you want to be in the long term, and what makes you, you? Because that's going to be important when we start designing products or things that we put in there.


But there is so much more than that. It is the emotion. It is everything that goes into it. So for us, the biggest thing is really helping everyone. There's no judgment when it comes to our first meeting. There's no judgment effort because it just is. Money is what its. You have done, what you've done with it, good, bad, indifferent, I'm not here to make that judgment. I'm just here to say, here's where you're at. Here's where you want to go. And here's the most efficient way to get there where you're comfortable.

Sharon: Oh, I love that. I mean, it sure is a different perspective. And what I'm hearing is really about building that relationship with you also, so that you have a really good understanding of who you're working with and what's important to them

Sarah: Yeah, absolutely. But the most important thing to us is making sure that, whatever you want, you get. You may not be perfect, it may not be the perfect road. I mean, gosh, look at look at this year, things change, but the fact that we can be adaptable to that and help people work through a lot of that.

Sharon: Yeah. And Sarah I know you also have a lot of experience working with business owners and businesses. And can you talk a little bit about why seeking out a financial adviser is also important for a business owner to do, versus just an individual person kind of looking at their legacy and their future planning?

Sarah: Absolutely. A lot of times it's funny because it does mirror a lot on the individual side, what happens on the business side. But a lot of times, again, business owners are so good at what they do in their specific industries, building their business, that they forget some of the other stuff. And that's really bringing in a financial advisor for that expertise of, if you're getting ready to sell a business, what are some things that you can do to structure things in a proper way to create bonus revenue or income revenue when you're doing that sale? So I work a lot with business brokers in that sense.


But then also, as the business is growing, how do you make sure that you're keeping your employees engaged? Because one of the biggest expenses for employers is turnover. And right now, even a lot of employers that they're having to pull people off of the sidelines and come back from unemployment. So what are some things that you can offer at a time when money is tight but still provide benefits to the employees? So at Prudential, we've actually done numerous studies around what happens when you create financial education programs for your employees to help them live a more stress-free life when it comes to finances. And it increases the amount of loyalty and retention that you get from employees. So there's even that small factor.


But even then, going into their retirement plan, do you have a retirement plan set up for your employees? Do they feel that not only that staying power because they have benefits there, but there's a loyalty factor that comes into it. Where not only are they not leaving during the bad times because they respect everything that's been done from the business owner side, but then also recruiting that great talent in, because if you have a great culture and those loyal employees, they will bring in the next round and help bring people off the sidelines.

Sharon: Superimportant and I think more often overlooked and probably especially in small businesses. Can you speak a little bit in like, let's say, a small business that has, I don't know, two to five employees? It may be some of the points that you spoke already, but would be important things for those business owners to be considering.

Sarah: Yeah, absolutely. So especially in that space, there are changes that are coming for 2021 for the small business owner space with the beginning of 2020. There was an act that was passed by the federal government called the Secure Act, and that expanded the requirement for qualified retirement plans. So for one case, IRAs to be offered from the employee or to the employees and it does not exclude employee size. So the Obama administration, with the health care, there was always an exemption for employee size, there was no exemption for employee-size on this.


With COVID, everything got swept under the rug, not under the rug, it got swept just to the side. We needed the Cares Act, we needed everything else to survive. But there are changes that are coming in 2021. But not a lot of businesses have looked at where there is a requirement to have a retirement plan in place. And if not, they're not penalties, but there are things that the governments are doing both at the State and Federal level to ensure that those employees have retirement plans and the business owners may lose a lot of control in that.


So that has been a big thing for me right now. I understand where we're at, I mean, it is not every small business has access to be able to offer these different things, but there are so many ways to structure it where the business owner isn't laying out a huge expense, to make sure that their employees are covered, the qualified 401K side and structuring it in a way that the business owners can really take advantage also of a lot of that.

Sharon: Really important. Thank you so much, Sarah. And I hope this video inspires some folks to reach out both on the personal and the business side of things, because I do think that this is an area that if all of us collectively could get a little more proactive, there probably be a lot less suffering around our finances.


And I think sometimes we think as professionals that we should know it all, and we're smart, we are business owners, we should have this figured out. But it's important that we reach out to folks like you to get the help we need.

Sarah: Yeah, absolutely. That's what we're here for. Want to help people grow and develop.

Sharon: So thank you. Thank you for your time today and look forward to talking again soon.

Sarah: Thanks so much, Sharon. I appreciate you.

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