Tag: CFP

5-10 Years to Go: Retirement Reality Check -Are You Really Ready?

Posted on by Brian Colvert

As you get closer to retirement, the financial planning landscape changes. Those final 5-10 years bring new priorities, questions, and a natural desire for clarity. Do I have enough to retire comfortably? Will my savings and investments support my lifestyle? This period is critical for setting up the financial security and peace of mind that most people seek as they step away from work. Below, we’ll dive into how to build confidence in your retirement planning by addressing key steps and practical strategies to ensure you’re ready.

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Step 1: Start with Your Expenses

The foundation of a successful retirement plan is understanding your current expenses. The goal is to get a clear picture of what it costs to live your life on a monthly and annual basis. To do this:

  1. Track your monthly spending: Look at your recent bank statements and credit card bills to get an idea of your average monthly spending. Include every category, from housing to groceries to entertainment.
  2. Account for yearly fluctuations: Certain months are often higher-spend months. For example, holiday season costs or summer travel expenses can raise expenses significantly. Make sure to average out these costs for a realistic annual spending figure.
  3. Consider future changes: Think about how your expenses might change in retirement. Will you be mortgage-free, or do you anticipate moving? Are there hobbies you plan to pursue that might increase costs?

Once you have a firm grasp on your current and anticipated expenses, you’ll have a more accurate starting point to build your retirement plan.

Step 2: Identify Income Sources

After estimating your expenses, it’s time to look at income sources you can rely on in retirement. For most people, these will fall into a few main categories:

  1. Social Security: Check your Social Security statement to see what you can expect to receive monthly. Remember that delaying Social Security benefits past your full retirement age can increase your monthly payments.
  2. Pensions: If you’re fortunate enough to have a pension, include it here. Know the details, such as whether the payout is fixed or adjusted for inflation, and if any survivor benefits are available.
  3. Investment Income: Income from investments in retirement accounts, brokerage accounts, or real estate holdings is crucial. This is where the bulk of many people’s retirement income comes from.
  4. Other Sources: You may have other income sources like part-time work, royalties, or annuities. Consider whether these will be consistent and predictable.

Tally these income sources to see how they measure up against your projected expenses. Many retirees find that guaranteed income from Social Security and pensions falls short of covering their needs. This difference, or “gap,” is what your investments need to cover.

Step 3: Calculating Your “Gap” and Understanding Withdrawal Strategies

Once you have an estimate of your guaranteed income versus your expenses, you can calculate your “gap.” This is the amount you’ll need to withdraw from savings and investments each year to meet your spending needs.

For instance, if your annual expenses are $120,000 and your guaranteed income covers only $60,000, then your gap is $60,000 per year. This is the amount you’ll need to draw from your investments to maintain your lifestyle.

Step 4: Implementing the 4% Rule

The “4% rule” is a popular rule of thumb for retirement planning. It’s a straightforward way to estimate how much you can sustainably withdraw from your investments each year without depleting your savings prematurely.

The rule suggests that if you withdraw 4% of your retirement portfolio each year, your savings should last approximately 30 years, even with inflation adjustments.

Here’s how to use the 4% rule to estimate your retirement readiness:

  1. Calculate your gap: For example, if your gap is $60,000, you’ll need enough saved to cover this annually.
  2. Divide by 4%: Divide your gap by 0.04 to estimate how much you need saved. Using our example, $60,000 / 0.04 = $1.5 million.

The 4% rule provides a conservative starting point. However, remember that it’s just a guideline. Depending on your personal situation, investment portfolio, and tolerance for risk, you may need to adjust this percentage.

Step 5: Assessing Risk and Adjusting Your Portfolio

As you near retirement, consider adjusting your investment portfolio to better align with your time horizon and risk tolerance. This often means reducing your exposure to high-risk assets, such as stocks, and increasing holdings in more stable assets like bonds or cash equivalents.

That said, maintaining some exposure to growth assets, like stocks, is still essential to keep pace with inflation over what could be a lengthy retirement. We can help you determine the right balance based on your needs and market conditions.

Step 6: Creating a Flexible Withdrawal Plan

A successful retirement plan includes flexibility. The 4% rule is a useful baseline, but there are times when adjusting withdrawals can help stretch your retirement savings further.

  1. Stay adaptable in lean years: If markets are down, consider withdrawing slightly less or pausing major expenses. Adjusting withdrawals during market downturns can prevent you from selling investments at a loss.
  2. Re-evaluate annually: Each year, assess your expenses, investment performance, and overall portfolio balance. Staying engaged helps you avoid surprises and make minor course corrections as needed.
  3. Bucket Strategy: Some retirees find it helpful to use a “bucket strategy,” where they segment their savings into short-term, medium-term, and long-term buckets. For example, keeping 1-3 years’ worth of expenses in cash equivalents can cover immediate needs, while medium and long-term investments grow to support later years.

Step 7: Plan for Taxes and Healthcare Costs

Taxes and healthcare costs are among the largest expenses retirees face, so accounting for them in your retirement planning is essential.

  1. Plan for taxes: Withdrawals from tax-deferred accounts, like traditional IRAs and 401(k)s, are typically subject to income tax. Understanding your tax liability and strategies to minimize it, like Roth conversions or strategic withdrawal planning, can make a significant difference in retirement income.
  2. Healthcare expenses: Medicare will cover some costs, but it doesn’t cover everything. Consider supplemental insurance, long-term care insurance, or creating a separate savings account for healthcare costs to ensure you’re prepared for medical expenses.

Step 8: Pay Attention to Inflation

Retirement can span two or three decades, and inflation will erode purchasing power over time. Make sure your income sources and withdrawal strategy account for inflation so your savings can cover the rising costs of living.

  1. Use inflation-adjusted estimates: When calculating future expenses, consider the effect of inflation. A 3% annual increase in expenses is a conservative estimate many financial planners use.
  2. Inflation-resistant assets: Keeping some investments in assets that typically rise with inflation, such as stocks or Treasury Inflation-Protected Securities (TIPS), can help offset inflation’s impact on your retirement income.

Step 9: Take Advantage of Catch-Up Contributions

For those 50 and older, catch-up contributions allow you to add extra money to retirement accounts, such as 401(k)s and IRAs. Maximizing these contributions can help bolster your savings in the final years leading to retirement.

  1. 401(k) catch-up contributions: As of 2024, you can contribute an extra $7,500 to your 401(k) annually if you’re over 50. This is in addition to the regular contribution limit.
  2. IRA catch-up contributions: Similarly, individuals over 50 can contribute an extra $1,000 annually to IRAs.

These catch-up contributions can add up significantly over time, especially when invested wisely.

Step 10: Seek Professional Guidance

Planning for retirement involves many variables, and even with simple rules, the calculations can become complex. Professional guidance can be valuable for ensuring your plan is realistic. We can work with you to create a tailored financial plan that addresses your unique needs, assets, and goals. We can also guide you in making adjustments and keeping your strategy on track as conditions change.

The Bottom Line: Retire with Confidence

The final years before retirement are the perfect time to refine your plan, reduce uncertainties, and build confidence in your financial future. By knowing your expenses, identifying reliable income sources, and understanding your investment strategy, you’ll be well-prepared to retire with peace of mind.

Remember, retirement planning doesn’t have to be overwhelming. Each of these steps, from budgeting to the 4% rule, provides you with a roadmap to a secure retirement. Following these strategies and seeking guidance when needed can set you up to transition from work to retirement with confidence, knowing you’ve planned well for the years ahead.

Are You Making These 3 Common Retirement Mistakes?

Posted on by Brian Colvert

Retirement marks a significant life transition, one that requires careful planning and a realistic understanding of what lies ahead. Despite all the guidance and information available, there are still many common retirement mistakes that many pre-retirees make, often without realizing the potential consequences. Avoiding these pitfalls can help ensure a comfortable and worry-free retirement. Let’s take a closer look at these three overlooked areas.

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Retirement Mistake #1 – Underestimating Healthcare and Medical Expenses

One of the most significant challenges that retirees face is handling healthcare costs. Many assume that Medicare will cover all their needs once they turn 65, but that’s far from the truth. While Medicare offers some assistance, it doesn’t cover everything. Parts of it, like Medicare Part B and Part D come with premiums based on your income.

According to recent studies, the average retired couple may need over $300,000 to cover medical expenses during retirement. And that number could rise as healthcare costs continue to increase. So, if you’re approaching retirement without a solid plan for medical expenses, you could be facing a serious shortfall.

Medicare Part A, which covers hospital stays, has its limits. It doesn’t provide full coverage for all medical costs, especially when it comes to long-term care like nursing homes or in-home care for chronic illnesses. You may find yourself needing additional Medicare Advantage plans or Medigap policies, both of which come with their own costs.

Long-term care is another often-overlooked area. No one wants to imagine themselves needing assistance due to age-related ailments. However, the reality is that many people will require some form of long-term care. Consider investing in long-term care insurance, especially if there’s a family history of illnesses like Alzheimer’s or Parkinson’s. Waiting too long to secure this type of insurance can result in significantly higher premiums or even disqualification based on pre-existing conditions.

Retirement mistakes are common. Preparing for healthcare costs in retirement is essential to avoid the unexpected financial strain, as Medicare alone won’t cover all expenses. By planning ahead and considering options like Medigap and long-term care insurance, you can better protect your financial future and ensure access to necessary care.

Retirement Mistake #2 – Ignoring Car Replacement and Maintenance Costs

While healthcare is a commonly discussed retirement expense, many people overlook the cost of maintaining and replacing their vehicles. Most retirees own a car and rely on it for day-to-day activities, whether it’s visiting family, going to the grocery store, or driving to leisure activities.

Cars don’t last forever, and depending on when you retire, you may need to replace your vehicle a few times. Cars come with maintenance costs, which only increase as the car ages. Routine expenses like oil changes, new tires, and brake repairs can add up, and unexpected repairs can come as a nasty surprise to anyone living on a fixed income. Beyond this, the price of new vehicles has been rising steadily, with even modestly priced cars costing tens of thousands of dollars. If you’re accustomed to driving luxury cars, that expense can easily double or even triple.

So, as you budget for retirement, make sure to factor in the potential costs of replacing your vehicle every 8-10 years. You’ll also want to consider rising costs due to inflation, especially if you’re hoping to drive a newer or more luxurious model. By setting aside funds specifically for car replacement and maintenance, you’ll be better equipped to handle these expenses without impacting other areas of your retirement budget.

Overlooking vehicle replacement and maintenance costs is another one of the common retirement mistakes that can lead to unexpected financial burden. By planning for these expenses, you can avoid costly surprises and keep your retirement budget on track.

Retirement Mistake #3 – Failing to Adjust Lifestyle Expectations to Fit Retirement Income

If you’re a high-income earner, you may be accustomed to a certain lifestyle—maybe it’s regular vacations, fine dining, or even memberships to clubs or organizations. Unfortunately, a luxurious lifestyle can be tough to maintain on a retirement budget.

The first step is to ensure that your savings can support your lifestyle. A general rule of thumb is to aim for about 70-80% of your pre-retirement income to maintain your standard of living. This can vary widely depending on your specific circumstances. For those accustomed to high incomes, this percentage can still leave a substantial gap if your expenses are disproportionately high.

Beyond savings, it’s essential to evaluate your current lifestyle and determine where adjustments might be necessary. You may need to make trade-offs to align your retirement spending with your income. For example, if luxury travel is a high priority, you might need to scale back in other areas, such as dining out or leisure activities. Conversely, if you have a passion for fine dining, you might consider fewer vacations or shorter trips to balance costs.

Take time to analyze your current spending and decide which elements are most important to you. If frequent travel is a priority, perhaps you can scale back in other areas to accommodate this passion. If you enjoy dining out, consider how often you’ll want to do so during retirement and factor that into your budget. It might mean fewer trips to five-star restaurants, but with thoughtful planning, you can still enjoy occasional indulgences.

You may also need to make some lifestyle adjustments to ensure your retirement savings last. This could involve downsizing your home, traveling less frequently, or taking a more conservative approach to discretionary spending. A financial advisor can help you analyze your spending and create a budget that balances your priorities with your resources.

Neglecting to adjust your lifestyle to match retirement income is a common mistake that can strain your finances. By recognizing these retirement mistakes early and planning accordingly, you can avoid financial stress and achieve a more sustainable retirement.

In Conclusion

The key to avoiding these common retirement mistakes is to start planning early. Work with a CERTIFIED FINANCIAL PLANNER™ to build a comprehensive financial plan that addresses healthcare costs, vehicle expenses, and lifestyle adjustments. By taking these steps now, you’ll be better prepared to enjoy a comfortable retirement free from financial stress. To recap:

Healthcare: Make sure to consider all aspects, from Medicare premiums to long-term care insurance.

Vehicles: Create a fund for car replacement and maintenance. Remember that you may need to replace your car multiple times during retirement.

Lifestyle: Be realistic about what your savings can support, and prioritize the areas that matter most to you.

Incorporating these three considerations into your retirement plan will ensure that you’re prepared for the reality of retirement, allowing you to focus on what truly matters—enjoying this new chapter of your life.

Next steps:

If you’re looking to avoid these retirement mistakes and plan confidently for the future, let’s chat. Schedule a call with us today to start building a retirement plan that works for you!

How I Invest: A look inside a CFPs Portfolio

Posted on by Brian Colvert

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Today we are diving into a question that doesn’t come up as often as it should: How do I personally invest? This is a crucial question that any prospective client should ask. Are you curious what is inside your CFPs portfolio?

Transparency in Investment

I firmly believe that transparency is the foundation of a trustworthy advisor-client relationship. The investments I recommend to my clients are the same ones I would consider for my own portfolio. This principle stems from a straightforward idea: if I am advising on an investment, it should be a good enough investment for my money.

However, investing one’s own money in the same assets recommended to clients requires careful navigation of compliance and regulatory frameworks. These measures exist to protect investors from unethical practices like “front-running,” where unscrupulous advisors manipulate stock prices to their advantage at the expense of their clients. While these regulations add a layer of complexity, they are essential for maintaining trust and integrity in the financial industry. Regarless, a CFPs portfolio should be transparent.

The Core of My Investment Philosophy

At the heart of my investment philosophy is the belief in asset allocation and diversification. It’s a strategy that aligns with the needs and goals of my clients, and it’s the same approach I apply to my own portfolio. Here’s how I break it down:

Asset Allocation and Diversification

I advocate for a well-diversified portfolio as a cornerstone of a sound investment strategy. This involves spreading investments across various asset classes to mitigate risk and capture opportunities in different market environments. For my clients, I develop customized models—equity and fixed-income models—that consider their risk tolerance, time horizon, and specific goals.

For instance, some clients may prefer a heavier weighting in equities for higher growth potential, while others might opt for a more conservative approach with a focus on fixed income. My own portfolio is similarly tailored, reflecting my unique preferences and risk profile. The underlying investments might be consistent across portfolios, but the allocation percentages vary according to individual needs.

The Role of Cash

Cash is an integral component of any investment strategy. I aim to ensure my money is always working for me, and I advise my clients to do the same. With interest rates currently favorable, options like money market accounts, treasury bills, and CDs offer attractive returns with minimal risk. While these conditions may change as the Federal Reserve adjusts its policies, having cash reserves that generate returns is a prudent approach, as should be part of any CFPs portfolio. .

The Fun Side of Investing: Asymmetric Risk

Beyond the traditional asset allocation model, I incorporate a “fun” element into my portfolio—investments characterized by asymmetric risk. This strategy involves committing a small portion of capital to opportunities with significant upside potential but manageable downside risk. It’s a calculated risk that can lead to substantial rewards without jeopardizing financial stability.

Real Estate Investments

Real estate is a key area where I apply this principle. Whether through direct ownership, private placements, or limited partnerships, real estate investments offers a tangible and potentially lucrative investment avenue. However, the critical factor is ensuring the investment generates positive cash flow from the start. It’s essential to avoid properties that drain resources monthly, banking solely on long-term appreciation. Cash flow is vital for managing unforeseen expenses and mitigating risks.

Cryptocurrencies

Cryptocurrencies, particularly Bitcoin, also feature in my investment portfolio. I believe in the underlying technology and the potential future of digital currencies. Despite the volatility and skepticism surrounding crypto, I see it as a valuable addition to a diversified investment strategy. Engaging in this space requires an open mind and a willingness to understand the intricacies of blockchain technology.

Art and Collectibles

Art and collectibles offer another avenue for asymmetric risk investments. The art market can be lucrative, with opportunities to own fractional shares in masterpieces by renowned artists like Jackson Pollock, Van Gogh, or Banksy. While not everyone can afford a multi-million-dollar painting, platforms exist that democratize art ownership. Whether it’s art, collectible cars, or fine wines, these investments provide a fun investment for a passionate investor and the potential for financial gain.

Maintaining a Balanced CFP Portfolio

Despite the allure of high-risk, high-reward investments, the bulk of my portfolio as a CFP remains in more traditional, “vanilla” investments. This conservative approach ensures a stable financial foundation while allowing room for growth. Here are some core principles I follow:

  1. Diversification: Spread investments across different asset classes to minimize risk.
  2. Risk Management: Ensure risky investments are limited to a small portion of the portfolio.
  3. Regular Review: Continuously assess and adjust the portfolio as circumstances and markets change.
  4. Financial Goals Alignment: Keep investments aligned with long-term financial objectives.

Adapting to Change

As an investor, it’s crucial to stay informed and adaptable when it comes to an investment portfolio. Markets evolve, new investment opportunities arise, and personal circumstances change. Regularly reviewing and adjusting the portfolio ensures it remains aligned with current goals and market conditions.

My approach emphasizes flexibility and resilience, allowing for strategic adjustments without losing sight of the core investment principles. This adaptability is crucial, particularly in a rapidly changing financial landscape.

Conclusion

There you have it, a backstage look into a CFPs portfolio.  My investment strategy combines traditional asset allocation with innovative, risk-managed opportunities. By aligning my investments with those of my clients, I ensure transparency and shared interests. Whether exploring the potential of cryptocurrencies, the tangible value of real estate, or the fun of art and collectibles, my approach remains grounded in diversification and risk management.

For those interested in exploring these strategies further, I invite you to connect with us!

When can I retire? Navigating Retirement

Posted on by Brian Colvert

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Are you contemplating retirement? Are you wondering when you can retire?

In the most recent episode of The Field Guide Podcast, Brian Colvert, CFP® of Bonfire Financial, dives into the complexities of retirement planning and addresses the question we often get asked… When can I retire? From financial considerations to psychological readiness, Brian offers insights to help you navigate this significant life transition.

Psychological Preparedness:

One of the key factors in determining when to retire is psychological readiness. Many individuals tie their identity to their careers, making the prospect of retirement daunting. Brian emphasizes the importance of having a plan in place to alleviate anxiety and uncertainty. Whether it’s traveling, pursuing hobbies, or spending time with loved ones, having a structured schedule can enhance the retirement experience.

Financial Considerations:

While psychological preparedness is crucial, financial planning is equally important. Brian acknowledges the variability in retirement lifestyles, from extravagant globetrotting to simpler pleasures like hiking and local gatherings. Understanding your current expenses provides a baseline for retirement preparedness. Contrary to the popular notion that retirees spend significantly less, Brian suggests that initial retirement years may involve increased spending due to travel and leisure activities.

The 4 Percent Rule:

To estimate retirement income needs, Brian touches on the 4 percent rule—a widely used guideline in financial planning. By dividing the desired income by 4 percent, one can determine the required investment portfolio. While this rule provides a starting point, Brian emphasizes the need for flexibility and ongoing financial planning.

Beyond the Basics:

Retirement planning extends beyond simple calculations. Brian highlights the importance of accounting for factors like healthcare costs, inflation, and unexpected expenses. Collaborating with a financial advisor ensures a comprehensive strategy tailored to individual needs and goals.

Final Thoughts:

Answering the question of “When can I retire?” requires a blend of financial prudence and lifestyle considerations. While the prospect may seem daunting, proactive planning can pave the way for a fulfilling retirement experience.
If you’re seeking personalized guidance or additional resources, don’t hesitate to reach out to us. Our team is dedicated to helping individuals like you achieve their retirement aspirations.

Remember, retirement is not just about reaching a financial milestone—it’s about crafting a life that reflects your values and passions. Start planning today to embark on a retirement journey that’s as rewarding as it is fulfilling.

Get started with your Financial Plan today!

Financial Plan Bonfire Financial

The What, Why and How of a Financial Plan

Posted on by Brian Colvert

THE ULTIMATE LIFE HACK:  THE WHAT, WHY AND HOW OF A FINANCIAL PLAN

There seems to be a life hack for everything out there these days. Aluminum foil in the dishwasher for extra shiny spoons, avoiding TSA lines with strollers for faster times, and toothpaste to clear foggy headlights… but what about your finances? 

Well, we have the ultimate hack for that …. A financial plan! 

The What: Basics of a Financial Plan

Think of a financial plan as your roadmap to financial success. It’s your strategic guide, outlining how to reach your financial goals. Just like a GPS, it helps you navigate through life’s twists and turns, ensuring every dollar is well-spent. It involves setting goals, creating a budget, making smart investments, and managing debt and taxes effectively. In essence, a financial plan is your key to turning aspirations into achievable milestones. It provides clarity and confidence on your financial journey.

No financial plan is the same

Every financial plan is inherently unique. It should be tailored to individual circumstances, goals, and preferences. Factors such as income, expenses, risk tolerance, and life stages contribute to the unique and personalized nature of every financial plan. It will also adapt and evolve with the individual’s journey, guaranteeing adaptability and ongoing relevance as circumstances change. It really is a living document.  However, each plan typically has similar components.

Components of a Financial Plan

A comprehensive financial plan typically includes the following key components, again varying based on the individual’s circumstances:

Financial Goals:

Incorporating financial goals into a financial plan provides a clear roadmap, giving purpose and direction to your financial decisions. These goals serve as motivating milestones, guiding your financial choices and fostering a sense of accomplishment as you work towards tangible objectives. It is important to identify short-term and long-term financial objectives.

Emergency Fund:

An emergency fund acts as a financial safety net, providing a buffer against unexpected expenses or sudden income disruptions. Including it in your financial plan ensures you’re equipped to handle unforeseen challenges without derailing your overall stability or long-term goals. Generally, we recommend at least three to six months’ worth of expenses in an emergency fund. 

Budgeting:

A budget is the compass of your financial plan, offering a comprehensive overview of both income and expenses. Beyond instilling disciplined spending habits, it establishes a structured framework for strategic allocation. It allows you to prioritize savings, investments, and goals, ultimately contributing to enhanced financial stability and control.

Debt Management:

Incorporating Debt Management into your financial plan is paramount for achieving and sustaining financial well-being. By strategically managing and reducing debt, you not only free up resources for other financial goals but also cultivate a healthier financial profile, fostering long-term stability and reducing unnecessary financial stress.

Savings Plan:

Integrating a savings plan into your financial strategy is crucial for building resilience. It allows you to allocate funds for both future goals and unexpected challenges. This disciplined approach fosters financial security and positions you to achieve long-term objectives with confidence.

Investment Strategy:

An investment strategy in your financial plan acts as a catalyst for wealth growth, leveraging your resources to generate potential returns over time. By carefully selecting investment vehicles aligned with your goals and risk tolerance, you optimize your financial portfolio, working towards long-term prosperity and financial success.

Insurance Coverage:

Are you covered? Including insurance coverage serves as a safeguard, shielding you from unforeseen risks and potential financial setbacks. Whether it’s protecting your health, property, or income, insurance provides a crucial layer of security, ensuring that unexpected events don’t jeopardize your financial stability and long-term goals.

Retirement Planning:

Retirement planning is a cornerstone of a financial plan, ensuring that you can enjoy your golden years with financial confidence and independence. It’s like giving your future self a high-five from the beach of financial freedom. By systematically preparing for retirement in your financial plan, you build a nest egg that aligns with your lifestyle goals, providing peace of mind and the freedom to savor your post-working years.

Social Security Strategy:

A Social Security strategy is essential in retirement planning due to the impact it can have on your financial well-being. Social Security benefits provide a significant source of income for many retirees. However, the timing and manner in which you claim these benefits can significantly affect the overall amount you receive.

Tax Planning:

By strategically navigating the tax landscape within your financial plan, you optimize your financial picture, dodge unnecessary tax potholes, and help to ensure that your money is working for you in the most efficient way possible.

Estate Planning:

Estate planning is the meticulous crafting of your financial legacy. It ensures that your assets are distributed according to your wishes and minimizes the burden on your loved ones. By incorporating estate planning into your financial strategy, you secure a comprehensive roadmap for the future, fostering peace of mind and preserving your financial legacy for generations to come.

Regular Review and Adjustments:

Regular reviews and adjustments are the steering wheel of your financial plan, ensuring it stays aligned with your evolving life circumstances and goals. It should be a flexible guide. By consistently revisiting and adapting, you optimize its effectiveness, making strategic changes as needed to navigate the ever-changing terrain of your financial journey.

The Why: Benefits of Having a Financial Plan

Embarking on a journey without a map can be a daunting prospect, and the same holds true for managing your finances. The benefits of having a well-structured financial plan are akin to having a reliable guide on a mountain expedition. From providing clarity and direction to ensuring efficient resource allocation, a financial plan serves as a powerful tool that empowers you to navigate the complexities of your finances.

Here are our top 5 benefits to having a financial plan.:

Goal Achievement: A financial plan helps you define and prioritize your goals, providing a roadmap for turning aspirations into actionable steps. 

Emergency Preparedness: A financial plan includes building an emergency fund, and offering a financial safety net for unexpected expenses or income disruptions.

Wealth Accumulation: A well-crafted financial plan incorporates strategies for savings and investments, allowing you to build wealth over time and work towards financial independence.

Risk Mitigation through Insurance: Integrating insurance into your financial plan safeguards against unexpected events, protecting your health, property, and income.

Retirement Readiness: Planning for retirement is a key aspect, ensuring that you have the necessary funds to enjoy a comfortable and secure post-working life.

Be part of the 35%

According to Schwab’s 2023 Modern Wealth Survey only 35% of Americans have a documented financial plan, and those who have one feel more in control of their finances. Surprisingly, this means that 65% of Americans have no plan. 

One of the biggest reasons why most said they don’t have one is that it seems too complicated to create a plan. 

Well… we disagree and that is where our life hack comes in. 

The How: Getting Started: Tips for Creating Your Financial Plan

A life hack is all about making your life easier, not more difficult. Hence, that is why we have a motto of “Do it for yourself, not by yourself.”

Don’t Complicate it- Get a professional

It can be a complicated process, but with the right people in your corner, it doesn’t have to be.  While some people may create their own financial plans, there are several reasons why you might want to seek professional assistance (Like from us… wink, wink) rather than attempting a DIY (Do-It-Yourself) approach:

Expertise: Financial planners and advisors have specialized knowledge and expertise in various aspects of personal finance.  Areas of expertise range from  investments, tax planning, insurance, and retirement planning. Their experience allows them to provide valuable insights and guidance tailored to your specific situation.

The complexity of the Financial Landscape: The financial landscape is complex, with laws, regulations, and market conditions constantly changing. A professional can help navigate these complexities, ensuring your financial plan remains relevant and effective over time.

Objectivity: An external financial planner provides an objective perspective on your financial situation. Furthermore, this objectivity can be crucial in making unbiased decisions, especially when emotions might cloud judgment in financial matters.

Comprehensive Approach: Furthermore, Financial planners take a holistic approach to your financial well-being. They consider all aspects of your financial life. They help you create an integrated plan that addresses short-term and long-term goals, risk management, and more.

Time and Effort: Ain’t nobody got time for that! Crafting a thorough financial plan requires time and effort. Professionals can efficiently guide you through the process, saving you time and ensuring that no critical aspects are overlooked.

Risk Mitigation: Professionals can help identify and manage potential risks in your plan. Whether it’s investment risk, tax risk, or other uncertainties, their expertise aids in creating strategies to mitigate these risks.

Adaptability: Financial planners are equipped to adapt your plan as your life circumstances change. Whether it’s a career change, marriage, birth of a child, or other life events, professionals can adjust your plan to align with your evolving goals.

Access to Resources: Financial professionals often have access to a broader range of financial tools, resources, and market insights that may not be readily available to individuals.

Accountability: A financial planner can also serve as an accountability coach and financial mentor. As such, they’ll help you stay disciplined and focused on your financial goals, especially during periods of market volatility or economic uncertainty.

Legal and Regulatory Compliance: Professionals are well-versed in legal and regulatory requirements. They can ensure that your financial plan adheres to applicable laws and regulations, preventing unintended legal consequences.

While DIY financial planning is possible, it’s important to recognize your limitations and the potential benefits of seeking professional guidance. A CERTIFIED FINANCIAL PLANNER™ or advisor can bring a level of expertise, objectivity, and comprehensive understanding that may enhance the effectiveness and success of your financial plan.

In Short

Having a well-structured financial plan is not just a strategy; it’s a necessity for securing your financial future. Above all, it’s the roadmap that guides you through life’s uncertainties, ensuring you’re prepared for both the expected and the unexpected. From managing debt to saving for retirement, a sound financial plan touches every aspect of your monetary life, providing peace of mind and a clear path forward.

Next Steps:

Understanding the intricacies of financial planning can be daunting. That’s why we’ve created the Financial Field Guide – a step-by-step guide to help you simplify, navigate, and elevate your financial life. This isn’t just any financial plan; it’s your financial life, broken down into simple, actionable steps. It is a path to a future where you’re in control of your finances, not the other way around.

Don’t leave your financial future to chance. The power to change your financial story is just a click away. Are you ready to unlock it?  Get your Financial Field Guide today!

Financial Plan Bonfire Financial

10 actionable ways to cut taxes now and in the future

Posted on by Brian Colvert

HOW TO CUT TAXES NOW AND IN THE FUTURE

 

If you just wrote a big check to the IRS, you may be wondering how you can prepare now to cut your taxes next April. We’ve got you covered. Luckily, there are several legal ways to reduce the amount of tax you pay each year that don’t just include adjusting your withholding.  Here are 10, practical and actionable, ways to help you cut your next tax bill and those in the future.

 

1. UTILIZE YOUR RMD FOR YOUR CHARITABLE GIVING

 

If you are 72 or older, donating your Required Minim Distribution (RMD) to a qualified charity is a great way to reduce your tax burden. These donations are considered a qualified charitable distribution (QCD) and will not be taxed up to $100,000 per account owner.

Note: The Secure Act raised the RMD age for some taxpayers to 72, but didn’t raise the QCD age from 70 1/2. 

A qualified charitable distribution can satisfy all or part of the amount of your RMD from your IRA. For example, if your required minimum distribution was $10,000, and you made a $5,000 qualified charitable distribution, you would only have to withdraw another $5,000 to satisfy your required minimum distribution.

The more you donate in this way, the more you can exclude and cut from your taxable income This is extremely helpful since RMDs are ordinary taxable income that will often push retirees into a higher tax bracket. 

Qualified charitable donations are a great way to use up your RMD if you are planning to give to charity. However, keep in mind that it must be a check sent directly from an IRA to the charity, it is not a charitable deduction per IRS rules. 

Schwab allows you to have a checkbook on your IRA that allows you to write such checks directly from your IRA. Be aware, that all donations need to be sent/cashed by 12/31 of the tax filing year. 

QCDs can offer big tax savings, as tax rates on regular income are usually the highest. Regardless of the tax benefits, designating this income for charity is a great way to begin or expand your giving and support the causes you care most about. 

 

2. TAKE ADVANTAGE OF TAX LOST HARVESTING 

 

There is always a silver lining, right? For market downturns, that silver lining is tax-loss harvesting. With tax-loss harvesting, you can use your loss to cut your tax liability and better position your portfolio going forward.

Here is how it works, in its simplest form:

  • First, sell an investment that is losing money and underperforming. 
  • Next, use that loss to reduce your taxable capital gains and potentially offset up to $3,000 of your ordinary income for the tax year. (Any amount over $3,000 can be carried forward to future tax years to offset income down the road).
  • Last, reinvest the money from the sale into a different investment that better meets your investment needs and asset-allocation strategy.

This allows you to free up cash for new investment and mitigate a tax consequence.  

As with anything tax-related, there are limitations. Please note that tax loss harvesting isn’t useful in retirement accounts because you can’t deduct the losses in a tax-deferred account. Additionally,  there are restrictions on using specific types of losses to offset certain gains. A long-term loss would first be applied to a long-term gain, and a short-term loss would be applied to a short-term gain. You also must be careful not to violate the IRS rule against buying a “substantially identical” investment within 30 days.

The best way to maximize the value of tax-loss harvesting is to incorporate it into your year-round tax planning and investing strategy. We always recommend talking to a professional about your specific situation. 

 

3.  FUND HSA OR FSA 

 

Health Savings Accounts (HSA) and Flexible Spending Accounts (FSA) allow pre-tax dollars to be set aside for medical, vision, and dental expenses, thus reducing your overall taxable income. Each has its own benefits.

An HSA is triple tax-advantaged, which means:

  • Contributions are made with pre-tax dollars 
  • It grows tax-free (you can invest your contributions and earn interest) 
  • Can be used tax-free for eligible expenses (

Another great thing about an HSA is that you can keep it forever. Funds roll over and never expire. On the other hand, an FSA is a “use or lose it” type of account. However, an FSA is still a good option because it is funded before tax and comes out tax-free. FSA are employer-sponsored so there is often less involved with enrolling and setting up the plan. As such self-employed filers are ineligible to open able to open an FSA. 

Regardless of which plan you have, both HSAs and FSAs are good options to help cut and reduce your taxable income.  

 

CONTRIBUTE TO A PRE-TAX RETIREMENT ACCOUNT TO CUT TAXES NOW

 

Contributing to a retirement plan may be one of the simplest ways to slash what you own to the IRS. Whether a 401k or an IRA, (learn the differences here), both offer tax savings. 

 

4. MAX OUT  YOUR 401K

 

If your employer offers a 401k, maximize it. To realize benefits on your next tax bill, contribute to a Traditional 401k rather than a Roth 401k. Traditional 401k contributions will reduce your taxable salary, another great way to cut your tax bill.

 

5. CONTRIBUTE TO A TRADITIONAL IRA

 

Additionally, if you are below the income limits, you can also contribute to a Traditional IRA. They are tax-deferred, meaning that you don’t have to pay tax on any interest or other gains the account earns until you withdraw the money. Contributions to a Traditional IRA are often tax-deductible. However, if you do have a 401k or any other employer-sponsored plan, your income will determine how much of your contribution you can deduct.

 

6. CONSIDER A CASH BALANCE PLAN

 

If you are a business owner or solopreneur and have a high income, consider a cash balance plan. A Cash Balance plan is a type of retirement plan that allows for a large amount of money to go in tax-deferred and grows tax-deferred. It is a great option for owners looking for larger tax deductions and accelerated retirement savings.

Cash Balance contributions are age-dependent. The older the participant is,  the higher the contribution can be. It can be an extra $60k to over $300k (based on age and income ) on top of combined 401k/ profit-sharing contributions. 

An attractive feature of a cash balance plan is that the company offering the benefit can take an above-the-line tax deduction on contributions. Above-the-line deductions are great for tax savings because they reduce income dollar for dollar.

 

CONTRIBUTE TO AN AFTER-TAX RETIREMENT ACCOUNT TO CUT TAXES IN THE FUTURE

 

While a 401k, Traditional IRA, and Cash Balance Plan can help curb taxes in the near term, we also recommend planning for future tax implications to help you cut your tax bill for years to come. Roth IRAs are retirement accounts that are made up of your AFTER-tax contributions, however, they offer tax-free growth and tax-free withdrawals. 

 

7. GROW TAX-FREE WITH A ROTH IRA 

 

Again, Roth IRA contributions are after-tax, so you can not deduct your contributions. Nevertheless, your distribution will be tax-free and penalty-free at age 59 ½  Something your future self will thank you for! Another benefit is that a Roth IRA isn’t subject to RMD requirements either. 

Your Roth IRA contribution limits are based on your filing status and income.

There are definitely some potential tax savings here, especially for those just starting out. It makes sense to pay taxes on the money you contribute now, rather than later, when your tax rate may be higher.

 

8. RUMINATE ON A  BACKDOOR ROTH

 

A Backdoor Roth allows people with high incomes to fund a Roth, despite IRS income limits, and reap its tax benefits. Could it be right for you?

In short, you open a traditional IRA, make non-deductible (taxable) contributions to it, then move that Traditional IRA into a Roth IRA and enjoy the tax-free growth. 

It is important to note that you can not have any money currently in an IRA, SIMPLE IRA, or SEP-IRA to make this work properly.  There are more complexities involved in setting this up, and we recommend talking with a CERTIFIED FINANCIAL PLANNER™.

 

9. ROTH CONVERSION

 

A Roth Conversion involves the transfer of existing retirement assets from a traditional, SEP, or SIMPLE IRA, or from a defined-contribution plan such as a 401k, into a Roth IRA.

You’ll have to pay income tax on the money you convert now (at your current tax rate), but you’ll be able to take tax-free withdrawals from the Roth account in the years to come

You can also use market downturns as an opportunity to do a Roth Conversion. If your IRA goes down in value because of market fluctuations, you could convert the account to a Roth, which allows you to pay a  smaller amount of taxes because the account is down in value. Then you’ll have the money in a Roth when the market recovers, which would then be tax-free.

While there is no predicting what the tax brackets and tax rates will be in the future, if taxes go up by the time you retire, converting a traditional IRA and taking the tax hit now rather than later could make sense in the long run.

 

10. PAY ATTENTION TO THE CALENDAR

 

Lastly, from a tax perspective, there is a big difference between December 31 and January 1st. While some things, such as IRA contributions can be made up until the filing deadline, many must be done during the tax year, like qualified charitable distribution.

It is important to plan as far in advance as possible to help minimize your taxes. We recommend meeting with a tax professional and your financial advisor throughout the year.

 

The key to lowering your tax bill is to plan ahead and cut your tax liability in a way that makes sense for you.  It’s impossible to know what regulations, changes, and updates will go into effect during any given tax season, but rest assured that we’ll be here to help you plan. Schedule a free consultation call with one of our CERTIFIED FINANCIAL PLANNER™ professionals today! 

Until then, take these tips to heart and remember that reducing your taxes isn’t an impossible task.

3 QUESTIONS TO ASK BEFORE MAKING ANY FINANCIAL DECISION

Posted on by Brian Colvert

 

Whether it is hiring a financial advisor, picking a mutual fund, or refinancing your mortgage it is a good idea to ask a lot of questions when it comes to your money. However, if you only ask a few, here are our top 3 questions to ask before making any financial decision.

What is the investment philosophy?

Make sure to ask yourself if the investment makes sense to you. It may be great for 99% of the population but is it a fit for you and your current situation. Does it match up with your risk tolerance and timeline?  Really take the time to contemplate this.  Further, do you understand it? Or is it too complex? Understanding this will help move you forward in a meaningful way.

Do I trust the person giving the advice or offering the investment?

Simply put, what is your gut telling you about who is behind this. What is the person’s credibility and credentials? Was it your cousin Eddie spouting off a stock tip at the family reunion? Or a longtime friend and financial advisor who has been in the industry for years? It may seem like a no-brainer to ask this question, but it is sometimes easy to get caught up in the hype of the product and the potential returns.

A quick way to tell if an advisor truly has your best interest in mind is if they are CFP® (Certified Financial Planner)- learn more on that here, but in short, it means they are a true fiduciary and must have your best interest in mind regardless of commissions. Trust is so important, don’t take it lightly.

What is the downside risk, and can I afford it?

What can you stand to lose? Sure, look at what the potential of the investment is, but don’t ignore the risk. Make sure the amount you invest matches your risk tolerance. The old saying stands true here- “Don’t put all your eggs into one basket.”  Before you make an investment decision know the risks.

Short and simple, those are the top 3 questions to ask before making any financial decision!

Are you considering an investment and aren’t sure if it is right for you? Asked these questions and are still unsure? We are here to help…just set up a call.

 

4 Reasons to Hire a CFP ®

Posted on by Brian Colvert

4 Reasons to Hire a CFP ®

Managing your finances can be difficult and time-consuming. However, finding someone to handle your finances can be just as challenging. Want a tip to make it easier? Hire A CFP ®.

People often ask us what is a CFP ®, how are they different from other financial advisors, and the reasons to hire a CFP ®. We are going to be breaking all that down for you today.

What Is a CFP® Professional?

First, it’s more than just an acronym. Unlike some designations that are worth little more than the paper they’re printed on, the CFP ® (CERTIFIED FINANCIAL PLANNER™) designation is one of the most esteemed financial certificates around.  Each CFP ® is held to an extremely high standard and requires an immense amount of work. Typically nine months to two years of study.

In the US, as of 2025,  there are only 101,505 CFPs ® and only 3,150 in the state of Colorado, according to the CFP® Board professional demographics.  The exam itself is a grueling 7-hour test that assesses the financial advisor’s ability to apply principles of financial planning. It covers all areas of insurance, investments, income taxes, retirement, estate planning, ethics and conduct, and financial plan development, among many other skills.

Beyond the test, there is so much more that goes into the certification. We have condensed it down to the top 4 Reasons to Hire a CFP®.

4 Reasons to Hire a CFP ®

  1. Fiduciary Standard
  2. Ethics Code
  3. Fitness Standards
  4. Experienced Life-Long Learners

Let’s dive into it:

1. Fiduciary Standard:

Currently, the SEC has NO uniform fiduciary standard that applies to all financial professionals who provide personalized investment advice. This means there is no oversight to protect consumers and clients from paying excessive commissions or receiving substandard performance. Consumers are exposed to even greater and unnecessary risks from products that may be deemed suitable (more on that here) for them but are inferior to other available options and not necessarily in their best interests.

The CFP ® Board has a Code and Fiduciary Standards that require CFP ® professionals to act in the best interest of the client at all times when providing financial advice. So, as a CFP ®, we have a legal requirement to act in your best interest, all the time. In addition to this standard, Bonfire Financial is also a Registered Investment Advisor which furthers this obligation.

2. Ethics Code:

All CFP ® practitioners agree to abide by a strict code of professional conduct, known as CFP ® Board’s Code of Ethics and Professional Responsibility, that sets forth ethical responsibilities to the public and clients. This ensures we act with honesty, integrity, competence, diligence, and offer services objectively.

It’s a pledge to protect the confidentiality of all client information, avoid or disclose and manage conflicts of interest and always act in the client’s best interests.

3. Fitness Standards:

Further, the CFP ® Board has also established specific character and fitness standards for the CFP ® certification. This ensures that an individual’s prior conduct would not reflect adversely upon the profession or the CFP ® certification marks. This helps you know that if you hire a CFP ® you won’t find out later that they have:

    • A felony conviction for theft, embezzlement, or other financially-based crimes.
    • A felony conviction for tax fraud or other tax-related crimes.
    • Revocation of a financial license (e.g. registered securities representative, broker/dealer, insurance, investment advisor).
    • A felony conviction for any degree of murder or rape.
    • A conviction for any other violent crime within the last five years.
    • A felony conviction for non-violent crimes (including perjury) within the last five years.
    • Personal or business bankruptcies.

4. Experienced Life-Long Learners:

CFP ® professionals are required to complete 3 years of experience related to delivering financial planning services to clients. They also must have a bachelor’s degree prior to earning the right to be a CFP ®. This real-life experience means that CFP ® professionals have practical financial planning knowledge. They can truly help you create a realistic financial plan that fits your individual needs.

Once certified, CFP ® professionals are required to maintain technical competence and fulfill ethical obligations. Every two years, they must complete a minimum of 30 hours of continuing education to stay current with developments in the financial planning profession and better serve clients.

Need more reasons to hire a CFP ®? We’d love to answer any other questions on what it means to have a CFP ® working for you, feel free to contact us.

At Bonfire Financial we pride ourselves on having a team of CERTIFIED FINANCIAL PLANNERs™ and we can’t wait to help you!

 

4 Reasons to Hire a CFP

 

How do Financial Advisors Get Paid?

Posted on by Brian Colvert

HOW DO FINANCIAL ADVISORS GET PAID?

 

Do you ever wonder how financial advisors get paid? If so you are not alone. It has been estimated that more than one in five people who have a financial advisor does not know what they are paying in advisory fees. You don’t hire a plumber or join a gym without knowing the cost. So why be in the dark about the cost of a financial advisor?

It should be simple enough…sadly, it’s not really straightforward. Understanding the compensation for financial advisors is often puzzling. It’s a perpetual source of confusion, so we are here to break it down.

Let’s first look at 3 different types of advisors you could choose to work with.

3 Types of Financial Advisors:

  1. A broker or broker-dealer
  2. Hybrid or dually registered advisor
  3. Register investment advisor

Broker or Broker Dealer:

First, if an advisor is a broker, which the majority of advisors are, they receive a commission based on the products that they sell and the investments they recommend.

The commission can be upfront (when you buy), it can be on the back end (when you sell), or it can be trailing (they get paid a portion annually).  The problem is that with most of them you “should” read the prospectus (the gigantic legal document you get when you buy or get sold a product and throw away when it arrives in the mail) to find out what you are really paying.

Moreover, there is an even bigger problem with brokers which has to do with what is in your best interest.  They only follow the “suitability” standard. This says the product or recommendation only needs to be “suitable” for the client. This suitability standard is established by the Financial Industry Regulatory Authority (FINRA) a private nongovernmental organization.

The suitability standard is problematic.

For instance, a broker could recommend a Mutual Fund that is ten times more expensive to own than a comparable Exchange Trade Fund, and that is acceptable because it’s “suitable” for the investor.  This obviously raises questions as to why a broker would prefer one investment over the other.

Many brokers push annuities as they are notorious for heavy hidden commissions, but keep in mind any investment could carry a commission. Mutual funds can carry sales loads up to 8.5% and brokers may take 1 to 2% off of a bond’s value for themselves. Think of it as a kickback.

To us, this is a huge conflict of interest and why Bonfire Financial is not a broker.

Dually registered or a hybrid advisor:

Next, let’s look at advisors that are dually registered or hybrid advisor.  There are some nuances between to a hybrid/dual-registered advisor. For the purposes of this discussion let’s focus on the fact that they are registered investment advisors AND licensed through FINRA (again, a private corporation that acts as a self-regulatory organization).

While that sounds good on the surface there are issues with this format.  As a registered investment advisor, they act as fiduciaries and do what is in the best interest of the clients. Great news, but they are also filing with FINRA to sell products as a broker. What? Yes, they can sell investment products and collect a commission.

These advisors can wear two hats with the same client. Not a good look.   They can have accounts which they are acting as fiduciaries on and then have another account with the same client in which they act as brokers and only follow the suitably standard.

In a recent research paper published by Nicole Boyson, professor of finance at Northeastern University, The Worst of Both Worlds? Dual-Registered Investment Advisers, she finds dual registrants “have numerous conflicts of interest.” These include cross-selling insurance products, revenue sharing with third-party mutual fund companies, and selling proprietary investment products. She also found dual registrants charge an average of 2.1% on assets under management. This is much higher than the 1% fee most registered investment advisers collect. On top of that, they are more likely to be the subject of disciplinary actions by securities regulators.

How can someone be a fiduciary to a client but not on all their accounts or money?  I am still scratching my head on this one.  In my opinion, a client would never really know if the recommendations were in their best interest or not! This model was a pass for Bonfire.

Registered Investment Advisor:

Finally, there is the Registered Investment Advisor (RIA). These advisors have a legal obligation to act as fiduciaries.  Meaning that they have to act in your best interest at all times. They also must register with the Securities and Exchange Commission (SEC). The SEC is a governmental agency responsible for protecting investors.

Further, a Registered Investment Advisor must explain upfront how they receive compensation. Fees range but generally average somewhere between 1-2% of the total value of the investments under management. An RIA must disclose any conflicts of interest.  RIAs usually earn their revenue through a management fee comprised of a percentage of assets held for a client. However, the most important thing to know about RIAs is that they must act as fiduciaries for their clients.

Unfortunately, few advisors that are acting full-time in this capacity, less than 13,000 total in the US, surprising, right?

Fee-Only Vs. Fee-Based

Another thing to consider in determining how financial advisors are paid is whether they are Fee-Only or Fee-Based. While the term Fee-Based may sound very similar to Fee-Only, there are important distinctions.

The Fee-Based model can be susceptible to the same conflicts of interest that the commission structure has. There are many advisors who are mostly fee-based and the majority of their revenues come from fees, yet they can offer you a mutual fund or an investment that normally has a commission, and a conflict.

Fee-Only advisors don’t sell products, don’t accept commissions and they operate as true fiduciaries. Fee-only advisors work for their clients and clients pay an hourly rate, a fixed annual retainer or a percentage of the investment assets.

In conclusion:

I have always strived to be upfront and honest with people and my clients.  At a young age, I started my career at a big wire-house and believed I was a fiduciary for my clients and that I could act in their best interest.  However, the more I was learning, the more I began to realize the cards were against me. Decisions made at the top made it difficult to truly act in the manner of a fiduciary.  I was a vegan in a butcher shop, a sheep in wolf’s clothing.

So, I made a switch and I started Bonfire Financial, a Fee-Only Registered Investment Advisor.  Now my core values are in line with the company I am with and I can be a true fiduciary all the time.

If you have any other questions on how Financial Advisors get paid, or if you are curious what category your advisor falls in, feel free to give us a call. 

Why Bonfire Financial?

Posted on by Brian Colvert

The story behind the name.

A BONFIRE IS A FIRE OF CELEBRATION.

As I look back on my life some of the best memories and conversations have happened sitting around the fire.  I have been pumped up at a homecoming bonfire. Inspired by having deep conversations with friends about the future around the fire. I have felt close to my family on camping trips roasting marshmallows on the fire, and I have felt at peace sitting at a fire and staring at the stars.  Fire is life and all of these are moments are cherished.

Life is meant to be experienced.

That sounds good and all but I am a financial advisor and what does that have to do with financial advising?

I say everything!  Or at least it should.  Money is a vehicle for those experiences and the time to enjoy those moments.  The more money you have, the more experiences you can afford to have with your family and friends. You can give more to the causes you care about. The more peace of mind you can have.

I wanted to create a company that focused on that outcome, not just dollar figures.

Everyone has different goals and dreams and how they want to spend their life. What Bonfire Financial does is focus on those and come up with solutions to meet them as efficiently and as quickly as possible. My hope is that our clients will enjoy even more moments sitting around the proverbial bonfire celebrating their lives.

In the many years I have spent in the financial industry I have seen that most financial companies only focus on the bottom line. They prioritize their shareholders’ value.  This means that the decisions made about the company are not necessarily about how to add more value to the client. They are often about how to improve the share price.  A good share price is nice but it comes at the expense of the client, and the employees of the company.

So why is Bonfire Financial different?

We created Bonfire Financial as a fee-only registered investment advisory firm (RIA) so that we could be true fiduciaries to our clients. We are based in beautiful Colorado Springs, but serve clients throughout the US. All of our advisors are CERTIFIED FINANCIAL PLANNERs™  As such, we must do what’s in the best interest of our clients at all times.  In effect, putting our clients first, which is where we think they should be. We have a belief that if we add more value to our clients than anyone else, not only will they be happy, the company will thrive.

So, as a constant reminder of these philosophies, we came up with a name that reminds us to focus on the client’s outcome every day so that hopefully soon we will all be sitting around the fire celebrating!

All the best,

Brian

President & CEO | Bonfire Financial

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