As the founder of ePERSONAL FINANCIAL, Eric helps his clients take control of their finances through technology and advice. Eric has always been interested in the financial world, and over the past 28 years, he has been involved in every facet of wealth management. This includes, retirement, family business succession, and insurance planning.
Unlike traditional firms, Eric and his team have transformed wealth management into a solution that is truly built with their clients in mind. No longer do clients have to meet with a suit-clad advisor in a stuffy office. Instead, they can take control of their financial future, monitor their investments, and harness current technology in the comfort of their own home.
Eric graduated from Washington State University with a degree in Business Administration with specializations in Accounting and Finance. In addition, he holds his Accredited Investment Fiduciary® and Certified Exit Planning® designations. Eric has a thirst for continuing education and holding himself to a high standard of ethics.
Throughout his career, Eric has managed to find balance among his professional and personal life. Eric enjoys spending time with his life partner, Sherrie, and being a father to his young adult daughters, Kayla and Brooke. As a Washington native, Eric takes every opportunity to get outside. He is an avid cyclist, has taken up stand up paddle boarding, and enjoys snow skiing and training his Australian Labradoodle puppy, Blake.
BA, Business Administration, Washington State University
Eric Flaten is an advisor representative of Sowell Management Services, which does business as ePERSONAL FINANCIAL, LLC. Eric is also the founder of ePERSONAL FINANCIAL, LLC, a separate legal entity. Advisory services are offered through Sowell Management Services, a registered investment advisor.
Thank you for your question. It looks like you could use some guidance on how to build a portfolio before you invest your hard-earned money. My philosophy is that the best result for investors is when they focus on understanding their own tolerance for risk first. Then build a diversified portfolio that perfectly matches their own risk tolerance. Review your progress towards your goals. This creates a perfectly matched portfolio to their Risk Number and a systematic way to measure your progress and adjust along the way. This can be accomplished in three easy steps:
First, capture Your Risk Number. The first step is to answer a 5-minute questionnaire that covers topics such as portfolio size, top financial goals, and what you’re willing to risk for potential gains. This will pinpoint your exact Risk Number to guide the decision-making process.
Align Your Portfolio. After pinpointing your Risk Number, create a portfolio that aligns with your personal preferences and priorities, allowing you to feel comfortable with your expected outcomes. The resulting proposed portfolio will include projections for the potential gains and losses you should expect over time.
Meet Your Investment Goals. Review your progress toward your financial goals by building an Investment Map. When you finished this process, you’ll fully understand what is possible to increase the probability of success.
You have hit the nail on the head. Financial management is complex and time consuming. Then notch up the complexity by trying to figure out someone else’s finances. It’s frustrating, a time suck and it feels like everyone has an opinion. I would suggest finding a fee-only advisor, which means they are a fiduciary and legally must act in your best interest. Fee-based advisors can accept both fees and commission and have no fiduciary responsibility. People seem to be more comfortable with financial advice is provided for their best interest, not what’s suitable.
It sounds like all you need is access to some financial management tools and perhaps a little guidance. I would suggest finding an advisor that provides access to online financial management tools that helps you organize your accounts in one place, like a financial eDASHBOARD. Find an advisor that helps you easily calculate your Risk Number and then can compare your Risk Number with the Risk Number of you of all your investment accounts. Then provide you with an investment portfolio that matches with pinpoint accuracy to your Risk Number. You also want to be able to see how your portfolio will react to economic events before you invest your money, NOT after (i.e. Financial Crisis of 2007, Dot Com Meltdown, Flash Crash, etc.). Make sure stress testing reports are available based on what events worries you, NOT what the advisor thinks. When you have this type of clarity, it builds your confidence. The process becomes so much easier and less stressful.
Screening investments, allocating portfolios and providing ongoing investment management requires quite a bit of skill and experience. Look for an advisor with this type experience, but also can provide access to most of these type tools free of charge. Take it for a test drive and see what you can accomplish on your own. Remember, you can always hire this advisor later.
You described a lot of thoughtful planning and it sounds like you just need a little coaching to get you to the next level. Your question is my #2 most common question, "Will I outlive my retirement savings". My recommendation is to simplify first, know your Risk Number* and organize your financial drawer to help track your spending. If you follow these three recommendations you have a greater chance of lowering your stress from worrying about outliving your savings.
- Simplify the COMPLEX: You have several accounts that can either be rolled into a IRA rollover account. This simplifies common asset types (retirement savings) into a single portfolio. It allows you more flexibility and choice in the underlying investments. It's a simple process and if done in conformance to IRS rules, can result in a non-tax event. If your brokerage accounts are also dispersed in multiple accounts, I would suggest exploring the same. Because these are taxable accounts, great care will be needed to minimize any capital gains exposure. This may require you to do this over a couple of years as you draw income beginning in the second half of 2018.
- Know your RISK NUMBER: #1 top request by clients – “Create an investment strategy that provides me with all the profit from the market but none of the loss”. To maintain your investments over any length of time, investors must first understand their emotional reaction to market loss. Too often investors have no idea of how upsetting a down market can be until after they experience a down market event. Unfortunately. then it’s too late. Knowing your Risk Number allows you to know this vital information BEFORE you invest your savings or allows you to evaluate your current investments. Investors armed with this information will know the upside and downside range of their investment portfolio six months ahead with a 95% confidence rate. When you know your Risk Number, you will know what expect with confidence.
- Simplify your FINANCIAL DRAWER & maintain YOUR budget: Organizing your financial statements, pension plans, social security, brokerage statements, 457 & 403B and keep track of all this information is very difficult for most investors. On top of all that, trying to keep track of your monthly spending and stay in budget. By having access to an eDASHBOARD you can easily organize all this important information and keep track of your spending. Clients enjoy a digitally secure site in which they can easily access from any device 24/7. By having all this information virtually at your fingertips, helps lower stress and keeps you organized. When you are organized and have easy access it’s much easier to stay on track with your goals. It also allows you to securely provide information to all your advisors (tax, financial advisor, estate attorney, etc.).
These are my three tips to help you reduce stress, simplify your financial life and enjoy your retirement with confidence.
* Risk Number is a registered trademark of Riskalyze
Excellent question! Bonds are the most underreported sectors in the business news today. The volatility in the bond market has been more dramatic than the stock market, but it's barely mentioned. I favor managers that have flexibility to tap a variety of global bond sectors and can tactically shift portfolio weightings, moving to wherever they believe the risk-adjusted yields can be found. This has been true in the past (bull bond market) and in an increasingly complex investment climate (today) by generating a remarkably consistent level of income.
First off, what is your investment objective? Income? Growth? Or both? What is your tolerance for volatility over time? Short, mid, and long term? Target rate of return? These are important questions and probably not what you were expecting when you posted your question. These fundamental questions must be answered first to establish your objective and to establish your RiskNumber. The RiskNumber is derived from a 7-15 question exercise that establishes your personal tolerance for market volatility. Once that is known along with your objective, a custom portfolio can be constructed. The investment portfolio will perfectly align with your objective and your comfort level of investment volatility. Aligning expectations of your portfolio volatility, along with your comfort level is often overlooked or misunderstood by investors until it’s too late (i.e. Tech Bubble 2000, Financial Crisis 2008). You have worked too hard for your money and it’s very important that you have a high level of confidence (expectation) in every investment decision you make.