|Volume 9, Issue 1||
|Tim Kober and his daughter, Jenna|
Tim Kober had been working at Intel for 18 years, moving up the corporate ladder to ever-higher levels of responsibility. This included flying all over, and even a family move to Olympia for a couple of years on a special project. But he gradually realized that he was missing the most important time of his daughter's life and many other facets of living. He began to explore ideas for an alternate way to support his family that would be satisfying and give him more flexibility.
As an Intel employee, he had to figure out how to invest his 401K and his stock options, and he found that interesting, so he investigated the field of financial planning.
He discovered the National Association of Personal Financial Advisors (NAPFA), an association of fee-only advisors across the country that binds members to a Fiduciary Oath, a Code of Ethics, and high educational standards. Their Western Region Conference happened to be held in Portland in 2006. Attending that conference confirmed his idea that this was a good fit, and he resigned from Intel the following week and began the studies necessary to take up his new profession.
After completing an executive certificate program in Financial Planning at the University of Portland, he took the Certified Financial Planner (CFP) Board exam in November 2007 and passed the first time. "Only about 50% of people pass the exam at any time," says Tim.
He began by working with Gail Parker, an established local financial planner who served as a mentor and consultant. He provided her with computer and technology support while learning to use the specialized software and getting practical experience in other aspects of the business.
He had a plan to grow his new business carefully. He didn't want to end up where he had been already, with too much work and stress and too little time for his family. He prefers to be able to do a good job for a limited number of clients.
He uses many of the skills he developed at Intel including strategic analysis and "people skills." And his Intel contacts proved to be a good source for his initial client base. In addition, NAPFA provides referrals to people searching for planners on their website.
Tim used his technical skills to build his website in a way that makes him come up tops in local searches. He gets about half his new clients from search and the NAPFA site, and half by word-of-mouth from current clients.
The field of financial planning is broad and includes many specialties. Kober is a fee-only planner, which means that he is working directly for the client, and he doesn't get commissions from any financial products that he recommends. He offers two major services—financial planning and wealth management. He works primarily with professionals, pre-retirees, and retirees..
“I can usually tell from the initial phone conversation whether I'll be a good fit for a prospective client,” he explains. "I am looking for a relationship where someone is willing to let me be their "family CFO," where they are interested in getting on with their life and want me to handle the details of how they can reach their financial and retirement goals. I'm not a money manager out to beat the market."
He usually works with couples, and sometimes finds that each of them has slightly different goals at the beginning. "The first step is to define and prioritize their goals for a ideal retirement lifestyle. Wants, needs and wishes—what is necessary, what would be nice, and hopes and dreams. Then we identify their resources, which include savings, pensions, and investments."
Kober then theoretically throws "stress" at this pool of resources, helping the client face the reality that things could go wrong, and figuring out how much cushion is necessary to insulate against potential loss. Having a prioritized list of goals allows people to adjust their current spending and their expectations to fit a comfortable retirement-income scenario. Once their current and future goals are in balance with their resources, he proposes an asset allocation and investment plan.
For some clients, the initial Financial Plan is all they need. Many of his clients hire him for the long term as a fiduciary agent to manage their wealth. As a Registered Investment Advisor, he obtains a limited power of attorney to move their portfolio into a range of asset classes—stocks, bonds, real estate, alternative investments, and cash—and takes on the job of managing them and reporting to the clients.
|Kober checks in with a client in his visiting office|
He creates an Investment Policy Statement (IPS) that he says is, "a job description for your money. This establishes the investor's expectations, objectives and guidelines in the investment of the Portfolio's assets. It creates the framework for a well-diversified asset mix that can be expected to generate acceptable long-term returns at a level of risk suitable to the Investor. It also defines the responsibilities of the investor and the advisor."
The "wealth management" side of his business involves all the "moving parts" of a client's wealth. Kober provides a quarterly statement that gives them the big picture. "Clients get lots of statements from various investment accounts. I provide a household account overview that shows how they all fit together, and how well they are doing at meeting their goals."
He also works with the other professionals who are involved with the family's financial life, including insurance, tax and legal professionals, acting as the "head coach" of the team of advisors, making sure that all aspects are in balance.
He says that he spends, "zero time picking stocks." His expertise is in financial planning, asset allocation and risk management. He has subscriptions to online resources and participates in both online and in-person discussion groups with other fee-only advisors to stay current on products for his clients, and on the right tactics to solve various problems and situations that arise.
The recession has reinforced his belief in a diversified portfolio and a long-term approach. He points to a study available on his website that shows that even during the ups and downs of the market in recent years, a diversified portfolio improves returns and lowers risk. He quotes Warren Buffet's "Noah Rule"—"Predicting rain doesn't count; building arks does."
His charges for a retirement plan are around $3000. Most of his wealth management clients pay him an annual retainer, based on assets under management and overall complexity.
Kober and his family have lived in Cedar Mill since 1998. His wife is an instructor at PCC. His daughter is in the seventh grade at the International School of Beaverton (ISB) and "loves pasta and soccer."
He mostly works at home and is able to attend his daughter's soccer games and be a "carpool Dad. That's a great way to spend time with your child and her friends." He has a conference room available for client meetings in an office building in Beaverton.
He first heard about the Cedar Mill Business Association from his mentor, Gail Parker. "I started attending meetings and saw that I could contribute and have a positive impact. I've enjoyed getting to know the community members and serving on the board," he says. He's working on a new website for the group with a focus on a business directory and a community calendar.
His website is www.cedaradvisors.com, and in addition to fully describing his services and offering reference tools, it includes a Client Portal that functions as an "online vault that enables file upload/download and storage. Financial Planning clients can upload the data required to develop their plan, and wealth management clients use the portal to store their statements and other important documents."
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