A total approach to financial planning that looks at everything from taxes to 401(k) accounts is an important part of the practice of Troy Von Haefen, founder and owner of Von Haefen Financial Management in Nashville, Tenn.
The word holistic “conjures up the wrong images to some people,” Van Haefen said, but to him it means that he does truly comprehensive planning for his clients, which include families, entrepreneurs, business people and musicians.
“I’m a solo practitioner and I have a very intense relationship with my clients,” he said. “I have clients that will call me and ask me everything from investment questions to ‘hey, my car broke down, do you know anybody?’”
“There’s so much to financial planning that is not numbers oriented,” he said. “That’s the part I really like.”
The clients at Von Haefen Financial Management generally fall into the upper middle class, he says, which means that their 401(k) may well be one of their largest assets. He said he has about 30 or so full-retainer clients.
Von Haefen said he especially enjoys working with small business owners. He has found “the typical small business owner puts everything they have into their small business,” sometimes focusing on that to the exclusion of other financial needs, or the needs of their family down the road. In his practice he likes to help business owners look at the overall value the business is bringing to them and their family, especially in terms of retirement savings and a long-term exit strategy.
“I look at everything from the big picture view,” he said, comparing a financial plan to a puzzle where one piece may look good but the more important part is how all the pieces fit together. He says that many financial planners only look at one component of a person’s financial life -- usually the investment piece -- without looking at other considerations, like a client’s overall tax burden, or what they have in their 401(k).
In contrast, Von Haefen’s practice is “a very tax heavy practice,” he said. “Taxes are the glue that holds the financial plan together.”
While he actually does tax returns for his clients, he doesn’t necessarily think every financial planner needs to do the same. Still, he considers having the ability to do tax returns “a big plus.”
Even advisors who do not do tax returns need to fully understand “what’s in the tax return and what makes it tick.”
Von Haefen said he works closely with the clients on tax preparation and planning, so they always know what is coming and there are no surprises come April 15. “Most people, when they take their taxes in to get done, walk in with their fingers crossed,” he noted. But his clients know what is going on because they are “proactively managing their taxes,” and developing a strategy, whether it is increasing 401(k) contributions, changing W4 withholding, or adjusting investment allocations.
“I see clients all the time that come in with tax inefficient investments,” he said. One of the biggest issues is asset allocation. While clients need to diversify their investments, where they put equities versus bonds, for example, can make a big difference at tax time.
Von Haefen blogs about a variety of topics on his Web site which he redid last year to be brighter and include more photos than the typical Web site of a financial firm. He said he has seen an increase in his business since he revamped the site, though he can’t necessary attribute that increase directly to the site. However, he said, “It is extremely important in today’s society to have a very positive Web presence.”
He said he uses technology to make sure the blog posts he writes are reaching the right people. For example, anyone who signs up can get an email when there is a new blog post, and he uses a system that allows him to see which clients actually opened that particular post. Writing a blog also allows him to reach potential clients, who can experience some of what it would be like working with him by reading his thoughts on topics ranging from tax incentives for small businesses, to saving strategies for families, to Social Security.
“My Web site is designed very purposefully to feel somewhat like it feels to be with me,” he said.