Learning Objective from the session:
- Understand the Role of AI in Advanced Planning:
Gain insight into how AI-driven platforms like FP Alpha are transforming tax, estate, and insurance planning, making these traditionally complex services more scalable and accessible. - Integrate FP Alpha into Existing Tech Stacks:
Learn practical strategies for seamlessly incorporating FP Alpha's platform into your current technology infrastructure, enhancing your efficiency and client service. - Differentiate Your Practice with AI:
Discover how to leverage FP Alpha to stand out in a crowded market, increase wallet share, attract new business, and provide enhanced value to clients through advanced planning services. - Maximize Client Outcomes with Tax and Estate Snapshots:
Explore real-world case studies demonstrating how using FP Alpha's Tax and Estate Snapshot can help clients achieve significant tax savings, resulting in stronger client retention and a reliable stream of referrals. - Scale Holistic Planning for Growth:
Learn how to apply AI tools to deliver holistic, comprehensive planning services to a larger client base, driving growth and improving client satisfaction across your practice.
Transcription:
Brad Frey (00:10):
A little bit about FP Alpha. We were founded by a financial advisor. His name's Andrew Fest. He is hopefully in this room watching me right now, and he will be presenting tomorrow at 10 35 as well. So please be on the lookout for that session. Basically, the traditional planning tools, as you guys all know, e-Money, money Guide Pro, right Capital, they do a great job in cashflow, retirement goal planning, things like that, but they've failed the advisor in many ways when the conversations have gotten more complex, when you start talking about estate, when you start talking about deeper income tax conversations, they've really not done a good job for you, and it's left you to manually read a bunch of documents that you don't have time to read. Tax returns, estate planning and documents, insurance policies. That's what we do. We take all of those complex documents, we read them utilizing AI, visualize them and summarize them for you and give you actionable insights on how to improve.
(01:09):
Plus, we have some really cool calculators. Simulators, as I like to call them. Those simulators can help in the tax conversation in the estate conversation, which today is one of the cases that we're going to be talking about with Grant in his practice. So enough about me. This is definitely more of your case today. This is some just quick screenshots of the platform. I really like this screen though, right here. I want to pause here for just a moment. The reason why we are hitting a lot of hot button items right now, why advisors are literally flocking to us is because of this screen right here, whether you like it or not, there's an advice gap in the world right now that advice gap is big, and that gap is in a lot of particular areas, particularly tax, estate and insurance. This is a study by the Spectrum group that was done just a couple years ago. If you want to Google Spectrum Group advice gap, this is what it's showing. Clients want help in these areas and you're not helping them. That's what's happening. You guys are doing a great job in traditional planning. You're doing a great job in portfolio management, but they want help in these particular areas. And that leads us into Grant. Grant tell us a little bit. Number one, thank you for being here today. Tell us a little bit about your firm. First, I think it'd be important for the advisors to understand your history and let's go into it.
Grant Blindbury (02:42):
Yeah, I think by definition, most folks here are probably going to be early adopters of technology, so I don't really want to spend too much time talking about how that's worked well for us. But I do want to put it into a little bit of perspective from where we sit. So we are an 11 person firm, fully independent, RIA. Okay, so a little bit bigger than a one man shop, not huge. So we've got to be really smart about how we use our resources. This has always kind of been the case. So you go back five years, four years actually, we were trying to do annual tax reviews. We were trying to do annual trust and estate reviews and insurance reviews and business reviews for clients, and we're doing all this by hand.
(03:32):
It was all with good intent. This is what to the previous slide, this is what the clients want. As a small, independent firm, we've got to try and stay a little bit ahead. We can't sit in the safety boat and wait for everything and everyone to catch up and just be with the herd. We want to differentiate in a positive way. This is how we're going to set ourselves a little bit apart as a firm that is doing things a little bit better than maybe the bigger safer firms. That's been our approach. So this has been something that we were trying to do. It was just taking up so much time.
(04:11):
So what's happened, previous presenter, it is lightspeed how quickly these things are happening right now. We were lucky enough to get introduced to FP Alpha about two years ago, actually via one of our other early adoption tech partners, and I was like, this is what we've been waiting for, and it was mind blowing two years ago, and now like I said, everything is going so quickly. It's just been such a valuable tool for us though. So what are we, just go back one more. Yeah, let's go back. So we got about 700 million of a UM four lead advisors, 11 employees, 350 households. Do the quick math. There are about $2 million average household size. Our niches founders, those are typically being sourced for us through m and a attorneys, and those are our COIs athletes. Those are typically being sourced via the agents. If you guys have any relationships with sports agents.
(05:18):
That's how we're sourcing our athletes, tech biotech executives. We're in Southern California. We get both Silicon Valley, Silicon Beach, a lot of biotech specifically where we're at in Westlake Village, Amgen is located there, and there's a bunch of spinoffs around there, a number of biotech startups. Those are typically coming via either our existing biotech and tech executives and founders or through accountants and then philanthropists. We do quite a bit of work with philanthropists. Those are typically coming via estate planning attorneys. They're having those conversations. They're seeing how much these people want to be doing. Maybe on the philanthropy side, we're getting introductions there.
(06:00):
Here's our Quick tech stack. Don't need to spend too much time on this. We use Salesforce financial services. Our portfolio management system is Orion Financial Printing is libretto, which is a little bit, I think, different. That's been another thing that we are an early adopter on. I think we were maybe one of the first, you can ask Jeff, but maybe one of the first five firms to do that. That's actually how we met FP Alpha. He was at a booth next to FP Alpha about two years ago, and then for advanced planning FP Alpha, which is why we're here today. So that's our quick tech stack. Again, that's kind of setting the stage, I think for you guys to know who I am and where this perspective is coming from.
Brad Frey (06:40):
FP Alpha, just real quick, what drove you to pick us?
Grant Blindbury (06:45):
So we had been, again, most people in this room, I think kind of early adopters we're seeking out next gen solutions on things, and we'd found some tax without naming any names, we found some tax planning software. We found some estate planning software. We actually never, before we came across FP Alpha, fed had found something that was doing insurance that at that point in time, but they were all separated. And what was really intriguing and still is I think super valuable, is the fact that all that information is pulled inside of one system and that information. And another thing I love about LP Alpha, which we'll get into here, it's not just a generative function or the reading function. There is a very, very meaningful advisor participation in this, that detailed questionnaire that FP alpha has that is all the stuff that's between our ears that still goes into the system. It's not trying to just take documents and take information like, well, I'm only going to make recommendations. I'm only going to give advice and give graphics just off of this. It's a combination of both. That was appealing then still incredibly valuable now. So taking all that information, we're taking a questionnaire. I'm spending a whole bunch of time putting in information about their tax situation, putting in information about their estate situation. It's all cross-referencing each other.
(08:15):
That wasn't happening when we were using siloed systems before the tax planning system. Maybe it was mostly reading and reporting if there were going to be any insights, but those insights weren't feeding into the estate planning one. So that was a differentiator for us. And I think one of the things that stuck out to us and why we wanted to be an early adopter of FP alpha.
Brad Frey (08:37):
And speaking of estate, let's talk about the powers. We've obviously created a fake name here for this, but you've got an amazing case study that we hear about these a lot and would love to. Let's talk about the profile of the powers.
Grant Blindbury (08:51):
So I just wanted to give you guys a quick example of how we use this system in a valuable way with a client. If you guys haven't used FPL for this, it'll just kind of be a quick little glimpse into it. So yeah, this is an anonymized client. So a couple of quick things. We don't need to run through all the data here. As you can see, it's a taxable estate. You can see there is joint assets and there is also separate property for each of the people. So this is going to be kind of key. So this client came to us. We started working with them. They had a super simple estate plan to the extent where they were really not trying to do anything to minimize their estate tax obligation, which if I'm skipping ahead and doing the math, is about 12 and a half million dollars is the estate tax that is going to be owed if things stay the way they are.
(09:40):
We know the estate planning attorney, well, Westlake Village is not a big town, very good estate planning attorney. The client was the one who had told him, we don't want to get too aggressive on stuff. I encourage 'em to go back and say, Hey, let's have some discussions around what we can do to try and minimize this. Because the big needle to move for them wasn't whether we're going to get four and a half or four and three quarters on their treasuries. This was the big needle moving thing, and they didn't quite understand it. So I said, let's go back to Peter, the estate planning attorney. He knows this stuff. Let's see what he has to say. Let's start working on this. Peter comes back, or they come back after meeting with the estate planning attorney. They say, so Peter told us about a slat and he thinks that's what we should do. Again, very good estate planning attorney. They didn't understand what that was. Okay, so this demonstration here, or this case study here is about how I used FP Alpha to try and educate them on, Hey, what is this? How would it work? And what would be the outcomes from it?
(10:48):
So we built it to FP Alpha in their simulator. It's amazing. If you guys haven't seen it, you get in there. They're also really, really, really helpful at helping you build these things out if you need it. So don't feel like you're left to your own devices on this. So we built this out. This is going to be a flow chart on how it works at First Death. We go to second one, how it's going to work at Second Death. This wasn't something that they understood coming out of their meeting with their estate planning attorney. Again, what I'm doing is trying to collaborate and team up with the estate planning attorney, not merge into his lane from a planning standpoint, but try and visualize what he's done in a way that the client might understand a little bit better and also create some space for me to have that conversation with 'em. And then if we go to the next one that we,
Brad Frey (11:43):
Real quick, show of hands, how many of you guys doing this on a dry erase board or Vizio or Word, right, PowerPoint. This is right out of FP Alpha, by the way.
Grant Blindbury (11:52):
And before this, honestly, we were generally taking whatever the estate planning attorney may be giving them and then trying to work off of that. And that's a whole spectrum of good and bad as far as how they're visualizing things. So again, how I communicate this to the estate planning attorneys and to the accountants if we're talking tax stuff, is I don't want them to feel like I'm merging into their lane. Again, that's my analogy. I say, I want to visualize and illuminate the good work that you're doing in a way that is relevant to my relationship with the client, and it's going to just shine a brighter light on what you're doing. That's kind of how I frame it, because we all want to make sure we're not practicing law, we're not trying to do accounting, and we're also not stepping on the toes of the people who bring us business either.
Brad Frey (12:44):
And a good sports analogy, you're helping just quarterback the conversation.
Grant Blindbury (12:50):
Because we're meeting with clients, right? 2, 3, 4 times a year, right? Estate planning attorneys once every three, four or five years. So keeping this stuff front of mind for them and also in a way that they can understand. We do annual estate planning reviews and FBL is amazing at this.
Brad Frey (13:10):
So let's show the, wow, we've got the flow chart of what we're modeling. This is the first one that really hit you in the chest.
Grant Blindbury (13:18):
So again, this is something that we're able to do with actual numbers. The estate planning attorneys are amazing. We couldn't do this without them. They're the attorneys, but they're doing documents, right? They're going to do a 30, 40, 50 page trust. Maybe they do a one page kind of little flow chart on how things will work. There's usually not numbers in there. They don't want to put numbers in there. The numbers are going to be stale the next day. So the power that we have is, well, we can take a real-time balance sheet there. Almost all the software that we all use is going to be updating balance sheet information on a daily basis, flow that in and give the client something a little bit more tangible and say, well, what would that actually mean today? FP Alpha was able to do that for us. So we're showing them like, look, you've got about a 12 and a half million dollars estate tax.
(14:10):
That money is coming out of your pocket, not going to your kids and being sent to DC. So let's figure out what can we do about that. So this is the problem that I'm trying to help them solve. That number is going to change on a daily basis, but it's great to be able to put that in there. So then once we laid this out, we went through and visualized and built out the slat in there. Now we're down to 3.7 million. So we're taking almost 8 million of money and giving it to where they want it to go, as opposed to where Congress might want it to go. So this is incredibly powerful. This wasn't something that they walked out of their meeting with their estate planning attorney. Again, an excellent estate planning attorney, and he should draft this. It was his idea to do this, but the ability to, one, use our relationship to connect with the client on this and again, create space for us to have this conversation.
(15:15):
They understand this so much better now. So the client is happy, the client feels more empowered and more enlightened. The estate planning attorney is happy because now the client isn't as confused. They have more confidence moving forward with what the plan's going to be. And by the way, they get to keep $8 million back in their trust or in their estate. So this was a total win for us on this, and this is something that we've been able to implement with them. So it was, I think, a good choice for how we use that system today. And then if you want to talk about the,
Brad Frey (15:53):
Yeah, we had a little bonus situation, right? Because this guy had some serious stock, right?
Grant Blindbury (15:59):
So from a tax standpoint, also something we've been able to use, FP Alpha, I'd mentioned this earlier, that one of the things that's really valuable is this combination of the stuff that is between our ears and the stuff that's on, say the documents that are being, the information being extracted from documents, but there's more information about the client, right? That's not in the documents, and that's between our ears. And the ability to combine those two things is really where things get powerful. One of the things that FP Alpha does is yes, they'll extract all of the information from all the documents that you upload. It's amazing. It's super quick, super efficient. But there's also this detailed questionnaire that they have. It's like, Hey, give us all the stuff between your ears. Let's push this into the system too and combine the two. And one of the things that came up was questions about closely held stock under $50 million of tax basis, which for those of you who've done this, this is leading towards a 1202 qualified small business stock.
(17:02):
This came up. I knew that this client had this stock. It was not in any of their documents that had been extracted. So if we just uploaded stuff, sent it in and said, Hey, here's your tax things. Here's the insights from it. Nothing would've come from this. But we knew as advisors that, Hey, this is one of the things in there. FP Alpha is asking this question, okay, now why this is important. Their accountant didn't even catch this, right? Their accountant who should have, now, let's not talk about what kind of reflection that is on him as an accountant, but let's talk about our ability to serve the clients in this situation. Again, trying to stay in our lane and not be filing tax returns. We were able to illustrate, pull this out and say, Hey, you have this. It's in this questionnaire. This is you. We think this is worth running down. Now, we had to challenge the accountant a little bit on this and end up bringing in a larger firm to do the 1202 qualification, but it ended up being real. And so that's the 10 million exemption on capital gains. The first $10 million you get federally an exemption on it saved them almost 2 million of taxes at the end of the day. And we did our best to make sure that there was as little egg as possible on the accountants face. But this system allows us to engage and bring that kind of value. You think that client's ever going to question
(18:34):
Our fee again when we save them almost $2 million? And then again, we tried to make the accountant look good. But that combination, I think, of what you guys are able to extract and what the AI can do combined with the information that us as advisors can put into it, that's where things really kind of get exciting. So those are two examples that we've used FP alpha in really, really meaningful ways. Again, almost 8 million of estate tax being saved via a, now, again, this was the estate planning attorney's idea. I'm not trying to take credit for that, but being able to help get that across the finish line. And then, yeah, surfacing this 1202 for this client, almost 2 million of money back in the pocket.
Brad Frey (19:15):
I think the biggest key is we've got 30 seconds left, but being able to visualize it for it, clients are visual. They learn so much better when you can actually show them and prove it to me. And I think the biggest key that you're also bringing on is there is this additional level of services that are wanted in the industry. A lot of clients don't know how to ask you for it. You should be quarterbacking these conversations, and I think this is just a great case study. I know we've just got about 10 seconds. I'm going to finish up here. Grant is going to be, I think we got a refreshment break coming up in about after the next session. He's going to hang out with us at the booth.
Grant Blindbury (19:53):
I'll be over at the booth if you guys have any follow questions, if
Brad Frey (19:54):
You guys have any questions, please let us know. We're right inside the exhibit hall, one of the first booths there. Yeah. Hope that was helpful. Everybody.