Uncovering client financial worries by asking the right objective questions is never easy. It’s why many advisors rely on fpPathfinder as a reference tool to help ensure planning opportunities are never missed.
On this Elementality, Abby interviews Mike Lecours who co-founded fpPathfinder with Michael Kitces. Elements and fpPathfinder have a lot in common, including similar “problem-solving” beginnings. On this show, Mike explains how referencing fpPathfinder’s flowcharts, checklists, and summary guides can help advisors be more diligent in the planning process. Whether it’s used as a meeting preparation tool or as a client engagement tool, discover why fpPathfinder continues to grow in popularity.
Show Notes
fpPathfinder.com
Podcast Transcript
Mike Lecours:
But the big theme, and this is what really gets… For me ties into everything going on at Element, is this whole concept of modular planning, and we talk about it on fpPathfinder as a service calender, you guys have… Your whole business is built around modular planning. And this idea of taking maybe that annual client review meeting and breaking it up into chunks throughout the year, is growing, it’s becoming a big thing with fpPathfinder in that advisors are saying, “I’m going to send out four different checklists to my clients each year, one for each quarter, and I’m gonna say, this is what I’m talking about this quarter, I’m just gonna focus on tax or investments or insurance or just end of year planning opportunity.”
Abby Morton:
I ran into Michael Lecours, who co-founded fpPathfinder with Michael Kitces at a financial planning event. As we chatted, I found that both Element and fpPathfinder have a lot in common, including the desire to help advisors have a better system and process. I was excited to interview Michael, because a lot of what they’ve created at fpPathfinder gives advisors peace of mind about the advice they are providing and allows the advisor and client have a stronger relationship. Enjoy.
Abby Morton:
Welcome to the Elementality podcast, everybody. I’m your host today, Abby Martin, here with Michael Lecours from Connecticut, from fpPathfinder. Michael, welcome to the show.
Mike Lecours:
Oh, great, thanks for having me on, Abby.
Abby Morton:
Yeah, we’re so excited. We have recently actually connected from a couple of conferences and found that Element and fpPathfinder have a lot of synergies together. And the more we’ve talked behind the scenes, I think the more we’ve been impressed with your product and what you guys are really putting out there for the advisor community. And so I really was excited to have you on the show and pick your brain a little bit more about what fpPathfinder really is and what services you provide to advisors. So let’s start right there. Give me a high-level overview, what is fpPathfinder, why do our listeners even care about what your product is? Tell us how maybe you guys are.
Mike Lecours:
Sure. Yeah. So in essence, we help advisors have more diligent communication and conversations with their clients about financial planning topics, and we do that just to help advisors come across as being smarter and more diligent to their clients, and the way we do that is we create checklists and flow charts. So we create checklists to try to capture all of the different planning issues that a client might be running into in their life at that moment, maybe they’re going through a life event, they are buying a house or their spouse is terminally ill, or they’re going through retirement. And our flow charts really delve into all of the different financial planning decisions that have to be made. “Can I make that deductible IRA contribution? Should I roll over my 401k?” There’s a lot of different decisions there. And so these can serve as a guide to help an advisor have those conversations with their clients.
Abby Morton:
Okay. And are these flow charts and checklists, I assume I, just as the advisor, am using them, like, am I sharing them with the end client at all?
Mike Lecours:
Okay, really interesting. I’ll paint the story as to how we got started.
Abby Morton:
Great, yeah.
Mike Lecours:
I’m an advisor, and that’s my background, and as I was getting started, I just kept getting tripped up on the rules, things like, “Can I make a deductible IRA contribution?” For whatever reason…
Abby Morton:
Oh, I mean, there are so many, right? [laughter] And they go and change on you.
Mike Lecours:
Yep, exactly. It just threw me. It’s not that it was hard, it was just that there were all these little items to check for. And then the income bracket, sort of the thresholds would change, and that would throw me off. And so I felt silly having to call my client back and answer what they think is a really simple question, and I would say, “I’m so sorry I got it wrong. I just forgot… Even though you can’t make one, the fact that your spouse has earned income, now you can actually do this.” And so I sketched out a little flow chart, just for myself, just so I had like a cheat sheet, just behind the scenes. And then over time, I started making more of those, going into Social Security rules, and 529 plan distribution rules.
Mike Lecours:
But then I started sharing them with other advisors to see if they found it helpful and they liked it, so then I started sharing it with bloggers, and that led me to Michael Kitces. And he was at the same time really starting to get interested in checklists, and I could go down that path separately, but that’s when we launched fpPathfinder, was we took, “Let’s have these guides, these checklist and these flow charts, and let’s package them up and see if, is this a tool that advisors would find helpful?” And our first thesis was, “This is a behind the scenes tool,” just as you’re talking about Abby. We’re thinking maybe this is like a client, or like a meeting preparation tool, or it’s just that quick reminder on a topic that you’ll only run into every once or twice a year, like a refresher.
Abby Morton:
Yeah, let me pause you there. So you’re maybe… You know the client question that you’re going to, you’re anticipating or you know what the question is going into a meeting, you might pull up a checklist and just run down like, “Have I thought about that and that and that?” Right? All the number of items on the checklist. So then when you’re walking into the meeting, you run it all over, you had it in your mind, you’re like, you’re ready to go.
Mike Lecours:
Exactly.
Abby Morton:
It’s all then fresh. Like, there wasn’t this one random nuance that you didn’t think about ’cause it’s all covered in the checklist.
Mike Lecours:
Exactly.
Abby Morton:
Okay.
Mike Lecours:
It could be in terms of meeting prep, maybe you’re just going through a checklist on issues of… Like all issues to look at in an annual client review meeting, 25 different issues or so, just see like, “Did this change? Did any of your interest rates change? Anything changed in your estate plan that we should know about? Anything changed in your life that we should know about that might affect this?” Or maybe it’s really issue-specific. Like, I had a case where a client emailed me and at the last minute they’re saying, “We need to talk a little bit about NUA distribution rules, because I think I might be subject to this,” and I studied it, I don’t run into it with the clients that I serve, so I had time to prepare for that. Okay, so that’s what we launched with, that was our initial thesis, and very quickly, advisors came to us and they said, “We wanna put this stuff in front of our clients, so actually get rid of your logo in that upper right hand corner, we wanna be able to put our logo in there, and we wanna be able to change the color palette around.” So now it’s not just behind the scenes, it becomes a client engagement tool, advisors are putting this in front of their clients, or they’re putting it up onto their website or into their email, newsletters, to talk about different planning concepts.
Abby Morton:
Definitely. So I actually pulled up one of your flow charts before and I’ve seen them previously at a co-worker that had signed up for fpPathfinder, so he was showing us, and I remember a couple of years ago like, “Oh my gosh, this is really cool.” But anyway, I was looking at the flow chart and then thinking any end client… Your flow charts are so easy to understand, like, does this apply to you? Yes or no. Follow this line. Does this apply to you? Yes or no. Follow that line. Like, here’s this question to answer, maybe, yes or no, right? So why go the advisor out and not just directly to the client saying, “Here’s the number of questions that we know you’re gonna ask and here’s a flow chart to help make a good decision to DIY it?”
Mike Lecours:
Well, in that particular case, it depends a little bit more on the specific checklist or flow chart that you’re using. There are some where you can just give it to a client and say, “Here, this is the answer to your question.” Others are very complicated, because we all recognize how complex the world is, and we’re trying to distill everything down into a checklist that fits onto two pages, or a flow chart that fits onto one page. And so we don’t steer or shy away from those technical aspects. So depending on the advisor, and depending on the clients and the client base, some of those checklists and flow charts might be just too much, and in that case, advisors might still be putting it in front of their client, but they’re saying, “Hey, that question you asked is pretty complicated, here’s a flow chart, but don’t worry, I’m here to walk you through it. I’m your guide. This is our map.”
Abby Morton:
Yeah. Perfect.
Mike Lecours:
Other times it’s really simple, it can be like, “Can I make a deductible IRA contribution?” It’s straightforward enough that you could probably just send that out.
Abby Morton:
And just get that done that way. Okay, no, that’s interesting. I think we often get asked the same question at Elements, “Why are you going through the advisor and not directly to the client?” And I think we felt the same is that you need an advisor to help you decide for this complex industry and all the nuances that come in. I think too, you need that accountability partner, and you need that person there. Everyone talks about handing someone over a financial plan does not mean it gets done, right?
Mike Lecours:
Right.
Abby Morton:
It often just sits on the shelf and collects dust. You need that advisor to help you take those action steps and move things forward.
Mike Lecours:
Yes, yes. And the other caveat too is that we can help uncover the planning issues, but we don’t know enough about the client situation to come up with what those recommendations should be. Is it create an estate plan or updating your estate plan, or do you just need to update your beneficiaries and you don’t actually need to get a special trust? Or change your will? Like, that’s not where this goes. That’s the role of the advisor, is to pull together those different issues that get uncovered and come up with the right recommendation, taking into effect everything that’s going on in that client’s life.
Abby Morton:
Yeah, definitely.
Mike Lecours:
Our job is just to make sure that we uncover all of those planning issues. Our job as fpPathfinder is to make sure that we ask all those questions, so we don’t run… Let an advisor forget what might be a seemingly obvious question, but you’re distracted or it’s an edge case, and all of a sudden the advisor is kicking themselves because they didn’t ask that question.
Abby Morton:
Definitely. And like you said, then you’re not calling them up after you already met and saying, “Sorry, I made a mistake, so let’s kind of back pedal and restart it again ’cause I forgot about this one thing, so.”
Mike Lecours:
Exactly, right.
Abby Morton:
Okay. Yeah, definitely. So this kind of leads me into another question, we were hitting on it before we started recording about there being a plethora of questions and issues that you could definitely need to talk to your clients about, right? There’s a full gamut. So if I was an advisor coming to fpPathfinder, how am I confident that your resources that I will then have access to span this wide variety of needs that I may need, because we have advisors focusing on millennials and Gen Z-ers, and then we have advisors focusing on retiree clients, and you have every advisor in between, so how do I know that you have enough checklist to cover my one maybe use case?
Mike Lecours:
Yeah, sure. Yeah, so basically, we have about 100 guides right now, I think maybe it’s like 105 guides, and we create one to two new guides every month, and then we keep them all up to date as the rules change. Like right now… Go back like three or four weeks ago, everything was getting updated because annual limits were updated.
Abby Morton:
The new year, right, yeah.
Mike Lecours:
And now SECURE Act 2.0 is coming out, well, everything is getting scrubbed to see what are the planning issues that are coming into effect this year and then next year as well as in subsequent years. In terms of knowing what guides are appropriate, that does become part of the interesting aspect of how fpPathfinder fits in or bolts on to an advisor’s practice. And it depends on a lot of different factors. So what we see as being most successful is actually advisors, the first thing they do when they come on is to just start looking through our site, looking for what kinds of guides are out there that could serve a specific need that they see. We generally see things being very cyclical, I guess, or the most relevant topics tend to creep up each time and become popular.
Mike Lecours:
What I mean by this is, we get a lot of advisors showing up at the end of the year because of our end of year checklist, and then around tax time, we have more guides focused on taxes. And we have one guide that will be coming out, or maybe it’s already going to be out by the time listeners hear this, just on the SECURE Act rules, and SECURE Act 2.0. And so it tries to go into what’s relevant and topical at that time, but the big theme, and this is what really gets… For me ties into everything going on at Element is this whole concept of modular planning. And we talk about it on fpPathfinder as the service calendar, you guys have… Your whole business is built around modular planning, and this idea of taking maybe that annual client review meeting and breaking it up into chunks throughout the year is growing, it’s becoming a big thing with fpPathfinder in that advisors are saying, “I’m going to send out four different checklists to my clients each year, one for each quarter, and I’m gonna say, this is what I’m talking about this quarter, I’m just gonna focus on tax or investments or insurance or just end of year planning opportunities.”
Mike Lecours:
And so it’s taking those guides to try to work them into the advisor’s practice and making sure that we more or less fall into the background. So we have like 105-110 guides, but we know that on average, advisors are using anywhere from 6 to 12 guides in their business. They’re just on the right 6 or 12. And our job, the big challenge we have is making it super easy and super fast for those advisors to find those 6 or 12 guides.
Abby Morton:
Okay. Yeah, very interesting. So I can go in onto your website and it looks like maybe even sort by, like you said, these certain categories and it will show me all the guides that relate to that specific topic?
Mike Lecours:
Yes, exactly. Okay, we’re advisors, we wanted to look under the hood, like quick enough. So a lot of what we’ve done, we add that level of transparency, so even if you just wanna go kick the tires and look around, you can go look through our members section and see what we have and get summaries of all the different guides, and then maybe… And what we actually see is people will say, “Okay, I see a couple, I’ll sign up for our base package here,” it’s the essentials membership level, and then they go, “Okay, I get it, I see how this can help me on the back end to prepare, now we wanna start to incorporate this into client meetings, or help to… ” We have interactive checklists as well, so help to streamline some of the meeting and the data gathering that we go through any way.
[music]
Jordan Haines:
Hey, Elementality listeners, it’s Jordan. The Elements financial monitoring system is revolutionizing how you attract, on-board, and deliver ongoing advice to clients, so you can scale your business far beyond traditional limits. If you want to profitably help more people make smart financial decisions, head over to getelements.com/demo and schedule a time to see it in action today.
[music]
Abby Morton:
I wanna come back to pricing, ’cause that was definitely a question I wanted to hit on, but before we go there, you talked about having to update these guides and making for sure that all the new tax changes are kind of incorporated. Talk to us a little bit about how that all happens. Like, who are the professionals behind the scenes, making for sure that data is accurate and up-to-date, and that I, as an advisor, can trust the research that you have done?
Mike Lecours:
Yep, yep. So that’s one of the big tenets of what we focus on over here, and we have it up on our site how we actually approach this, but we know that most guides… Well, half, about half the guides are gonna be getting updated every year anyway, because annual limits change and those annual limits are baked into so many of our conversations. So we know that they’re getting updated. We also know that end of the year, start of the year, this whole time frame, there’s a lot of legislative changes that we have to factor in. We’re in that right now, and so it’s just a heavily process-driven element to systematically go through each guide with our own internal checklists to make sure what planning issues that are getting rolled out are actually affected by this guide. And when we look at SECURE Act 2.0 this year, there’s a handful of changes that happen, but it’s actually more interesting about new trends that are starting to emerge in some of the planning conversations that might not have been there a few years ago. So, like, one, for instance, is the RMD dates are changing, so it’s moving from 72 to 73.
Mike Lecours:
Okay, so it’s one year. Not a big deal, right? But if you go back to SECURE Act 1.0, and now they’re changing how the distribution happens to heirs. So it’s compressing this window when the clients or the heirs are taking money out of their… From their required distribution is coming down to a shorter window, more and more. So now the question that we’re adding in is saying, “Hey, take a look at that, how does that actually affect things?” That R&D window is getting shorter and shorter, it might require you to wanna take money out earlier than you thought, because that window where you have to is getting shorter and shorter.
Abby Morton:
Definitely.
Mike Lecours:
So it’s not just, “Let’s just update the rule,” but it’s update the planning conversations that are going to have to happen. And then we go through like, there’s a due diligence aspect where things get double-checked and triple-checked before they go out, and then there’s an audit process that happens where we have got another group or another framing of it, where we’re just combing through looking for, “Is everything up-to-date? Did we miss something?” And then we also take in member feedback quite a bit, “What are the questions that we should be asking that we didn’t ask? Which ones should be re-phrased to make it clear or better?” And we log those and then we just go through those and we update them at the same time.
Abby Morton:
How are you receiving that member feedback? Is it through the emails that they submit or do you have some online private community that you gather all those responses?
Mike Lecours:
It’s not a private community. A lot of it comes through member feedback, we’re asking how people like the guides, what do they think. We have a mechanism where advisors can vote on the new guides that they wanna see developed, and so you can write in your suggestion and then other advisors can vote them up, and as that moves up…
Abby Morton:
Is that all on like your website or you don’t wanna state?
Mike Lecours:
Yep, yeah, that’s all up on our website.
Abby Morton:
Okay. Cool.
Mike Lecours:
And then when we’re creating new guides, we come up with them, we get all of the different planning issues that we see as being really important for a checklist or flow chart, and then we just put out an open-ended question as a survey to our members and just say, “Hey, we’re working on this check list for,” whatever it is, insurance planning, business succession planning, whatever that topic is, “If you work in this area, what are the areas that you would really wanna see covered in a checklist, what are the big items, what are some of the unusual smaller items that you flag for?”
Abby Morton:
Definitely.
Mike Lecours:
And then we get this laundry list, and then we compare that to what we’ve already developed as a check and balance to make sure that we don’t miss something.
Abby Morton:
Yeah, definitely. I like it. So you’re really talking to the community as well and making for sure you’re being all-encompassing in the responses, and the final checklist that comes out is… Really been vetted and audited by multiple different people.
Mike Lecours:
Exactly. That is where I think it’s the really important aspect, it’s not that five or six advisors sitting around a table can come up with all of the different planning opportunities, it’s making sure you get lots of different voices at various stages to make sure that the product is factoring in all of the different situations.
Abby Morton:
Totally. Awesome. Okay, well, back to pricing then, so you’ve convinced me now, I wanna buy some checklists and flow charts just to make for sure I’m being a well rounded advisor and make for sure I’m capturing everything, especially with all the new tax changes that are coming up. Talk to me about pricing, it sounds like there’s different levels and tiers and what’s included with each of those.
Mike Lecours:
Yeah. So there’s three different levels. The base level is $99 a year, gets access to all the checklists and flow charts, but it has our logo in the upper right-hand corner. So if you’re looking for behind the scenes support, just meeting prep, that’s where you can get started with.
Abby Morton:
99 a year.
Mike Lecours:
99 a year. And…
Abby Morton:
Okay, so is that billed monthly or do you pay annually for that, is it one time fee.
Mike Lecours:
Everything is on an annual fee.
Abby Morton:
Okay, cool.
Mike Lecours:
So $99 a year, then we move up to our Deluxe package. You get the same content, but now you can white label the guides, you put your logo in the upper right hand corner, you can change the color palette to match your brand. There’s a back page where you can put your disclaimer on there, that’s 299 a year. That’s really for putting these guys in front of the clients, whether it’s in the meeting as a guide or if it’s gonna be just used as content on your website or your news, whatever.
Abby Morton:
Right, whatever you… Okay, awesome.
Mike Lecours:
Then there’s the third tier, this is Premier, and here it’s a bit of a combination of both, but this is where our checklists become interactive, so clients that… This is the most recent tier, and this is where we’re seeing the most growth, is advisors are sending a link to their client saying, “Before we meet, please complete this checklist.” The client can type in their answers, they can check the boxes, and when they’re done, they hit one button and it sends it all over to the advisor’s CRM. So when the advisor now meets with the client, they’re not trying to go through this checklist, they’ve already gone through it, they’ve now had enough time to prepare for the meeting, they’ve uncovered most of the planning items, or they know the areas that they’re gonna have to drill into a bit more, and so the meeting is a more productive meeting. And so that there’s different ways that that gets structured to make it more scalable for advisors looking to communicate with their clients, but in essence, it’s to share this out to help with scaling client meetings. And that price point is 499 a year.
Abby Morton:
Alright, so you got the 99, the 199, and then the 499…
Mike Lecours:
299.
Abby Morton:
Oh, 299. One, two, and 499.
Mike Lecours:
That’s right.
Abby Morton:
Awesome. Okay, well, great, well, tell me in closing, you talked a lot about how having these checklists and flow charts is gonna help me have a better relationship with my client. I’m gonna be able to communicate better. Talk to me a little bit more about that and why you feel like some people might say that’s a hard path to draw, of like, “I have a checklist and now I can communicate better,” talk to me about that.
Mike Lecours:
Well, it’s not a communicate better, it’s a communicate more diligently. That’s the key aspect. Because if you as the advisor are asking the right questions and it comes across that you’re uncovering every stone looking for issues to help that client, that client’s gonna trust you more. And if they’re trusting you more, you’re gonna stay around, and they’ll give you more money to manage. So it’s a diligent aspect, because you wanna uncover everything, but then what does that lead to? And that leads to retention, that leads to a greater share of wallet. You can draw analogies to where checklists are used elsewhere, and in a very basic concept, if I go take my car to a mechanic and they change my oil and I say, “Did everything look okay? Like, “Yeah, everything else looked fine.” Or you take it to a mechanic where they say, “We changed your oil and here’s this 50-point checklist we went through and we realized that your air tire pressure was low in this tire, but other than that, you’re okay.” I have a lot more confidence in that mechanic where they said everything’s okay than the one that didn’t do anything.
Abby Morton:
Yeah, ’cause they’re saying, “This is everything I did, and you can kind of see that quickly,” and like, “Oh, I can’t think of anything else you should have done.”
Mike Lecours:
And so if that oil change cost me twice as much, but I have twice as much confidence, that’s money well spent for, in my book. And so taking that like a mechanic aspect, but the mentality kind of can move over to different industries.
Abby Morton:
Yeah. Definitely. Well, awesome. Well, why don’t we end with telling me what you’re excited about for this coming year for fpPathfinder, what can I look forward to, big changes that are going on in your company?
Mike Lecours:
Big changes. Well, we have been just… We’ve been having a lot of excitement around some of the new website developments that we put together, the user experience was a huge focus last year for us, making it easier to find the guides and to navigate, and so now we kinda get to pause and we just start to watch the activity change. And so it’s not this heavy lift that we had to do last year, now it’s the tweaking, it’s the refining that we get to do. And so I get to live in the details and start to live in the data a bit more, and so you’ll see more changes. Like the first thing we did this year was change our search function around to make it a lot easier to find what you’re looking for. There’ll be more of those changes coming forward.
Abby Morton:
Awesome. Well, awesome. Well, any final words you’d like to leave our audience with?
Mike Lecours:
No, I think it’s just… I am very excited to see what you guys are doing at Elements, and I think the partnerships here and the synergies are numerous, and I’ve been a fan of you guys from, I think, before day one, I think when it was still like this concept that was emerging, so…
Abby Morton:
We’re selling spreadsheets, and we were just like, “We’re selling spreadsheets.” It’s crazy to think where we’ve come from.
Mike Lecours:
I think it just builds on this whole theme of modular planning and the service calendar, and I think that that’s gonna be a really important driver going forward.
Abby Morton:
Awesome. More excited to continue to see where the partnership goes and excited to see the new things that fpPathfinder brings, so thank you so much for your time today, Michael, it was nice to get to know you a little more.
Mike Lecours:
Yeah, thanks for having me on.
Abby Morton:
Have a good one.
Mike Lecours:
Alright.
Abby Morton:
Next time on Elementality.
Carl Richards:
Like, we’re actually navigating a complex adaptive environment, and all these tools that we have to pretend that we’re not are not based on reality.
Reese Harper:
Yes.
Carl Richards:
And so the only thing you can really do, which is what got me so excited about this methodology, if you will, or the way, is that it gave me a set, a standardized set of measures to anchor myself in current reality, to get clear about where I am today, so that the only decision that I can make really is what do I do next.
Reese Harper:
Yeah. And I think that’s at the core of this, or trying to do is reduce someone’s financial stress, we’re trying to reduce their financial anxiety.
Carl Richards:
Yeah.
Abby Morton:
You can learn more about the Elements financial monitoring system at getelements.com/demo and schedule a time to talk with one of our friendly financial planning experts. Elementality’s executive creators are Reese Harper and Carl Richards. Elementality is produced by Abby Martin and directed by Jordan Haines. Have a good one.