Five Questions with Omar Almaraz - 09/17/2024

What's the best part about working with the tax team at Pathview? 
What I enjoy best about working with our tax team at Pathview is how each member has a commitment to staying updated on the latest tax regulations to ensure our clients’ needs are best served. This allows me to lean on their deep tax expertise and make complex tax issues manageable and understandable for our clients. Everything we do for our clients, from savings recommendations to investing portfolios, is done with a tax lens in mind. None of this would be possible without our team of tax professionals.

What do you wish more people knew about the process of creating a financial plan? 
The most important thing to understand is a proper financial plan must first start with getting a thorough understanding of your financial situation. Most people understand this includes compiling information about assets and liabilities. However, it also includes outlining goals and a good understanding of your values. Things like how you view and handle financial risks are paramount to understand. Only then can we move toward areas that may need to be addressed, like implementing strategies to minimize taxes or setting up an appropriate portfolio that aligns with your risk tolerance and goals. Additionally, regular updates and reviews to a financial plan are crucial as life circumstances change. Engaging in this process helps ensure financial stability and progress toward achieving your goals. 

How are you involved in the community?
I’ve had many folks in our industry help me along my journey, so I jump at any opportunity to mentor the next generation of financial planners. Any chance I get, whether it’s at a networking event or if someone reaches out to me via social media, I’m happy to help. Over the last few years, I’ve partnered and helped several students through NAPFA, an organization I’m involved in, get prepared for the rigors of the CFP® exam.

What do you think is the biggest mistake people make with their money? 
The biggest mistake people I see folks make with their money is living beyond their means. While crafting a budget can help and may be necessary in certain cases, I’m not a big fan of them given they typically take a ton of time to create and maintain. Instead, I prefer something called a reverse budget. This involves listing out all your goals (e.g., retirement by a certain age, buying a home, paying down debt, etc.); setting up how much of your income needs to be allocated to each goal to meet it; and setting these contributions or payments to be made automatically. Anything that’s left over once those goals are being met can be spent completely guilt free.

Talk about the importance of creating a financial plan prior to any investment advice. 
Completing a financial plan before any investment advice is important as the plan provides a clear understanding of a client’s goals, tolerance for risk, tax considerations, and time horizon. All of these are crucial to understand before creating a portfolio tailored to their specific needs. The answers to how much to invest, which accounts to invest in, and when to invest can all be answered through a financial plan. Sometimes the best choice is to not invest at all and maybe focus on paying down high-interest debt or saving toward a fully funded emergency fund.