We sat down with Veronica Arellano of Edward Jones in Ventura who discusses financial planning, the challenges of growing a business, and the necessity of teamwork.
JR Bookkeeping: Thank you for taking the time to talk to us today, Veronica! Can you tell us a little bit about you and what you do?
Veronica: Sure. I am Veronica Arellano, and I am a financial advisor with Edward Jones in Ventura. I’m committed to working closely with people to help them reach their financial goals and maintain an optimal lifestyle, whether that’s setting up retirement or funding for college, or even finding ways to generate income to invest back into your business.
I’m especially passionate about advocating for women, so I do a lot of work with young professional women and women in transition.
I have a BA in finance from California State University Northridge and have worked in the financial-services industry for 11 years. I also have an Accredited Asset Management Specialist (AAMS®) certification from the College for Financial Planning, which is a special designation awarded only to individuals who successfully complete the 12-month program, are committed to their code of ethics, and who continue to pursue ongoing education.
JR Bookkeeping: Wow, that’s great. It’s because of your experience and professionalism that we’re reaching out to you today. So with that, let’s jump right in.
According to Investopedia, small business owners face a number of challenges when it comes to financial planning. As a Ventura County-based financial planner, what are some of the unique challenges businesses face in our particular area of the country here in Southern and Coastal California?
Veronica: Right. Well, the small businesses of today will become the big businesses of tomorrow, and having a strong financial foundation and a team of professionals is essential for that growth. As a member of the community that I serve, I know from first-hand experience that we in Southern California and Ventura County have a very unique cost-of-living situation. So growth-rate tax and other regulations have to be taken into consideration when planning for long-term financial stability.
One of the biggest challenges I see, which is unique to businesses everywhere and not just here in our region, is local business owners and entrepreneurs taking on way too many responsibilities and wearing too many hats. In my estimation, the best way to offset this challenge is to be ready to invest in a team of professionals to take over some of those responsibilities so that they can focus on what they do best, which is building and growing their business. Anytime a business owner can do that, that’s a really good thing.
JR Bookkeeping: That is so true. As a growing business ourselves, we can definitely testify to that. From your perspective, what are some of the common responsibilities that business owners might consider outsourcing? Which ones seem typically seem to be most beneficial?
Veronica: Well, you’ll probably be pleased to hear this, but I really believe having a bookkeeper is very important. That way business owners don’t have to worry about things that are so time-consuming, like doing their own payroll, or keeping track of all of their receipts and every single expense that they have.
Having a tax professional is just as important, because instead of doing their own taxes—which, again, can be time-consuming as well as confusing—a tax professional understands things like business structures and tax laws, and knows how to efficiently and accurately take care of a business’s taxes.
I’m a little biased here, but the same is true with a financial adviser. Based on the recommendations from both the tax professional and the bookkeeper or accountant, a financial adviser can guide business owners in opening the right types of accounts, setting the right contribution limits, having the right type of employee retirement plans, and all those things on which a business’s financial health depends.
So, from a financial standpoint, I would say that businesses would do well to invest in at least those three right from the beginning—a bookkeeper, a tax professional, and a financial planner.
“One of the biggest challenges I see is local business owners and entrepreneurs taking on way too many responsibilities and wearing too many hats.”
JR Bookkeeping: So if we’ve heard you correctly, as a financial advisor, you actually rely on the information provided by professionals like accountants, bookkeepers, and tax professionals when you’re advising your clients, right?
Veronica: Yes, absolutely. The financial statements that they provide are essential to financial planning, because I have to be able to look at a client’s whole financial picture. When I look at a platform, for example, I can see the different types of income that they have and whether it’s taxable or tax-free, which then can let me know which type of account or investment is appropriate for that particular client. Those statements also let me know that we are staying within income and contribution limits, and allow me to see the business structure that they have, any dependents that they may have, and based on the items that they’ve itemized, whether or not I need to refer them to other professionals.
Also, in financial planning as with so many other things in life, what you put in is what you get out, right? So inaccurate information is going to lead to inaccurate guidance and, likely, inaccurate results. Having properly-prepared and updated financial statements gives us as well as our clients not only the appropriate information that we need, but also the peace of mind that comes from knowing that we have the entire financial picture and that we truly are partnering together to reach their long-term financial goals.
JR Bookkeeping: What are some of those long-term goals, and what would some short-term goals be? And what’s the difference between a long- and short-term financial goal?
Veronica: The way I look at that is, anything that is going to be happening within the next five years, for me, that’s a short-term goal. Anything between 5 and 10 years is a medium-term goal, and anything over 10 years is a long-term goal. And all of those are going to be different for different people and depend on things like age and the current stage of life a person is in.
Specific goals might be anything from buying a boat in five years, to retiring within the next 20 years. So it all really depends on a lot of factors and what’s important to the client, what they are trying to reach, and the timeframe that we are working with.
JR Bookkeeping: So the goals that you help your clients reach can really be anything—whether that’s having immediate extra capital to invest back into the business, to something that’s more of a luxury purchase, like buying a boat, all the way to setting yourself up financially after retirement, right?
“Specific goals might be anything from buying a boat in five years, to retiring within the next 20 years… we truly are partnering together to reach their goals.”
Veronica: Absolutely. And again, it’s those financial statements provided by bookkeepers, and accountants, and tax professionals that give us the information we need to help our clients reach those goals.
JR Bookkeeping: Obviously, then, it helps you to be able to communicate directly with accountants, bookkeepers, or tax professionals when you’re helping a client, right?
Veronica: Yes it does. I tend to have open lines of communication with the other members of the team of professionals that my client works with, and that is because we each have different areas of expertise. So, for example, when I notice a tax issue that catches my attention, I have to be able to get confirmation from the tax professional that I’m understanding this correctly, but also so that I’m able to offer solutions to my client that they may not know were available. So it’s all about being able to bring our expertise together to help people make the best-possible financial decisions.
JR Bookkeeping: That’s great. Teamwork makes the dream work, right?
Veronica: (Laughs) That’s right.
JR Bookkeeping: We’re just about out of time, and we really, really appreciate your time today, but in closing, are there any last words you have for anyone who might be reading?
Veronica: Well, we build life-long relationships with our clients, and of course, my consultations are always complimentary. So I would be more than happy to sit down with anybody at no cost to them, and just have a conversation and see if there might be a strategy or plan that we could put in place for you that would give you the kind of life-long financial stability that we all need.
JR Bookkeeping: Perfect. Thank you again, Veronica.
Veronica: Thank you.
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