#61 — Andrea Thompson: The Growth of Advice-Only Planning & Cross-Border Tips
6/16/202652 min
Our guest this episode is Andrea Thompson — Founder and lead financial planner of Modern Cents, a virtual, advice-only firm she launched in 2022 after more than 16 years in the financial industry. A CFP who also writes and marks the national CFP exam for FP Canada, Andrea built her practice to serve Canadians who have cash flow instead of assets, making quality financial advice accessible to younger people and those below traditional asset minimums.
In this episode, Dave and Andrea dive into the rise of advice-only financial planning in Canada. They explore why she walked away from the traditional model to build Modern Cents, the factors fueling the model's growth, how advice-only planners find clients and where the pricing sweet spot lands. They also break down one of the model's biggest hurdles, the implementation gap between receiving a plan and actually executing it, along with the question of whether financial planners and investment advisors should stay in their respective lanes.
The conversation also explores Andrea's specialty in cross-border financial planning, including the common mistakes Canadian residents make with their US 401(k) accounts. They discuss the overlooked psychological and financial value of annuities and why so many people resist them, how young adults should balance saving for a down payment against retirement, and the case for term insurance over permanent cash value policies.
Whether you're curious about the advice-only model, weighing the value of professional financial advice or navigating the complexities of cross-border planning, this episode is full of practical takeaways you can put to use right away.
Show Notes
(00:00) Intro & Disclaimer
(00:55) Intro to Andrea Thompson
(02:43) Why Andrea Started Her Advice-Only Firm
(06:43) Factors Fueling the Growth of Advice-Only Planning in Canada
(07:55) Lead Generation for Advice-Only Planners
(09:25) How CFP Education Has Improved Over the Years
(11:55) Community and Collaboration Within Canada's Financial Planning Industry
(13:55) Overcoming the Implementation Challenge in Advice-Only Financial Planning
(21:23) Navigating Investment Execution for Advice-Only Clients
(23:47) Should Investment Advisors and Financial Planners Stay in Their Respective Lanes?
(28:03) Should You DIY Your Retirement Plan?
(29:52) What's the Pricing Sweet Spot for Advice-Only Planners?
(32:27) Cross-Border Financial Planning Challenges
(35:35) Common Mistakes with US 401(k) Accounts for Canadian Residents
(36:53) The Psychological and Financial Value of Annuities
(40:41) Why Don't People Like Annuities?
(43:34) Balancing Down Payments and Retirement Savings for Young Adults
(47:43) Childhood Money Lessons from an Actuary Father
(48:29) Term Insurance vs. Permanent Cash Value Insurance
(50:07) The Critical Importance of Disability Insurance
(51:29) Conclusion
Clips
Transcript preview
First 90 secondsDave Chilton· Host0:00
[upbeat music] Hey, it's Dave Chilton, The Wealthy Barber and former dragon on Dragon's Den. Welcome to The Wealthy Barber podcast, where we'll be hosting some of the top minds in the world of personal finance. Yes, that's to balance me out. The podcast is about making the subject not just easy to understand but, dare I say, even fun. Honest. Whether you're trying to fund your retirement, figure out how to build a down payment, save for your kids' education, manage debts, whatever, we'll be here to help you do it. Before we jump in, a quick but important note: nothing we discuss here should be taken as investment advice. We don't know you and your personal financial situation, so we're not here to tell you where specifically to put your investment dollars. We're here to educate, get you thinking, and we hope entertain. But please do your own research and/or consult with your financial advisor before taking any action. Hey, it's Dave Chilton, The Wealthy Barber with The Wealthy Barber podcast. The momentum has continued. We are thrilled with the number of listeners we're getting every week. Thank you so much. And also the questions you're sending in have been very helpful. We pay a lot of attention to those. In fact, you've noticed we've addressed a lot of those subjects if you sent them in through the experts we've been able to get on to the show. So it's really, really helpful that you reach out and say, "I still don't understand this" or you haven't covered this topic yet. We do try to get at it. Today's guest I'm very excited by. We did something a little different. We reached out to a lot of the top experts in the industry, people we'd already had on the show, and said, "Hey,