Kevin Batstone

Financial Advisor

BayBridge Capital Group

This week I sat down with Kevin Batstone of BayBridge Capital Group to talk about finances and how we should be preparing for our future. 

Kevin is a trusted friend who honestly, I can attribute being the first advisors to tell me, “its time, now or never – go into business full time.” The conversation we had 3 years ago launched me into opening Shani Studios, confidently, full time. Its been a wild ride, which Kevin warned me would happen, but I am so happy he told me to go for it. 

Kevin began his career, working as a financial planner  or sales representative for a large firm, but is now a fiduciary or CFP.  

Kevin explained that “Technically when you work at a big firm it is under what is called the suitability standard, so basically what you are is a sales representative for a large financial institution going out finding perspective individuals to buy products or buy solutions for investment purposes.” 

Going on to become a fiduciary was a huge step for Kevin and his career.  “As a fiduciary it is a much higher standard of care so you must at all times put your clients best interest above your own, so you can’t make any recommendations unless you have all of the information about the client. Both current financial as well as future goals.” 

He went on to explain that this is not the case under the suitability standard.

A financial advisor who is not a fiduciary, and working under the suitability standard  may be approached by a client who is looking to invest a certain amount of money, the advisor will provide a certain solution they have available to them at that time, and that is perfectly fine. However, under a fiduciary standard, that solution may not be the most appropriate. A fiduciary in this instance would be required to insure that the solution provided meets with the clients long term goals, short term objectives and current financial situation. A fiduciary must take all of these things into account prior to offering an investment solution, and make the recommendation based off of what is best for the client. 

“You have to have perfectly good justification for recommending a specific solution…it is really just  a matter of doing what is absolutely best for the client, which interestingly is not and has not always been the case of the capacity in which we have had relationships with our clients within the financial industry. So I think that its absolutely crucial to abide by such a standard and I think its unbelievable that it has never really been really required for someone working in a position like I am, to commit to such. So becoming a Certified Financial Planner (or CFP) gives you all the education, knowledge and insight that you need to create a comprehensive financial plan for someone, taking into account all of their financial components, currently, and then shows you how to deluxe, develop and deliver a quality financial plan that includes all of the financial products that are in their best interest.” 

He also explained that by being a fiduciary or CFP, it’s really about a code, and part of that is about being “Of Ethics,” meaning that you have be of a good background in the financial world and to fully commit to the fiduciary standard. 

Kevin really believes that it really comes down to trust , because the Fiduciary Standard isn’t a law “above and beyond doing what is best for the client”, but a phrase and a standard that one must hold themselves to. At its base it is really about focusing on what is best for the client and not on what is best for themselves as the financial planner. There is also a board that keeps a close eye on those who are allowed and actively use the title CFP or Fiduciary. 

I wanted to know what drove Kevin to become a CFP and his answer was one that really does set him apart!

He explained that it is a widespread and well known credential to be certified but there aren’t a lot of people who become part of that level of standard in the industry. 

“I saw abuses taking place in the industry that I was disgusted by, so I wanted to show the world and prove to myself that I would do whatever it took, even if that meant turning my back on earning an extra buck the traditional way, I wanted to find a different path and prove to everyone that I was willing to make that commitment to them and their best interest and not just my own, and this is one way I found I can do that.” 

He began this journey as a 24 year old, so he sees his youth as a benefit to upholding this standard because when he started he didn’t need to make a ton of money to stay afloat, personally. He sees this as an advantage because he knows he has time to make money in this business, therefore his reputation is more important to him and he would never do anything to destroy that. 

We began discussing young entrepreneurs and as a young entrepreneur myself, I wanted to know what his thoughts were on the first step to take to begin building a retirement fund.

To this, Kevin brought up the undeniable fact that most of us young entrepreneurs are 5-8 years out of college, paying back student loans and with living in the bay area, it is difficult just to make ends meet.

 “A very important first step is to make sure your debt is taken care of. Not necessarily paid off, but that you’re managing it appropriately, because high interest rates add up in the long run and make it very difficult to reach any future objective that way. So, saving for the future at a young age is a really important, its a really great thing to do, but not at the expense of not paying down loans or racking up credit card debt with high interest rates that way.”

Kevin believes that putting ten percent of your income away, forever, per year would be ideal, but that isn’t always feasible. He went on to explain that in this instance he likes to see why it isn’t necessarily feasible for a client and then help his client structure their debt situation so they can get to a good place and also have an emergency fund account available. 

“You always want to have 3 to 6 months of pure cash, in terms of what your monthly expenses are, available at any given time, just liquid cash in a savings account… its very important to have that safety net in place” 

For entrepreneurs specifically Kevin went on to talk about the importance of investing in yourself.

If you are building a business that could potentially turn into something amazing, it is important to invest in the business because the rate of return on the business may be exponentially more than investing those funds into the stock market for instance.

 “I don’t want entrepreneurs to necessarily limit themselves from their potential by not having the capitol available because they are putting it into long term retirement savings which is a great thing to do, but not at the cost of not being able to expand their business or grow their business that could one day turn into something that could generate a whole lot more income than their retirement savings account could in the long run.” 

I wanted to know where Kevin likes to start with clients, who his ideal client would be. At this point in time he really enjoys working with clients who are individuals in their late 50’s who are close to entering into retirement. Those who are looking at retirement and are wondering if they are secure enough to retire possibly a few years earlier than they anticipated. 

Speaking of retirement, I asked what one thing should a person who is entering retirement should be aware of before retiring.

“They should take into account that many people these days do not have pensions, we do not have guaranteed paychecks when we go into retirement. So anyone who is depending mainly on social security to cover their monthly living expenses, they are in for a rude awakening… especially here in the bay area….its all based on your lifestyle, of course, but the main consideration is how much income do you need now, and then lets figure out how to replace that actively earned paycheck, once you go to retire, with your retirement savings…”

Kevin went on to talk about how today, retirement is completely different from how it used to be and a lot of people are actually surprised by how much it actually costs. Furthermore, people are living longer, so that is something that anyone entering retirement needs to take into account. 

“The biggest concern and biggest eye opener is how much retirement actually costs, especially if you retire early… you could easily have thirty years to live off of your assets, so you have worked for 40-45 years, but you have to live off of this for another 30 years, so you need to have significant savings, because it dwindles pretty quickly.” 

He also talked about how medical expenses, just themselves, are a huge part of personal expenses after retirement. Medicare is not going to take care of everything that you may need. 

To wrap up, I asked Kevin what makes him and his team different. He explained that he feels, “when you invest with us, you invest in us, and we invest back into you” – he explained that this means that when you work with him and his team, you get them specifically. You have their email, you can text them and it is important to him that they build a relationship with their clients. 

If you are interested in working with a CFP who cares about your interests and your finances, I urge you to meet with Kevin Batstone. 

For more information visit www.baybridgecg.com or find Kevin here on Linkedin