Hi! I’m Forrest Baumhover, and welcome to Teach Me! Personal Finance.
I’m a dad, husband, Certified Financial Planner, tax practitioner, retired Navy veteran, and writer. I love to write articles on financial topics. I especially like to explore financial planning subjects that no one else has tackled before, and help people with financial questions they haven’t found the answers to.
Table of contents
How I became a financial planner
Halfway through my Navy career, I was stationed on a ship where I was in charge of supervising about 50 Sailors. Because my line of work involved managing the ship’s operating budget, people naturally came to me for help in managing their own budgets.
When I saw for myself how people could drastically improve their lives by simply making a few changes to their financial habits, I realized that this could be something that I could do when I retired from the Navy. But since I was only halfway through Navy career, I put that thought on the back burner.
About 6 or 7 years later, I was at a different duty station, but being a financial planner was the idea that still stuck in my mind.
I used the Navy’s tuition assistance program to pay for my financial planning certificate from the College for Financial Planning. But we were still 5 years out from retirement, so once I finished the certificate program, I kind of stopped. I figured that I could always pick it up at a later point when I was ready to leave the Navy.
So I wrote my thoughts out in a business plan, which served as my roadmap for becoming a financial planner.
The very next duty station happened to be in Tampa, near my home town in Florida. And we decided to retire after that tour. So I started executing my business plan, which included:
- Taking (and passing) the CFP exam
- Becoming an IRS enrolled agent
- Starting my own financial planning firm
In one calendar year. All while still wearing a uniform. Let’s take a closer look at what this entails, starting with the CFP designation.
About the CFP credentials
The Certified Financial Planner designation is often considered the gold standard in the financial planning community. There are four basic requirements for all aspiring financial planners:
- Education
- Experience
- Exam
- Ethics
Education
Each aspiring CFP must complete a bachelor’s degree and advanced financial education requirements from an institution of higher learning. The CFP curriculum exposes candidates to the following aspects of financial planning:
- Basic principles of financial planning and professional conduct
- Risk management and insurance planning
- Investment planning
- Tax planning
- Retirement savings and income planning
- Estate planning
- Psychology of money and financial planning
All of these topics culminate in a final course, known as the capstone module. In the capstone module, students actually create a comprehensive financial plan based upon everything they’ve learned. My capstone experience was one of the most exhilarating accomplishments I’ve ever experienced in a classroom setting!
Not only does the CFP Board require an education requirement to sit for the CFP exam, but it requires CFP certificants to maintain continuing education for as long as they keep the marks. This continuing education requirement consists of 30 credit hours every two years. This also includes 2 hours of ethics.
Experience
In addition to a demanding education requirement, the CFP Board requires actual, real world experience in helping other people with their financial planning needs. Lots of experience, in fact.
The CFP Board requires each candidate to accumulate at least 6,000 hours of experience, equivalent to three full years of dedicated financial planning work. Over the course of my Navy career, I was able to document the work that I did with my Sailors. This helped me meet the experience requirement while I was still on active duty.
Examination
The CFP Board requires all candidates to pass a comprehensive, 170 question exam that covers all financial planning topics.
Exam participants are advised to take a preparation course from an outside provider and expected to study for at least 100-150 hours to prepare for the examination (above and beyond the coursework itself). Leaving nothing to chance, I documented at least 200 study hours on my journey.
Ethics
The financial planning industry is one of the least trusted industries in the United States. To help ensure trustworthiness amongst its members, the CFP Board requires each members to:
- Regularly attest to specific ethics requirements, in writing
- Maintain the highest standards as outlined in the CFP Code of Ethics, Fitness Standards, and Code of Conduct
- Maintain an ethics component as part of the continuing education requirement
About being an enrolled agent
The IRS enrolled agent designation is the highest credential that the IRS bestows upon tax professionals. Like certified public accountants (CPAs) and attorneys, enrolled agents have unlimited practice rights to practice before the IRS. This includes:
- Which taxpayers an enrolled agent may represent before the IRS
- Types of tax matters an enrolled agent may handle
- Which IRS offices an enrolled agent may represent clients in front ot
In order to become an enrolled agent, one must pass a three-part comprehensive IRS test covering individual and business tax matters. To maintain the enrolled agent credentials, individuals must adhere to high ethical standards and complete 72 hours of continuing education every three years.
About becoming a financial planner
There are several things about becoming a financial planner that aren’t apparent to most people. While there are several routes to becoming a financial planner, the most traditional way for financial planners to begin their practice is to become a registered investment advisor.
Becoming a registered investment advisor is usually not a difficult process. But the process involves the state government’s office that oversees investments, unless you’re able to register directly with the Securities and Exchange Commission (SEC). So it can be a daunting experience, and not usually completed overnight.
In my case, it took about 4 months to become registered as an investment advisor in Florida. This meant that I could legally give investment recommendations to my clients. It also meant that my office was open for inspection by state examiners at any time.
My first audit as a financial planner
This story is a little out of order, chronologically speaking, but is relevant here. My first audit happened exactly as described:
Two men in suits showed up without notice to my office (located at my house). I wasn’t there at the time, as I was doing work at another location. But my wife was there, and not happy.
So she called me, explained the situation, then told me I needed to come home to handle it. I came home to find:
- My wife rushing to get my three kids ready for school and out the door
- The air conditioning technician was coming in and out to do maintenance
- Two fairly upset auditors standing patiently at my driveway
Why the driveway? Because even though they had law enforcement badges, my wife wouldn’t let them in the house until I came home. And they were soaking wet because the lawn sprinklers kicked in while they were waiting outside!
Despite the ominous start to my audit, the rest of it went fairly well. They determined that everything was in order, gave me a checklist of things to correct, and left me alone after that.
Before I got started in personal finance
Before I became a financial planner, I was in the Navy.
I joined the Navy as a hospital corpsman in the early 90s, when I was still 17 (turned 18 in boot camp!). After my first duty station in Camp Lejeune North Carolina, I figured I should make the Navy pay for my college, so I applied for the Naval Academy and was accepted (somehow). That free education might’ve been the first astute financial planning move I ever made!
I was fortunate enough to have found the love of my life, Tania, while still in college. Having been commissioned as a Supply Corps officer, we went wherever the Navy sent us, which was mainly up and down the East Coast of the United States, as well as Europe.
As my career progressed, I thought long and hard about what I wanted to do when the Navy and I parted ways. While I had lots of different ideas, financial planning was the one idea that kept coming back to me. And it comes down to this story.
Why I became a financial planner
One time, when I was stationed on a ship, one of my junior Sailors missed ship’s movement. Missing ship’s movement means exactly what it sounds like: The ship left port without him.
When someone misses ship’s movement, it’s a pretty big deal. Usually, it means that the Sailor is in trouble. And it usually means that the ship has to do without him or her until the ship gets back to port.
When we returned to port several weeks later, I sat down with my Sailor to ask him why he missed ship’s movement. This is how that conversation went:
Me: Why did you miss ship’s movement?
Sailor: I overslept.
Me: Why did you oversleep?
Sailor: I was up all night working.
Me: But I let the division go early so everyone could prepare for getting underway.
Sailor: I was working late at my other job.
(Note: enlisted personnel usually aren’t supposed to have side jobs without getting prior approval…for reasons like this)
So when I finally got to the bottom of this, it turned out that he had gotten a defective car at a used car dealership right outside base. It had been in the shop for virtually the entire time that he owned it. And since he financed the purchase form the car dealership, he was still making car payments.
When I sat down with him to calculate the interest rate, we found out that he was paying 70% interest! That’s right–seventy. Fortunately, Congress made predatory loans against servicemembers like this illegal, but that law wasn’t in place at the time.
That’s when I decided that I eventually wanted to become a financial planner. After my Navy career was finished.
What happened when you retired from the Navy?
In April 2017, I took off my uniform for the last time, and hit the deck plates running as a new financial advisor. Running right into a brick wall.
Almost every financial planner runs into this brick wall where nothing happens. No clients, nothing. You go to all the chamber of commerce meetings, drink 1,000 cups of coffee, but no one hires you. Your only visits are from the state auditors, who make you feel like you’re failing your clients, even when you don’t have any clients!
Eventually, something good happens, if you stick around long enough. Either enough clients hire you so you build your own practice, or something else fortunate happens.
Finding a partner
In my case, another financial advisor needed an extra financial planner and decided to take a chance on me. With a handshake agreement, we agreed that I would:
- Come to work as an employee
- Buy into her practice and become a partner
- Eventually buy out her practice when she was ready to retire
I did come on as an employee, and I did become a partner. A few years later, we ended up going our separate ways, and she bought out my side of the partnership instead.
What happened after you left the firm?
During my time as a financial planner (both on my own and with my partner), I wrote lots of personal finance articles. TONS!
Along the way, I found that it became natural to me, and that a lot of my articles became highly sought after in Google Search queries.
So I figured that I had some time on my hands, and decided to see what would happen if I tried this in real life. Writing articles, full-time, where I actually have the time to completely edit and proofread everything (instead of just sending out an article every other week in between client meetings and everything else a business owner has to do).
What’s this have to do with Teach Me! Personal Finance?
Then I came across Teach Me! Personal Finance, and talked with the previous owner. He no longer wanted it, and we came to an agreement on acquiring the website.
Since then, I’ve tried to help improve the articles already on the site, so current readers can appreciate them, while writing new articles on subjects and questions that aren’t quite covered out there on the Internet.
Article topics I like to write about
Here are some of the article topics that I enjoy writing about:
Lately, I’ve been trying to provide step by step walkthroughs, articles, and guides on the IRS’ free and fillable tax forms.
I hope you enjoy the articles, and please check out my Work With Me section if you need more detailed research.