march 2006 virtual office news - junxure · virtual office news volume iv, issue 3 page 3 two...

Virtual Office News

The problem with trying to decide whether or not to purchase a specific product based upon product claims and cursory reviews is that those things lack a human element. We might hear, for example, that Junxure-i is great CRM software tailored to advisory firms, but that doesn’t mean we don’t have a lot of questions we need answers to before we plunk down our hard-earned cash, and more importantly, invest what is likely to be many hours in learning the software and adapting it to our practices. Perhaps a useful tact would be to study firms actually using the software

and see what it does for them. We did exactly that when we talked to Annette Simon and Veena Kutler of Mosaic Wealth Management in Bethesda, MD. To give you a bit of background, Mo-saic’s two principals — Simon and Kut-ler — work with two full-time employ-ees. Simon handles planning, Kutler handles investments, one employee is a paraplanner, the other is an adminis-trative type. The clients belong to the

firm, an RIA offering a comprehensive financial planning and investment management service. Mosaic also outsources several of its functions. Sherry Carnahan of To-tal Office Inc. maintains its website, and Advent Axys portfolio accounting is outsourced via TD Waterhouse which saves them a half person in the office. There’s a critical point in time when a small firm that perhaps started as a sole practitioner takes on partners and/or employees and has more than one person with a “need to know.” That’s when it quickly becomes ap-parent that clients cannot be served well if one person in the office has information about the client that isn’t systematically shared with everyone else.

March 2006

Volume IV, Issue 3

Junxure-i — from a User’s Perspective by David J. Drucker

1-5

Office Live by Joel P. Bruckenstein

6-11

Conference Sightings 12

What We Use— Hand-mark Express by David J. Drucker

13-14

Q&A with Joel and Dave

15-16

Guest Columnist: Steven Podnos, M.D., CFP

17-20

Letter From the Editor Last Page

Inside this issue: The Only Practice Management/Technology

Newsletter for Financial Advisors

© Copyright 2003-06, Sunset Financial Management, Inc. All Rights Reserved.

Junxure-i — from a User’s Perspective by David J. Drucker

Annette Simon Veena Kutler

Ever wish you could find one person that had all the skills and tools to manage your back office operations, and all you had to do was let them know what needed to be done? Does such an uber (or super) em-ployee exist? Well how about two for one? Beth and David Dickin-son have formed Adviser BackOffice Solutions LLC (ABS) to meet your uber needs. They don’t even require any office space! ABS uses the increasingly sophisti-cated Web-based appli-cations available to ad-visers — PMS systems, document management, CRM, financial planning, etc. — to take care of all customary back office functions. Services even include production and mailing of quarterly statements, fee billing, and a list too long to re-produce here. (cont’d)

Junxure-i reduces client contacts to actions, and “...because everything you do is an action, we can all know the activities going on with a par-ticular client,” says Kutler. “This is especially important when it comes to emails,” says Junxure-i’s developer, Greg Friedman. “In Junxure, the entire office can see the complete history of client emails.” On a broader scale, “…there are so many little things you do for every client,” says Kutler, “and every client is different, so Junxure-i allows us to track all those little things.” And, while tracking every activity is criti-cal, it’s perhaps the effect on client service that is so important, because the ability of everyone in the office to track things is also the ability to be interchangeable. “If someone starts transferring an account for a client and is then out of the office, another person can open the client's record and find out ex-actly where we are in the process,” explains Kutler. Junxure-i also helps Simon and Kutler prepare for client update meet-ings. Smart advisors know they can’t assume clients will remember every little thing done for them. Periodic meetings with the client are an opportunity to toot one’s own horn — if one can easily put his hands on a list of tasks performed for the client since his last meeting. “It allows us to answer the client question, ‘what have you been doing for me,’” says Simon. Adds Friedman, who has his own successful advisory business for which he originally developed Junxure-i, “In my office, one of my favor-ite reports shows, by date range, all activity for a client broken down by category, for example, financial planning, administration, and so on. Not only is it a great way to show a client what you’ve done for him, but it’s enabled me to continue raising my fees over the past several years.” If you’re going to track all client activities, it’s essential you be able to attach to those CRM items images that may accompany them. For ex-ample, if your client sends you a letter with an enclosure in response to a request you made for information, both the request and the response, along with a copy of the enclosure, should ideally be made a part of the client’s record in your CRM. “Everything is saved in the client’s Junxure-i file,” says Kutler. “Our for-mer paper filing system where we'd have a file cabinet with estate or financial planning and other documents… all of these drawers are now

Junxure-i — from a User’s Perspective ... Continued

Vir tua l Of f ice News Volume IV, Issue 3

Hiring an Uber Em-

ployee


tabs in the client’s Junxure-i record.” New documents are scanned and added to that file, as received. “And if we’re doing financial planning for the client, we might save a planning report right in their record, as well.” Of course, scanned copies of contractual documents — the cli-ent contract, IPS, etc. — are all maintained in the client record too. “Junxure also integrates with several leading document management systems, including Worldox, CEOImage, DocuXplorer and others,” says Friedman. Simon says they scan everything to PDF format which Junxure-i stores in folders accessible via Windows as well as through Junxure-i, making Junxure-i’s document management system even more valuable for its flexibility. Taking it a step further, Friedman says, “Junxure will link to any docu-ment in any location in any file format. And, in turn, documents can also be linked to actions. So, if you presented a financial plan to a cli-ent, you could link a PDF of the plan to the action item in Junxure.” “We even set up Mosaic as a client,” says Simon, “so we have all our PowerPoint presentations and other things in Junxure under Mosaic’s ‘client’ record.” Kutler explains Junxure’s greatest strength from a client service stand-point: “Our next project will be to use Junxure to set up Deliverables for our entire client process, starting with the first call from the client, then meeting, and then signing the contract. When we flesh out the process of serving that client — the meetings and documents we’ll provide — Junxure will ’push’ these things out to us so we don't have to remem-ber the next thing to do. Junxure will say, ‘"If you’ve finished action A, then you need to perform action B.’ That's the real power of Junxure, and we’re just scratching the surface now.” Adds Friedman, “If you have different client segments, you can also create different ‘deliverable sets.’ Each of the deliverables can be as-signed to a particular advisor or employee and given a desired interval. Action items are created automatically and then when marked as com-plete, the next recurrence of that action will be automatically assigned. Nothing is forgotten!” But how does all of this happen automatically? “When you log on in the morning, you get a pop-up screen that shows the actions assigned to you and other actions on which someone else has sent you an FYI,” says Simon. “That’s a real nice feature,” adds Kutler, “because it tells you who the client is, what was done, who did it, and the follow up re-

V i r tua l Of f ice News Volume IV, Issue 3

Two services are wor-thy of special mention however, because of their uniqueness: 1) Complete ongoing com-pliance including regu-latory filings and up-dates, liaison with regu-lators, review of letters and marketing materi-als, mock audit, etc. (done through Dickin-son’s firm — Regula-tory Alliance), and 2) Direct client communi-cation when the adviser is out on appointments, on vacation, or just working on more impor-tant matters. Through a phone system like Aptela or GotVMail, the adviser can prompt his phone to ring directly to ABS for unexpected transactions, like send-ing a check to a client. If you want to be more virtual, contact ABS at (231) 386-5280.

Hiring an Uber Em-

ployee (cont’d)



quired.” They both say it’s very difficult for something to fall through the cracks. Of course, the more a CRM will do, the more time it takes to learn. Simon and Kutler say it took them about a month of studying the program to begin using it productively. They took a half dozen Web-based training classes and Kutler also attended one of Friedman’s “boot camps” to get up to speed quickly. “There’s also a users group that has teleconference meetings, but we haven't had time for those,” says Simon. Friedman sheds light on Junxure’s learning curve: “Junxure is a very large program with tremendous capabilities. Implementation can be made easier by starting small and then increasing the use of different areas of the program over time. We have created a fair amount of material based on my actual firm and experience to help firms get the program implemented, including quite a bit of practice management material that firms can use.” CRMs like Junxure that let you originate word processed documents, send and receive email and capture scanned images may seem on the surface to be the Holy Grail of integrated software everyone is looking for. Close but no cigar. As essential a tool as a full-featured CRM is, and as great a product as Junxure is, few CRMs pretend to do either financial planning or portfolio man-agement accounting. Those that do tend not to do all tasks equally well. It’s important to remember that a CRM is your primary client service tool; that un-derstanding will help you integrate it with your financial planning and portfolio management activities. Specifically, your CRM lets you track client activity and handle client calls/questions, so the actual planning or portfolio information you need to be able to track directly with your CRM is a “lite” version of what your planning portfo-lio software can actually produce. As for portfolio management information, Kutler says they pull certain values from their Advent Axys download every day into Junxure. “It takes two or three minutes every day to get Axys numbers into Junxure. If necessary, we can then click on a client's Asset tab [within Junxure] and know what's in each of his accounts.” “Junxure gives you a page in its database for each of the client’s assets,” adds Simon, showing the asset’s current value, cost basis, what account it’s in, who owns it, and whether its taxable.”




Don’t Forget to Access the VON

Virtual Ac-cess List Fre-quently! We

are con-stantly up-dating the

list with new entries. You should have the URL to the list (it’s given to all subscribers at the time you sub-

scribe) but, if you don’t

have it, email sherry@tota

loffice.cc who will

check your subscriber status and email you the URL).

To enhance their use of Junxure, Simon and Kutler set up a Virtual Private Network (VPN) after moving into new offices in July 2005. They made certain the new network would let them use Junxure from any outside location. “The rule for ourselves and our employees is that everything must be done through Junxure,” says Kutler. “If the SEC comes in to look at email retention, our email will all be in one place if we’ve all accessed it through Junxure.” Says Simon, “We just link through our home Internet connections to the network, then we input all of our data into Junxure or read our email directly off the server.” How’s tech support for Junxure? “We’ve found the Junxure staff extremely responsive, returning calls within an hour or so. They walked us through installation and implementation, and everyone on our staff has gone through the training, which has been great.” Says Friedman, “We place a great emphasis on taking care of people that purchase Junxure. In ad-dition to devoting many resources to technical support, we also are continuously adding training ses-sions, boot camps, virtual users groups, and an online forum for our users to share best practices and provide suggestions to enhance the program.” Which is why Virtual Office News continues to recommend Junxure-i as one of the best, advisor-specific CRMs you can own. If you want to check it out further, visit http://www.junxurei.com/.

* * *




www.junxurei.com

Ever since I heard about its pending launch a number of months ago, I’ve been anxiously awaiting an opportunity to try out Microsoft’s new Office Live beta (http://officelive.microsoft.com/). While not targeted specifically at financial advisors, it is designed to be used by small businesses. In this case, a small business would be defined as any firm that does not have the sort of in-house IT expertise typically found in major corporations; in other words, all but the largest financial advisory firms. The reason I was drawn to Office Live is that it incorporates many of the themes we often write about on these pages such as ASPs (application service providers), collaboration and ease of use. My hope was that Office Live would be a tool that would be immediately useful to some readers or their clients. Even if that turned out not to be the case, I thought that the Microsoft Office Live beta might serve as a good model for future development that could directly benefit advisors and their clients. What Is Office Live? Office Live is Web-based software, that is, there is no software to install on your computer; everything resides on Microsoft’s servers and you access the platform over the Web using nothing more than a Web browser. Well... perhaps not any Web browser. This may just be a coincidence, but to get the full functionality from the Office Live beta site, you must use Microsoft’s Internet Explorer browser (more on that later). There are three levels of service being offered during the beta test. Microsoft Office Live Basics includes the ability to register a domain name for free, website design tools to create your own website, free Web hosting, basic Web traffic reports, and five email accounts associated with your domain name, for example your name@your domain name.com. It is anticipated that this service will remain free after the beta period has expired. The next level is called Office Live Collaboration. This service does not include a domain name or client facing website, but it does include 50MB of password-protected space on the Web, more than 20 “business applications,” licenses for 10 users (you can add additional storage space and additional users for a fee) and daily backups. This service is free during the beta test; it will cost at least $29.95 monthly when the beta concludes. The most comprehensive level of service, Office Live Essentials, combines the components of the other two packages and adds perks such as additional bandwidth, advanced Web traffic reports, additional email accounts (50 vs. five), larger email attachments (20MB vs. 10MB), and the ability to access your Office Live email account from either Microsoft Outlook or Outlook Express. This service is currently free as well. Once the beta ends, prices will start at $29.95/month. I recently signed up for a Microsoft Office Live Essentials account to see if the service had any applicability to advisors or their clients.



Office Live… by Joel P. Bruckenstein

http://officelive.microsoft.com

Getting Going The sign-up process for Office Live is very straightforward. First, you search for and select a domain name. Currently, this part of the service is being handled by Melbourne IT (http://www.melbourneit.com.au/). Through Office Live, only .com, .net and .org domains are being offered at this time. Next, you set up a Microsoft Passport account, or link to an existing one (if you use Hotmail, MSN Messenger, MSN Music, etc., odds are you already have a Passport account). You then virtually sign the Office Live service agreement, the Office Live privacy policy, and the Melbourne IT domain registration service agreement. Once that’s done, your account is created and you’re transported to the Member Center pictured below.

The member center offers easy access to most of the major areas of the site through the use of the



Office Live… Continued

http://www.melbourneit.com.au

taskbar on the left and/or through links on the home page itself. First, I went to the email tab to verify my email account associated with this site ([email protected]) and to set one up for Dave. This was accomplished in a matter of seconds. (I was somewhat disappointed to discover that the email accounts we received were the classic Hotmail-type accounts as opposed to the newer Windows Live Mail beta accounts that make use of AJAX technology). Next, I clicked on the Web Site tab and went to work creating a website using the tools provided on the site. Creating a Website Microsoft provides a decent selection of tools and templates. There are over twenty “themes” to get you started, including one entitled Finance and another entitled Insurance. Once you select a theme, you can customize the graphics, the layout and the color scheme with a few mouse clicks. You then go through the same customization process for headers, fonts, navigation tools and footers. Next, you go to the page editor where a few pages (home, about us, contact us, and site map) are already laid out for you. You can immediately begin replacing the stock text with your own, or you can further customize as needed. Once the initial pages are complete, you can create new ones. Again, a number of page templates are already there for you, ready to use. These include a company calendar, employee bio page, newsletter page, press release page, etc. Of course, one can also design custom pages from scratch. While the site creation tools are limited, they are easy to use and they produce satisfying results. I created a very basic sample site in just over an hour, and I have no particular talent in this area. To view the sample site, visit www.financialadvisortech.com. There are, however, a couple of gotchas regarding the website section. First of all, you need to use Internet Explorer for the creation tools to function properly, although it appears that they can be viewed by other major browsers such as FireFox. If you decide to leave this host for another, you can take your domain name with you, but I’m not sure about your website design or content. From time to time I ran into sluggish performance when updating the site. I’m not sure if this was due to heavy traffic, system updates or what, but it was disturbing when it happened. I also experienced a delay while adding hyperlinks to my Web pages. When I created a link, it took as long as five minutes before the link “went live.” I’m not sure if this was due to the same issues as above, or if Microsoft does some sort of checking or filtering before enabling the links. One time I ran into a script problem when I failed to exit a page properly. After that, I could not edit pages on the site. I was able to quickly remedy the situation by going to the IE Tools menu, selecting Internet Options, then deleting the files, the cookies and clearing the history. Easy for me, but I wonder if readers would have known what to try. If there was a spell checker I couldn’t find it, however you can create the text on an application such as MS Word, then cut and paste it to the site. Despite these shortcomings, my overall impression of the website creation tool was positive. I strongly suspect that any performance issues will be




www.financialadvisortech.com

addressed before Microsoft starts charging to use the platform. Business Applications and Other Tools Another major section of the site is the business applications section, which is best accessed through the dashboard pictured below.

In Office Live terminology, an application is nothing more than a customized view of data that is stored as a list. So, at the most basic level, an application might be a list of contacts, employees, projects, sales opportunities, etc. There is also a calendar. On the dashboard, you can view key data relating to just the user, or to the whole company The platform includes tools for managing customer relationships (Inquiries Tracker, FAQ, customer Manager), Projects (Project manager, Project Tasks, Project Issues, Project Milestones), Sales (Campaigns, Collateral Materials, Competition Tracking, etc.), Human Resources, and Company (Calendars, Resources, To Dos, Documents).




The shared sites tab allows the administrator(s) to control who has access to what, and at what level (there are three levels of access). While these applications are too basic to totally run most businesses, they could be the foundation of some small businesses and projects. A Valuable Tool? At the outset, I said I was determined to find out if Office Live would be a useful tool for advisors and their clients. At first glance, the answer would appear to be “No.” Clearly, the Web creation tools here are no match for those of AdvisorSites and other companies catering specifically to advisors, and there is no content provided. There are some advisors out there who are still paying for “billboard” websites (essentially a home page and a contact page) and they probably could use this as a substitute, but those advisors tend not to be VON readers. On the other hand, I can think of a number of situations where VON readers would benefit from using a service like this. One situation would be to set up a site for a study group or other organization. With the shared workspace you could create a member list, schedule meetings, share documents and exchange email. The cost would be minimal, as would be the upkeep. Another good use of Office Live might be for ad hoc projects related to clients and/or other professionals. You could set up a website for a short period of time, use the site to collaborate on the project, and then close up the site when the project was completed. I also think that this could turn into an interesting resource for clients. Over the years, I’ve had a number of clients start a side business either for fun, or as a way to ease into retirement. Often, these new ventures are service- or sales-oriented, and they would lend themselves to a site of this type. Office Live allows an entrepreneur to develop a basic Web presence and a “virtual workspace” with only a tiny upfront investment of time or money; hence a client can test out the viability of a business idea with little risk. Do I think that Office Live is any indication of what the future has in store for us? The answer is yes, I do. The current trend is to move more and more of our data and applications to the Web. If Office Live is even moderately successful, it could accelerate this trend. In fact, if this service catches on, it would not surprise me to see some company create a similar service specifically for the advisor community. Are there any possible impediments to moving to a totally Web based environment? Clearly there are some. Security is one issue and access is another. I feel fairly certain that most providers in our industry are totally paranoid about security, but Microsoft has not yet demonstrated the same dedication to user safety. If you do not have access to the Web, you will not have access to these tools, but most readers already have redundant Internet access, and those who don’t surely will if they commit to greater dependency on Web tools.




As it relates specifically to Office Live, Microsoft has currently imposed some very skimpy limits on bandwidth (25GB per month) and storage (50MB). The storage limits in particular are troubling. If one was to start storing some complex documents and/or photos on the site, that 50MB would be consumed rather rapidly. Conclusions Right now, Office Live is not the sort of environment that advisors can use to run their business, but if it proves to be reliable and secure, they might use it for activities and projects that were limited in scope. It might also be useful for some clients, and for recreational activities at home like your child’s little league team or girl scout troop. Perhaps more importantly, Office Live offers us an indication of what the future holds. By distributing Office Live, Microsoft — I feel certain — will gain valuable insights into serving very small businesses. They will also gain insights into providing a Web-based environment to people like us. Hopefully, we will all reap the benefits in the future of the lessons Microsoft learns.

* * *






During the next 12 months, Dave and Joel will be appearing and speaking at the following confer-ences: • April 3-4, 2006, NorCal FPA, San Francisco (Joel) • April 27-29, 2006, Financial Advisor Retirement Symposium, Las Vegas, NV (Dave & Joel) • May 3-5, 2006, 2006 Financial Profiles Conference, San Diego, CA (Joel) • May 9, 2006, FPA of Central Ohio, Columbus, OH (Joel) • May 14-16, 2006, Canadian Advisor Tech Expo, Toronto, Canada (Dave) • June 20, 2006, 24th Annual MNCPA Estate and Personal Financial Planning Conference,

Brooklyn Center, MN (Joel) • September 17, 2006, NAPFA West Region Conference, Portland, OR (Dave & Joel) • October 21-24, 2006, FPA National, Nashville, TN (Dave)

Conference Sightings

Handmark Express

If you own a Palm PDA or Treo phone, you know there are many aftermarket companies producing software for these devices, some of which verges on essential. For example, I consider SnapperMail and Documents to Go for my Treo 650 phone (upgraded last year from a 600) as products I can’t live without because they give me full email-with-attachments capability. Handmark (http://express.handmark.com/) is one such aftermarket company that’s come out with a number of games and indispensable utilities for those of us who can’t live (or travel) without our Treos.

Does its “Handmark Express” offering fall into the category of “essential?” Perhaps not in the way an aftermarket email utility is essential but, if the true test is how long one is willing to pay a monthly service fee, then yes — perhaps it is essential — for me, at least. Here’s why. As most readers know, Web-based services can be streamlined in such a way that they integrate well with a smartphone’s wireless network speeds and capabilities. So what Handmark has done with its Pocket Express product is assembled nine critical resources into one streamlined package:

• News • Stocks • Weather • Sports • White & Yellow Pages • Maps • Movies • Dictionary • Extras

These are fairly self-explanatory. You click on Express on your Treo phone and see a screen like the one in the above graphic with the nine choices arrayed in a matrix. News and Sports are news sources — always ready to be updated with a click for the latest stories. (News is broken down into subheadings like World, Technology, Science, Entertainment, Strange et al). The Sports “channel” includes football, basketball, hockey, and baseball. (It does not include boxing — about the only sport I follow — but then no one’s ever accused me of being mainstream). What I use the most are the Weather, White & Yellow Pages and Movie channels. These alone keep me paying $6.95/month for Express. It’s so easy to check the weather anywhere/anytime while



What We Use by David J. Drucker

http://express.handmark.com

traveling. The phone number lookup capability is something I use at least several times a week and, once Express finds the number I need, it lets me click on “Dial” and reach the party I want without having to first write down the number. (Actually, I can do all of this one-handed with the Treo’s keyboard features). The 411 charges I avoid, alone, pay for Express. And the movie channel always comes in handy at Friday night dinners out when my wife and I are trying to decide if we want to see a flick. Of course, this channel works for any theater in the U.S. The other channels are useful or fun and would maybe be more essential to you than me. Maps gets you a small, hard to read map right on your phone. You probably couldn’t refer to it safely while driving, but it could pull you out of a tight spot if you had a minute to stop the car and dial in the location you’re looking for. The Dictionary channel comes in handy now and then, although I tend to just use www.dictionary.com if I’m sitting at my computer. Extras just gives you news of new Handmark offerings, so it’s more of an advertising channel than anything truly useful. If you want a simple set of utilities that you’ll find yourself using more and more — little things that just make your life a tad easier — try Handmark Express. When you weigh the $6.95/month cost against the ability to defray some stress by finding phone numbers quickly, or just being able to read the very latest news on your phone while waiting for a plane, the price will seem like peanuts.



What We Use… Continued

www.dictionary.com

In this column, we reprint real questions and answers exchanged with readers and others during the previous month. Real names have been deleted to protect the shy, the inquisitive, and the just plain stupid. (Just kidding… there are only stupid questions; not stupid people).

* * * Question: Can the Seagate internal hard drive mentioned in your latest Price Watch be easily installed into a Dell Inspiron 1100 laptop? Joel: The short answer is no. First of all, the typical laptop hard drive is a different size than the typical desktop hard drive. Second, I would not suggest that anyone open a laptop and do this sort of job unless they are very experienced. There's a chance you could void the warranty. I'd have a computer shop do the upgrade. CompUSA is selling a 120GB Seagate laptop hard drive for $219.99 after rebate this week. That's a decent price.

_________________________ Question: You have written a terrific book… thanks for your contribution to the advisor community. I’m looking for a list of FocusPoint’s competitors [editor’s note: he refers to FocusPoint Solutions at www.focuspointsolutions.com, one of the recommended providers on our Virtual Resource List].

Dave: I'm afraid it's not that easy. FocusPoint is very hard to pigeonhole. It's a firm that does some of what a broker-dealer does, and some of what a number of different outsourcing partners would do. It's nearly impossible to find another entity that provides exactly the same combination of services as FocusPoint.

However, if you were to try to duplicate some of its services in the world of outsource partners, you might look start with these entitles: The Work Place (www.workplaceadmin.com), Financial Support Services (www.finlsupport.com), and Pillar Virtual Partners (www.pillarvp.com).

_________________________ Question: Reading the frequent identity-theft blowups in the press, it occurs to me that should I depend on a lot of ASP services, it takes just one inside job by an employee stealing client financial info to shatter my clients’ faith in the security of my business. I could just get a ‘Dear John’ letter from an ASP site one day, and overnight, I’d have to send out my own letter to my clients, and probably have to turn things upside-down operationally. Maybe it’s not likely, but if I use more than one ASP service over many years, that’s a lot of potentially-exposed client data traveling around cyberspace, and residing in various servers.



Q&A With Joel & Dave

www.focuspointsolutions.com

www.workplaceadmin.com

www.pillarvp.com

www.finlsupport.com

Joel: There is some risk, however, the better ASPs keep their data locked up pretty tightly. Part of your due diligence process should be satisfying yourself that the providers you work with take security seriously. In my experience, most do. They realize that they work with advisors, and only one breech will almost certainly put them out of business, so they do a good job on security because it is vital to their business. Also, I’d be remiss if I did not point out that the security in the typical advisor’s office is far inferior to that of the typical ASP provider. In most (not all) cases, advisors do not have their computers physically secure. They are often prone to theft, fires, water damage, etc. And like an ASP, you, or any other firm, could suffer damage as a result of a disgruntled employee.

_________________________ Question: I work for a firm that has previously consisted of two planners who were married. The marriage is ending in divorce as well as the practice. I plan to move on with one of the planners who’s considering moving to another office or working out of his home. He felt like working from with an established business wasn’t a big deal, but is worried about attempting to grow a business from a home base. I am encouraging the planner I’m moving on with to consider working out of his home at least initially for cash flow’s sake. What is your opinion on advisors working from their homes? Dave: If you're looking for statistics on home-based advisory firms, I know of none. However, I can tell you anecdotally that a lot of advisors do it. If I had to guess, I'd say it might be as high as 20 percent. These aren't all small practices or practices dealing with just middle-income clients, either. They're advisors who've trained their clients to understand the benefits of not having to pay for expensive office space. For those clients they need to make an impression on, these advisors will often rent an hour or two of office suite space if they're in a city large enough to have that sort of thing (e.g., www.hq.com). One last comment -- the success of a home-based office is also a function of what kind of clients he'll continue working with and what they've come to expect. If they expect a fancy office and royal treatment, you can always put a positive spin on a major change if you can just show the client how it will benefit him or her financially to settle for your more modest office.



Q&A With Joel & Dave… Continued

www.hq.com

Running a Paperless Office From The Start I happened to read Virtual Office Tools for a High Margin Practice by David Drucker & Joel Bruckenstein (Bloomberg Press, 2002) at about the same time I started my financial advisory practice. The practical and encouraging content convinced me to start out with a paperless office from the beginning. Over the last three years, I’ve evaluated a number of options for managing and expanding the paperless and remote capa-bilities of my system. Generally, I was guided by my desire for redun-dancy, low cost and relative simplicity. To clarify the applicability of the following comments, my practice is lim-ited to approximately 40 upper-middle-class families (about two-thirds medical and dental professionals) ranging in age from 30 to 75. Luckily, about 80 percent of my clients are email “competent.” This system has worked well for me to date (the only paper I file at all is signed contracts) and works in the following ways:

Document Storage

With new clients, I gather a fairly typical number of documents: wills, insurance forms, tax returns, questionnaires and other miscellaneous forms. All of these are scanned and either returned to the client or discarded. I bought a Visioneer 9450 scanner with an automatic document feeder for just under $300. It is slower than the Fujitsu line and many other recommended scanners, but good enough for my in-frequent needs. I scan into .pdf format using Paperport Office 10.

Each client has a group of folders under his or her name in a section of the My Documents folder on my hard drive. The folders are titled: Correspondence, General Documents, Tax Documents, Custodial Forms, and Plan Documents. In the Plan Documents subfolder, I have some custom-ized templates for Asset Protection, Estate Planning, Insurance Review, Educational Planning, and Retirement Planning. I have a set of all the folders and subfolders in blank form in another directory that I can just copy and paste into a new folder as I add each new client. The appropriate documents are scanned into the corresponding folders (e.g., 1040s into Tax). As I develop custodial applications, they are also then saved into the Custodial Forms folder (in case they need to be reprinted). Correspondence is saved by a file name with date first, followed by a brief description of the content (e.g., “2005-8-25-re: IRA transfer”). I make a CD-ROM copy of most of the scanned documents for the clients to keep in a remote lo-cation. I also tell the clients that I’m a resource for copies as needed for them or their family members.



Guest Columnist: Steven Podnos, M.D., CFP®

This system works very well for my needs. I can pull up documents and correspondence in a few seconds and print or email them as desired. I’ve not modified this in over a year, finding it suit-able in every respect.

Backup

I've been a stickler for backups after losing a couple of hard drives in my early computing days. Over the past three years, I've added a number of types and frequencies of backups -- still not sure of the optimal system. Many other systems have been described elsewhere that look equally as good and maybe even better than mine. Daily backup tapes kept offsite seemed most comprehensive, but I didn’t trust that I'd be compulsive enough to maintain the needed sched-ule. Therefore, I use the following methods of backup: 1. Monthly DVD copies of all client and document files -- kept offsite. 2. Intermittent weekly DVD copies of some client and document files when there has been a lot of activity -- kept offsite. 3. 80GB Mirra server (www.mirra.com) -- continuous onsite backup of all critical files. 4. I have two hard drives on my computer and use SyncbackSE (www.2brightsparks.com) to keep a daily exact copy of all my important files on both hard drives. This is done automatically every evening. 5. Also, I keep a periodic clone of my primary hard drive on the second hard drive. If the primary drive fails, I can restore a new drive from the clone in a few minutes. I can then restore all the im-portant client files (with less than a 24-hour data loss) within an hour. For the cloned drive, I’ve tried Norton Ghost and Acronis True Image, but I actually like Easy Gig 2 (www.apricorn.com) the best so far. 6. Daily online backup of crucial files using www.datadepositbox.com. I like this service as it is inexpensive and charges only by the storage used. 7. Just prior to publication, I began using Foldershare (www.foldershare.com). For $50 yearly, I

can keep a number of folders almost instantly synched between computers -- even if they're remote. I use it for backup by synching many important folders (ACT backup, Quickbooks backup, Client Files) on a computer in a different location from my main office machine. Fold-ershare uses peer-to-peer technology, like Bit Torrent.

8. Both the Mirra server and the online backup service allow downloads from remote locations

(see the next section). Foldershare also allows remote access to folders and files from remote locations.

Steven Podnos… Continued



www.mirra.com

www.2brightsparks.com

www.apricorn.com

www.datadepositbox.com

www.foldershare.com

Remote Access I rarely need remote access except when on vacation. Communications away from home and of-fice are by cell phone and email (just as when I'm not away). My custodian, Fidelity, allows easy access to accounts and trading from any computer. LogMeIn (www.logmein.com) suffices for those rare times when I need to view something on my desktop while away. This service is free and is adequate if downloading isn't required. My Mirra server and online backup service (www.datadepositbox.com) both allow me to remotely download any backed up files I may need. With all of these options, I've been able to travel as far away as Africa without any signifi-cant remote access problems. Client Email List Client email has evolved a great deal over the last three years. Initially, I only used email for brief questions and follow up. What a time saver it proved to be! I can avoid phone tag and carry on “conversations” far longer than I would otherwise. I also switched from sending out by U.S. mail a monthly firm commentary to just emailing it out. The email list is sent to all clients (husband and wife separately in most cases), several accountants and estate planning attorneys I work with, and a number of individuals whom I consider good or potential referral sources. I use AOL as the email list host and send all participants "blind" carbon copies so that each recipient sees only his name and, specifically, doesn't see any other list members. All the names are grouped together so I can send the email to all recipients with a single click.

I send out two to four emails a week on the list. Recent emails included a terrific deal on a Dell computer (from www.techbargains.com), a monograph on the Avian flu and a discussion on the Roth IRA that I wrote up. I also send out articles of interest from mainstream finance sources like the Wall Street Journal and SmartMoney. If I've been quoted in the press, I send out a copy of the article to the list as well.

The email list gives me a way to "touch" clients on a very regular basis. I get different responses to different posts from different clients. I'm often told by my clients that they enjoy getting the emails.

I’ve tried a few different ways to retain emails for compliance purposes, still not quite having fig-ured out what the rules are. My latest effort is to add a separate Gmail (www.gmail.com) address to myself with each client email. With the 2GB storage and excellent search capabilities of Gmail, I think I’ll be able to retrieve email as needed.

Again, this “paperless” system isn’t suitable for every practice, but does hold out some basic utili-ties that can be adapted as needed. Having run a previous “paper-based” (non-financial) busi-ness, the advantages are obvious on a daily basis.




www.logmein.com

www.datadepositbox.com

www.techbargains.com

www.gmail.com

____________________

Steven Podnos, MD, MBA, CFP® has enjoyed diverse careers over the span of his lifetime. While working as a successful specialist in Respiratory Medicine, he also invested successfully in stock and real estate markets over two decades. From this, he realized the importance of con-tinuing to build and preserve the wealth that he was accumulating. In a quest to do this intelli-gently and wisely, he began to educate himself in more aspects of investing and financial plan-ning. Finding this process fascinating, he made the leap from helping people with their physical health to assisting them with their fiscal health. Dr. Podnos earned an MBA degree and went on to achieve Certified Financial Planner® certifica-tion. He recently authored Building And Preserving Your Wealth: A Practical Guide To Financial Planning For Affluent Investors (Oakhill Press 2005). His firm, Wealth Care LLC, provides clients with a method for building and preserving their own wealth and well-being. Dr. Podnos and his wife live in East Central Florida with their three teenage children. He can be reached at [email protected].




Thank you, Bentley. We get the picture.



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Virtual Office News is produced by...

Joel P. Bruckenstein, CFP, Publisher President, Global Financial Advisors, Inc. Miramar, FL [email protected] www.joelbruckenstein.com

David J. Drucker, MBA, CFP, Editor President, Drucker Knowledge Systems.

Albuquerque, NM [email protected]

www.daviddrucker.com

Letter From The Editor I don’t want to gloat or anything, but if you missed our First Annual Technology Tools for Today conference in Ft. Lauderdale February 9-11, you missed the boat. We didn’t actually call it the “First Annual” conference, but that’s what it will be, judging from its success. Aside from enjoying a great program, approximately 215 advisors met with 27 vendors during ample break times, but in a much different dynamic than you see at most industry conferences. The typical situation is one of advisor throngs strolling down exhibit hall aisles doing their damnedest to avoid eye contact with ven-dors. Our exhibit hall couldn’t have been more different. This was a focused conference with advisors focusing on finding solutions, so they actually talked to vendors! (Conrad Foster, president of CEO Image, said he’d never before worked so hard at a conference). More importantly, attendees came away with valuable information on hardware, software and outsourcing opportunities through an experience that can’t be duplicated within a newsletter. (Sometimes there’s just no substitute for getting questions answered by a product’s devel-oper). Next year, we’ll have a few more openings for attendees than we did this year but, with all the favorable publicity the conference is getting, demand may still exceed supply so get your tickets early. (As always, we’ll offer exclusive early-bird discounts to our subscribers). We hope to see you next year, and we hope you enjoy this issue.

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