What Makes Me Different
As a professional advisor for over 20 years and as an independent advisor for over 5 years, I am often asked, “What makes you different than the next guy?”. The answer is a more complicated than the question, as there a few items involved in the answer.
The biggest difference is that as a Registered Investment Advisor (RIA), I am required to act as my client’s fiduciary, putting their financial interests ahead of my own. My job is to create the most cost-effective, performance oriented portfolio that makes sense to the client and is suitable to their need.
Since I work as a small independent financial businessman, it simply would not be a good business practice to act in any other manner. When I look around the financial industry, I find it interesting how many financial companies won’t allow their salesforce to act in this manner as it may cause compliance issues or open the company up to litigation. What then are they left to provide besides a product that is available anywhere?
Furthermore, I do not work for a publicly traded company. Often the largest barrier to a client is the company itself as the objectives of the company and the objectives of the client can be, and usually are, at odds with each other. Additionally, the misaligned goals of the salesperson exist unbeknownst to the client. Most offices at publicly traded firms employ a sales manager. Why? To ensure the products that provide the largest margin for the company are sold first. The client very rarely is made aware that certain mutual fund companies have paid the firm to be on their investment list or managed portfolio. Often the view is that there is no client without the company rather than the other way around. I don’t have shareholders that need to be appeased, just clients that know they are being treated fairly and honestly, always.
My business is a fee-based business. I charge an annual fee that is billed to the client on a quarterly basis. There are no hidden costs, charges or commissions, other than those that are internal expenses to the security the client owns. The fee that I charge entitles the client to receive a suite of recurring and ongoing features: All portfolio construction and management; a personal financial plan; quarterly account reviews via either telephone, computer or in person (best option); statement reporting by TD Ameritrade; performance reporting by Orion; time set aside for friends and family to help review their personal financial situation.
All accounts are managed by me on a discretionary basis. The client provides the input to help create the personalized portfolio, but trading of the portfolio is performed directly by me. Typically, my portfolios are constructed using dividend paying stocks (which have zero internal expense) and Exchange Traded Funds (ETFs, that have very low internal expense).
My practice is a truly holistic one. There is more to just ‘growing your money’. What is the money for? Who is the money for? Are you retiring here in the Bay Area? Do you know what your retirement tax picture looks like? Have you optimized your Social Security Income? Do you have a way to protect your assets from the unexpected? Do you have a post-employment medical plan? Are your concerned with your legacy? Some of my clients scrimp and save so that everything possible can be left to beneficiaries; some want part or all of their legacy to be remembered by charities; other clients plan on writing the last check they own to the mortuary and it’s going to bounce! It depends on you, what your needs and wants are and your ability to make the most informed choice you can.
Accredited Asset Management Specialist, Accredited Portfolio Management Advisor
Chapter President - American Financial Education Alliance, 501 (c)3
My practice is designed to help those approaching or in the early stages of retirement, navigate all of the options available to them. These options often take the form of many concerns, such as: How do I move money from a 401k to an IRA; How do I take money from an IRA and when?; Do I still need insurance?; I have money left in a 529 plan, what can I do with it?; How do I make my retirement money last through retirement? How do I consolidate my assets? ; Can you construct a retirement plan that does not become a paperweight? There are many concerns and issues for retirees and pre-retirees alike.
Once these issues are addressed and resolved, most of my clients still have three primary concerns.
First, preserve their wealth. Most have accumulated significant assets and are concerned about losing their wealth due to market volatility, lawsuits, or illness. Using proven wealth management strategies, I review the client's situation, their goals, risk tolerance and time horizon, so I can resolve this concern in a suitable, tax efficient manner.
Second, in conjunction with the clients CPA® or accountant, I can provide strategies to help them manage taxes, specifically income and estate taxes. Few people want to pay taxes and the real issue is finding strategies that can help reduce or eliminate those they can. My role is to recommend an approach for their situation.
Finally, I address my client's personal interests and responsibilities. Most are concerned with three issues: First is making sure that their heirs are taken care of, second, they have a medical insurance strategy for lifetime, beyond employment, and third they have a retirement distribution plan that takes into account their net worth and lifestyle costs. Through my discovery process, I surface these issues and through the use of wealth management strategies, I recommend suitable solutions.