The financial services market is far too diverse and complex to be an expert in everything. Therefore I focus on the things I know best, and let others who are experts in their areas of financial management help you. I develop an asset allocation strategy based on your unique situation, and implement it with a combination of one or more of the following: mutual funds, exchange traded funds (ETF's), securities and bonds through separately managed accounts or unified managed accounts.
All investment accounts will be on a discretionary basis unless another agreement is made in advance. That is, I will be making the investment decisions and changes will be made when necessary without requiring clients permission. Non-discretionary accounts are possible if agreed to in advance.
I use TD Ameritrade as custodian for most of my client accounts. However, you are free to use any custodian or broker that you choose. I also advise clients on their 401(K), 403(B), and 401(A) accounts, and those are usually held by other custodians, such as Fidelity Investments. I am approved by Fidelity Investments to access client account information, with the client's written authorization. I am also authorized to do the same by American Funds.
Asset management fees generally start at 1% per year of assets under management, and go down as assets go up. See my
ADV Part II for details on fees and how I operate.
Mutual Funds
Mutual funds are a principle investment tool for most investors, and I evaluate funds based on the quality of the company and manager(s), expenses, and long-term performance.
Exchange Traded Funds
Exchange traded funds (ETF's) will be used when appropriate as they generally have the lowest expenses. They also can be traded at any time of day rather than at the close of the trading day, like mutual funds, and do not have any short term redemption fees, unlike many mutual funds.
Separately Managed Accounts
Separately managed accounts (SMA's) are managed by institutional money managers using stocks and bonds in individual accounts for the client, and generally are for a specific asset class, for instance, large cap value. They generally offer some advantages, such as better tax efficiency. However, most have minimum investment amounts of $100,000 per account, or greater. They also require a different account for each money manager. They are not for everyone.
Unified Managed Accounts
Unified managed accounts combine attributes of SMA's, mutual funds, and ETF's for much smaller minimum account sizes than can be done using regular SMA's. They generally do not have as much breadth or depth as using individual accounts, but do allow you to own individual securities in a well-diversified portfolio that would be difficult to put together on your own.
Annuities
I generally do not advocate using annuities as a retirement vehicle, although there are exceptions. Most, but not all, annuities have high fees and high commissions paid to the insurance agent. They also usually have surrender periods which can be quite long. If you buy an annuity then find a couple of years later that you need the money, paying a surrender charge of several percent can be painful.
The benefit of an annuity is the ability to turn it into a guaranteed lifetime stream of income at some point after retirement. But once you do that, access to the funds are gone, other than the regular payments that you will be receiving. I would not advocate putting all of one's savings into an annuity, but some part might be appropriate, depending on the client's needs and health. If you have a shorter than typical life expectancy, it probably doesn't make sense to annuitize an annuity. If you have an annuity that has not been annuitized, you should be able to withdraw funds as needed without penalty, if the surrender period has expired.
