About
Our philosophy is to move clients away from "group" investing that uses mutual funds and exchange traded funds to create cookie cutter portfolios.
Separately Managed Accounts (SMA's) are portfolios that consist of individual equity and fixed income assets that are managed by a team of professionals. In contrast to a mutual fund or ETF, you own the actual stocks in the portfolio.
No portfolio manager excels in every area, so we use those managers that have a documented history of out-performance in each category of investment objectives.
Most clients have at least three SMA managers in a portfolio that seeks to provide performance in line with your risk tolerance and investment time frame.
Have you received invitations to 'Retirement Planning Seminars' promising tax-free income and recession-proof portfolios? These events often aim to instill fear about the stock market so the presenters can sell you an annuity. They promote strategies like converting retirement accounts to Roth accounts for tax-free income in retirement. Tax free income sounds attractive, but converting a traditional IRA or 401K to a Roth requires all of the taxes to be paid up front. Paying taxes earlier doesn't mean you aren't paying taxes!
These seminars typically recommend transferring your Roth funds into Fixed Indexed Annuities (FIAs) to seek portfolio protection. While it’s true, FIAs offer stability in that they avoid market volatility, they may not offer growth potential. Additionally, the guaranteed lifetime income from FIAs relies on regular distributions of your own funds. The annuity company provides income only if your account is depleted due to extended life expectancy. Then, and only then does the guaranteed income come from the annuity company*.
We occasionally encounter a situation where an annuity may be necessary because of an extraordinarily unique situation, and in those cases we can and will use an annuity to work toward achieving a particular outcome for a client. In our practice an annuity is an asset of last resort.
*Fixed and Variable annuities are suitable for long-term investing, such as retirement investing. Gains from tax-deferred investments are taxable as ordinary income upon withdrawal. Guarantees are based on the claims paying ability of the issuing company. Withdrawals made prior to age 59 ½ are subject to a 10% IRS penalty tax and surrender charges may apply. Variable annuities are subject to market risk and may lose value.