My wife and I are interviewing a few different people/firms and they are all a bit different. I'm curious if some of you have been through this process or are in the business that can help me out.
For background, we have interviewed three firms.
One is a 1 person operation with about 180-200 clients. She is CWS and CRC, but not a CFP. She is personal and seems competent in the knowledge category compared to our other interview candidates. If it matters, she charges 1% net of investing expenses. So if the expense ratio for an investment is 0.2, she charges 0.8, etc.
The second was a local 4-6 person operation that was recently acquired by a national wealth advisory company. They have a 2 person team approach with a Senior Advisor and an associate advisor. Both are CFPs, one is also a CPA and brings in tax strategy to the planning process. They are fiduciaries. Expenses are 1.25% flat, but would go down in tiers with more AUM. Right now we would be more of a "planning" client for them, growing into a "management" client over time. Each team in the firm tops out around 250 clients before they start expanding their practice with new advisors.
The third was a CFP with Charles Schwab. We are very close to one of their bigger branches in the country and she came highly recommended. She is a CFP/fiduciary with about 500 clients, but 300 of those are "passive" clients assigned to he by Schwab - the rest are active clients that she knows well. Fees would be 0.28% with the Schwab Intelligent Advisor portfolio and then we'd grow into the Private Client side which is at 0.8% at the bottom tier and goes down as AUM goes up.
- Fiduciary / non-fiduciary? Two of the firms we have viewed were fiduciary. The third was not, but was in the process of going that route, delayed due to some recent law changes???
- Does size of firm matter? Options 2 and 3 above have some larger scale and can bring in some people in their firm that have expertise in areas like real estate, executive compensation (a big key for us), and tax planning. On the flip side, we don't want to just be a number in a big machine.
- Do any of the fee structures seem out of whack to you guys?
At this point, we are wary of not knowing what we don't know to ask. I figure TexAgs knows everything, so...
For background, we have interviewed three firms.
One is a 1 person operation with about 180-200 clients. She is CWS and CRC, but not a CFP. She is personal and seems competent in the knowledge category compared to our other interview candidates. If it matters, she charges 1% net of investing expenses. So if the expense ratio for an investment is 0.2, she charges 0.8, etc.
The second was a local 4-6 person operation that was recently acquired by a national wealth advisory company. They have a 2 person team approach with a Senior Advisor and an associate advisor. Both are CFPs, one is also a CPA and brings in tax strategy to the planning process. They are fiduciaries. Expenses are 1.25% flat, but would go down in tiers with more AUM. Right now we would be more of a "planning" client for them, growing into a "management" client over time. Each team in the firm tops out around 250 clients before they start expanding their practice with new advisors.
The third was a CFP with Charles Schwab. We are very close to one of their bigger branches in the country and she came highly recommended. She is a CFP/fiduciary with about 500 clients, but 300 of those are "passive" clients assigned to he by Schwab - the rest are active clients that she knows well. Fees would be 0.28% with the Schwab Intelligent Advisor portfolio and then we'd grow into the Private Client side which is at 0.8% at the bottom tier and goes down as AUM goes up.
- Fiduciary / non-fiduciary? Two of the firms we have viewed were fiduciary. The third was not, but was in the process of going that route, delayed due to some recent law changes???
- Does size of firm matter? Options 2 and 3 above have some larger scale and can bring in some people in their firm that have expertise in areas like real estate, executive compensation (a big key for us), and tax planning. On the flip side, we don't want to just be a number in a big machine.
- Do any of the fee structures seem out of whack to you guys?
At this point, we are wary of not knowing what we don't know to ask. I figure TexAgs knows everything, so...