Long-Term Approach

We strive to create long-term relationships with our clients because successful wealth management is built upon this relationship. We cannot guide you toward financial independence in one meeting any more than a doctor could proclaim your lifelong health in one visit.

Instead, we work with you to create a series of wealth management strategies and over time put these strategies into action, adjusting for changes in your life along the way. Our clients, therefore, typically have long term time horizons for their investments. They are not looking to make a quick dollar in the market. Instead, they are focused on achieving returns suitable to their risk tolerance in line with those outlined in their financial plan. They realize that rate of return should not be the focus of true financial planning. Rather, the focus should be on achieving their financial goals. Rate of return is simply one component in the plan toward that end.

As a result, our investment philosophy reflects this long term approach. We use no-load mutual funds and exchange traded funds (ETFs) almost exclusively for our clients, as we believe that they suit those with a long term time horizon better than other investment choices. We use an extensive screening process to narrow the mutual fund universe to what we consider the best funds available for our clients. This list is continually reviewed and updated if we believe that the fundamentals of the fund are no longer superior to its peers.

Picking individual stocks to achieve outsized gains is simply not our business, and we leave the stock selection to the professional managers who run the mutual funds in which we invest.

Avoidance of Market Timing

Study after study has shown that attempting to “time” the market may actually hurt an investor’s long term returns. This is because consistently predicting the short term direction of the market is extremely unlikely. Investors are apt to sell precisely when they should be buying, and vice versa. We instead focus our clients on their long term plans, and the importance of sticking with those plans. While short-term market declines can be painful, missing the recovery that inevitably takes place can be even more so. Staying invested and riding out these swings in the market is how successful equity investors achieve outsized gains over the long term.

Preference Toward Equity

Many investors have no doubt heard the many “rules of thumb” used to judge how much of a portfolio should be allocated to equity vs. fixed income. We believe that any rule of thumb in a business like ours is an incorrect one. This is simply because every individual’s situation is unique, and may call for a drastically different approach than may their neighbor’s.

When we look at how various asset classes have performed over time, we notice that equities tend to outperform all others as the time horizon grows longer. Retirement today is quite different than the retirement of previous generations. Most people live decades of their lives in retirement, and many who consider themselves retired continue to work in some capacity for years longer than they anticipated. As a result, we see the time horizon for retirement assets growing longer, while at the same time the need for current income in retirement declining.

Not only that, but prices for goods and services continue to rise year after year, even for retirees. Fixed income investments alone do not provide an adequate hedge against this inflation over long periods of time.

All of this points toward the need for a larger portion of equity investments in portfolios for all ages. Allocating too much to fixed income in the name of “safety” ignores the fact that this allocation simply shifts market risk (the risk that your investments will decline in value) to purchasing power risk (the risk that the cost of goods and services will rise faster than your investments appreciate in value).

Therefore, while we do include fixed income investments in many client portfolios, we tend to favor a larger allocation toward equities over fixed income for almost all age groups.

Focus on the Tax Consequences of Investing

Over many decades of our client’s lives, nothing can derail a financial plan faster than giving up investment return to taxes. Many advisors focus on achieving the rate of return, and forget about the impact that taxes can have on it. An ill-timed investment sale can offset all of the gains that have been achieved during the year.

Because a number of our principals are practicing Certified Public Accountants, tax consequences are never far from our minds. We weigh the benefits of every investment decision we make against the tax ramifications it may have. Our clients rest assured that while not all taxes can be avoided, any that they pay are incurred with their overall goals and objectives in mind.