We make our best efforts to understand your own life story and your present circumstances. We then come up with financial strategies that best address your needs. We endeavour to establish long lasting relationships. Your circumstances will change and we will change financial plans as you go through various phases in your life.
We coordinate estate planning with an estate planning attorney.
We emphasize low cost, tax efficiency, diversification, and staying the course.
On more than an occasional basis, we furnish advice to you on matters not involving securities, such as financial planning matters, taxation issues, and estate planning that often includes trust services.
Based on the client’s availability, we will hold face-to-face meetings quarterly and review performance.
We are strictly a fee-only financial planning and investment management firm. The firm does not sell annuities, insurance, stocks, bonds, mutual funds, limited partnerships, or other commissioned products. The firm is not affiliated with entities that sell financial products or securities. No commissions in any form are accepted. No finder’s fees are accepted.
- Emphasize asset allocation and diversification. This is key to long term success.
- Assess client’s risk profile periodically and adjust the portfolio accordingly. We invest in globally diversified equities for the high-risk part of the portfolio and in high quality short to intermediate duration bonds for the low-risk part of the portfolio.
- We do not recommend “market timing.”
- We Invest mostly via index funds and other low cost mutual funds. In general, we do not recommend individual stocks.
- We try to minimize the income tax impact by investing in low turnover funds, by locating some asset classes in tax favored accounts, and by harvesting capital losses when appropriate.
Here are a few vignettes that illustrate some of the specialized services we provide for our clients, going beyond the basics. Names have been changed to protect client confidentiality.
Our client, John, is an executive at a technology company that went public in the past year. He holds an array of equity positions in the company: founders stock, non-qualified stock options (NQSOs), incentive stock options (ISOs), and RSUs. He is also subject to a 10b5-1 “insider’s” equity selling plan that controls how and when his equity positions are sold. Although he understands the basics of these equity positions, he doesn’t know the details or the tax implications. And he would rather spend his time focused on his career and his family instead of learning the details of AMT preference items in the tax code!
Financial planning is a business of details. Tracking carefully the details of John’s different equity positions is critical. We maintain a spreadsheet showing the timing of when each position might be sold, and the tax consequences of selling each position (capital gains, ordinary income, AMT). It’s also important to track the liquidity needs that arise throughout the process - either for exercise of options, or for payment of taxes. We stay in close communication with him about the company’s situation, what stock might be sold in the near future, and what tax liabilities he may be subject to. We also stay in close communication with his CPA, the stock department at his company, and other professionals assisting John. Staying on top of the details of his equity positions assists all involved to know where John stands, and helps us to maximize the benefit we provide to John for the work he has put into his career.
Our client, Jennifer, is a widow. She and her husband were very successful financially, and she is now enjoying her retirement, spending time with adult children and grandchildren. Her estate consists of a Survivor’s Trust and a Bypass Trust, an estate planning arrangement that is not unusual. In fact, several of our clients have such an arrangement. The challenge arises in the accounting and taxation of income from the Bypass trust. This has been compounded by changes in the new tax law.
In order to find the strategy that will best benefit Jennifer from a legal and financial perspective, it is important to understand trust accounting income, distributable net income (DNI), and how these are affected by the new tax law. Although these subject areas ultimately remain the responsibility of Jennifer’s CPA, it’s also important that we, too, as Jennifer’s financial planners, go deep into the details, understand how they affect Jennifer’s situation specifically, and then respond appropriately. And, similar to John’s situation above, we built a spreadsheet for Jennifer. With this, we model the trust’s income, the allowable deductions, the distributable net income, and any taxable income that remains in the trust. With this detailed level of granularity, we can strategize ways to minimize taxes to Jennifer or her Bypass trust. We work closely with Jennifer’s CPA to make sure her return is completed accurately, and in Jennifer’s best interests. We are, after all, fiduciaries!
Please contact us at firstname.lastname@example.org to see how we might assist in your unique circumstances.