What’s the difference between saving versus investing? Not to oversimplify matters, but you save your money for something. You put money in the bank so you have it when you need it for an emergency or when a great opportunity presents itself.
However, investing is different from saving.
Investing is getting your money to work for you. One way to think about your investments is to think of them as employees. Employees are hired to work for you to help you build your wealth. You need to effectively manage those employees so they produce for you. For those people who are a little bit new to the world of investment management, that’s one way to think about what investment management is and how it works.
Investment management is a science and an art. Investment management involves the following:
- Choosing which account types to hold your investments is important and there are a lot of choices. I can help you make these decisions.
Retirement accounts: Traditional IRA, Roth IRA, Non-Deductible IRA, SEP IRA, SIMPLE, solo 401(k), or a company 401(k), 403b.
Taxable accounts: Individual, Joint with Right of Survivorship or Trust.
- Simplification through consolidation of many accounts into one or two accounts.
- Minimize taxable income.
- Defer tax on investments or pay the tax now rather than at a higher rate later.
- Capital Gain management through tax loss harvesting to offset future capital gains.
- Employee Stock Options and Restricted Shares.
Once your financial goals, time frame, risk tolerance and the amount of money you want managed is made clear, then a portfolio is structured which can include all major and minor asset classes. The amount of the portfolio that any given asset class uses is set for the long term strategy. And short term or tactical changes are made to adjust for changes with either or both client needs and economic changes.
Fee-based Investment management is carried out on various LPL Financial advisory platforms. Flournoy Wealth Management provides structuring, monitoring and rebalancing on a quarterly basis. Clients may also opt for theme based investing with LPL or a chosen investment manager.
Commission-based investments can also be used depending upon the individual situation.
We care about and treat our clients’ money as if it was our own. We work to grow your money at the rate that is needed to achieve your goals and with the minimal risk to accomplish this. This drives the asset allocation equation. We are able to offer numerous types of asset classes to our clients including stocks (U.S., global, foreign. emerging market) and even small cap emerging market, bonds, commodities, investments that focus on natural resources, managed futures, Real Estate Investment Trusts and cash.
Diversification among asset classes and the need for non-correlation between at least some of the asset classes is key to our asset allocation strategy because it aims to minimize volatility and risk. Keeping investment expenses (seen and unseen) low is very important so we use various types of investments to manage cost. But we do not let the tail wag the dog. Certain clients, possibly you, can also choose from a wide scope of investment offerings such as private real estate (non-publicly traded REITs), and annuities. These are more expensive investments.
Using the highly respected, independent research department of LPL Financial and Morningstar is a key part of our due diligence when selecting investments for our clients. Attending CE classes and conferences on various investment products, and estate and tax planning issues are also part of our investment choice and financial planning processes. Our portfolios are monitored against established benchmarks.
- Mutual Funds (Index and Managed)
- Exchange Traded Funds (ETFs)
- Alternative Investments
- Traditional and Rollover IRA
- Roth IRA
- Retirement Plans for Private Equity Business Owners
- Individual Accounts
- Trust Accounts
- 529 Educational Accounts
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not ensure against market risk. No strategy ensures success or protects against a loss. Investing involves risk including potential loss of principal.
Fees are agreed upon based on investment platform and size of account(s) under management, and client relationship.