At Signet, when we work with all of a client’s assets, we are better able to deliver a clear, comprehensive, and coherent strategy designed to meet each client’s unique needs and circumstances.
Pitfalls with using multiple advisors
Spreading money across two, three, or more advisors may cause problems, such as:
- Lack of coordination
Each advisor is often working in isolation, rarely, if ever speaking with one another or even knowing what the other is doing or how they are investing your assets. Nothing positive can come from this sort of relationship.
Just because you have multiple advisors does not necessarily mean that you are properly diversified. Multiple advisors may put a client into the same investment multiple times. You may unintentionally wind up overweight or underweight certain asset classes, which can impact your long-term returns and risk.
Recommendations by one advisor could inadvertently be offset by another advisor’s investment choices. This might cause the risk of the overall portfolio to be more conservative than the investor’s financial goals warrant. For example, imagine one advisor tilts your portfolio to underweight small caps, while another is overweight small caps, thereby creating market-neutral exposure. In other words, you could be too diversified and end up paying active fees for passive market exposure.
- Higher taxes
Multiple advisors can exacerbate tax- and estate-related matters. For example, perhaps advisor A has $50,000 in realized taxable gains for the year, and advisor B has $50,000 in unrealized losses. If they are not communicating and coordinating with one another, advisor B might not know to realize these tax losses. The can result in a higher tax bill than necessary.
- Undue risk
In an attempt to diversify risk by using several advisors, investors may instead multiply it. Having multiple advisors may cause you to take more risks than you need to because the advisors feel like they are competing with each other. It’s only natural for each advisor to try to outperform the other. This may compel each advisor to take unnecessary risks in search of higher returns. This could also put more emphasis on short-term performance, which may undermine the investor’s long-term financial plan and risk management.
Benefits to consolidating with one firm or advisor
We believe working with one primary advisor is best for most investors. Signet provides the most value for clients when we manage a client’s entire portfolio. It is difficult to design, implement, and monitor financial solutions without total awareness of each client’s whole financial picture.
How Signet can help
Aggregate all of your statements and financial information, not only across your investments but also your CPA, estate attorney, and business advisors.
Managing your assets can become more complicated when using more than one advisor. We can provide a holistic view of your whole financial life. In one conversation with us, you’re able to understand where everything stands.
It’s hard enough to find time to speak with one advisor. Do you have enough time to meet with 2, 3, sometimes 4 different advisors to discuss strategy, goals, and financial planning on a consistent basis? One advisor streamlines the process and frees up time for you.
- Lower fees
By consolidating with one advisor, you are more likely to reach fee discounts based on assets under management.
Effectively rebalance back to targets across all portfolios to help ensure that your short-term and long-term goals are met.
Design and manage portfolios to meet your unique needs.
- Risk management
Focus on potential risks across multiple investments & financial accounts – risks that could put your financial health in jeopardy.
Just because you work with one firm, does not mean you have “all-your-eggs-in-one-basket”
At Signet, we design portfolios that embrace diversification and blend multiple sources of return. We have many different investment strategies available to clients. We know how to combine these strategies and personalize each client’s portfolio to their unique needs.
Furthermore, we utilize a team approach to helping clients achieve their goals. We have multiple experts available to clients in different areas such as stocks, bonds, options, asset allocation, financial planning, social security, retirement planning, income investing, etc. By utilizing a team approach, we aim to help each client through various stages of life.
Final word: more is not always better
We believe Signet provides the most value when we manage a client’s entire portfolio. This allows us to best integrate and monitor your complete financial life, including investments, taxes, estate planning, insurance, and retirement.
About Signet Financial Management
Signet Financial Management is a wealth management firm that takes a personal approach in helping high-net-worth families, individuals, and business owners navigate the complexities of managing money. We believe in your financial well-being, and custom-tailor solutions using sophisticated investment management tools to help you keep more of what you earn and to reach your financial goals.
Founded in 1988, we manage approximately $800 million in assets with offices in Parsippany, NJ; Reston, VA; Chapel Hill, NC; Ft. Lauderdale, FL; and Naples Fl.
For more information, please contact Steve Tuttle at 800-390-2755 or firstname.lastname@example.org.