Advanced Planning Desk: Asset Management

What is it?

Advanced planning, case design, OCIO, the “strategic partner” (who generally just wants your business), the “back end” of your business, your “outsourced team”, or the best-in-class wholesaler who would’ve been an advisor if she had a better retail network…
We’re sure you’ve heard one of these terms or maybe even used them yourself at some point.

So what even is it?
From an asset management perspective, at least to us, advanced planning encompasses:

  1. Providing financial advisors with a single point of contact who understands their business and target market, has the knowledge to construct an appropriate solution, and is product agnostic.
  2. Leveraging that single point of contact to gain access to third-party experts, and to appropriately position their strategies in the best possible way for the client. A good advanced planning desk will have built relationships with high-end offerings, and can provide access for lower minimums than are generally accepted.
  3. Truly partnering with the advisor, to help them with:
    a. Assessing the client’s goals, appetite for risk, need for tax-sensitivity, income, reduced volatility, time horizon and more.
    b. Performing an analysis of client holdings and appropriately positioning offerings and/or portfolios, presenting the solution to the advisor – because only they know their client best – and making appropriate changes.
    c. Offering to help the advisor present to the client, generally through third-party.
    d. Providing ongoing analysis, oversight and ideas to advisors based on financial markets and the changing goals of the client.

It is a little more than the typical wining and dining or cardboard cutout partnership model with no back end.

There needs to be an intelligent point of contact who genuinely wants to help the advisor and client.

Why does this matter for clients?

It matters because most clients’ advisors generally speak to performance, fees, or the secret algorithm that allows them to time the market.

We think that’s very 1980s.

What do we think asset management should be?

We believe in the Unified Managed Household (“UMH”).

UMH allows advisors to provide solutions that are tailored to each client’s goals.

Our advanced planning desk helps create these strategies by gaining a deep understanding of clients’ entire financial lives.

We start by gaining an insight into that client or family’s vision, goals, and need for reduced taxes, volatility, or more.

Doing this helps us appropriately construct a comprehensive solution with multiple sleeves in accounts. It also allows us to get every account type within the household marching toward the end goal.

Give me an example.

Perhaps the client has a non-qualified account with $50,000 for a new car in 3 years. Or perhaps that’s only $50,000 of a $500,000 account. And maybe, there’s also a $400,000 Roth IRA, another $1,000,000 in a joint account, and $48,000 in a 529 plan for their daughter.

This deeper understanding means that your advisor can create solutions that are a good match for all of your goals.

It reduces the need to focus so much on performance. And it generally means that through consolidation, there are savings for the clients due to aggregated fees.

Not only does it help clients, but it helps advisors stand out from the same old, “we manage it in house,” or, “we use this platform, for this reason.” It helps you get off the merry-go-round.

What are some solutions?

We may use tactical fixed income portfolios for short term assets, or we may use tax-managed strategies to complement them within non-qualified accounts. If there is excessive turnover in a portfolio, we may position that in a qualified account. Or if you have a portion of assets you don’t need for 15 years (must be nice!), we may put it in a low-cost, direct indexing strategy, to add post-tax alpha and ride the waves of the market.
The answer is, it truly depends.

Wrap it up.

All clients deserve a tailored strategy designed to achieve their goals.

Nobody can control performance, and it is better for clients to have a customized strategy with a focus on their goals and personal needs.

Advanced planning is all about giving clients peace of mind and giving financial advisors the resources to provide it.

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