- What makes Peck Bulgin Wealth Management different?
- At Peck Bulgin Wealth Management, we have pursued additional education and certifications. We believe it is important to take a holistic look into each client's financial plan and corresponding investment portfolio.
- I would like help with my finances but have hesitated to reach out to someone as I don’t want to be sold a product. How can I be sure that the person has my best interests in mind?
- This is a great question, and we hear this sentiment a lot. Many people seek knowledge and advice but are very hesitant to reach out to a financial advisor as they are afraid that person will try to sell them a product. This is where credentials can be of assistance for helping a person find their financial advisement team. The importance of credentials is that they tend to illustrate the way in which advisors approach a client relationship. Be wary of “advisors” who sell only one product, e.g., annuities. Be sure to ask how the advisor gets paid and what services are included within that fee. Don’t be afraid to ask questions about the advisor’s practice including the number of clients that the advisor has, if those clients are similar in nature, how the advisor’s time is split between clients, how the advisor’s service model is structured, etc. If you seek out advisors with additional certifications as well as asking numerous questions, you will help ensure that you are a good fit for the advisor and that the advisor has your best interests in mind.
- I live nowhere near your office location. Can we still work together and if so, how?
- Many of our clients live nowhere near our office. In fact, the majority of our clients do not even live in Florida. This is not a problem at all, especially with our modern conveniences. Although we like our first planning meeting to be in person, many times we conduct reviews or follow-up meetings over the phone or via Facetime (Apple products) or Skype (non-Apple products). These modern conveniences have made it possible for us to go through spreadsheets with a client in Kansas while sitting in our office in Jacksonville. However, even though technology has brought wonderful changes to our industry, it is still our opinion that nothing beats a face-to-face meeting. Thus, we make every effort to visit our clients in person as often as possible, regardless of location.
- Is there a fee for an initial consultation?
- We never charge a fee for an initial meeting. We feel that a general overview of your financial situation should be something that everyone is entitled to. Putting a financial plan together is merely the beginning, as keeping up with that plan and adapting it as your life goes on and the economic markets change is where the true value is realized.
- How often should I be contacted by my financial planner?
- This truly varies from person to person depending on how often they need to be spoken to in order to feel comfortable. At the outset of every financial partnership, there should be clear guidelines on how many face-to-face meetings and how many “update” conversations, whether phone or email, should be expected. At the minimum you should have your investment portfolio reviewed every 6-12 months, with economic updates and any portfolio adjustments associated when appropriate.
- How do I know if an Investment Fee is Reasonable?
- Every advisor has a different way they structure their practice as it relates to the fees they charge. There is really no right or wrong way this should be done. However, it is very important for a new client to fully understand these fee structures and be completely comfortable with all components before moving forward with any financial advisory relationship.
The fees surrounding financial management have gotten quite complicated over the years as new products are being offered with various fee schedules and holding periods. Years ago, this was very simple. When you bought a stock from your broker you were charged a commission and likewise, when you sold that stock you were charged another commission.
Times they have a changed! Some advisors still charge commissions for trades just like this, however, most charge what is known as an “asset-based” fee or “wrap” fee. This is a percentage fee assessed to the value in the account regardless of how many trades are done or what products are bought or sold. For example, an account with a value of $1,000,000 and an annual “asset based” fee of 1% would pay $10,000 in fees ($2,500/quarter). Within these “asset based” fees you will typically also receive other services along with simple buying and selling of products such as financial planning, cash flow planning, client event invitations, tax, estate and retirement planning etc. It is very common to simply ask the question to your new advisor “what services am I paying for with my fee?” Even though this conversation can sometimes feel awkward it is much better to discuss this at the beginning of a financial advisory relationship to be able to set expectations on both sides.
The measuring stick to determine if this “asset based” fee is reasonable should comprise several components. Performance should always be considered but it should never be the sole factor. Value can come in many ways and changes from client to client. Asking yourself at the outset of any financial advisory relationship what the total fees are and what you are getting for those fees will go a long way to determining if your fee is reasonable.
Depending on the type of product offered there could be more fees associated. Not all fees within the financial services industry show up on your client statement like the “asset based” fees do. Many products (ex. mutual funds, exchange traded funds, unit investment trusts, annuities etc...) will have an internal expense ratio and possibly additional trading costs as well.
It is very important to be able to have a candid conversation with your new advisor to find out what your “all-in” fee is on an annual basis. This would include your “asset-based” fee plus any internal expenses that might not show up on your statement but are still being charged. Keeping internal expenses low is paramount to giving yourself the best possible chances to beat your benchmarks and achieve your financial goals.
Having your advisor run a Total Fee Analysis each time you meet will always help to ensure your fees are constantly kept in check.
In a fee-based account, clients pay a quarterly fee, based on the level of assets in the account, for the services of a financial advisor as part of an advisory relationship. In deciding to pay a fee rather than commissions, clients should understand that the fee may be higher than a commission alternative during periods of lower trading. Advisory fees are in addition to the internal expenses charged by mutual funds and other investment company securities. To the extent that clients intend to hold these securities, the internal expenses should be included when evaluating the costs of a fee-based account. Clients should periodically re-evaluate whether the use of an asset-based fee continues to be appropriate in servicing their needs. These additional considerations, as well as the fee schedule, are listed more fully in the Client Agreement and the Raymond James & Associates Wrap Fee Program Brochure & Brochure Supplement for Ambassador or the Raymond James & Associate's Form ADV Part 2A & Brochure Supplement for Passport.