The Why Behind Our Investing Approach

We say here at WealthFactor that we are reimagining wealth services by removing the parts that don’t work and reworking the parts that do. 

Plain and simple - we just approach this work differently than the industry norm.  In particular, we approach investing in a more passive way, and we’d like to explain the philosophy behind  this methodology.

We say here at WealthFactor that we are reimagining wealth services by removing the parts that don’t work and reworking the parts that do. 

Plain and simple - we just approach this work differently than the industry norm. In particular, we approach investing in a more passive way, and we’d like to explain the philosophy behind this methodology.

TRADITION

This industry is filled with a great deal of tradition and historical mindsets. Few advisors stray from the “way it’s always been done.” 

Traditionally, investing is an active, hands-on activity involving managers who may be performing research and analysis in an attempt to outperform the market, earn you a big return, and bank their percentage (pssst… their fees are outrageous… learn more about that in this post).

And traditionally these hands-on efforts are initiated by a financial advisor who outsources to fund managers and other “experts” to actually perform said work or research. 

The problem with this approach is unnecessary layers. You, as the client, have employed your advisor to be your trusted resource, to work on your behalf, and you are paying them to do so. But they aren’t experts in the complicated needs you may have, so they work with others, and you pay the high price, both in fees and higher risk.

Blog Stylized Qu

NEW STANDARD

At WealthFactor, we have removed the unnecessary layers of management, thus removing unnecessary risk, and we can provide actual expert advice and support for your complex needs at a fraction of the price as a result.

Our passive investment methodology draws from a strong body of academic research and evidence-based principles. History is filled with investment salesmen promising outperformance and not delivering. Rather than employ people trained in justifying increased risk taking driven by their higher fees, we’ve chosen the low fee, simple approach and actively seek to avoid all unnecessary risk taking.

Plus, we provide additional support via our Wealth Concierge - experts in more than just client service, but in advisor support, communication, and organization. THIS is real client care that you just won’t find when working with a traditional advisor. 

because we have removed the layers and streamlined our service methods, our fees aren’t the 1%+ you’d pay in the traditional model. Instead, we charge just 0.35% of assets up to $10M and only 0.10% beyond. 

Blog Stylized Qu (1)

WEALTHFACTOR AND RISK

In the traditional wealth management model, risk will be higher and is often an afterthought - something that must be assumed in order to beat the market and make enough return. 

At WealthFactor, risk is considered from the beginning and will always be in the forefront of our approach, both from a behavioral and structural standpoint. 

Why? 

Because the amount of risk you are comfortable with (behavioral) and that you can withstand financially (structural) should inform the actions we take, not the need for return to make up for high fees. 

Likewise, your right level of risk should determine the actions we take together, not your desire for huge returns or financial goals (we wrote a whole post about that too).

TRUE PERSONALIZATION

Another downfall of the traditional investment model is a lack of real personalization. Oftentimes advisors will get you into a model portfolio, “set it and forget it,” and not consider the uniqueness of your situation, risk tolerance, tax considerations, or investment criteria.

At WealthFactor, personalized indexing is at the center of our methodology because we know that no two client’s risk, needs, tax situation, or investing criteria will be the same. So, we put the effort into determining not just your right amount of risk, but the other unique parts of your situation so you receive investments that are actually right for you and your needs.  We go into deeper details on how we determine this for you in this post.

 

LEARN MORE

Take a deeper look at WealthFactor, including how we approach investing and serving clients. 

Insights: Why You Shouldn't Start with Goals

Insights: What's a Wealth Concierge?

Insights: WealthFactor: An Overview

 

Ready for a conversation?

Schedule a time to talk with Bill - get your questions answered and learn more about the difference you’ll experience with WealthFactor.

Not ready to talk? Meet our Wealth Concierge Team.


Schedule time    Wealth Experts

Recent Insights