There would be little value in helping our clients understand what they need money for and how much they’re going to need if we didn’t have the insight and expertise to develop a plan on how best to get them where they want to go.
We find that most new clients have never taken a truly comprehensive and co-ordinated approach to managing their financial affairs – many financial decisions have been made sporadically or in isolation without understanding how they impact on the bigger picture.
So if an investor achieves a return of 8% on their portfolio one year, what does that really mean? Are they on track? Can they spend more, or less? Can they take less investment risk now because they’re ahead of where they need to be? Without a clear plan, it’s impossible to know the answers.
Our role is to bring order to our client’s financial lives and answer these questions and more.
We collectively refer to all the elements that comprise our clients financial plans as their Financial House.
Your Financial House is complex, and it takes significant time, work, and the best expert advice to get it in perfect order. If you ask most people if their Financial House is in order, the answer is typically no or ‘I don’t know’.
The diagram below illustrates the elements that comprise your Financial House.
Please roll your mouse pointer over the Financial House for information on each component.
Values & Expectations
We can only develop a truly effective strategy by understanding what is important to you. Our thoughtful approach helps you define what your ideal life looks like and this guides the development of our strategies and investment plans by ensuring we are focusing on the right things.
We work with you and your other advisers (such as your accountant and estate lawyer) to develop a clear understanding of your current financial and family situation in order to prioritise the gaps and risks in your strategy that need to be addressed. Over time as your life changes, the risks you face will also change, and our processes are designed to identify and mitigate these in a timely manner.
Strategy & Structure
When we develop a strategic framework based on what is most important to you, we need to consider the appropriate use of structures based on your particular situation. The right structure can make a material difference to your after tax returns. This may include family trusts, self-managed superannuation funds or a range of alternatives.
Academic research has demonstrated that the allocation of your assets to cash, fixed interest, property, Australian shares, International shares and Emerging Markets is the primary determinant of the long term performance of your portfolio. Based on your objectives, we tailor a target asset allocation to ensure you only take those risks you need to achieve your lifestyle objectives. Over time, we rebalance your portfolio against the target to maintain the agreed risk and return characteristics of your portfolio.
Estate & Generational Planning
We will arrange and work in tandem with specialist estate lawyers to ensure that adequate provisions are made if you are unable to manage your own affairs and your wealth passes tax effectively to your intended beneficiaries upon your death. We have developed our own internal Estate Planning Risk Assessment checklist that enables us to maintain a current and comprehensive overview of your estate plans.
Cashflow & Tax Management
We work with your accountant to ensure your affairs are structured as tax effectively as possible and that surplus cashflow is identified and invested appropriately. We have clever strategies that can minimise the cash held in lower yielding transaction accounts whilst ensuring you always have sufficient funds available. We also provide annual tax reports to your accountant that removes the need for you to maintain paper records and prepares your tax return to be both efficient and straight forward.
Asset Protection Planning
We take into consideration your particular financial, employment and family situation in order to protect your assets from potential claims. We also have an on-line Document Safe to help keep your key financial documents in order.
Many of our clients are actively engaged in philanthropy. We have extensive experience helping clients establish and maintain private philanthropic strategies and structures (including Private Ancillary Funds), and facilitate the identification of projects and organisations to ensure donations achieve genuine and measurable outcomes.
Objectives & Milestones
No two people have the same needs and objectives. We quantify the money required to achieve your lifestyle objectives and then track their achievement over time. By documenting what is most important to you, over time we can ensure that every recommendation we make is consistent with your values.
We have developed a visual tool to monitor the achievement of your lifestyle objectives over time and clearly demonstrate whether you are on track to live your ideal life. Against the backdrop and noise of the daily news cycle, our Capital Target helps keep our clients reassured and focused on what matters.
Once we have quantified how much investment risk you need to take to achieve your lifestyle objectives, we then need to determine an appropriate target asset allocation for you. Before finalising this, we provide historical stress testing results on our proposed target allocation to ensure you will not be uncomfortable with the potential volatility of your portfolio. We also discuss the lifestyle and portfolio protection strategies we use to safeguard your portfolio from tempestuous markets and minimise the risk of you needing to sell stocks at distressed prices.
We ensure that you take full advantage of the tax effective opportunities that superannuation provides, and consider the most appropriate superannuation structures to help grow your wealth and ensure your retirement planning is on track.
Our evidence based investment approach is transparent and based on academic research. Over the long term we have achieved consistently strong results whilst using strategies to protect client portfolios against volatile markets. The cost of implementing our approach is low relative to what most investors pay.
We identify issues that are a significant risk to achieving your ideal life and develop strategies to mitigate them. This may include an extensive review of your personal and general insurance situation to ensure you have appropriate coverage in place. We have a panel of experts we use to review your existing policies to ensure that your terms and premiums are appropriate.
Ongoing Education & Governance
You will receive regular communications that distil global economic events down to practical and clear explanations of how they may or may not impact on your strategy. Our comprehensive approach helps to ensure that the compliance issues associated with your financial strategy are managed appropriately. We also assist in ensuring your compliance with regulations and legislation.
Taking the emotion out of managing your financial affairs is perhaps our greatest asset provided to you. We ensure that the ‘noise’ surrounding financial markets does not result in you making reactive decisions that are not consistent with your long term plans.