After our initial phone meeting and we decide working together is in both of our best interests, we will begin. Our Portfolio Management process contains two aspects: pre-management and the actual management. Pre-management is used to determine what you are looking to accomplish, set expectations, and start building your accounts. The management is the internal process after we take control, building and managing your accounts according to your goals established in the pre-management process.
Initial Phone Meeting
We will start our relationship with a short initial phone meeting used to determine what you are looking to accomplish and set expectations. If everyone feels comfortable with the new relationship and we all agree to move forward, the process can officially begin.
During this meeting you will share with us your specific financial goals, we will discuss the feasibility of these goals, and quantify how to reach these goals.
Data Gathering/Risk Assessment
At this time we will request all your financial information. We will send you a list items we will need such as any investments, your tax returns, insurance, budget, etc. Having this information as soon as possible will allow us more time to be able to able to review and possibly ask you to bring any additional information.
During this meeting, we cover the findings of what we learned during our data gathering. Because of the strategic nature of these meetings, we do require all decision-makers at this and other planning meetings.
In order to gain access to your existing accounts, you will need to fill out an Engagement Agreement (fiduciary agreement). This paperwork is required for us to begin the process of opening your new accounts and transferring the funds to them.
Open Accounts/Transfer Funds
Upon completion of all paperwork, the Engagement Agreement will be sent to our custodian TD Ameritrade, accounts will be opened, and funds transferred in. After the funds are deposited, you will receive login information to all online portals allowing you access to all your accounts.
Please note, the transfer of funds can take as little as three days, or as long as two months. Also, all funds will be housed at TD Ameritrade, not Heritage Investors.
The Portfolio Management Process
After all this preliminary work is complete, the professionals at Heritage Investors takes over.
Using the numbers from the Data Gathering, Risk Tolerance, and the discussions during our Goal Setting meeting, we will check to see if your current portfolio "matches" the goals that you outlined.
This step in the process we will look at the portfolio quality to see if there is room for improvement within the underlying holdings. We take the data from your statements, enter into our systems, and see if there is room for improvements. Is there a cost improvement? Can we get the same position at a lower cost? Is there a quality improvement? Are there higher quality, higher ranking assets we can buy in the same class?
An adjustment means rebuilding the portfolio and buying new assets. This may potentially mean a complete portfolio rebuild. Or, we may need to make tactical moves if there are issues like tax constraints. For example, consider a portfolio that has $600,000 in taxable gains in it. We may have to tactically rebuild the portfolio over a couple of years. Because of tax constraints, we may want to make small changes to your portfolio. If it is an IRA, we may need to make major changes and completely start over with a new portfolio.
Monitor/Review – Tactical Rebalancing
As life happens, we are going to deal with it and constantly adjust our direction to make sure you are staying on your path moving toward the desired goals. By planning and staying proactive, you have a better chance at success of reaching those goals than someone who is reactive.
Other adjustments might also need to be made as the market moves. During this time, changes might be made in order to keep the portfolio allocation's numbers driving toward the goals we discussed in the Goal Setting meeting.
Semi-Annual Portfolio Review Meeting
This meeting is designed to ensure you have access to all your accounts, you are getting your statements and newsletters, make sure you understand your portfolio, adjust the portfolio in relation to any particular life changes you might have. We make sure that the portfolio continues to be on track for hitting goals.
As with other planning meetings, we request that all decision-makers attend this meeting.
Just one of the many ways we feel your trust is gained is by being 100% transparent about the fee structures. Click to learn about our Portfolio Management fee structure.