Even before I launched†Finance for Teachers, I knew I would outsource the investment management piece of my business. But I didnít realize how many vendors there were catering to this need -- nor the variety of investing approaches they all took.
After some research and a few interviews, I chose Asset Dedication, because their philosophy on investing was very similar to mine and their pricing was hard to beat.
IMPACT ON CLIENTS
So what does this mean for my clients? For one thing, the TAMP offering doesnít affect all of them. As part of my annual retainer fee, I build basic ETF portfolios and rebalance them at each 12-month review.
Clients who do want more hands-on investment management, however, can pay extra to use the TAMP and get access to its portfolio options, which include DFA funds. They pay an asset-management fee for the TAMP -- roughly 0.25% to 0.35% per year -- as well as an increased retainer that covers my additional time and access to the program. I then work with Asset Dedication to build a custom portfolio based around their plan, and Asset Dedication will then rebalance the portfolio and provide performance reporting, and other services.
IMPACT ON ADVISORS
Iím happy no matter which option they choose. I am happy to build basic portfolios for every client -- I simply see that as part of my job. If clients choose to use Asset Dedication, then my scope of work changes as it relates to investments, but my income goes up as well.
I may make changes to this plan over time, but I will not being doing hands-on investment management any time soon.
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