With just over $600 million under management (including over $200 million of co-managed assets), William Mack & Associates, Inc. (WMA) has been ranked as one of the top wealth managers in the United States by Wealth Manager magazine (formerly Bloomberg Wealth Manager) for the past 10 consecutive years. In addition, WMA was recognized for the eighth consecutive year by Financial Advisor magazine in its annual ranking of leading Registered Investment Advisers.
For over 25 years, we have been helping clients achieve their investment and financial planning goals and objectives using a simple four-step approach.
- The Initial Client Introduction
- Developing a Plan
- Implementing the Plan
- Monitoring the Plan
STEP 1: The Initial Client Introduction
Our client relationships typically begin with a referral to WMA from a friend, family member, co-worker, or a tax/legal advisor—as we do not advertise or conduct public seminars as ways to grow our firm. After a brief initial phone call, we schedule a complimentary, no-obligation initial consultation.
During the initial meeting, we get to know one another as we discuss your goals and objectives. Once we have a basic understanding of where you are today relative to your goals and objectives, we can share our initial thoughts on whether or not we believe you would benefit from the services we provide.
Over the years, we have successfully helped our clients address life’s major challenges, such as:
DEBT: Avoid all debt. It is a sad commentary that the average American’s 401(k) balance is less than their credit card balance. Get rid of credit card debt first, since that is most likely the most expensive debt. Having a credit card is okay. Having a credit card balance is not. Next, begin retiring the rest of your debt, up to and including the mortgage. Getting rid of debt is the same thing as making an investment—but without any risk.
RETIREMENT: An almost universal goal is to retire and live comfortably until we die. Based on our experience with clients who have retired, the closest definition of “comfortable” is to be able to receive 100% of your pre-retirement income throughout retirement, adjusted for inflation.
COLLEGE: Most clients would like their children or grandchildren to have good jobs and move out of the house. In today's challenging world, not only is a college degree important, but a graduate degree is considered mandatory for many careers. There is a wide array of investment vehicles and planning strategies to save for college—many with tax advantages.
EMERGENCY FUND: Everyone would like to have enough cash to weather severe financial storms, without needing to rely on credit cards or lines of credit. We generally suggest establishing a money market fund with a balance representing three months of living expenses.
HEALTH: Health care costs continue to rise, and it is becoming increasingly unclear as to who will pay for them. In addition to staying healthy by eating right, exercising, and taking good care of yourself, which is extremely important, we recommend having a side fund of money to pay for the extra cost of health care in retirement. There are various vehicles that can be used to establish the side fund, some with tax advantages.
LONG-TERM CARE: We all want to be able to live in old age with dignity, and without being a burden to our families. There is a high probability that, at an advanced age, we will need help with normal daily activities of life. As such, we need to have sufficient money to cover these long-term care needs, or insure against these potential costs.
ESTATE: Everyone would like to leave their money to people or places they like, not lawyers, or the government. We help our clients with proper beneficiary designations on all of their assets, and encourage them to get a Durable Power of Attorney, a Medical Power of Attorney, a Will, and a Trust if appropriate. Ironically, the time when you really need an estate plan, is when you aren't here to create one.
STEP 2: Developing a Plan
Should you decide to move forward with our firm and become a Retainer Client, we would then go to work gathering all of the data that is pertinent to your goals and objectives. Our staff of Certified Certified Financial PlannersTM and Certified Fund Specialists will then begin to plot out various strategies designed to help you move from where you are today—to where you want to be—with respect to each individual goal. The end result is an actual plan that we will monitor for you throughout the years. The lack of an effective plan is one of the key obstacles preventing people from achieving their goals and objectives. After all, no one plans to fail—most people simply fail to plan.
Unfortunately, most people spend more time planning for their next vacation than they do planning for retirement, college funding, or any other financial goal.
STEP 3: Implementing the Plan
The next phase is devoted to reviewing the strategies that we have devised, and to discuss the logistical steps that will be taken to implement the plan. With respect to investment accounts, we utilize the custodial services of major firms such as Charles Schwab & Co. Inc. We handle all of the paperwork and do all of the legwork to help you consolidate your investment accounts.
Once the investment accounts are in place, we implement the investment strategies that were presented to you. These strategies are typically implemented using no-load mutual funds. As part of our ongoing research, we analyze thousands of actively managed and index mutual funds, as well as Exchange Traded Funds (ETFs).
We also establish various features on your investment accounts that give you quick access to your funds at any time. In some cases, we establish automatic monthly savings programs or automatic monthly withdrawal plans, depending on your needs.
During this implementation phase, we also address your non-investment related goals and objectives in the areas of retirement planning, education funding strategies, cash flow analysis, and insurance as well as estate planning. If you already have advisors in these areas, we will work with them to ensure that you stay on track in each of these areas. In this manner, we are able to maintain the “big picture” view as we monitor the efforts of each advisor on your behalf. This enables us to ensure that each area of your financial life is being coordinated with the other areas as we monitor your progress toward achieving your goals and objectives.
STEP 4: Monitoring the Plan
With a plan in place, it will now be important to monitor your progress. Quarterly investment statements are sent directly to you from the custodial firms such as Charles Schwab & Co. Inc. indicating the value of your accounts, as well as any activity that took place during the quarter. In order to understand in greater detail the diversification and performance of your portfolio, WMA will also send you a quarterly Portfolio Summary along with our market commentary.
Ongoing communication is encouraged and is dependent on your needs. While phone calls are convenient and emails are efficient, we believe that face-to-face meetings are most productive. We strongly encourage meeting at least annually in order to review your progress, and discuss any changes that might have occurred that would prompt us to make adjustments to your plan.
WMA is unique in that our compensation to manage portfolios also covers the comprehensive financial planning advice we offer throughout the relationship. In other words, there are no additional charges for retirement projections, college funding projections, life insurance and cash flow needs-analysis, tax planning, etc. This is the reason we refer to our efforts as a “Retainer Service.”
Our Retainer Services fee is based on the size of the portfolio that we actively manage.
For example, at the beginning of each quarter, we take the value of the portfolio and multiply it by 0.25%, which is a typical quarterly Retainer Services Fee. We then deduct the amount of the fee automatically from your investment account(s). In this example, drafting this 0.25% fee each quarter results in an effective annual fee of 1.0% of the value of the portfolio (see our ADV Part II for specific details). We include a fee draft notice each quarter along with your Portfolio Summary and our market commentary.
When it comes to managing your portfolio, WMA does not receive compensation from any investments we recommend, or from any custodian such as Charles Schwab & Co. We do receive computer support from custodial firms like Schwab that are related to tracking portfolios and handling transactions. In this way, you are always fully aware of what WMA is earning in our efforts to design and maintain investment and financial planning strategies designed to help you achieve your goals and objectives. Our fee structure is clear evidence that your best interests always comes first.