Frequently Asked Questions
Q: What do I need to bring with me to the initial meeting?
A: If you're interested in our financial planning services or inquiring about SNE managing your investments, you won't need to bring anything with you for the first meeting. The initial meeting is when we get to know each other to see if we would be a good fit for working together. This initial meeting is at no cost to you. If you're interested in engaging us for our Cost/Fee Analysis service, you will need to bring all of your brokerage statements as well as retirement statement information such as IRAs, 401k or 403b for the consultation. We will also need any bank savings information such as CDs or passbook savings accounts. Also, we will need statements on any insurance based products such as annuities and whole life insurance policies. We suggest going back at least one year of monthly or quarterly statements for a Cost/Fee Analysis.
Q: Can I engage you for your financial planning and/or Cost/Fee Analysis services while staying with my current financial adviser?
A: Yes. You can stay with your current adviser while engaging us for financial planning and/or cost analysis.
Q: Can I keep some of my investments with my current adviser when providing you with a portion of my money to manage?
A: Yes. However, as a Fiduciary RIA we will need to know what your entire financial picture looks like which means we will have to know what investments and how much you will be keeping with other adviser(s).
Q: If you become my adviser, where will my investments go?
A: It depends. If you have not engaged us for our Active Value investment strategy, your account(s) will be held at Charles Schwab. If you are engaged solely in our Active Value strategy, your account(s) will be held at Interactive Brokers. If you are partially engaged in our Active Value strategy, you will have two custodial platforms; 1) Interactive Brokers for Active Value and 2) Charles Schwab for our Income and/or Low Cost Passive Equity strategies.
Q: Can I keep my current brokerage/custodian, such as Fidelity Investments or TD Ameritrade, and engage you as my adviser?
A: No. This is not a reflection of the services provided by other major brokers/custodians such as Fidelity or TD. Those two in particular are fine companies to work with and provide great service to individual investors and professional advisers on behalf of clients. We have chosen Charles Schwab and Interactive Brokers for the specific type of investment management services we provide for our clients and it makes it easier for us to manage your investments with these two custodial platforms.
Q: If you become my adviser and manage my investments, can I keep discretion over what you invest in on my behalf?
A: No. We require full discretion with no exceptions.
Q: Can I make investments in the same account in which I have granted you discretionary investment management?
A: No. We will suggest that you open an entirely separate account for your own investment decisions/trading and we will, of course, not be compensated on any assets in those separate, personal account(s).
Q: Your company is called Southern New England Investment Advisers. If I don't live in southern New England, can I still do business with you?
A: Yes. If we are registered in the state in which you live, we can become your, or one of your, advisers. We can serve you if you live in northern Massachusetts. We can also register in the state in which you reside. Also, we have the technology to conduct virtual meetings.
Q: How are you paid?
A: It depends. We are fee only and do not charge sales commissions for any products or services. We charge a variable fee based on the time spent on our Cost/Fee Analysis and on our financial planning services. The fee is based on the complexity of your financial situation and the estimated time it will take to complete the project. The fee will be fixed at time of engagement so you won't pay any more than the initial engagement fee quoted. The fee is paid upon completion of our Cost/Fee Analysis and/or financial plan. We charge fees on assets under management (AUM) for ongoing investment management services. If you hire us for a Cost/Fee Analysis or for our financial planning services, pay us our fee for the work performed, and subsequently become an investment management client of our firm, your fees for those previous services are rebated from the monthly asset management fees for as long as the prior service fees exceed the investment management fees. Our investment management fees are billed on a monthly basis.
Q: How much does it cost?
A: Again, It depends. A simple Cost/Fee Audit (a 401k and a few retirement and/or brokerage accounts) will cost $300-$400. A complex audit (several accounts, annuities, whole life insurance policies, several family members, etc.) can cost up to $2,000. Our comprehensive financial plans begin at $1,000 (minimum) and can go as high as $20,000 depending on complexity. Our investment management fees are outlined below:
Income Strategies: 40 basis points annual and billed monthly
Low Cost Passive Equity: 75 basis points annual and billed monthly
Active Value Strategy: 0 basis point management fee and 50% incentive
Notice there are no AUM breakpoints in our fee schedule? We have this long standing noble concept that the really rich should not have advantages over the merely well-to-do, the middle class or the struggling. You will also notice that our fees on the income and low cost passive equity strategies are lower than industry average fees on AUM, particularly on income strategies in which many clients are retired, are in spend down mode and who are trying to make their retirement money last for the balance of their lifetimes.
Q: What is an exchange traded fund (ETF) and how is it different from a mutual fund?
A: An exchange-traded fund (ETF) is a security that tracks an index or a rules-based investment strategy, much like an index mutual fund, but is traded like a stock on an exchange. ETFs track fairly closely to the indexes that they follow, such as the S&P 500, and are bought and sold like stocks throughout the day (intra-day) at intra-day prices whereas mutual funds are bought and sold at end of day trading at net asset value. We use ETFs and we do not use mutual funds in our client accounts when implementing income and low cost passive equity strategies because of the cost advantages and tax efficiencies of ETFs vs. mutual funds.
Q: What is tax loss harvesting and why do you do it?
A: Tax-loss harvesting is also known as "tax-loss selling." With tax-loss harvesting, an investment that has an unrealized loss in a taxable investment account (not IRAs) is sold allowing a credit against any realized gains which occurred in the portfolio. The asset sold is then replaced with a similar asset to maintain the portfolio's asset allocation and expected risk and return levels.
Q: How do you invest your own money?
A: Please keep in mind that everyone is different with a different capacity and tolerance for risk and having different investment objectives. What's appropriate for me may not be for you. That said, my investable assets are partially in SNE's Low Cost Passive Equity strategies and partially in our Active Value strategy. Within both strategies, I invest in the same ETFs and stocks that go into client accounts, so "I eat my own cooking". There are no stocks or ETFs in my client portfolios which I would not invested in for my personal account. I personally have no desire for income generation in my investment portfolio which means that I have no bonds or fixed income exposure other than what is used for money market cash reserves. My time horizon is very long-term (inter-generational). Both my risk capacity and tolerance for volatility is high and I tend to add more funds and deploy cash reserves aggressively when markets go down.
SNE Investment Advisers, LLC
70 Perry Hill Road
Acushnet, MA 02743
The information contained in Southern New England Investment Advisers, LLCs (SNE's) website are of a general nature and is for informational purposes only and does not constitute financial, investment, tax or legal advice. These materials reflect the opinion of SNE's Management on the date of production and are subject to change at any time without notice due to various factors, including changing market conditions, regulations or tax laws. Where data is presented that is prepared by third parties, such information will be cited and said sources have been deemed reliable. Any links to third party websites are offered only for use at the site visitor's own discretion. SNE's Management is separate and unaffiliated from any third parties listed herein and is not responsible for third party product, services, policies or the content of third party websites. All investments are subject to varying levels of risk, and there can be no assurance that the future performance of any specific investment or product referenced directly or indirectly in this website will be profitable, perform equally to any corresponding indicated historical performance levels or be suitable for the individual reader's investment needs. Past performance is not indicative of future results.
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