Still have questions? Get in touch with Phil:
Yes, and yes.
No – the only compensation I receive is the fee paid directly to me by a client. I receive no kickbacks, commissions, revenue sharing schemes, etc.
Yes – Fair Asset Management is a virtual firm & serves clients across the United States.
While we provide tax planning, projections and strategies, we do not prepare and/or file tax returns at this time.
No – we only serve clients who wish to delegate the financial aspect of their lives on an ongoing basis.
Client assets are electronically transferred in-kind (i.e. not a taxable event) to Altruist, a modern custodian for independent financial advisors. You can read about Altruist’s strength, stability, and protection here.
In the event of my death, you’re free to transfer your accounts to another financial planner/custodian of your choosing. You’re not locked into any contract and there’s no obligation to keep your assets at Altruist.
No – however, if we manage less than $750,000 for you, your fee as calculated on a percentage basis would be greater than 1%, which may not be in your best interest if you can find truly comprehensive financial planning & investment management elsewhere for a 1% AUM fee.
We believe financial planners should be compensated like attorneys & CPAs – for their time & expertise. The $7,500 annual retainer fee reflects our cost of doing business, plus reasonable compensation for a professional service provider. Clients should expect the $7,500 fee to increase, but not often and not by much. As my cost of doing business (and cost of living) rises, the flat annual retainer fee will be adjusted upward by no more than $300-$500/year. I anticipate this occurring every 5-10 years but reserve the right to implement a fee increase more frequently than that.
As a client of Fair Asset Management, you will pay the $7,500 flat annual retainer fee, as well as the expenses associated with the investments in your portfolio. Because we use low-cost index funds, those expense ratios should remain below 0.15% (depending on portfolio allocation).
The $7,500 annual retainer fee is billed monthly ($625) in arrears. The fee will be swept directly from one of your investment accounts, as is industry-wide practice.
Pre-retirees & retirees age 50+ that have over-saved and for whom taxes are a major pain point. These clients need guidance on financial planning, as well as the gradual, tax-efficient drawdown of their nest egg over a decades-long retirement. Planning will revolve around generating retirement income, strategic Roth conversions, navigating Medicare surcharges (IRMAA), planning around significant required minimum distributions (RMDs), and maximizing charitable giving opportunities (QCDs & DAFs).
High income employees & executives with complex fact patterns, including concentrated positions in employer stock, equity compensation & deferred comp, directly held real estate investments, integrated tax planning, charitable giving, and early retirement desires/concerns. These clients are very busy and interested in delegating the financial aspect of their lives.
You’re after a portfolio, and not a plan
You’re seeking high returns with low risk
You’re seeking a market timing approach that gets you in & out of markets
You expect consistently superior performance
Your judgement of value is based on how your portfolio performs relative to the S&P 500
85-100 clients. I do not believe it is possible for an advisor to provide truly comprehensive financial advice to more than 100 clients without corners getting cut or important details slipping through the cracks. When I reach capacity, I will stop taking on new clients and refer them elsewhere.
Depending on client preference, we will meet 1-2 times per year, with on-demand check-ins whenever you need help. In addition to that, I send a regular email (about 4x per month) that details my current thinking on important events and reinforces my long-term investment philosophy. I am also very active on social media, and post regularly on LinkedIn each day. I respond to text messages almost immediately (unless I’m in a meeting or enjoying time with my family), reply to emails within a few hours, and can usually make time on my calendar for an urgent client meeting within 24 hours.
Keep investment costs low; own tax-efficient investments; own broadly diversified asset classes. Clients should be patient, remain disciplined (with my guidance), and have faith in the future – lifetime investment success is unavailable to the pessimist.
No. Modern Portfolio Theory suggests that any risk that can be diversified away should be, as these are uncompensated risks that do not increase (and may even decrease) your expected return. Therefore, I will not waste my time researching individual stocks.
Those who judge their performance relative to some narrow benchmark are focusing on an issue that is largely irrelevant to their financial success. The only benchmark that you should care about is one that indicates whether you’re on track to achieve your financial goals. Risk is measured as the probability that you won’t meet your financial goals. Investing should have the exclusive objective of minimizing this risk.
No. As John Kenneth Galbraith put it, “The only function of economic forecasting is to make astrology look respectable.”
"Waiting to see what happens” results in far worse returns than does riding the decline out – because the market can never be successfully timed. Make no mistake about it: the only way to capture the full permanent return of equities is to be fully willing to capture their temporary declines. The impulse to get out of equities in anticipation of the economy and/or market backing up is eternal – it is fundamental to human nature. But such phenomena a) are blips in the context of an investing lifetime, b) can’t be timed, and c) are irrelevant to a goal-focused, planning oriented investment philosophy. Anything that takes your focus off your most cherished long-term financial goals - and fixes it instead on “outperformance” as an end in itself - will prove fatal to both. That is, you’ll fail to achieve your real goals – by underperforming. The only way you win the market timing game is by refusing to play it.
No - we recognize that new clients may wish to hold specific legacy investments for various reasons, including due to embedded capital gains.
Over the long term, most investors should expect between a 6-7% nominal (before inflation) return on a relatively balanced portfolio. Assuming taxes/expenses consume 0.50% of that, and inflation runs 2-3%, a reasonable real (after inflation) rate of return would be 3-4%. More conservative investors may do less, while more aggressive investors may potentially achieve more. If you think you can achieve far higher real returns than this on a consistent basis, good luck to you.
I do, and I invest it in the same low-cost, tax-efficient, diversified manner as client portfolios.
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