The financial services industry consists of several participants from major Wall Street Investment Firms to your local bank teller. The industry is crowded with overlapping terms like broker, advisor, planner, analyst, money manager, wealth advisor, consultant, agent, etc. Each firm distinguishes themselves from the competition by trying to be better, bigger, cheaper, smarter, or safer. The list of adjectives used to describe wealth management firms would make Noah Webster proud.
I, too, try to separate myself from the pandemonium[1] of wealth management firms, so here are my fabulous fanatical F’s.
Faith. I put my trust and faith in Christianity and know God is in control of our plans. God promises us daily bread and He will take care of our needs. Give us this day our daily bread. ~ Matthew 6:11. He also tells us not to worry about tomorrow. Therefore, do not worry about tomorrow… ~ Matthew 6:34.
Facts. My investment philosophy is based on financial science from the research and findings of Nobel Laureates and industry titans. The pillars of investment success are found in asset allocation, the efficient market hypothesis, modern portfolio theory and the five-factor model.[2] These four principles are superior to excessive trading and market timing.
Follow Up. I have a servant’s heart and believe in constant contact with an open line of communication to my clients.
Fiduciary. I’m a fiduciary and, by law, I must put your interests first and disclose all conflicts of interest. As a registered investment advisor, I’m bound by the fiduciary standard. In addition, I’m a Certified Financial Planner™ and must adhere to the fiduciary standard. According to Investopedia a fiduciary is an individual who must act with “…the highest legal duty of one party to another, it also involves being bound ethically to act in the other’s best interests.”[3]
Financial Planning. The plan is the thing. The financial plan will be your blueprint for your financial dreams. The financial plan will help outline your financial goals and this, in turn, will establish your asset allocation and investment selection. According to one study, individuals who complete a financial plan have three times (3X) the assets of those individuals who do little or no planning[4]
Funds. My mutual funds of choice are managed by Dimensional Fund Advisors and The Vanguard Group. These two firms adhere to strict investment guidelines, keep their fees low, and put the investor first.
Fees. The lower your investment fee, the higher your investment return. The industry average for advisors and planner’s hover around 1% of the assets managed on your behalf. My firm fees are half of the industry standard or 0.50%.
Fun. I love what I do and consider my career a calling. I’m a financial missionary trying to help as many people as possible.
It’s paramount you work with an advisor and firm who’ll put your interests first. If you’re not sure your investment firm is serving in your best interest, it’s time to make a change.
Our goals can only be reached through a vehicle of a plan, in which we must fervently believe, and upon which we must vigorously act. There is no other route to success. ~ Pablo Picasso
Bill Parrott is the President and CEO of Parrott Wealth Management. For more information on financial planning and investment management, please visit www.parrottwealth.com.
June 22, 2017
[1] A group of parrots’ is referred to as a pandemonium.
[2] http://www.barrons.com/articles/a-different-dimension-1388824465, Beverly Goodman, January 4, 2014.
[3] http://www.investopedia.com/terms/f/fiduciary.asp, website accessed June 22, 2017.