Frequently Asked Questions and Answers
The most significant differences between a broker and an RIA come down to “fiduciary duty” and commissions. Brokers are not fiduciaries and they may earn income through commissions. Investment Advisor Representative firms like Price Wealth Management are subject to the fiduciary standard, and generate income from fees, not commissions. In our view, the Fiduciary Standard is the ‘gold standard’ of care for clients and results in the fewest potential conflicts of interest.
At PWM, we utilize low-expense Exchange Traded Funds (ETFs) and individual securities to build client portfolios. We are diligent about investor costs, and we normally select ETFs that have expense ratios in the bottom quartile of their asset category. Frequently, we purchase individual securities which have no expense ratio. Many of our competitors use actively-managed mutual funds. This practice creates a layer of mutual fund-level fees for the client. According to the 2016 Investment Company Institute Factbook, the average fee for actively-managed stock mutual funds in 2015 was 0.84% (ICI 2016 Factbook). Mutual fund expenses like these are in addition to the advisory fee charged for selecting your mutual funds and managing your asset allocation. The clients’ total fee at Price Wealth Management is very competitive because we employ low-fee ETFs or no-fee individual securities, or a blend of both.
They are certification marks owned by the Certified Financial Planner Board of Standards Inc. (CFP® Board). The CFP® designation helps the investing public identify financial planners who are both technically competent and committed to ethical professional behavior. To become certified by the CFP® Board, one must first pass five graduate-level examinations in the areas of financial planning, taxes, insurance, estate, and retirement planning. Once these preliminary exams are passed, the CFP® candidate must pass a comprehensive ten-hour certification exam, as well as fulfill the industry years-of-experience requirement.
The CTFA designation is awarded by the American Banker’s Association. To earn the CTFA designation, candidates must demonstrate mastery via examination in subject areas such as: taxation of trusts, wealth transfer using trusts, estate planning, investment principles, and risk management. The CTFA certification includes ethical and professional standards, and a commitment to ongoing professional education consisting of 45 hours of professional training every three years. The CTFA is one of the most respected post-graduate certifications in the field of wealth management and trust services.
At Price Wealth Management, we have safeguards in place to give our clients confidence their assets are handled with the utmost integrity. First, Charles Schwab is the independent custodian for our clients’ accounts. Charles Schwab is the largest custodian of client assets for independent advisors, with over $1 trillion in their custody as of 2017. Since our clients’ investments are held at Charles Schwab, the client account statements are produced by Schwab, not by Price Wealth Management. Employing a respected third-party custodian such as Charles Schwab provides transparent and independent reporting for our clients. In addition, clients of Price Wealth Management can view their assets from any computer or mobile device by logging on to Charles Schwab online. Using Charles Schwab as an independent custodian is a vital check and balance measure which helps protect our clients from fraud or identity theft.
Price Wealth Management is a Registered Investment Advisor representative firm that is licensed so that the firm is able to advise clients throughout the country.
Our disciplined investment process avoids investment decisions based on emotions caused by market volatility. We rely on our decades of experience to remain calm when markets look bleak, and to remain steady when the market is irrationally exuberant. We remain even-tempered, and this centered approach helps our clients remain resolute in the face of market volatility. The consistent focus on our clients’ long term goals, supported by our even-tempered approach, improves our clients’ probability of success over time.