Our Investment Management Retainer focuses exclusively on management of clients’ portfolios. The retainer is open-ended with respect the portfolio - our clients may call us or meet with us about any matter that directly relates to the portfolio. As the Investment Management retainer is separate from our financial planning retainer, it allows our clients flexibility in choosing the services that most closely meet their needs.
Focus on Taxation
At Merrithew & Thorsten, Inc., we believe that a tax bill is the largest recurring expense that Americans are faced with. One of our central concerns throughout the entire financial planning process is the reduction our clients' tax burden. One of the reasons that we integrate all aspects of our financial plans is to make your tax liabilities as low as legally possible. Although we are aggressive with tax planning, we make certain that all of our strategies are defensible, as we represent you before the IRS for no extra charge if you should be audited. Whereas Tax Preparation deals with preparing the forms necessary to report last year’s income and deductions, Tax Planning focuses on structuring your finances now so as to minimize their tax burdens in years to come. Tax Planning is especially effective for those with their own business or larger taxable portfolios.
At Merrithew & Thorsten, Inc., we are investors, not speculators. We do not believe in market timing or day trading. We believe that proper asset allocation may not always outperform the bull market but will, in the long run, deliver more consistent returns with less volatility. In allocating assets, we maintain a balance between equity, interest-bearing and alternative investment classes. The most important determinants in weighting assets are the client's goals and objectives, time horizon, risk aversion and investment experience.
There are two aspects of our approach to investment management that are very rare. One aspect is the focus on net - i.e. after-tax - returns. Since we see firsthand the affect that taxes can have on net portfolio returns as well as the affect that they have on your annual tax liability, we are very sensitive to the tax implications of our investment recommendations. The second aspect is the concept of low volatility portfolios. In these portfolios, our focus is to achieve as close to stock market returns as possible with significantly less volatility. This is especially appropriate if the stock market volatility from 2000 to present caused you considerable stress and anxiety or if you are close to or in retirement. In retirement/income producing portfolios, avoiding large and prolonged losses is actually more important to the long term viability of your portfolio than experiencing large short term gains (even though it’s not nearly as exciting!). Rather, we work to consistently preserve and increase your total net worth so that you can be confident in achieving you’re your short and long term goals.
Consistent with this philosophy, we do not to attempt to achieve the highest rate of return possible on investments (thereby subjecting you to a roller coaster ride).
At Merrithew & Thorsten, Inc. we believe that the financial planning process takes a great deal of time. Unlike some "planners," we do not pretend to be able to create long range, integrated and realistic financial plans in a couple of hours over the course of one or two appointments. The first year of the client advisor relationship is spent building the plan and building a relationship. Usually, our first two to three appointments with you do not involve any business transactions. This is the time for us, the advisors, to converse with you, ask you questions and learn about your goals, expectations and priorities. At the same time, you are encouraged to ask us any questions that you feel are relevant, to gain an understanding of how we do business and to build a solid comfort level in working with us. It is imperative that you trust us implicitly. If we have not put forth the effort to earn that trust, we cannot expect you to present us with your true concerns, desires or goals. If you do not speak openly and honestly with us, we cannot present you with our best recommendations. We feel that only by building a solid foundation on mutual understanding can a true financial plan evolve.