By Mark Knackendoffel on November 10, 2014
You probably already know that financial and investment advisory firms bring a variety of approaches to their client relationships. But what you probably don’t know are some details about how firms differ in their:
- Product offerings and services;
- Investment strategies;
- Methods of getting paid;
- Customer service levels;
- Regulatory oversight; and
- Fiduciary standards.
In fact, we frequently meet folks who, when hearing about our services, respond, “I didn’t know that!” Therefore, we thought it might be helpful to explain some of these different approaches, so that “you will know!”
While The Trust Company is indeed an independent trust administration company, did you know that our services extend well beyond this? In fact, trust administration is a relatively small part of our business. Our core business is providing financial, future planning and investment advice and helping clients execute the steps dictated by that advice. Much of our work involves designing and managing investment portfolios for all types of investors: individuals, couples and families, businesses, foundations, retirement plans...and trusts.
Other advisors also provide investment services for these entities, but what distinguishes us is that we are empowered to serve as a trustee or fiduciary for these clients under the laws of the State of Kansas and most other states.
As a “fee-only” advisor (versus a “commission-paid” advisor), did you know that we receive no commissions or sales loads from mutual funds, stock and bond transactions, and other investment products? We believe that by not being paid from the investments we use for our clients’ portfolios, we can make more objective investment decisions.
In terms of our management fees, did you know they generally start at 1% annually of the assets being managed, and then decline from there based on the value of clients’ portfolios? This “percent of assets” fee structure ensures we have the proper incentives to preserve and enhance the value of our clients’ portfolios.
Of course, as mentioned earlier, managing portfolios is only part of what we do. We also offer experience and expertise in financial planning, retirement planning, estate planning, and trust and estate administration. To accomplish all this, we work closely with clients’ personal attorneys, accountants and insurance advisors to structure portfolios, tax plans, estate plans and insurance plans that enhance the likelihood that our mutual clients will reach their goals.
So, now you know!