Asset Management

The Investing For Life Process™

Milestone Financial Advisors brings clarity to the management of your investments with structured, diversified portfolios that reflect your risk tolerance and unique goals, and which accommodate an ever-changing market environment. Our portfolios utilize time-tested asset allocation strategies which can reduce risk while simultaneously allowing for growth opportunities. Because we use a wide variety of passively-managed mutual funds (similar to index funds), investments are selected by the client and the advisor, not a mutual fund manger, creating a more individually-tailored and low-cost portfolio. Traditional index funds have the benefits of discipline, low turnover, reduced costs and objectivity, all of which have been shown to add significantly to investment returns. However, typical index funds also have drawbacks; specifically, a rigid necessity to follow a brand-name index. Milestone uses low-cost, passive institutional funds which are unavailable to the general public and which seek to capture the benefits of indexing while avoiding its drawbacks.

 

Milestone Financial Advisors, LLC uses four core principals to guide its investment policy:

Diversification.

Allocating money into different investment categories and placing combinations of uncorrelated assets within portfolios is a proven risk-reduction methodology. Studies have shown that allocating money into different asset classes (asset allocation) can increase annual return while lowering volatility. (Asset allocation accounts for more than 90% of the variation in portfolio return while security selection, market timing, and random luck explain the rest.)

Milestone Financial employs a buy and hold strategy in managing investments on behalf of our clients and generally believes in the principal that markets are efficient. An overwhelming body of evidence indicates that making accurate near-term market forecasts with any consistency is extremely improbable, and can be costly and inefficient on an after-tax basis. Moreover, one or two incorrect or ill-timed decisions can undo the advantages of remaining committed to a diversified group of investments over the long-term.

Low-Cost Investing

Put simply, expenses reduce investment returns. Since we have no proprietary financial interest in any mutual fund or individual investment used in client accounts, we can construct portfolios at the lowest possible cost. (The more you reduce cost, the more you can increase return.) The buy and hold approach can lower cost further by reducing potential capital gains tax exposure.

Tax Efficiency.

For taxable accounts we utilize tax-managed index funds which can increase after-tax rates of return over time and control tax exposure by minimizing trades within the fund.

Periodic Rebalancing.

Rebalancing is the purposeful and tax-sensitive harvesting of gains and losses in order to adjust a portfolio to more closely match the risk/return characteristics of its original targets. This can prevent portfolio drift, reduce volatility, and increase net return over time.

 

Financial Planning

The Financial Discovery Process™

Our financial planning process begins by focusing on the client, not the money. We take the time during the introductory meeting to explore what is most important to you, initially detaching these values from your financial situation. We then seek to connect your most meaningful goals and money beliefs into a workable financial plan which can help you live a rich and rewarding financial life.

Our process typically begins with four meetings conducted over a 4 week period.

Meeting One: Exploration

At the initial consultation we explore your goals and life’s purpose in preparation for building successful financial strategies around these considerations. Our view is that creating a financial plan without the benefit of this information would be incomplete and less likely to succeed.

 

Meeting Two: Sharpening The Vision

After you complete an inventory detailing your total financial profile, we build on the discoveries of the initial meeting to refine the vision, establishing what is most meaningful and significant. Additional financial information may be collected and we may discuss the various obstacles that would prevent the vision from being fulfilled. Often these obstacles can supply us with the raw material which can help facilitate your goals.

 

Meeting Three: Strategic Planning

We are now in a position to prepare a comprehensive plan which addresses some or all of the following eight Key Money Concerns, as applicable:

cash flow, cash reserve, investments, wealth accumulation, tax-management, education planning, retirement planning, estate planning.

The strategic advice provided in the financial plan is intended to address the vision, obstacles, opportunities and strengths that were identified during the previous meetings.

 

Meeting Four: Implementation

Following your review of the plan we will meet to take action on some or all of the recommendations we have presented to you. Accounts may be opened, transfers initiated, and legal or tax follow-up will be advised if applicable.

Fees

Financial Planning Fees

Financial planning costs are fee-based and correspond to the complexity of the services needed and to the number of financial concerns covered in the plan. The minimum financial planning fee is $2,000 and may be higher depending on individual circumstances and requirements.

Investment Management Fees

Investment Management Fees are well below industry average, and are determined by the amount of invested assets that we manage for you and are payable on a quarterly basis.

The first $500,000	1%
The next $500,000	0.75%
The next $1 million	0.65%
The next $1 million	0.45%
Amounts exceeding $3 million	0.25%

Minimum annual fee for asset management
and/or financial planning services is $2,000.