Crafting a meaningful financial plan is more difficult than many realize, and adhering to that plan is even more challenging.  

Independent studies by Vanguard, Russell Investments and Morningstar show individuals who work with a good financial advisor receive meaningfully greater returns over the life of their portfolio - value well in excess of the cost. Advisors add value in many ways, from cost effective investment implementation to strategic withdrawal strategies. But where they add the greatest value is being an accountability partner, helping you navigate the joys and challenges of life. 

Read more about our carefully designed process at Phillip James.

1. Fiduciary Relationship

We put your interests first.

As a Fiduciary we have a legal and ethical obligation to put the client's interest first. Not all financial advisors are held to this high of a standard, and is often not clear which advisors work this way. In fact, many "broker/dealers" are held to what is called the Suitability Standard, a much lower quality of care. With this lower standard, investors are often sold expensive financial products that generate high sales commissions, many times unknown to the client. 

<See: Fee-Based versus Fee-Only: Conflicts of Interest and the Fiduciary Standard>

2. Financial Planning 

Proper life planning that aligns your goals with your investments.

We integrate your financial plan with your investment portfolio.  It is critical these two aspects are aligned properly.  The investments are the tools we use to accomplish your life goals. Having a written, clearly defined plan helps eliminate some of the worst investor behaviors we encounter. Without a plan, how can you track your progress or know if you are off-track and need to adjust? Having a financial plan provides serenity during market volatility, keeping you focused on the plan and ultimately providing the best chance of success.

<See: Our Financial Planning Process>

3. Better Portfolios

An investment philosophy that is consistent, academically based, and objective.

Central to any financial plan is the investment strategy.  At the heart of our investment philosophy is Modern Portfolio Theory which attempts to maximize the portfolio return for a given amount of risk. We accomplish this by utilizing asset allocation to determine the efficient portfolio and then customize each client's portfolio given their own level of risk tolerance and risk capacity.  

Research has proven time and again that asset allocation is by far the primary determinant of total return. Each portfolio is monitored and re-balanced continuously to maintain that optimal asset allocation. This disciplined approach has repeatedly been proven to achieve optimal investment returns over time.

The investment vehicles we utilize are low-cost, tax-efficient, and highly diversified mutual funds, most notably those offered by Dimensional Fund Advisors (DFA) which look to capture factors of higher expected return through advanced portfolio design, management, and trading. These funds are only available through a select group of advisors. We also utilize Vanguard, Charles Schwab, and a variety of ETFs.

4. Cost Effective Implementation

It starts with utilizing lower cost funds (DFA, Vanguard, Schwab) but doesn't end there. 

We are always looking to lower our clients' overall costs. Part of keeping costs down is taking into account the investment options you have within your employer managed accounts such as 401(k)s or 403(b)s and building the most efficient portfolio possible. We practice smart trading techniques by aggregating trade orders, using limit orders, and being patient (and smart) with our implementation. 

5. Tax Management

Taxes are a part of everything you do financially, and your plan should reflect it.

Being that our co-founder is a CPA, taxes are built into our DNA. Always being tax conscious is another area to unlock real value and lower the client's overall costs. Not only can we prepare your annual tax return but we also utilize asset location strategies, perform tax loss harvesting, are cognizant of when and how to take capital gains, and craft a strategic withdrawal strategy all focused on limiting the tax drag on our portfolios. Ultimately leaving more available to you during retirement and your beneficiaries.

6. Behavior Management

An investor's greatest threat to success is themself.

Proven through numerous studies, the single greatest threat when it comes to investing is the investor’s own bad behavior. These threats come in the form of lack of discipline, cognitive biases, and emotional errors. In many instances, investors don't even realize they are making a mistake. The key to avoiding these costly mistakes is to have a written financial plan with a dedicated advisory team in place to help guide you through life's challenges and market volatility.  Warren Buffet once said, "Investing is simple, but not easy." 

<See: Investor Behavioral Biases>

7. Ongoing Monitoring

A financial plan requires monitoring and tracking to be successful. 

We monitor your portfolio to ensure your investments are aligned with your financial plan’s goals and objectives.  For many investors it can be a challenge separating the noise from real issues. At Phillip James we use rule based parameters to initiate portfolio changes; removing the subjective, emotional aspect of planning and investing. Changes to a portfolio should always be a result of changes in a client’s circumstances, never as a response to market conditions.