Homrich Berg brings a comprehensive approach to wealth management, combining our expertise in investment management and financial planning to answer key financial questions facing our clients as they seek to achieve their unique goals.
How should my assets be invested? How much risk should I take? What returns do I really need to achieve my goals? What about alternative investments? Are active managers worth it?
We work with you to translate your financial planning goals and long-term cash flow analysis into an investment plan designed to put you on the track toward your unique goals. The Homrich Berg Investment Committee, with over 150 years of combined wealth management experience, debates key investment strategy issues and recommends changes for investment strategies. The conversation starts with asset allocation and then moves to active vs. passive, manager selection, and monitoring. These biweekly meetings are the culmination of the ongoing processes that drive the investment policies of the firm.
HB has a dedicated internal investments team (not outsourced) led by our Chief Investment Officer that focuses on providing updates to the firm and clients on each asset class and the key issues affecting portfolios. The firm also provides commentaries and updates on portfolio allocation movements to clients.
In addition to traditional investments in each asset class, many families utilize alternative investments (funds and strategies generally not always available to the average retail investor) to pursue additional diversification and potentially superior returns. HB has staff dedicated to sourcing, analyzing, and performing due diligence related to traditional and alternative investments. Our status as a firm managing over $5 billion in assets helps us gain access to offerings from the institutional brand names as well as smaller niche players. We often push down the fees and/or minimum investment levels for these investments, and in some cases create pooled access fund vehicles to allow investors access to a diversified portfolio of alternative investments with, of course, no additional fee paid to HB.
So what does this mean for your portfolio and how we manage risks for you? Your HB client service team will translate the firm’s investment perspectives to provide an investment strategy that can be aligned with your goals, your tolerance for risk, and our outlook for the financial markets. Over time we will discuss the portfolio performance with you and discuss how your changing financial situation and plan goals may lead to potential changes in your investment strategy.
We always emphasize diversification as a critical part of managing risk. From our experience we believe that wealth is often created or lost by being highly concentrated – and preserved by being diversified. Correlations between asset types and individual investments are evaluated as part of the overall portfolio strategy in order to manage volatility risk via diversification. We measure performance against benchmarks both on total return and volatility, with a goal of providing higher returns and less volatility. HB has a long history of using a wide range of investments beyond basic stocks and bonds in order to achieve client goals. Rebalancing is also a key risk management tool, and rebalancing of portfolios is managed on an ongoing basis with the aid of our internal software that monitors each allocation weight.
How much money do I need to retire? How much risk do I need to take to potentially reach my goals? How do I maximize my income and minimize my taxes? How do I figure out how to pass wealth down to future generations? As you read through the details of our services you will likely have many questions, and the good news is that we are ready to help you with the answers to your financial questions.
We believe in the importance of starting with financial planning. This planning may incorporate lifetime cash flow analysis, investment planning, tax planning, risk management, and estate planning elements. We combine this information into an overall cash flow analysis that can then be used to test different investment approaches initially, and will also be updated over time as your situation and the investment environment changes.
In the simplest view, a family can do four things with its money now and in the future:
- Spend it on their lifestyle
- Give it away to people and charities
- Leave it to future generations
- Let the government have a large portion of it as tax revenue
Our objective is to understand and develop your family’s goals around the first three options and then minimize the fourth option as much as possible.
It is important to remember that success is not always defined by maximizing your investment returns. Your family financial plan involves complex choices related to risk tolerance, time horizons, liquidity needs, tax implications, generational transfer desires, cash flow needs, and philanthropy goals. Homrich Berg works with you to construct the financial plan customized to fit your goals and needs.
How much have my investments grown this year? Which managers are doing well vs. their benchmarks? What does my overall asset allocation look like? How much income has my portfolio produced this year? Homrich Berg offers the ability to answer all of these questions and more via HB Online, our consolidated interactive reporting system available to clients 24/7 without having to wait for a quarterly report or monthly statement.
Access is available via the Internet or an iPad application. Standard consolidated reports combine information from all advisors and sources, including liquid and illiquid investments and performance and indices for comparison. Clients can view their current balances, historical performance, asset allocation, and comparison to relevant benchmarks all in one place. Additional more detailed reports can also be provided to clients outside of the online system. Traditional printed quarterly reports are also available for clients who choose to receive them, and are also posted to the home page for the client to be reviewed any time.
What is my marginal tax rate? What is the best way to set up my investments in my taxable and tax-exempt accounts in order to minimize the tax impact? How much can I avoid future estate taxes?
Navigating the world of tax strategies and compliance is an important part of your overall financial plan. Income and estate tax considerations impact the planning process. Homrich Berg develops investment and estate planning strategies that factor both investment and non-investment income sources and their tax implications. We coordinate closely with your CPA to implement strategies and provide important information for the timely preparation of your tax returns.
If something bad happens to be me tomorrow, will my family be okay? What if I get sick and cannot work? This insurance agent I know keeps pitching me a lot of ideas – which of these things do I really need, and how much? How else can I protect my assets?
Managing risk for your family and your property is a necessary part of the overall financial plan. Our team has experience and expertise working with various insurance providers to seek the best solution for you, including the first step of discussing whether you feel your insurance is already sufficient. As always, our advice is completely objective and independent with no financial incentives involved in choosing providers or solutions, because as a fee only advisor we do not sell insurance or accept referral fees. We can help you sort out the different options and decide what approaches make the most sense for you and your family. We can also help you explore other asset protection strategies as appropriate.
What is the best way to achieve my long term goals for passing wealth to my spouse and/or future generations? How can we most effectively meet our philanthropic goals? We did some estate planning a long time ago – is it still set up the right way to achieve our goals now that our assets have grown and the laws have changed? What are the different ways I can try to avoid estate taxes?
We work with your attorneys or recommend specialists to work with you as we assess your current situation and create new approaches to meet changing needs and regulatory requirements. We have the expertise to help you wade through all of the acronyms and strategies in order to understand the approach best suited for your family. If appropriate, we can also assist you with managing the appropriate trustee services related to the entities created or already in place.
How much money do I need to retire? How long will my current investment capital last given the forecast for market returns and my risk tolerance? How do I decide when to start Social Security benefits? Should I be using a regular IRA or a Roth IRA? What are my options for setting up a retirement plan at my new company?
There are many unique questions that we help clients deal with when it comes preparing for retirement. We act as the guide for the family, whether it is helping a younger client set the right goals for their future or helping an older client adjust to the beginning of retirement from their career.
How do I plan for the future college costs of my children? Should I be using a 529 plan? What states offer the best 529 plan options? How do I talk to my kids about private vs. public college costs?
For our clients with younger children or grandchildren these are all critical questions where having an advisor is a wonderful benefit. We help you figure out these answers and ensure that your financial plan includes the steps needed to reach your goals.
We want to maximize the returns of our foundation assets, but worry about a one size fits all foundation consultant pushing us into a standard model – do we have any other options? We want access to some alternative investments for our foundation, but worry about someone pitching us products – is there a firm with institutional quality access but an unbiased approach?
Homrich Berg can apply the investments expertise and access of a firm managing over $4 billion in assets for your foundation, customizing a portfolio strategy to align with your goals. We can help translate the jargon and complexities of the investment world for the staff and board of your foundation as you work to be good stewards of the foundation assets.
Some families need additional services beyond what Homrich Berg normally provides to most of our clients. These family office services can go beyond our regular comprehensive wealth management offerings in order to include bill pay services, management of multiple houses and boats and aircraft, and unique family governance and family education services.
Many firms claim to be a “multi-family office” firm but may not have the true experience serving families at this depth of assistance. The key is not a certain level of assets, but an appreciation for this extra level of service. Some professional athletes value our ability to help them manage their lives administratively while they are out living on the road. Some families with multiple houses across the country value our ability to help manage the details and bills so that they can enjoy their life without worry. Some families with younger children want assistance with family meetings and education for their children to prepare them for the day in the future when they will inherit significant wealth. For some families our Homrich Berg Outsourced Chief Investment Officer (CIO) approach is the best fit, where HB can help by advising the family regarding all of their various managers and strategies inside and outside of HB. Every family office story is unique. We encourage you to learn more about our family office services by reading our Family Office brochure and visiting our HB Family Office website.