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Your Next Best Investment - A Quality Wealth Advisor


IF PEOPLE CAN'T BEAT THE MARKET, WHY HIRE A WEALTH MANAGER?

Fantastic question.


Indeed, the data shows that virtually no one can beat the market. And if they do, it's likely blind luck (see previous blog post on this HERE)


So what can wealth managers like myself provide if they can't pick stocks to beat the market?


3%

I won't get into how we help organize and strategize clients' financial lives; I'll simply stick to investment returns.


Vanguard, the company that essentially started the passive investment phenomenon, is the research leader on this topic that is difficult to quantify.


They propose that a quality advisor can add up to, or even exceed, 3%¹ to a client's annual return (after fees).


HOW?

See the chart below:

Strategy

Up To

Behavioral Coaching

2%

Order of Withdrawal in Retirement

1.2%

Asset Allocation

0.6%

Low Expense Mutual Funds / ETFs

0.3%

Rebalancing

0.14%

FIGHTING BIAS

The data presented is surprising, given that Vanguard has every reason to shout, "DON'T HIRE ANYONE - JUST USE OUR FUNDS AND FORGET ABOUT IT!"


However, they recognize that investing is far more than just parking your money and waiting. Emotions and tactics play a more prominent role than most realize.


Again, this doesn't even include other wealth management tactics such as Roth conversions or social security optimization, which can save clients (I'm not joking) hundreds of thousands of dollars...


IMPORTANT FINAL THOUGHT

Depending on the business model of your advisor, these strategies may actually be a detriment.


For instance, many advisors receive a commission every time they invest your money into a mutual fund or stock. So if the advisor were to rebalance your portfolio, they'd end up with a juicy commission that comes straight from your portfolio. They win, you lose.


But not at AlphaOmega. We match our incentives with the client - we make more when you make more (oh, and no commissions).


CONTACT OR SUBSCRIBE

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Care to see if we'd be your next best investment? Contact us below or email me at john@wealthao.com.

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Risk Disclosure: Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance does not guarantee future results.


This material is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The content is developed from sources believed to be providing accurate information; no warranty, expressed or implied, is made regarding the accuracy, adequacy, completeness, legality, reliability, or usefulness of any information. Consult your financial professional before making any investment decision. For illustrative use only.

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