We know you may have questions, and we would like to share some of our most commonly asked questions here! We would of course prefer to have a conversation directly, but hope these help until we do.
Are you a fiduciary?
Yes! If you are asking this question, you have been doing your homework.
What is a fiduciary, exactly?
A fiduciary is an advisor who is bound by law to act in the best interest of a client. They may not churn accounts (trade excessively to generate fees) or make unauthorized trades, among other regulatory requirements. Believe it or not, there are advisors who are NOT fiduciaries. They must only recommend funds that are “suitable,” even if they’re not the lowest-cost, best ones for you. In an ideal world, all advisors would be fiduciaries, but the financial industry lobbied successfully to kill legislation that would have made that so, saying it would drive up costs in the industry.
How does Bridge get paid?
We charge a fee that covers both your financial plan and the investment management we do to fulfill that plan. It starts at 1% of the total assets we manage for you and goes down as your wealth grows and surpasses the minimum amounts we require for lower fees.
So, Bridge charges no fees for anything else?
If you are a client with at least half a million of invested assets with Bridge, then no. We don’t charge commissions on trades. We don’t charge for advice. We make more money when you make more money. If you fall below our minimum of invested assets, we may charge a planning fee if you want to have more than an investment-only relationship with us.
How will our relationship work?
We take a team approach at Bridge. First, you’ll work with our team to determine what resources you have and what you need. Your wealth manager will ask you a lot of questions and use those answers to figure out how to get you where you want to go. After that, your senior wealth manager will execute the plan. Your wealth manager will stay involved, weighing in from time to time to make sure you’re on track.
How often will we meet or talk by phone?
A lot, in the beginning, when we’re preparing your financial plan. After that, we like to check in every quarter, but understand each client has their own preferences. Most clients like a full review of their finances once a year. You are welcome to call anytime, of course, and you’ll get detailed statements every month, and a performance statement every quarter.
What is Bridge’s investment philosophy?
We believe in keeping it simple. We advocate patience over panic. Stock and bond markets are unpredictable. Despite what they may say, few advisors know what’s coming. There have been almost 500 economic downturns worldwide since 1988. The International Monetary Fund, with its legions of economists, predicted only four of them, according to London-based Fathom Consulting. We control the things we can, like the cost of mutual funds and the impact of taxes. We believe in diversification, and in having a plan and sticking to it.
What does a typical Bridge client look like?
Our clients usually have between $500,000 to $5 million of assets. They have made their own money, and they’ve saved it. They know enough about investing to know that they’ll do better with a little help or are simply too busy to focus on such an important task. They are aware of how the right tax strategy can add years to their retirement. They can stomach some ups and downs in the market, relying on time and patience to ensure a successful retirement.
Do you do any “active” money management?
In the old days, and predominantly before 2008, people invested most of their money in mutual funds run by stock pickers. Fidelity’s Magellan fund, run by the legendary Peter Lynch, was the hottest mutual fund in 1990 and stayed that way for a decade under his successors. These days, investing in anything but a “passive” index fund (sometimes called an ETF) that just owns all the stocks in the Standard & Poor’s 500, say, is often considered foolish because so few active managers beat the market. We agree, mostly. We will use active management when it counts, and where we can justify a strategic and compelling advantage while still working in your best interest.
Where is my money held when I’m a Bridge client?
Believe it or not, your money is not at Bridge. It’s held at either TD Ameritrade or Charles Schwab. And that’s a very good thing. Those firms act as custodians for thousands of advisors like Bridge. The best advisors almost always have an independent custodian, and you should demand one. The people who invested with Bernie Madoff did not, and they lost all their money because Madoff had the freedom to move their money.
Do you manage for taxes in the portfolio?
Yes, absolutely. A quick example: say we buy an investment that falls in value soon after the purchase. We try hard to make this rare, but unfortunately, it happens. If we think the fall is overdone, and the fund is likely to rebound, we may still sell it, and buy a different investment that behaves very similarly to the original one. Why? Because we can use the loss to offset gains on your taxes and still benefit from any rebound in the new holding. Taxes get more complex every year. Money management is nothing without tax management.
Do you charge for financial planning?
No! It’s included in our fee. That said, we do have minimum fees needed to allow for a full planning engagement and are happy to discuss with you. See our firm brochure for additional information. If you would like a copy please do not hesitate to ask us for one.
Do you provide advice on taxes?
Yes! We have a brand new partnership with The Accountancy, a Los Angeles-based tax firm that has been in business since the 1940s.