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Top 10 Questions to Ask Your Financial Advisor

By on March 30, 2022
Categories: CHOOSING YOUR FINANCIAL ADVISOR
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Founded in 1991, Dowling & Yahnke Wealth Advisors helped start a revolution in wealth management to deliver world-class financial advice under the fiduciary standard. Today, D&Y manages over $6.1 billion and provides portfolio management and financial planning services to clients across the United States.1 Our only source of revenue is a competitive management fee – no commissions, unnecessary trades, or competing incentives.

1. WILL YOUR FIRM STATE IN WRITING THAT YOU ARE ALWAYS A FIDUCIARY?

Yes. Investment advisors registered with the SEC must act as fiduciaries and are legally bound to act solely in the clients’ best interests. We always have and always will serve our clients as fiduciaries.

2. WHAT IS YOUR EXACT FEE SCHEDULE?

We strive to offer our clients great value and transparency with our fee schedule. Our advisory fees are charged as a percentage of the assets under management, which decline on a marginal basis as assets grow. We bill our clients on a quarterly basis using the annual tiered fee schedule below:

TIERED RATE SCHEDULE2       RATE
First $2 million                       0.85%
Next $1 million                        0.70%
Next $7 million                        0.50%
Portion above $10 million          0.40%

3. DO YOU CHARGE AN ADDITIONAL AMOUNT FOR FINANCIAL PLANNING?

In addition to investment management, we provide personalized financial planning for our clients which are typically included under our asset-based investment advisory fee arrangement. In some situations, particularly standalone financial planning, we may consider charging for financial planning by the hour or under a retainer.2

4. WHAT DOES COMPREHENSIVE FINANCIAL PLANNING LOOK LIKE?

We start by understanding what a client wants most out of their life and then implement a plan which supports achieving targeted spending, giving, or other financial goals. Our financial planning services are tailored to specific client needs and may address retirement planning, tax planning, debt management, estate planning issues, charitable gift planning, executive compensation review, insurance-related matters, and other personal financial issues.

5. THERE ARE COUNTLESS FINANCIAL SERVICE ACRONYMS AND ACCOLADES. THE CFA AND CFP® CREDENTIALS ARE HIGHLY REGARDED DESIGNATIONS IN THE INDUSTRY. WHICH ONES DO YOUR ADVISORS HAVE?

We take the responsibility of managing your life savings very seriously, so knowledge is one of our core values. We are lifelong learners and continually seek knowledge to improve and expand our services.

Our Lead Advisors have all earned or are in process of obtaining the CERTIFIED FINANCIAL PLANNER™ designation. Many are also CFA Charterholders or Certified Public Accountants. To attain these credentials, candidates are required to pass rigorous exams, dedicate multiple years of study and experience, and complete ongoing continuing education. Our diverse team also includes members with graduate degrees from world-renowned business schools including the Harvard Business School, the University of Chicago Booth School of Business, University of California, Los Angeles, and the Kellogg School of Management at Northwestern University. In addition, Dowling & Yahnke has been nationally recognized as a “Top 100 RIA Firm” by Barron’s for 2021.3

6. DO YOU SELL ANY PRODUCTS?

No, we never have. The only source of revenue for our firm is a competitive advisory fee – no commissions, unnecessary trades, or competing incentives.

7. DO YOU EARN OR PAY REFERRAL FEES TO OTHER PROFESSIONALS TO GENERATE NEW BUSINESS?

With the sole exception of a cross border agreement with our parent company, CI Financial, we do not engage in any third-party programs to receive new client referrals.4 When we refer clients to other professionals (tax advisors, estate planning attorneys, insurance agents, mortgage lenders, etc.), we do so without accepting any compensation. Our goal in making referrals is to identify trusted professionals who will provide excellent service at a fair cost.

8. WHAT IS YOUR FIRM’S INVESTMENT PHILOSOPHY?

Dowling & Yahnke’s investment philosophy incorporates many principles of “Modern Portfolio Theory,” which is supported by decades of academic research and real-world implementation. We regularly review available research, finding that the vast majority of those who engage in active strategies (technical analysis, market timing, stock picking, etc.) underperform the market over longer periods of time. Accordingly, our philosophy emphasizes market efficiency along with the investment factors most under our control and impactful to returns over the long-term: risk management, minimizing costs, investing tax efficiently, global diversification, and disciplined rebalancing.

We utilize individual securities for the U.S. large cap stock and municipal bond portions of selected client portfolios, primarily to realize tax benefits. The firm also employs well-diversified mutual funds and ETFs to access taxable fixed income, U.S. mid/small cap stocks, non-U.S. stocks, real estate securities, and other asset classes. We have long-term institutional relationships with Dimensional Fund Advisors (over 25 years), Vanguard, and other fund sponsors which offer very low cost, tax efficient investments across global asset classes. Our Investment Committee meets frequently to review research and actively monitors investments.

9. ARE YOU “ACTIVE” OR “PASSIVE”? WHAT IS YOUR TRADING STRATEGY?

We believe that markets are generally efficient in valuing securities, especially in large, liquid, well-regulated markets. We trade as efficiently as possible to minimize expenses and taxes while maintaining our asset allocation targets. When we do trade, it is to add economic benefit through investing excess cash, rebalancing, or tax-related trades. We trade substantially more when the markets are down or up sharply to take advantage of opportunities to tax manage and rebalance portfolios (buy stocks when the market is down and trim stocks when the market is up).

10. HOW DO I ACCESS REPORTS REGARDING MY PORTFOLIO PERFORMANCE?

We have made substantial investments in technology including a state-of-the-art platform to provide up-to-date reporting on your portfolio through our dashboard. Your personalized DY Dashboard provides detailed information about investment returns, capital gains and losses, income and dividends, contributions and withdrawals, asset allocation, and much more.

 

1 Regulatory assets under management as of 12/31/2021.
2 Based upon a particular client’s facts and circumstances, the Firm may charge a minimum quarterly fee. See Form ADV Part 2A, Item 5 for additional details.
3 Disclosures from Barron’s: The ranking reflects the volume of assets overseen by the advisors and their teams, revenues generated for the firms, and the quality of the advisors’ practices. A ranking of “N” indicates the advisor was not ranked in the specified year. HNW=high net worth; UHNW=ultrahigh net worth. Additional disclosures: Barron’s requested Dowling & Yahnke to apply for the ranking. The information for the ranking was compiled by the advisor and may or may not be verified by Barron’s. It is unknown as to the number of applicants considered for the ranking and the percentage of applicants that made the ranking. The award should not be viewed as representative of any one client’s experience and should not be taken as an indication of performance by Dowling & Yahnke and any of its clients. While Dowling & Yahnke did not pay a fee to apply for the award, the firm does purchase goods or services from the publisher of the award (such as subscriptions to the publication, reprints of the ranking, and payment to be included in other Barron’s-published lists).
4 CI Affiliates (Canada) Cross-Border Referrals: When appropriate, Dowling & Yahnke may refer an eligible client or prospective client to a Canadian Affiliate for the receipt of services. Likewise, the Canadian Affiliates, when appropriate, may refer an eligible client or prospective client to Dowling & Yahnke for the receipt of services. To facilitate this activity, Dowling & Yahnke has entered into a bilateral cross-border agreement with the Canadian Affiliates to refer eligible clients or prospective clients to one another. The party receiving a referral has agreed to pay the party making a referral a fee equal to 37% of the ongoing gross fees payable by the referred client in respect of the services provided to such client by the party receiving the referral. Products or services will only be offered in jurisdictions where Dowling & Yahnke and/or the Canadian Affiliates are lawfully authorized and permitted to conduct business and offer or provide such products or services.

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