Purtill Financial LLC
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FAQ

Frequently Asked Questions

 

 

Why choose Purtill Financial?

The best reason to choose an investment adviser is to work with an investment team you can absolutely trust and get the highest returns on your investments appropriate to the risk you are willing to take. Every additional percentage point of portfolio return is critically important to the investor. Over 25 years, each additional percentage point of return adds $170,000 in value to a $600,000 portfolio.

When your advisers have years of successful investment management experience and extremely high client retention, that should be a strong signal that you are making the right choice in choosing an advisor.

Our firm's goal is to outperform in terms of investment returns by keeping costs low, choosing the best mutual fund and ETF managers, maintaining highly diversified, value-oriented global portfolios, and adjusting portfolio allocations as market situations change. 

Why pay for your services when I can get free advice elsewhere?

Large brokerage firms have thousands of people on their payroll earning six and seven figure compensation. If you are a customer of these firms, you are helping to pay those costs. In fact, you may be paying a lot more than you think you are because the fees you are paying are most likely not fully disclosed to you.

Since most advisors are product salespeople, they are held to a standard of suitability, rather than a fiduciary standard, much in the same way that a used car salesman would be expected not to sell you a vehicle that would not run, but not necessarily sell you the best vehicle available at the lowest price.  Fortunately, for investors, the US government is changing its regulations on retirement accounts to minimize these suitability practices.  The SEC has still not developed regulations to prohibit financial service representatives at brokerage firms, insurance companies, and banks from following suitability standards, which allow many firms and their employees to maximize profits at the expense of their customer.  

Most investment salespeople make their money when you sign their contract for an annuity or agree to purchase commissioned mutual funds or a broad portfolio of new investments. They can quickly make anywhere from 5% to 15% in upfront commissions by selling those investment products to you.

They can also make additional annual commissions through 12(b)-1 fees or C mutual funds, both of which can pay them 1% per year or more in extra fees paid directly by the mutual fund to the broker or agent. When they sell you an annuity, their upfront commissions range from 6% to 15%, depending on how long the deferred sales charge will run. These commissions and annual fees are paid out of the operating costs of the securities that you buy. Since there are extra costs being paid by the mutual funds or insurance companies, who pay the commissions to the investment salespeople, your returns on the securities they sell you will likely be considerably lower. 

Many commissioned financial advisors like to sell individual stocks, preferred stocks, individual bond issues, unit investment trusts, separately managed accounts, closed-end mutual funds, mortgage backed securities and a host of other financial products that you may not fully understand. What you should understand is that there may be high commission products throughout your portfolio that generate extra profits for the broker, insurance agent, or bank financial representative and for the firm that employs him or her. No one works for free, particularly commissioned sales agents.  

Large brokerage firms, many independent investment advisors, and banks also may employ noncommissioned salespeople who receive annual bonuses based on their “production.”   These individuals are not fiduciaries, meaning they are working for their employer and have an incentive to sell products that generate more profits for their firm.

You also may be paying much higher commissions on trades of individual stocks than you would at a discount broker, where trading fees are usually around $10 per trade. Brokers also can sell securities held in inventory by their firms, which the firm bought at a lower price and you may be buying at a higher price because the firm has been promoting that security to its customers through its broker sales force.

If you want objective advice concerning the best investments and your overall portfolio, the independent, fiduciary, fee-only adviser is your best source of information. Be careful not to work with a fee-based advisor. This is a salesperson, usually working for a brokerage firm, who sells some products for commissions and also works for clients for a fee. If you find yourself paying a fee to an advisor who also sells commissioned products, you need to be very careful and should probably take your business elsewhere.

How do I find the right fee-only adviser?

Fee-only advisers are not all the same. Some do not choose investments themselves. They may hire this out to other individuals for a fee or put their clients only in index funds or ETFs (baskets of securities that match an index, such as the S&P 500), which have average performance by definition. You should seek out fee-only advisers who are personally qualified and capable of selecting good investments and have the talent to earn sufficient additional returns to justify their fee. 

Some fee-only advisers specialize in preparing financial plans. If what you need is a good plan that you can implement on your own, choose a fee-only adviser who specializes in plan preparation. If you need ongoing investment help, make sure you choose fee-only advisers who are skilled and experienced in asset allocation, portfolio design, choosing investments, active investment management, and in generating above average returns for clients. 

How can I verify the credentials of an investment adviser?

To look into a financial advisory firm online and determine whether it is legally registered as a fiduciary firm working in the best interest of its clients, go to the SEC website:

To find out whether an advisor is a member of the National Association of Personal Financial Advisors, the nation's leading organization of fee-only advisors who meet the highest standards for professional competency, comprehensive financial planning, and fee-only compensation, go to the NAPFA website:

To verify that an advisor has met the requirements for the Personal Finance Specialist designation, go to the American Institute of CPAs website:

To verify that an advisor holds an active Certified Public Accountants license and has successfully completed the rigorous certified public accountants examination, go to the following website and select Accountancy Board in the Division drop-down box:

To verify that an advisor holds an active CERTIFIED FINANCIAL PLANNER™ credential and has successfully completed its examination and experience requirements, go to the following website:

Who will I work with if I become a client of Purtill Financial?

Our investment management team works with all Purtill Financial clients. Clients receive help and support from all professionals at the firm.  

Don Purtill provides general oversight for portfolio management and sets strategic direction for the firm, as well meets with clients.  Tom Geraci, Michael Purtill, and Carly Purtill actively participate in all of the firm's activities, work directly with clients, and participate as team members in investment selection, financial planning, tax preparation, and executing trades and other financial transactions for clients.

What is your client base like?

We currently serve more than 140 client families. They range from 25 to 94 years old. Many clients are in retirement drawing retirement distributions, but we also have many young professionals as clients.

Our specific client niche and expertise is in working with medical and legal professionals, corporate executives, small business owners, and educators. We also have clients who are  Ph.Ds, engineers, CPAs, and media professionals.  Many of our clients are from Ohio and Florida, although we also work with clients who reside in 13 other states.

In most cases, our clients have portfolios ranging in size between $250,000 and $7 million in investable assets. 

What kind of clients qualify to work with your firm?

Our clients are expected to have a sufficient amount of investable assets in order for us to meet mutual fund minimum investment requirements and provide a globally diversified portfolio.

Clients need access to the Internet so that they are able to execute trades online through an online broker. We provide assistance to ensure clients are able to do this easily and will make all trades for clients with email authorizations in advance. Clients need to have an e-mail account where they can receive regular communications from our firm about their investments. With proper authorization we can also work with family members who assist in financial matters.

Our clients need to be responsive on a timely basis when we recommend changes in investments. Clients cannot earn the best returns when they do not react in a reasonable time frame to recommendations. 

We seek a professional, collegial relationship with clients. We provide them with highly detailed information about the market and individual investments and appreciate client feedback. We recognize that some clients have little interest in investing specifics and we can accommodate them as well as long as they are patient and understanding about what can reasonably be accomplished in a professionally managed investment portfolio. 

Our firm is not suited for individuals who want to pick stocks, make daily trades, and micromanage their investments. Such individuals are better suited to work with brokerage firms or invest on their own.

Besides the asset management fee, are there any other expenses that could be charged to me as a client?

No. We have a straightforward fee arrangement with our clients based on a percentage of their assets at the end of the previous quarter. We bill clients only once per quarter, based on their investment assets at the end of that quarter. 

Also, we frequently try to choose no transaction fee, no-load mutual funds and low-cost ETFs for our clients. This means that clients have little or no fees related to the brokerage accounts where they hold their investments. We also recommend mutual funds and ETFs, which have trading fees when the funds are bought or sold. These fees never exceed $25 per trade for our clients.

Asset management clients can receive basic tax preparation and financial plan development for no extra charge.

Are there minimum account sizes for investment management services?

We currently do not have an investment minimum. We have a minimum quarterly fee of $250. We feel that it is most cost-effective for clients if they have approximately $250,000 or more in investable assets. 

Does Purtill Financial provide legal or insurance advice?

Of course, we are not a law firm and cannot provide legal advice. Where estate planning issues are involved, we can answer general estate planning questions and recommend an estate planning attorney, as needed. We can also help identify sources to purchase various types of insurance in a cost effective way and provide guidance on types and amounts of insurance. We receive no compensation for any referrals. We are not licensed in insurance.

How safe is my money?

Purtill Financial LLC is an advisory firm only. We do not take custody of your assets. We recommend TD Ameritrade Institutional for all non-employer plan security purchases. Funds invested in such accounts are generally covered by SIPC protection up to certain limits.

As with any investment, you are subject to normal stock market risk to the extent that you wish to invest in stock or bond funds or individual stocks or bonds.

Are you currently accepting new clients?

Yes, we currently have capacity to add one or two new clients each month. Many new clients come to us as referrals from current clients or from the National Association of Personal Financial Advisors (NAPFA) website.

We pay no referral fees for new clients and do not spend firm resources on advertising for new clients. We employ no sales staff and do not solicit client business by mail or telephone, other than responding to client inquiries we receive.

How do we get started as clients?

The best way would be to contact our firm through our contact page or telephone (440-484-5340) to arrange for an initial meeting. We generally meet with clients in our main office near I-271 in Highland Heights, Ohio. We also meet clients in Fort Myers Beach, Florida during certain months of the year. There is no charge or obligation for an initial meeting for prospective clients.

Where clients do not live in reasonable proximity to our office locations, we arrange client meetings by telephone and exchange documents by e-mail or fax. We are happy to work that way with clients who find that more convenient. 

 In an initial client meeting, we normally gather information about their financial objectives, risk comfort levels, investments, and loans, and then discuss our initial thoughts with them in terms of recommendations for best serving their financial objectives.

If the prospective client meets our qualifications to become an investment management client and wishes to do so, we ask them to sign a minimum one-year contract and then we would get started with detailed analyses of their financial, tax, and investment statements and prepare a plan to get them started. We then work with the client until all investment changes have been accomplished. 

We then follow up with monthly progress reports on their consolidated investments and investment performance and recommendations for changes in investments as we go forward.

How specific are your recommendations?

We make specific recommendations on mutual funds, exchange traded funds, stocks, and bonds and identify specific securities and amounts to buy or sell. We want to make it as easy as possible for clients to implement our recommendations and to do that without error. That requires specific recommendations and specific instructions and as much help from us as might be needed by anyone.  For clients who are not comfortable executing investment recommendations, we are happy to execute those transactions on their behalf with their written or email approvals for recommended transactions.

How does your advising work?

We monitor client portfolios each month in terms of returns compared to benchmark averages. Our software updates all client portfolio and efficient frontier positions daily. We rebalance client portfolios whenever clients add or withdraw funds from their accounts. All client portfolios are rebalanced each year. This is part of our regular service for no additional fee.  

Can you help with other financial questions outside of investments?

We also provide assistance with tax issues, 529 plans, mortgages, refinancing, auto loans, Roth IRA conversions, 401(k) rollovers, executive incentive plans, deferred compensation plans, stock options, long-term care insurance needs, Social Security, and financial planning in general.

We routinely receive financial questions from clients. Our clients feel free to e-mail or call us with these questions. 

Our goal is to give our clients the most appropriate advice in any financial situation. We are not experts in all subjects, but try to answer the clients’ questions and never limit the subjects we are willing to talk about. 

What is your privacy and confidentiality policy?

All client matters are confidential, as covered in our contract and privacy policy.  We do not disclose client information to anyone.

What are the differences between a CPA/PFS and a CFP®?

The designations are similar. The CPA/PFS is generally more knowledgeable in taxes and the CFP® certificant in financial planning per se. Mike is a CFP® professional. Don and Carly are CPA/PFS professionals. Tom is pursuing the CFP® designation.

Do you have liability insurance? 

Yes, we have liability and errors or omissions insurance.

Are you comfortable with making recommendations and clients making trades, or do you prefer to assist with implementation?

We think that providing good recommendations for a well-diversified portfolio is hard work and takes special skills. As for implementing trades, we prefer to execute trades with client approval, but if the client is comfortable and competent in executing online trades, we are happy for them to do that. We provide all the help needed to open accounts, roll over accounts, and execute trades on a timely basis.

Why did you choose to be independent and fee-only?

We believe that the commissioned approach to recommending securities is fraught with conflicts of interest that are damaging to the financial health of clients. We would not work in this industry if we could not be independent and free of any influence from Wall Street, banks, brokerage firms or insurance companies. We have seen abuses on the part of these firms, and would not want to be associated with them, other than assisting our clients.

Can you answer small business questions?

Yes, if they are financially related and within our area of expertise.  Basically, we answer any questions we are knowledgeable about because we excel in service to our clients.

What if a client doesn’t want to or cannot act on a recommendation?

We are advisors only. It is entirely up to the client if they want to adopt a recommendation.  Our role is to provide specific recommendations and give clients alternative ways of meeting their objectives and provide as much help as needed in implementing the recommendations.

How frequently do you meet with each of your clients?

We do not have any required meeting schedule for our clients.  We encourage them to meet with us as often as they would like and do not limit the number of times that they see us.

Do you include emergency reserve and cash savings numbers in overall asset allocation?

We often prepare investment plans separately for emergency accounts, versus all other investments, but include emergency accounts in overall portfolio reporting and financial planning. We normally include some cash reserves in all client portfolios.

What is your business continuity plan?

We have a continuity plan in our company policy manual. Basically, it calls for continued investment in training our professional staff in all functions of the firm so that they can take over the company and perform all client service functions well. All client recommendations are prepared jointly by the investment advisors so that clients can gain the benefit of multiple viewpoints on specific investment categories and securities.