Our goal is to ensure our clients are “exceptionally well taken care of.” This mandate orients our thinking and directly influences the way we deliver advice to our clients: custom-tailored, highly-specialized, and extremely personable.
It’s natural for investors to be focused on costs. Higher costs eat into your returns, leaving you with less money at the end of the day. On the flip side, if you can efficiently lower your costs, your net returns will rise.
That’s the simple story. Problem is, many people just focus on one particular cost—the fee paid to their advisor—without considering the other considerable costs that can take their toll on a portfolio.The truth is, a management fee, while an important cost, is far from the only one you should be aware of. Here are some other costs that play a role in your investments over time, and how we try to minimize them for you:
Isolation CostHere at Assante, we practice what’s known as integrated wealth management. That’s just a fancy way of saying that we don’t invest your money without being aware of your personal situation. Whether it’s estate planning, cash flow requirements or risk management, we can do best for you when we consider all your needs.
Tax CostsTaxes can be a significant drain on an investment portfolio. They can reduce your investment gains by a huge amount (sometimes 25-50%). Over time, this can have a very negative effect on your portfolio. We seek to combat the tax cost by investing in a manner that reduces the amount of tax you will owe on any investment gains. Whether it’s through RRSPs, TFSAs or corporate class investments, our tax strategies are aimed at improving your bottom line. We are supported by an experienced team of in-house tax and estate specialists. They are able to work with you and your professional advisors to keep your taxes low.
Opportunity CostAn opportunity cost is the cost of doing one thing when you could have done another. In other words, it’s the lost benefit. If you watch a rerun of a show instead of going to the ball game, your opportunity cost is the enjoyment you would have had watching the Jays play. In the investment world, a key opportunity cost is having your money with the wrong advisor. This cost can be very high. According to a study published in 2011, the average investor underperformed the market by 4.32% annually over a 20-year period. Put another way, an investment of $500,000 only turned into $992,974 over the two decades, compared to $2,249,836 had the money kept up with the S&P 500. That’s a cost of $1,256,823. Ouch indeed! To avoid this kind of cost, we consult with you and come up with a detailed Investment Policy Statement. By taking into account your risk tolerance and personal situation, we formulate a strategy to help you achieve your financial goals. Having settled on a, strategy, we then create a balanced and diversified portfolio with a long-term outlook. We constantly monitor the markets and your specific holdings to make sure you’re on the right track.
The Cost of Only Focusing on FeesIt’s easy to think only about the fee paid to your advisor, but as you can see, there are costs lurking in the background that can have a much bigger effect on your financial well-being. We work tirelessly to minimize them for you. That’s the benefit of Assante advice.
Assante Private Client is a division of CI Private Counsel LP which is an indirect, wholly-owned subsidiary of CI Financial Corp. Assante Private Client and the Assante Private Client design are registered trademarks of CI Investments Inc.