Frequently Asked Questions
Why choose Purtill Financial?
The best reason to choose an investment adviser is to get the highest returns on your investments appropriate to your risk comfort level. Every additional percentage point of portfolio return is critically important to the investor. Over 25 years, each additional percentage point of return adds $85,000 in value to a $300,000 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?
The large firms have hundreds of 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 this 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.
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 for 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 in extra commissions. If they sell you an annuity, their upfront commission will run 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, the returns on the securities they sell you will likely be lower.
Many brokers 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 rep and for the firm that employs him or her
You are also paying much higher commissions on trades of individual stocks than you would at a discount broker, where trading fees are usually under $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 large sales force.
Banks and insurance companies also do not charge for investment advice. Their commissioned salespeople, known as consultants or advisors, will sell you only those investment products that generate substantial commissions for their firms. Since they do not advise you on your employer plans, such as 401(k)s, you have no assurance that your overall investments provide you a balanced, diversified portfolio.
If you want objective advice concerning the best investments and your overall portfolio, the fee only adviser is your best source of information.
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 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.
Purtill Financial is a professional firm, not a one person operation. Investment advising is our only business. We have three full-time professionals and a well equipped office available exclusively to our firm on a 24/7 basis. Our software for investment analysis, portfolio allocation, taxes, and client reporting is first rate.
How can I verify the credentials of an investment adviser?
To check out 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:
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 manages investment selection, portfolio management, financial planning, and tax preparation.
Tom Geraci and Michael Purtill actively participate as team members in all of these activities.
What is your client base like?
We serve nearly 100 client families. They tend to be middle aged or older, but range from 30 to 90 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 retired and current corporate executives, small business owners, educators, and CPAs. We also have clients who are doctors, nurses, dentists, attorneys, clergy, media figures, and engineers.
Most of our clients are from Ohio and Florida, although we have clients from other states under the de minimus exception.
In most cases, our clients have between $250,000 and $3 million in investable assets. Our average client investment balance is about $500,000.
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 diverse portfolio. We target clients with a minimum investable assets of $500,000 or the potential to accumulate that over the course of their working careers.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. They must also 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.
Clients must have realistic expectations about investing in the stock market, understanding that balances move up and down daily, that there are both bull and bear markets, and that it is possible for investments to lose money.
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 timeframe to recommendations.
We always welcome questions and suggestions from our clients. Client feedback helps us continue to improve our business to ensure client satisfaction. We are also happy to work with any client who wishes to have a conservative or aggressive portfolio, as long as they clearly articulate their wishes to us when we meet with them and complete our risk profile questionnaires.
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 should 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 do not pass through any out-of-pocket expenses, such as long-distance telephone, postage, etc. We have a straightforward fee arrangement with our clients based on their assets at the end of the previous quarter. We bill them 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 ETF’s, which have trading fees when the funds are bought or sold. These fees never exceed $24 per trade.
Asset management clients may 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 $125,000 or more in investable assets. However, we do manage a few smaller client accounts and help them reach cost-effective levels for our fees by recommending savings plans and helping grow their investments.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 will recommend an estate planning attorney. 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 and Scottrade for all non 401(k) security purchases, including mutual funds, exchange traded funds, money market, etc and also employer accounts, such as 401(k) or 403(b) plans. All funds invested in such accounts are generally covered by large insurance policies protecting you against theft or embezzlement.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 and seek higher returns.
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. New clients are important to us in helping grow the firm and increase our ability to add more support services for existing clients.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 is 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 Vermilion, Ohio and Fort Myers Beach, Florida. There is no charge or obligation for an initial meeting for prospective Investment Management clients.Where clients do not live in reasonable proximity to our office locations, we do client interviews by telephone and exchange documents by e-mail or fax. We are happy to work that way with clients who find that more convenient.
We normally interview a client, 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. We don’t think that providing general suggestions would be a useful service to clients. For clients who are not comfortable executing investment recommendations, we can 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. 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 with 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, stock options, long-term care insurance needs and financial planning in general.We routinely receive questions from clients and 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 client’s questions and never limit the subjects we are willing to talk about. Our staff is experienced in credit cards and mortgages, as well as the normal financial planning subjects.
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 advantages of a CPA-PFS vs. a CFP designation?
The designations are similar. The CPA-PFS is generally more knowledgeable in taxes and the CFP in financial planning per se. Our business plan is to have both designations in our firm. Don is a CPA-PFS and Tom and Mike are 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 doing the work, 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 that clients do that if they are comfortable and competent in doing so. Otherwise, we provide all the help needed to get this done.Why did you choose to be independent and fee-only?
We believe that the commission 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 or brokerage firms or insurance companies. We have seen abuses on the part of these firms, and would not want to be associated with them in any way, shape or form.Can you answer small business questions?
Yes, if they are financially related and within our area of expertise. Usually they are, because we run a small business ourselves. 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.Can I schedule an annual review of my financial situation?
Yes we would like to meet with clients at least once a year. We actively encourage them to visit us 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.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 eventually 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.