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Discount brokers have their place and many present great value, but for investors who want professional wealth management, a full-service investment firm could be the answer.
Find your match today with our review of the best investment firms.
Best Wealth Management Investment Firms
The miscellaneous fees and commissions as well as account restrictions such as minimum required balances are a trade-off for service that can’t be found with the lowest cost providers.
From personalized account management to goal-driven investment strategies, the best full-service investment firms treat investors like more than just an account number. You might even get a signed birthday card from your advisor or management team.
- Best for Retirement Advice: Datalign
- Best Robo Advisor: Vanguard Personal Advisor Services
- Best for All Skill Levels: Charles Schwab Asset Management
- Best Youth Account: Fidelity Investments
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1. Best for Retirement Advice: Datalign
Datalign Advisory is an online platform that matches people with financial advisers in a way that meets their individual needs. Too many people look online for financial advisers and spend time speaking with advisers who don’t match their needs.
For instance, someone who has a small amount of money to invest may not work well with an adviser who primarily advises high-net worth clients. Likewise, someone who needs advice on retirement goals will not see much value in a financial adviser who specializes in high-risk investments.
Datalign Advisory solves this issue by thoroughly vetting both the advisers and clients looking for financial advisers, then matching them based on detailed information.
If you’re looking for a financial adviser, it only makes sense to use a platform like Datalign Advisory to find them. The no cost platform will match you with an adviser who can successfully address your needs. But with every platform, there are pros and cons to using it. Here are the pros and cons of the Datalign Advisory platform.
Best For
- People who need investment advice or need help with investments
- People who need advice about retirement
- People who need help arranging their finances
- People who want to work with a financial adviser
- Saves time and money by matching you with a suitable financial adviser
- Preserves your privacy
- The questions the platform asks don’t allow you to go into detail or skip the question if it doesn’t apply to you.
Datalign Advisory is a company that specializes in connecting individuals with personalized financial advisors tailored to their specific needs and preferences. Founded by a team of experienced professionals, Datalign Advisory has developed a platform that programmatically matches users with vetted fiduciaries from their extensive network of financial advisors. The company places a strong emphasis on transparency and partner-focused values, aiming to provide crystal clear information and eliminate obstacles to accelerate growth.
At the core of Datalign Advisory’s approach is their belief in data-driven intuitive guidance, empowering users to make informed decisions with the support of comprehensive data. By fostering a collaborative environment and sharing information, Datalign Advisory ensures that both the consumers and the advisors benefit from their platform [1]. The company’s dedicated team comprises professionals with diverse expertise in areas such as partnerships, optimization, product development, and marketing. They work together to create platforms and services that deliver results, focusing on action rather than mere words.
Pros
- Tailored matches: Datalign Advisory uses a detailed questionnaire to match customers with pre-screened licensed professionals based on their unique needs and criteria. This personalized approach ensures that customers are connected with advisors who are best suited to help them achieve their financial goals.
- Extensive advisor network: Datalign Advisory boasts a broad network of thousands of financial advisors nationwide, who have a long history of assisting clients with various financial services such as tax preparation, estate planning, retirement planning, and more.
- No fee for matching: The platform is completely free to use. Customers can match with a verified financial advisor without paying any fees or charges.
- Free consultation call: Upon matching with an advisor, customers are offered a free, no-obligation phone call to discuss their needs and determine if the advisor is a good fit for them.
Cons
- Limited advisor research: There is no option to research potential advisors in the network ahead of time. Customers must rely on the matching process and the information provided by Datalign Advisory to determine the suitability of an advisor.
- Lack of online resources: Datalign Advisory does not provide online calculators or educational resources on its platform. Customers may need to seek additional sources of information or tools elsewhere.
- Customer service contact information: There is no dedicated or obvious customer service contact information available online, which may make it challenging for customers to seek assistance or address any concerns they may have.
2. Best Robo Advisor: Vanguard Personal Advisor Services
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With Vanguard Personal Advisor Services (VPAS), Vanguard once again changed the investment industry. VPAS came about a few years ago, offering a product that is almost a happy marriage between a robo-advisor and a traditional financial advisor.
A Vanguard Personal Advisor works directly with you to understand your goals and financial needs. From there they implement a financial plan to help you achieve whatever your goals are.
Vanguard brings the low investment fees they are known for with their index funds to VPAS. A human advisor will help manager your investment portfolio for as low as 0.3% of all your assets under management. Most other wealth management firms will have fees above 1% anytime a human advisor is being used.
The account minimum needed for a VPAS account is about the same compared to other investment management firms. You will need $50,000 in investable assets to be able to open a VPAS account.
Pros
- Low-cost funds and ETFs
- Large mutual fund selection
- Straight forward approach
Cons
- Investment minimums are on the higher side
- Website and app are lagging
3. Best for all Skill Levels: Charles Schwab Asset Management
Charles Schwab is a solid choice for traders of all skill levels. It offers full access to the U.S. equity and options markets as well as 30 international markets. Traders can create a diverse portfolio with $0 commissions and no account minimums. Schwab’s margin trading is expensive but Schwab makes up for it with affordable futures and options trades, along with a comprehensive mobile offering.
Best For
- 3 trading platforms perfectly in sync makes matching your platform to your skill level a snap
- Excellent futures trading education for new traders
- $0 account minimum means anyone can start trading
- Wide range of available assets to trade, including futures and 30 global markets
- SmartStreet Edge platform is powerful enough for advanced traders, yet easy enough for new traders to utilize
- Unique educational resources (like infographics and podcasts) make learning fun
- Margin rates are more expensive than competitors
- More limitations on available margin than competitors
- Expensive mutual funds
With 5 stars in nearly every category in a recent JD Power’s customer satisfaction survey which rated full-service brokerages, Schwab proves its value to investors seeking full-service investment management by winning the survey’s top rating based on its average scores in all categories.
With a minimum investment amount of $1,000 for standard accounts and $5,000 minimum investment for managed accounts, Charles Schwab aims to be the investment firm that’s accessible to investors at nearly any level.
Investors with at least $25,000 in their
Additional service-level tiers are available, including Schwab Managed Portfolios or Diversified Managed Accounts, bringing more personalized service for larger investment accounts.
Pros
- Best option for ETFs
- Large quantity of low-expense funds
- High-quality research and screening tools
Cons
- Schwab keeps a large percentage of interest on your uninvested cash
- Limited fractional shares trading
4. Best Youth Account: Fidelity Investments
Fidelity is a comprehensive and responsive brokerage suitable for both new and experienced traders alike. With complete access to the full U.S. stock and options markets, a set of state-of-the-art education and research tools, as well as a wide fee-free fund selection, Fidelity is equally useful for the veteran swing traders to novices opening their first accounts. Mobile traders will be especially happy with Fidelity’s app, which mirrors full capabilities of the platform. Though there isn’t much to criticize about Fidelity, the broker does have a few areas where it can afford to improve. Margin rates are significantly higher than most other brokers, especially for traders borrowing less than $25,000. It also doesn’t offer any access to the futures markets. Despite these minor flaws, Fidelity remains a strong choice for most investors.
Best For
- Easy-to-navigate yet functional platform strikes the perfect balance between expert tools and comfort for beginners
- Mobile trading app is fully-optimized and mirrors full functionality of the desktop platform
- Wide range of education and research options make learning more about securities and the market easier and less time-consuming
- Complete range of both independent and managed services available at exceptionally affordable prices
- Offers access to both domestic markets and 25 foreign markets, as well as a wide range of options contracts and over 10,000 mutual funds
- Mobile app that is well-integrated and works just as well as the desktop platform
- Wide selection of education tools and resources available free of charge
- Margin rates higher than many other competing brokerages
- No access to futures trading
- High fees for buying a non-Fidelity mutual fund (with over 3,300 fee-free funds available)
Servicing a broad spectrum of investor profiles, Fidelity Investments offers low-cost trades for self-directed accounts as well as portfolio management and more complex wealth management services.
For investment accounts starting with $50,000, Fidelity can design a strategy to help you invest for retirement or other financial goals. Additional account tiers for accounts with a minimum $200,000 investment offer either tax-sensitive investment management or separately managed portfolios investing in specific equities or fixed income markets.
Fees for managed accounts vary widely with Fidelity, ranging from 0.20% up to 1.7% with the lowest fees available to F
Pros
- Inexpensive
- High quality research tools
- Powerful educational content
Cons
- Funds can be pricey
- Tools are scattered over multiple platforms
Why Choose a Wealth Management Firm?
Whether it’s time to rollover a 401k into an IRA, start an IRA or college fund or build an investment account simply to invest for your future, investors have a growing number of options. Online brokers have taken the market by storm, offering low cost trades, technical charts, webinars and online education centers to help investors learn the ropes, research and trade.
Robo-advisors promise to bridge the gap between DIY discount brokers and full-service firms by providing guidance or automated portfolio management based on predetermined criteria. Even with all the online options available, some investors prefer a more personal touch and the knowledge that someone they can trust will handle their portfolio and help guide decisions. Because there’s often some crossover in services, investment firms might offer a robust online platform for self-directed investing but also offer full-service advisors or account management.
How to Understand Your Investment Goals
Every investor has his or her own goals, balancing risk against safety or the chance to earn outpaced gains against dividend income and steady appreciation. A full-service investment company can point the way to the best solution or basket of options that can help you realize your investment goals.
A good investment firm’s advisors can help you to invest in a way that matches your long-term goals for safety and earnings — AND point out potentially problematic investments or likely underperformers. Utilizing a full-service investment company doesn’t guarantee you’ll never have losses, but many losses can be avoided or minimized.
Who Needs an Investment Firm?
It’s a good idea to find the right financial advisor in an investment firm if you’re:
- Dealing with complicated investments like inherited money and margin trading.
- Undergoing a complicated life situation, like a remarriage or divorce.
- Dealing with a large portfolio and multiple assets.
- Looking for comprehensive wealth planning.
- Unsure about your own ability to manage your money.
You may be able to think of other situations that warrant the need for a financial advisor at an investment firm. Make sure you do your homework before you act!
What to Look for in an Investment or Wealth Management Firm
You don’t want to choose the wrong firm for your needs — and there’s a possibility that could happen. Follow these guidelines to make sure you’re with a financial advisor that feels comfortable for you.
Overall Customer Satisfaction
No investment firm can be a perfect fit for every investor, but the best investment firms focus their efforts on the areas most important to their clients, providing top-notch service at the acceptable expense of higher commissions or fees than discount brokers.
Dedicated Financial Advisors or Teams
Much of the attraction for a full-service investment firm is the availability of dedicated financial advisors or teams, people who understand your investment goals, listen to your concerns and who often know you by name.
Customer Service and Support Options
The availability of multiple support options for account questions anytime of day or night has become a must-have feature, with the understanding that advisors are only available during business hours.
Reasonable Commissions and Fees
Expect to pay more when investing with a full service investment firm as opposed to a discount broker. However, if fees or commissions are too high, investment returns can be adversely affected by the headwind created in trading or management costs.
Information Resources and Investor Research Tools
Investors with a healthy curiosity will want to do their own research or learn more about investments they’ve either made or are considering.
Variety of Products and Investment Vehicles
The number of investment vehicles has increased dramatically in recent years, and the best full-service brokers will provide options to round out your portfolio with investment options for nearly any type of asset class.
Investment Performance
For fully-managed accounts, investment performance becomes a big part of an investment firm’s report card for investors.
Additional Wealth Management or Estate Planning Solutions
Sometimes investments are only part of the picture. The availability of trusts, life insurance and estate planning options can help turn gains into a legacy of lasting wealth.
Drawbacks of Using an Investment or Wealth Management Firm
When choosing a full-service investment company, you’re often trading autonomy for management. This isn’t necessarily a bad thing, but it is different than what you’ll get with most discount brokers. In exchange for the management or guidance provided by a full-service investment firm, fees or commissions will also be higher than with some lower-cost options.
You’ll have a new silent partner in your investment account, quietly taking a percentage — in good times and in bad. Warren Buffett is famous for his quote, “Price is what you pay, value is what you get.” This investment maxim can be applied to the notion of investment management cost as well. What’s often overlooked is the ability of a managed investment strategy to keep you out of trouble.
Many individual investors using a DIY brokerage account lose money. A management team’s or advisor’s ability to keep your account in the black — at least most of the time — is part of the value you get for the price you pay in higher commissions or fees. Be aware that some investment firms charge a transfer fee if transferring your account to another broker. You can probably expect transfer fees to be waived if transferring to another location within the same firm.
Account Funding for Investment Firms
A variety of methods to fund accounts is another must-have feature for an investment company. A particular interest is the ability to automatically invest on a weekly or monthly basis, taking advantage of dollar-cost averaging to build your account.
For most households, it’s easy to establish an amount that can be safely invested on a scheduled basis and that won’t be missed from the budget.
Additional amounts can be invested at your discretion or when you come into extra cash, such as selling an asset, earning a bonus or getting a large refund. Many investment firms require a minimum investment amount or offer lower management fees for larger investment accounts.
Investment Firm Trading Costs
With full-service investment firms, trading costs are often more accurately described as management fees. Certain types of trades or investments may have a set commission, typically ranging higher than the per-trade commission costs available from discount brokers.
Additionally, investors can expect a management fee ranging from below 1% up to over 3%. Management fees apply in good years and in bad, which means that in an investment year in which your account is essentially flat, you could show negative growth due to management costs.
Accounts with a higher dollar value are often rewarded with lower management fees and smaller accounts may have a minimum fixed annual fee as well.
Get the Best Financial Firm on Your Side
Over the past several decades, the broad market and wide indexes such as the S&P 500 have outperformed most managed funds and the same may apply to managed portfolios.
Avoiding costly investment mistakes is crucial to overall portfolio growth and capital preservation, providing an often-overlooked advantage to using a full-service investment firm as opposed to self-directed investing.
A dedicated financial advisor or team can focus your portfolio on growth goals while also defending against losses, helping you to keep more of what you’ve earned.
Before choosing an investment firm that’s best for you, you should research heavily. Discuss various investment strategies and inquire more about how your wealth will be managed.
Frequently Asked Questions
What is the role of an investment firm?
An investment firm offers professional advice in stocks, bonds, mutual funds, retirement planning, insurance and wealth management.
What are the types of investments?
Several areas include stocks, bonds, mutual funds, commodities, annuities, real estate, insurance and bank products.
What strategy do investors use to protect themselves from risk?
Investors use portfolio diversification to help protect themselves against risk.
The post Best Investment Firms by Eric Huffman appeared first on Benzinga. Visit Benzinga to get more great content like this.