A question we receive from time to time when meeting with prospective clients is whether we can manage only a portion of their investments while other accounts remain self-managed or with another advisor.
Our preference is not to manage partial portfolios, but rather a client’s full investable portfolio because it allows us to provide the highest level of planning, coordination, and investment oversight. This approach helps ensure that every part of the portfolio is working together in support of our client’s goals. Let’s take a deeper dive into the reasoning behind this philosophy.
Your Investment Strategy Is Built Around Your Entire Financial Picture
When we recommend a portfolio strategy, we’re not looking at accounts in isolation. We’re looking at your complete financial situation and designing an investment plan that works together across each of your accounts.
If some accounts are managed separately, it becomes much more difficult to keep your overall allocation aligned with your goals and capacity for portfolio risk. Over time, this can lead to unintended exposures and a portfolio that no longer reflects the plan we created.
A Portfolio Works Best When Everything Is Coordinated
Different advisors, employer plans, target date funds, and investment strategies often operate under different philosophies.
That can create issues such as:
- Duplicate or overlapping investments
- Conflicting bond strategies
- Higher overall costs
- Risk levels that don’t match your financial plan
We believe portfolios are most effective when every account is working toward the same objective within a unified framework.
Bonds Have a Job to Do
We don’t view bonds as a tool to maximize returns. Instead, we use them primarily to help stabilize the portfolio and provide liquidity when needed.
When part of a portfolio uses a different bond strategy, it can weaken the role bonds are intended to play within the overall plan.
Tax Planning Requires Coordination
One of the biggest ways we add value is through tax-efficient portfolio design.
That includes strategically placing investments across Roth, traditional, and taxable accounts to help reduce taxes over time. When we only manage part of the portfolio, we lose much of that flexibility, which can create unnecessary tax drag and reduce long-term efficiency.
Comparing Accounts Can Become a Distraction
When assets are split between advisors or investment approaches, it’s natural to compare performance.
The challenge is that short-term differences in returns are often driven by differences in asset allocation, not advisor skill. Chasing whichever account performed best most recently can lead to poor decisions and unnecessary portfolio changes.
Rather than focusing on individual account performance, we believe the better measure of success is whether your total portfolio is helping you make progress toward your financial goals.
Our Fiduciary Responsibility
As fiduciaries, we’re obligated (and we strive to) act in our clients’ best interests.
When assets are divided between uncoordinated strategies, it can create unnecessary complexity, overlap, gaps in planning, and additional costs. Because of that, we don’t believe managing partial portfolios allows us to deliver the level of advice, coordination, and accountability our clients deserve.
Our goal is to provide advice that is comprehensive, coordinated, and aligned with your entire financial plan, not just a portion of it.
Choosing a financial advisor is an important decision, and we believe understanding how and why we make recommendations matters. If you have questions about our investment philosophy, portfolio management approach, or whether Financial Symmetry is the right fit for your situation, we’d love to connect and learn more about your goals.
