It may be your money, but when a financial advisor / salesperson "gathers" your assets for their commission based remuneration (assets under their administration), they get a sense that they are now their assets and they are not going to want to see them leave (because there goes their revenue stream).
I wrote a blog back in November (http://highrockcapital.ca/scotts-blog/the-human-element)
about a client who was fired by her advisor because she and her husband decided to buy a house against the advisor's advice (which meant taking a chunk of their savings away from his assets under administration on which he earned revenue of 1%).
They bought the house over a year ago and the house that they bought was in Toronto. We know what prices in Toronto have done over the last year.
Needless to say, that particular advisor was not thinking of what the client wanted or needed, just his own bottom line.
A week or so ago, one of our High Rock clients decided that they wanted to build a strategy into their Wealth Forecast for the purchase of a vacation / retirement home in a warmer climate. So we did just that. They were a particularly astute couple and had done their homework and provided a spreadsheet of costs and potential rental revenues. We counseled them on the risks (currency conversion rates, interest rates, $US bank account, $US Visa card, possible tax and estate issues, etc.), but in the end after all the inspections were completed, it was a go!
We executed the $US purchase at the wholesale rate yesterday (they pay us a fee on the investments that we manage for them, so we do not take any additional points on foreign exchange transactions). At the time, their bank's website offered a conversion rate at approximately $12,000 more expensive than what we were able to get for them (one of the many benefits of working with an Asset Management firm).
A dream realized (at a reasonable cost)! And the $US is considerably higher today, so risk well managed as well.
Are those assets that we might otherwise have managed? Possibly, but that is not our purpose here. Our purpose is to help clients achieve their goals. If that means helping them utilize $ that we might otherwise have managed, then that is how it goes. It is, after all, their money.
From our voluntary code of conduct:
#3 Respect that our client’s money is theirs to take whenever they wish (with no costs for moving money out of our care)
So that is how it should work.
There is an alternative to the old ways of doing things and we (at High Rock) are paving the way forward.
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Scott Tomenson,CIM Managing Partner, Chief Investment Strategist