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Investors Worry About Resources and the Safety of Their Assets

By Rita Raagas De Ramos October 25, 2018

This is part four of a six-part series probing the concerns of American investors, as expressed to top financial advisors.

Michael Weissman, New York-based director of investment advisory and principal at Aspiriant, says the top financial security-related questions his clients ask are about the resources they need to meet their goals and the safety of their assets.

“As advisors we help guide the conversation by asking good questions to clients, walking them through goal setting exercises, developing wealth plans, and establishing investment policy statements,” Weissman says. “I now provide financial satisfaction survey questions to new clients to help identify areas of concern.”

Here are the top three financial security-related questions Weissman is asked by his clients, and how he answers them:

#1 Do I have enough money/resources?

“For many this is ‘Do I have enough money to weather the next financial downturn?’ For working executives this may be ‘Do I have enough money to retire, to leave my job or to scale back my earnings?’ For retirees this is often ‘How confident can I be that I will not outlive my assets or do I have enough money to make it through retirement?’

The answers to questions about financial resources are best addressed through running financial projections. We are able to build wealth plans for clients after gathering information on income, expense, goals, etc. with reasonable assumptions on inflation, investment growth, etc. and looking at the likelihood of success in meeting their capital sufficiency goals. We build a base case and layer on different scenarios including bear market, loss of pension, etc. as a stress test to the base plan.”

#2 How safe are my assets at our custodian (Schwab, TD Ameritrade, Fidelity, etc.)?

“I provide high level guidance on the safety of their assets. Noting that failures at custodians are very rare, they have protection at our custodians through SIPC (Securities Investor Protection Corp.). I also note that it is generally a matter of time, not whether they would get their assets back, in a bankruptcy situation. The SIPC website notes that investors with Lehman Brothers all received the contents of their securities accounts without the need for SIPC to advance funds. A few of the clients I serve have opted to use two custodians rather hold all of the investment assets with a single custodian.”

Michael Weissman

#3 What can I do to protect myself against identity theft and fraud?

“I recommend that clients take a proactive approach to monitoring their financial accounts and their credit card accounts. You want to know if there is an issue as soon as possible so I do not believe it is prudent to wait for monthly statements. I think it is prudent to look at your larger financial accounts and credit card transactions on a weekly basis. I have also seen more of the clients I serve freezing their credit over the past few years with the Equifax and other data breaches.”

Weissman has been an advisor since 2004. Aspiriant says it has around $12 billion in client assets.

Read Ric Edelman’s interview here, Ken Fisher’s here and Nick Strain’s here.