Because it will launch as part of our new website, I’ve spent a lot of time thinking about the appropriate content for this first blog post. There are numerous things that I would like to write about in the coming weeks and months—including deeper dives into some of the things that I intend to discuss in brief today. In the end, I felt it was appropriate to define exactly what ideals are behind Liberty Tree Asset Management (“LTAM”).
It turns out that, in many cases, I define the vision for the business by what I don’t want this company to become.
I describe Liberty Tree Asset Management as a “boutique” Financial Services firm. Having been in the finance business for over fifteen years, I have encountered many Financial Advisors that have thousands of clients but barely maintain a relationship with any of them. That business model is in volume. We will never become one of those. The goal also is not to become a mega-firm that manages a massive amount of money. In my experience, these firms tend to allocate most of their attention and resources to a few wealthy clients at the expense of the majority.
Many firms offer “financial planning”, but experience tells me that it is too often a thinly veiled sales tool. When I first started in this business in 2005, I learned from a veteran retirement planner. It did not take me very long to realize that the end result of all of his “plans” lead to somebody needing to buy life insurance Not only was there always a product sale involved, but most of the time it wasn’t good advice. That was a very formative experience for me. I have never believed in such a self-serving approach and I’ve always resented the bad name that such individuals give our industry.
Regarding investment management, many firms do things the “easy way”. This includes cookie cutter portfolios by third parties. In my view, this tends to allow the “local agent” to have a disassociation. In practice, advisors who sub out their investment work don’t have their “hands on the wheel” and have no idea what is happening in these portfolios at any given time. If something goes wrong, they would say that it is the fault of the third-party fund firm and not the agent who selected and hired them. I disagree.
This all begs the question, then. What is the vision for Liberty Tree Asset Management?
To start, I would answer that in the way that I imagine most small business owners would: I seek to offer a service of value and enjoy the time that I spend doing it. The reward for me is in interacting with client households in a one-on-one environment, building relationships with my long-time clients and perspective new clients, and knowing that the advice and roadmap which I provide should help each household to further their financial goals.
My relationship with prospective clients begins, in most cases, with a detailed financial plan. When established, this is periodically updated and provides a game plan for the financial future of the household. Done right, financial planning is not for everyone as it is a very time-intense process for new clients who must provide a litany of data and then commit to a series of meetings in which to develop an action plan. To offset, once the analysis is completed, I have interacted with very few prospective clients who do not consider the plan development to have been time well spent.
Once a financial plan is established, most clients require some form of investment advice. Liberty Tree Asset Management offers a full suite of customized investment solutions. This includes what I view as two future, long-term asset management trends: a move toward international investing and toward sustainable and ethical investing. Whereas the last major trend in investment allocation was toward maximum diversification, households today are increasingly interested in knowing exactly what they own and feeling good about it. Nobody can claim to have the “best” investments, but I do seek to create educated investors.
In 2020, Liberty Tree Asset Management is a “one-man shop”; a single Financial Advisor who left a larger practice to strike out on his own. It used to be a staple of the industry, but I don’t believe that a solo practice is the right business model for an increasingly complex industry. Expect the Liberty Tree staff to grow over time while always maintaining that “small business” feel. As that happens, I hope that our services offered will improve and expand.
Finally, said succinctly, my goal is to democratize financial planning and investment management in my own little corner of the world. I’ve worked both for very wealthy clients and for households who started with a negative net worth. Whatever their financial situation, I am more interested in where clients want to go than where their starting point is.
Launching a new investment practice is sort of like building a diversified investment portfolio. For a sustainable long-term business, I seek a client base with a variety of ages, experiences, incomes, assets, and goals. What is of most interest to me is to service households that are attentive, optimistic, and who seek to improve their financial future through saving, planning, and investing.
If you’re that kind of person, then Liberty Tree Asset Management may be the firm for you.
Financial Advisor, RICP™