Frequently Asked Questions
Please click the questions below to discover the answers.
WHAT DOES YOUR FIRM DO?
We provide professional retirement planning, investment management and wealth advisory services to individual investors. We help individual investors develop a plan intended to help them accumulate enough investment assets so that when they wish to stop working or can no longer work, they will have enough income from their investments, Social Security and pensions to replace their earned income to support them in their desired lifestyle. Then we build and manage a portfolio of investments in their brokerage and retirement accounts with the goal of helping them generate the income they will need to meet their planned expenses in retirement. This income may come from many sources, including dividends, interest, rents, royalties, annuities and other distribution payments.
We serve our clients as an advisor, manager, leader, and counselor. In each role, we contribute differently as our clients look to us with different needs at different times. Most often, we contribute simultaneously across all capacities in differing degrees. As leaders, we provide motivation and direction. As counselors, we help remove barriers. As advisors, we provide technical advice. And as managers, we carry out process. Taken together, we are always working to position our clients in their place of greatest potential.
To learn more about how we pursue and accomplish this, read our Blog.
DOES YOUR FIRM SERVE ITS CLIENTS AS A DISCRETIONARY INVESTMENT ADVISER FIDUCIARY?
Yes, we serve our clients as a discretionary investment adviser fiduciary and are subject to the requirements of the Investment Advisors Act of 1940 and other applicable laws, rules and regulations.
WHAT IS A FIDUCIARY STANDARD AND WHY IS IT IMPORTANT?
A fiduciary stands in a special relationship of trust, confidence and responsibility with another person. The duties of a fiduciary include loyalty to the client and reasonable care with regard to the client’s assets. All of a fiduciary’s actions are to be undertaken in the best interest of the client. A fiduciary must avoid self-dealing and minimize and disclose conflicts of interest to the client.
IS YOUR FIRM A FEE-ONLY FINANCIAL ADVISORY FIRM?
Yes, our firm is a fee-only financial advisory firm.
WHAT DOES FEE-ONLY MEAN?
Fee-Only refers to compensation for a service. A Fee-Only financial advisor charges the client directly for advice and/or ongoing financial management. No other financial reward is provided by any institution, which means that the advisor does not receive commissions or other forms of compensation on the actions they take on the client’s behalf. Fee-Only practitioners may not receive commissions, rebates, finder’s fees, bonuses or any other form of compensation from others as a result of a client’s implementation of the practitioner’s planning recommendations. The National Association of Personal Financial Advisors (NAPFA) ascribes Fee-Only to a practitioner, who in all circumstances is compensated solely by the client, with neither the practitioner nor any related party receiving compensation that is contingent on the purchase or sale of a financial product. It is the required form of compensation for members of the National Association of Personal Financial Advisors. Compensation is based on an hourly rate, a percent of assets managed, a flat fee, or a retainer. Fee-Only compensation helps minimize conflicts of interest.
IS FEE-BASED THE SAME AS FEE-ONLY?
No, fee-based means a fee is charged in addition to collecting sales or brokerage commissions and other forms of compensation.
DOES YOUR FIRM CHARGE SALES OR BROKERAGE COMMISSIONS?
No, we do not sell financial products to our clients or broker their investment transactions to generate sales commissions or other forms of compensation to us, or to meet one of the qualifications for a bonus, award, prize, educational trip or job title.
WILL YOUR FIRM HOLD CUSTODY OF OUR ASSETS?
No, our firm uses unaffiliated, third-party custodians to hold custody of your assets. Your accounts are held at a recognized unaffiliated custodian like Fidelity Investments, Schwab, or TD Ameritrade and are not held in-house at ICW Investment Advisors. We have limited power over your accounts held by these unaffiliated third-party custodians. That power is limited to buying and selling securities on your behalf, moving funds between your accounts, and having funds sent directly to you via your address of record or like-registered accounts at other financial institutions.
DOES YOUR FIRM INVEST IN INDIVIDUAL STOCKS AND BONDS?
Yes, we prefer to invest in individual stocks and bonds when the accounts are large enough to achieve acceptable diversification and transactions costs. We want as few people and layers of cost between our clients and their money as possible. We have found that it helps our clients become better investors to see the dividends and interest payments deposited into their accounts directly from the companies in which they are invested. This reinforces our objective of keeping a priority focus on investing for cash flow to help our clients meet their income needs.
WHAT OTHER TYPES OF INVESTMENTS DOES YOUR FIRM USE?
We also use open-end and closed-end mutual funds, exchange-traded funds (ETFs), exchange-traded Real Estate Investment Trusts (REITs) and exchange-traded master-limited partnerships (MLPs).
DOES YOUR FIRM HAVE A FEE SCHEDULE OR RATE CARD?
No, we price each client engagement only after we believe we have a complete understanding of the scope of an engagement and the client’s expectations and requirements for the firm’s resources. We consider many different factors in determining our professional fee, including the required planning complexity, professional skillsets required, the nature, types and size of investment assets and accounts to be managed, regulatory and fiduciary costs, the number of family members and other professional advisors involved, the number of meetings required, client responsiveness to our requests for information, and client organizational and recordkeeping skills. Our fees are spelled out in our Form ADV Part 2A Disclosure Brochure.
WHAT IS THE DIFFERENCE BETWEEN INTELLIGENT CAPITALWORKS AND ICW INVESTMENT ADVISORS LLC?
There is no difference. The firm’s legal name is ICW Investment Advisors LLC. Intelligent Capitalworks is a tradename. The names are interchangeable.
YOUR FIRM BROCHURE SAYS YOU WORK WITH INVESTORS WITH A MINIMUM OF $1,000,000 OF INVESTABLE ASSETS ACROSS ALL OF THEIR ACCOUNTS. WOULD YOU MAKE AN EXCEPTION TO THIS POLICY?
Possibly. We may make exceptions, solely in our discretion, for potential clients with investable assets below $1,000,000 who wish to work with us.
IS WORKING WITH YOUR FIRM LIKE WORKING WITH A FINANCIAL ADVISOR AT A STOCK BROKERAGE FIRM SUCH AS MERRILL LYNCH OR MORGAN STANLEY, A BANK LIKE BANK OF AMERICA OR WELLS FARGO, OR AN INSURANCE COMPANY LIKE NORTHWESTERN MUTUAL OR NEW YORK LIFE?
The term “Financial Advisor” has been co-opted by stockbrokers, insurance agents, discount brokerage firms and retail banks over the past 20 years. Before that time, stockbrokers were registered representatives or account executives, insurance agents were insurance agents, and bankers were bankers. If they generated enough securities brokerage commissions or insurance sales commissions, they were awarded titles such as vice president or senior vice president.
As the protective regulatory walls of the Glass-Steagall Act were falling in the mid-90s and brokerage firms, banks and insurance companies began to merge back together again, titles for stockbrokers, insurance agents and bankers quickly and quietly morphed away from sales titles to “Financial Advisor” while regulators were busy overseeing the bigger picture of re-integrating the stockbrokerage, banking and insurance industries.
Today, the title Financial Advisor seems to be a catch-all title for just about anyone in a financial services industry. This has left consumers to figure out “what’s inside.” It’s a not-so-funny thing that we have more stringent laws for truth in food-labeling than we do for people to whom we entrust our money.
To this day, spirited debate continues whether the term “advisor” should be restricted from broad use and returned and preserved exclusively to the province of investment professionals adhering to the higher fiduciary standard of the Investment Adviser Act of 1940. To the extent that regulators have not yet successfully stepped into the breach, the investigative burden continues to fall to the consumer. To that end, you must observe what they do and how they act, not what they call themselves.