Successful wealth planning has never been easy – and in today’s volatile marketplace it’s more challenging than ever. Many people do not have the time or the expertise to make sound investment choices or continually monitor the performance of those choices. The best wealth plan doubles as a comprehensive strategic plan and a report card. A solid wealth plan must first start with the right conversation. New clients must open up about their finances -- and their attitudes towards money and risk – before we can produce a detailed plan. We believe in spending more time with the client in the beginning to create a better match to what the client really wants. For Summit Capital Management, this starts initially with three or four meetings.
We describe the initial meeting as the discovery phase. We use multiple questionnaires to uncover how the client thinks and acts as an investor. We spend extra time discussing risk; how much risk can you afford before it’s too much? We want to know what you want to accomplish 10 to 20 years from now. We begin with the end in mind, but build in the flexibility to make today run smoothly.
The second phase is designed as open collaboration. We want to make sure we understand what is important to you and make sure you are comfortable with our assessment. We want to create a couple of scenarios for a joint discussion and we want to fine tune everything from the first discussion. We want clients to pose questions or raise concerns about what we have created for them. This is where we make sure the plan fits the client and has the desired results. The purpose is to explore the clients risk tolerance and educate the client on a range or uncertain financial outcomes – and how the client would react under different scenarios.
Normally with the third conversation, phase, we are ready to present the client with a strategic plan. It is important to take the results of the first two meetings, come up with a blueprint together and get on the same page with the client. This is where we start with our recommendations and the base level strategic plan.
From here we move to Investment Strategy and Portfolio Design, the fourth phase. These two processes are independent of each other, but are combined in the same conversation since they are so closely related. Investment strategy and portfolio design are introduced in the second meeting and part of the scenario discussion, which makes this part easier. Since strategy and design were vetted in a prior meeting with the blueprint, the implementation now takes place.
Finally, we will continually monitor the progress and the investments. We schedule reviews to spend time with the client to get their feedback and have candid discussions regarding their expectations. During our reviews with our clients, we want to discuss if anything has changed with them financially. We also want to discuss the accounts and want reassess that their goals have not changed or if their appetite for risk has changed. We have found that comfort with risk can and does change; for example, say they have lost a job or retired, and maybe a parent has died. Events like this can change a client’s attitude for risk and we want their plan to match their attitude towards risk.