Answers to the most commonly asked questions
What is 360° Private Wealth Management?
By integrating financial planning with investment management and ongoing advisory counsel, our wealth management program aims to help ensure our clients have the freedom to enjoy their success without concern about where they stand financially, no matter what the future brings. Although every client will have a unique set of circumstances requiring specific planning support (which often evolves at different stages of life), one feature of Darrow’s wealth management program which is universally shared by all clients is ongoing asset management.
What types of services do you provide for wealth management clients?
Over the long-term, we have helped clients navigate a variety of situations that have ranged from common to very unique. Below you will find a list of some of the more typical scenarios. Ongoing asset management and retirement planning are cornerstone services that all clients utilize. In addition, the type of support we provide will change over time as the individual’s needs and situation changes. For example, we may focus heavily on getting an estate plan in place and saving for college for a couple with young kids, but fast-forward twenty years, and we could be working to help them develop a plan to retire early after selling a business or receiving an unexpected inheritance.
- Financial advisory support. This is where we spend most of our time working with clients. The types of issues we may advise on will vary with every situation, but some common focus areas include: allocating cash or a windfall to multiple goals, managing stock options, selling a business, college planning, managing financial change.
- Retirement planning. Like everything with financial planning, retirement planning is an evolving process. Through a combination of technology and personal conversations, we strive to help clients with all aspects of retirement planning, such as developing income assumptions, analyzing trade-offs or what-if scenarios, investigating options for additional tax-efficiencies, and helping to navigate major legislative changes that alter the retirement landscape. These are just some of the ways we help clients prepare for retirement.
- Tax-minded guidance. Taxes are always a consideration, though we believe it’s important not to let the tax-tail wag the dog. From our fund selection and asset location to tax-advantaged savings strategies, we work in conjunction with clients’ CPAs to help develop a tax smart strategy.
- Proactive support and ongoing review meetings: Semi-annual meetings are a great way to discuss changes in your life to help ensure your whole financial picture (e.g. asset level, insurance coverage, estate plan, benefits, etc.) is aligned with your current situation and goals.
- Investment management. All of our clients receive ongoing discretionary management of investment accounts (e.g. IRAs, trusts, taxable accounts, and certain active 401(k) and 403(b) retirement plans). Our investing philosophy is based on a low-cost, diversified management strategy that doesn’t seek to time the market or pick single stocks.
- Goal projections. Developing a detailed and custom financial pathway to help you reach your goals. Modules are selected based on your needs, but all plans include a Monte Carlo simulation, net worth projection, cash flow projection, and progress towards achieving your retirement and other goals.
- Ongoing Financial Advice. As unexpected changes occur in your life (and they always do), we always strive to be one of the first calls our clients make. We can either assist you with navigating your options or work to help introduce you to the right professional who can.
To discuss your personal situation, please contact us.
What is a fiduciary duty?
As a registered investment advisor, Darrow Wealth Management has a fiduciary obligation to act at all times for the sole benefit and interest of our clients. This is the highest act of loyalty, trust and care as established by law.
Unfortunately, not all advisors are held to a fiduciary duty at all times. If your advisor is only a part-time fiduciary, how do you know when they stop acting in your best interest? Darrow Wealth Management is always required to act in our client’s best interest.
Is your firm independent or affiliated with a broker-dealer?
We are 100% independent. As an independent wealth management firm, we don’t have allegiances to a particular fund family or product. Independence and compensation method help an advisor be objective when making recommendations.
Independence also matters when a client is in need of other services, such as life insurance or banking. As an independent wealth manager, we will make referrals to other professionals when clients need of insurance or other products, based on what we believe will be in the client’s best interest.
Does your wealth management program have an investment minimum?
Typically, our wealth management clients will have a portfolio of at least $1,000,000 in investable assets. Investable assets most commonly include current retirement plans, retirement accounts from previous employers, IRAs (traditional, rollover, Roth, SEP, inherited, SIMPLE), brokerage accounts, trusts, and cash you wish to invest.
What services don’t you offer?
We are focused on helping individuals build, grow, and protect their wealth over time, which often takes time and ongoing support. As such, we do not offer hourly planning services. Although we collaborate with a client’s team of professionals in other practice areas, such as a trusts and estates attorney or CPA, Darrow Wealth Management does not provide legal, tax, or accounting advice or services.
What does a typical client look like?
Our individual and family wealth management clients are a diverse group of successful professionals in a variety of different fields and industries, such as healthcare, tech, engineering, biotechnology, pharma, law, education, and life sciences. Typical clients include scientists, professionals in academia and research, executives, consultants, attorneys, engineers, doctors, business owners, and nurses.
Where are your clients located?
The majority of our clients are in the greater Boston area, but we have long-standing relationships with clients around the country. Although we are based in Massachusetts, we’re able to partner with executives and professionals across the United States as a SEC-registered investment advisor.
Technology makes it easy to meet face-to-face, even if we are in different locations. When looking for a fiduciary financial advisor, consider prioritizing the right complete fit over an office location near you. After all, if you move or your advisor does, you probably won’t want to start over with a new firm.
When was your firm founded?
Tom McFarland founded Darrow Wealth Management in 1987. His daughter, Kristin McKenna, is now the firm’s Managing Director.
Client Service
Who will I work with at Darrow?
As a Darrow client, you will have a primary advisor who will be your central point of contact. However, we do work as a team in many situations as we believe our clients benefit from the insights and perspectives of more than one seasoned financial advisor.
How can I view my investment performance and holdings?
You may view your accounts and performance at any time via Darrow’s secure client portal. You will also be able to review your holdings daily through our third party custodian’s website.
How is your firm compensated?
As fee-only advisors, we are compensated only by our clients. We do not receive compensation from any of our managers or the investments we make, or from our custodians. We do not receive any commissions from transactions. As a registered investment advisor and fiduciary, we’re always working in your best interest.
What are your fees?
At Darrow, you will work with an advisor – not a salesperson. As a client, you will never have to worry that your advisor may try to sell you a financial product for their own personal gain. Why? As a fee-only financial advisor, we do not sell securities, insurance products, or receive commissions. Instead, we are compensated as a percent of the assets we manage on our clients’ behalf.
Our wealth management program encompasses investment management and ongoing advisory support. Fees for this service are calculated as a percentage of assets under management. The annual fee for most equity portfolios between $1,000,000 and $2,000,000 is 1% of assets under management. Our fees decrease as the asset level increases.
As a fee-only financial advisory firm, we do not sell any financial products (e.g. insurance), receive any commissions, or back-end sales charges. Fees may also be reduced at Darrow’s sole discretion. For more information, see our disclosure page.
What is included in your fees?
Our wealth management fees are all-inclusive. We generally do not bill for additional advice or services within the standard scope of private wealth management.
Preparation of a financial plan is an optional service that Darrow Private Wealth Management clients may request for a flat fee of $5,000. Visit our Financial Planning page to learn more about the benefits of financial modeling and what’s included in the analysis.
Investment Process
What is your investment approach?
We have a broad mandate in our investment approach and look for attractive investment returns wherever they can be found. We use a global approach in selecting opportunities and employ both passive and active investments.
Does your firm pick stocks and bonds?
Typically not. We employ a mix of passive investments such as ETFs and actively managed mutual funds to build a broadly diversified portfolio designed to withstand market volatility.
Do you use index funds or ETFs?
Yes. We incorporate them when they are the best available option.
What will happen to my existing portfolio if I transition to Darrow?
Darrow takes care of all the paperwork to move over existing accounts and tie up loose ends. We have the ability to invest in almost any type of investment and we work with your existing custodians to ensure a smooth transition. While we are likely to recommend changes to your portfolio to improve its risk/return characteristics, we try to incorporate existing managers and positions where appropriate and are likely to implement the changes over time so as to minimize any disruption and tax consequences to the portfolio.
For all other questions…
Every situation is different and it’s common for new clients to have questions unique to their situation. Please contact our office or schedule a phone consultation with a wealth advisor so we can answer your questions about becoming a wealth management client.