Based out of Folsom, California, Allworth Financial is a financial advisor firm that manages assets for both individual and institutional clients, and it offers several services within the realms of financial planning, consulting and portfolio management.
Some members of the advisory staff at Allworth receive commissions when they sell certain insurance products or securities to clients. That represents a potential conflict of interest and is why Allworth is considered a fee-based firm. This is very different from a fee-only firm, which avoids conflicts of interest by collecting only client-paid fees.
Allworth Financial Background
Allworth Financial registered as an advisor in 1993. The firm is majority-owned, through subsidiaries, by the Ontario Teacher's Pension Plan and Lightyear Capital. The rest of the firm's ownership shares belong to HMG Holdco, Inc., which is a holding company owned by co-founders and senior partners Scott Hanson and Patrick McClain.
Of the advisors working based in Folsom, there are 11 Certified Financial Planners™ (CFPs®) and one certified fund specialist (CFS).
Allworth Financial Client Types and Minimum Account Sizes
Allworth Financial works primarily with individuals (both with and without a high net worth). Other clients of the firm include retirement plans, charitable organizations and businesses.
In general, Allworth Financial imposes a minimum account size of $500,000. However, the firm may, at its discretion, accept clients who have less than that.
Services Offered by Allworth Financial
Allworth Financial provides a range of advisory services to its clients, most notably investment management and financial planning. Investment management services are mostly available through a wrap fee program, which is an arrangement that bundles expenses for management, transactions and custodial services into a single charge. The firm offers a similar service for variable annuity sub-accounts.
Financial planning services at the firm can meet a multitude of needs. Some examples are the review of a client's financial position, insurance planning, investment planning, retirement planning, strategic tax planning, estate planning and consulting for retirement. The firm also offers educational newsletters seminars, webinars, guides, tutorials, podcasts, checklists and articles.
Allworth Financial Investment Philosophy
Allworth Financial has designed 16 broad investment categories to choose from when constructing client portfolios. These range from active to passive strategies, along with options for both the risk-averse and risk-tolerant. The firm will consider each client's objectives, comfort with risk, income needs, time until retirement and other factors when determining which strategy is most appropriate for them.
The advisory generally constructs client portfolios using some combination of mutual funds and exchange-traded funds (ETFs). These funds tend to focus on variations of fixed-income securities and equities. Allworth also sells variable life insurance and variable annuities.
Fees Under Allworth Financial
Fees for the investment management services at Allworth Financial are generally charged as a percentage of the client's assets under management (AUM). The exact rate you'll pay will be laid out in your initial advisory agreement, but it will never exceed 1.85%. As the firm typically provides asset management via a wrap-fee program, this fee will cover all management, brokerage and custodial charges. These fees are usually deducted directly from your account's balance.
This firm will generally charge a flat fee for financial planning services. Rates can range from $1,500 to $30,000 depending on the extent of the planning services that you're requesting. Learn more about what advisors typically cost here.
What to Watch Out For
Allworth Financial has no disclosures of legal or regulatory action on its most recent Form ADV, meaning it has a clean record.
As a fee-based firm, some advisors here are licensed insurance agents or securities brokers who collect transaction-based fees and commissions. This could represent a potential conflict of interest. That said, the firm has the fiduciary duty to act in its client's best interests, no matter what.
Opening an Account With Allworth Financial
The easiest way to find out more about Allworth Financial's services is to call the firm at (916) 482-2196. You can also fill out the contact form on the firm's website.
All information is accurate as of the writing of this article.
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