Menu burger Close thin Facebook Twitter Google plus Linked in Reddit Email arrow-right-sm arrow-right
Tap on the profile icon to edit
your financial details.

First Trust Advisors Review

Your Details Done
by Updated

This review was produced by SmartAsset based on publicly available information. The named firm and its financial professionals have not reviewed, approved, or endorsed this review and are not responsible for its accuracy. Review content is produced by SmartAsset independently of any business relationships that might exist between SmartAsset and the named firm and its financial professionals, and firms and financial professionals having business relationships with SmartAsset receive no special treatment or consideration in SmartAsset’s reviews. This page contains links to SmartAsset’s financial advisor matching tool, which may or may not match you with the firm mentioned in this review or its financial professionals.

First Trust Advisors L.P. is a fee-based registered investment advisor (RIA) that’s based in Wheaton, Illinois. The private, limited partnership manages billions in assets. Its client base primarily comprises non-high-net-worth individuals and investment companies.

First Trust Advisors Background 

First Trust was established in 1991, along with its affiliate, First Trust Portfolios L.P. (FTP). FTP provides supervisory, administrative and evaluation services for unit investment trusts (UITs). First Trust’s general partner is The Charger Corporation, and the firm’s only limited partner is Grace Partners of DuPage.

First Trust Advisors Client Types and Minimum Account Sizes 

The firm’s client base consists of individuals and high-net-worth individuals, FTP-sponsored UITs, trusts, corporations, foundations, pension and profit-sharing plans, mutual funds, variable annuity sub-accounts, exchange-traded funds, closed-end funds (CEFs), among others. 

If you’re interested in investing with First Trust, you’ll need at least $100,000 to establish an advisory relationship. 

Services Offered by First Trust Advisors 

First Trust specializes in the following advisory services: 

  • Portfolio management
  • Selection of other advisors
  • Security ratings or pricing services
  • Publication of periodicals or newsletters

First Trust Advisors Investment Philosophy 

First Trust’s core principles are to “know what you own, invest for the long-term, employ discipline, re-balance and control taxes," according to its website. The firm’s philosophy is rooted in the belief that a company’s long-term value is determined by the cash flow it produces. 

Though the firm mainly focuses on equity securities, fixed-income securities and alternative asset classes, it has multiple teams on its investment committee who oversee research and securities analysis. Its investment committee consists of an equity sub-committee, a fixed-income sub-committee and an alternatives sub-committee. 

Fees Under First Trust Advisors

First Trust earns its compensation through the following three services: FTP-sponsored UITs, separately managed accounts (SMAs) and its management of CEFs, ETFs, open-end mutual funds and variable annuity sub-accounts (the funds). For its FTP-sponsored UITs, the firm assesses fees as a fixed amount per unit. Each trust’s prospectus specifies the exact fees. First Trust charges non-negotiable asset-based fees for the funds, and each fund’s prospectus also includes specific fees. 

Individual or institutional clients with SMAs pay a standard annual fee of 0.50% of AUM if they’re invested in equity and balanced portfolios. Management fees are negotiable for individual clients with fixed-income securities. In providing portfolio advice, First Trust says it may also rely upon the services of non-discretionary portfolio consultants or investment strategy providers. For instance, First Trust works with Morningstar Investment Management, LLC to provide such services. The firm then pays a portion of its compensation to these providers. 

What to Watch Out For 

As a fee-only firm, First Trust may earn additional compensation when referring clients to other advisors, which creates an incentive to make such recommendations. However, as an SEC-registered practice, First Trust has a fiduciary duty to act in its clients best interests. 

Additionally, the firm has one disclosure on its regulatory record for which it paid a $15,000 fine and over $31,000 in disgorgement in 2023. 

All information was accurate as of the writing of this article.

Tips for Retirement Planning 

  • Though budgeting and saving are two effective ways to grow your money for retirement, you can also benefit from employer-sponsored plans that allow your money to grow tax-free, like a Roth 401(k). If you aren't covered by a workplace retirement plan and want the benefit of tax-free income in retirement, consider opening a Roth IRA.
  • A financial advisor can help you save and plan for retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

How Long $1mm Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology We analyzed data on average expenditures for seniors, cost of living and investment returns to determine how many years of retirement a $1 million nest egg would cover in cities across America.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research