Based in Mason, Ohio, Matson Money provides asset allocation advisory services primarily to non-high-net-worth individuals. With billions in assets under management (AUM), it generally allocates client's money across model portfolios built with its proprietary mutual funds and securities managed by other firms. Matson Money works through unaffiliated partners such as other registered investment advisors (RIAs) to serve its clients.
Matson Money Background
Matson Money first opened its doors in 1991. The firm’s main business is delivering asset allocation services through unaffiliated RIAs and other entities such as broker-dealers or co-advisors.
CEO and founder Mark Matson principally owns the firm. Matson has not only shared his vision on investing as an advisor but also as an author and producer. He’s made hundreds of TV appearances as a financial commentator.
Matson Money Client Types and Minimum Account Sizes
Matson works with both non-high-net-worth anf high-net-worth individuals, as well as investment companies, pension and profit-sharing plans, charitable organizations, municipal government entities and corporations.
If you’re interested in opening an asset management account with Matson Money, you don’t need to worry about a minimum investment. There isn’t one.
Services Offered by Matson Money
Unlike other firms that combine stand-alone financial planning with investment portfolio management services, Matson Money’s main line of business is providing asset allocation advice. It does this through unaffiliated RIAs and broker-dealer representatives.
In other words, a typical client spends most financial advisory time with another registered firm or co-advisor. In fact, the firm notes that it usually communicates directly with clients only in unusual circumstances. The client would come into separate agreements with the co-advisor as well as Matson Money.
Matson Money also manages its own mutual funds, which it calls the Free Market Funds. These are the Free Market U.S. Equity Fund, the Free Market International Equity Fund and the Free Market Fixed Income Fund. Matson Money and its co-advisors may allocate client assets across different mutual funds, especially Free Market Funds as it sees fit based on the client’s risk tolerance and investing goals.
Additionally, Matson Money offers two investment advisory programs for new clients: the Matson Fund Platform and the Frontier Adjusted Portfolio Program. We describe them below:
Matson Fund Platform
The Matson Fund Platform generally involves Free Market Funds. But it may also invest in variable insurance products also managed by Matson Money. The asset allocation of your portfolio will be based on your answers to a questionnaire. Depending on your answers, your assets may be allocated based on one of the following models:
|Model Portfolio||Asset Allocation|
|Aggressive Growth||95% equities; 5% fixed income|
|Long-Term Growth||85% equities; 15% fixed income|
|Long-Term Growth||75% equities; 25% fixed income|
|Balanced Growth||60% equities; 40% fixed income|
|Balanced Growth||50% equities; 50% fixed income|
|Balanced Growth||40% equities; 60% fixed income|
|Income and Growth||25% equities; 75% fixed income|
|Fixed Income||0% equities; 100% fixed income|
Should Matson Money recommend that your asset allocation involve a separate insurance account, the firm would determine the appropriate percentage.
Frontier Adjusted Portfolio Program
The Frontier Adjusted Portfolio Program generally invests in Free Market Funds, and advisors adjust your asset allocation annually to reflect your risk profile at the time. The starting asset allocation can be based on any of the models in the Matson Fund Platform as long as the equity portion is at least 15% and the firm finds it suitable to the client’s risk profile. Clients enrolled in this program currently can’t invest in the Matson Money insurance products.
Additionally, the firm manages the Private Account Asset Allocation program, which mainly invests in no-load mutual funds managed by Dimensional Fund Advisors. This program, however, is not currently available to new clients.
Matson Money Investment Philosophy
Matson Money adheres to the Modern Portfolio Theory, which suggests that diversifying portfolios across asset classes is key to capturing upside returns, while protecting against downside risk.
The firm also relies on the Efficient Market Hypothesis (EMH), which proposes that share prices reflect all available information, making it impossible to time the market (since all shares are priced at their fair value). EMH makes the case for investing in low-cost, passive funds.
Matson Money mainly invests client assets among its proprietary Free Market Funds along with other mutual funds. It may also utilize exchange-traded funds (ETFs), variable annuities and life insurance contracts.
If you have an existing portfolio when you establish a relationship with Matson Money, the firm would recommend you sell the securities in that portfolio to free up funds to purchase shares of the securities that Matson Money recommends.
Fees Under Matson Money
Clients of the Matson Fund Platform and the Frontier Adjusted Portfolio Programs bear all fees and expenses associated with the portfolio program they’re enrolled in and the funds that these programs invest in. The latter include embedded advisory and other fees and expenses that may be paid to Matson or other fund managers.
In other words, as Matson Money states, clients “bear their asset-based share of the fees and expenses of each underlying fund as well as of the Free Market Fund series or Matson Money Fund series in which their assets are invested.”
That said, neither Matson Money nor any other party receives a sales load in connection with client investments in its funds. Also, clients do not pay Matson Money any separate advisory fee above the fees embedded in the Funds to participate in the Matson Fund Platform or the Frontier Adjusted Portfolio Platform.
However, clients do pay separate fees to co-advisors who refer them to Matson Money’s funds. The firm has capped the maximum allowed for all new clients to 1.20% of client AUM (historically, it went as high as 1.40%).
So if your account size is $3 million and the co-advisor charges you an annual asset-based fee of 1.20%, that would translate to a $36,000 annual fee. These fees are charged quarterly in advance. But they do not reflect the underlying fund fees and expenses detailed above.
For Private Account Asset Allocation accounts, clients pay fees generally according to the following fee schedule (fees may be negotiable under certain circumstances and at the firm’s discretion).
|Assets Under Management||Annual Rate|
|Next $3 million||0.75%|
|More than $4 million||0.50%|
What to Watch Out For
At the time of this writing, Matson Money has no legal or disciplinary events involving the firm or its officers or principals to disclose.
As described above, Matson Money tends to limit its scope to allocating client assets across its Free Market funds and other mutual fund families from firms such as DFA. However, Matson Money doesn’t collect compensation from DFA or other mutual fund companies for allocating client assets among their funds. It collects its fees solely as an asset-based portion of your portfolio program account.
But unlike firms that offer a variety of stand-alone financial planning services in addition to portfolio management, Matson Money provides solely the latter. It focuses on asset allocation services through co-advisors and other firms in the financial services industry.
So if you’re looking for advice around specific financial goals like debt management or estate planning, you may want to look elsewhere. To find an advisor who can help with financial planning, try using SmartAsset's free matching tool.
Opening an Account With Matson Money
The best way to establish a relationship with Matson Money is by visiting its website at www.matsonmoney.com and sending a secure message. You can do so by scrolling toward the bottom of the home page and clicking on the “Contact us” tab. You can also call at (513) 204-8000.
All information was accurate as of the writing of this article.
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