Transamerica Financial Advisors, Inc.
A part of the Transamerica family of financial services and insurance companies, Transamerica Financial Advisors (TFA) is a fee-based financial advisor firm managing more than $1.3 billion in assets. The firm is a full-service financial advisor and is also a broker-dealer, meaning the firm can execute trades for clients. That keeps everything in house but also presents a potential conflict of interest, explained more fully below.
With headquarters in St. Petersburg, Florida, TFA has 364 branches across the country, serving more than 54,000 individual clients, a small number of whom are classified as high-net-worth. Advisors at TFA offer a variety of services, including third-party money management, employee retirement services, wealth management and robo-advisory services.
Transamerica Financial Advisors Background
Though TFA opened for business in 1984, it first registered with the SEC in 1991. It is owned directly by AUSA Holding, LLC, Commonwealth General Corporation and AEGON Asset Management Services Inc. Each of those are indirect, wholly-owned subsidiaries of the ultimate parent company, AEGON, which is publicly traded on the New York Stock Exchange.
TFA is part of Transamerica, a broader financial services and insurance company founded in 1928 and headquartered in Grand Rapids, Iowa.
Transamerica Financial Advisors Client Types and Minimum Account Sizes
Most of the clients of TFA are individual investors, the majority of whom are not high-net-worth.
There are also institutional clients at the firm. These include pension and profi- sharing plans, charitable organizations, corporations, 529 plans and UGMA/UTMA accounts.
The minimum account size varies based on the program you use. The Transamerica ALPHA Program — a digital investment management service — has a minimum account size of just $10. Other programs may require a minimum account size of up to $5,000.
Services Offered by Transamerica Financial Advisors
A variety of services are available at TFA. The most basic is the Transamerica ONE Wealth Management Platform, a wrap-fee program for clients looking for fee-based investment management.
TFA also has a variety of third-party money management programs.
There is also the ALPHA Digital Investment Program. This is offered in partnership with Betterment, LLC, a digital financial services company. This program offers discretionary investment management on an internet platform, with Betterment as the subadvisor.
TFA also has its I-Series program, a wrap-fee program using model portfolios.
Finally, TFA offers services to retirement plans.
The exact investment philosophy the advisors at TFA follow will depend on the program you use:
- Third party money managers generally purchase securities available on the exchanges such as stocks, but may also invest in mutual funds. Bonds and exchange-traded notes may also be investments.
- The ONE Wealth Management Program may invest in stocks, bonds, mutual funds and other exchange traded products. The model portfolio strategies, described below, are also available to these customers and may be combined to use multiple strategies within one account.
- The Transamerica I-Series program is a series of model portfolios, each focused on a specific investing strategy. Investments could include stocks, bonds, mutual funds and other exchange traded products. The model portfolios available are: Aggressive, Moderate Aggressive, Moderate, Moderate Conservative, Conservative, Ultra Conservative, Strategic Alternatives Core, Social Impact Growth, Social Impact Balanced and Social Impact Conservative.
Fees Under Transamerica Financial Advisors
Fees also depend on the program you are using, as follows:
- For third-party money management programs, the annual advisory fee will not exceed 2.60% if you are not using variable products and won’t exceed 1.20% if you are using variable products.
- The Transamerica I-Series program’s annual fees will not exceed 2.50%
- For the Alpha Standard program, the total fee is 0.65%. For the Alpha Premier Program, requiring a higher minimum investment of $10,000, the annual fee is 0.95%.
For the Transamerica ONE Wealth Management Platform, the fee schedule is as follows:
|Account Balance||Annual Advisor Fee|
|$25,000 to $250,000||1.10%|
|$250,001 to $500,000||1.00%|
|$500,001 to $1,000,000||0.90%|
|$1,000,001 to $2,000,000||0.80%|
In dollars, these fees would look like this:
|*Estimated investment management fees do not include brokerage, custodial, third-party manager or other fees, which can vary in amount.|
|Estimated Investment Management Fees at Transamerica Financial Advisors*|
|Your Assets||Annual Fee Amount for ONE Wealth Management Platform|
The industry average fee for investment management is 0.95%, according to a 2018 study of 1,500 firms by RIA in a Box. This does not include brokerage, custodial, mutual fund or other fees. Learn more about advisors' typical costs here.
What to Watch Out For
TFA reported nine disclosures of regulatory and disciplinary actions in its most recent filings with the Securities and Exchange Commission (SEC). While two involved an affilliated firm and an affiliated individual, seven involved the firm itself. Regarding these seven violations, fines ranged from $50,000 to $800,000, and in one case, TFA had to return roughly $6 billion to customers.
Also worth noting: TFA is part of a much larger financial services conglomerate. This has positives, as there are more resources available. Still, it means they are not independent and may be more likely to offer services and products from within the corporate family. Also, all advisors at TFA are insurance agents, and most are brokers. In these non-advisor roles, they earn commissions and transaction-based fees, which pose potential conflicts of interest. That said, as an SEC-registered investment advisor, TFA is bound by its fiduciary duty to put clients' interests first.
Opening an Account With Transamerica Financial Advisors
You can contact TFA through this page or by calling (770) 248-3271.
All information is accurate as of the writing of this article.
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