Search

FAQ

A: Integrated Wealth Management firms offer clients and advisors a single, consistent experience. There is one approach to client service, to financial planning and to investment management. There are several benefits to offering a single experience:

-Clients receive consistent service regardless of which team member they communicate with.

-All clients with a similar investment objective receive similar investment results because they are invested according to a repeatable, centralized process.

-Because there is a single approach, advisors and staff can take vacations, and be out of the office without a guilty conscience. They know that all clients will be taken care of by other team members.

-A common system allows back up across locations. If one client care coordinator is not available, the phone can be answered by someone else, maybe in another city or state. Meeting prep can occur anywhere, so that peak loads and busy times in one location can be smoothed out by staff in another location.

-For advisors, a consistent experience leads to more satisfied clients and therefore more client introductions to prospects. An integrated firm is often much more valuable than a collection of separate practices, which happen to share real estate or lease the same technology or services. Feel free to request our Guide to RIA Integrators and Aggregators.

A: We have adopted this term from Philip Palaveev’s book, The Ensemble Practice. The ensemble means that the whole firm is working together to serve the needs of the clients. While individuals are assigned to serve certain clients, there aren’t “my clients” and “your clients.” Clients are surrounded by a team of people, each of whom have a specific role to play in delivering an amazing service and advice experience. The clarity around roles provides leverage: financial advisors are able to be more productive and effective because they don’t do things they aren’t great at. Instead, they maintain relationships with the firm’s clients and seek out new clients to serve. Please request our article, The Superpower of a Leveraged Ensemble.

A: There are several methods available to value a financial planning practice. Some rules of thumb in the industry include multiples of revenue, or multiples of owners’ compensation. Anyone buying a business is buying the future cash flow or profits. The more predictable the profits are, the more valuable the business will be. Therefore, the more recurring revenue (from advisory fees, for example) the greater the valuation. There could be two practices which generate $500,000 of income, but if most of the income is from transactions, that business will be worth a lot less than a $500,000 business from advisory fees. We are happy to provide an estimate of value if you complete and return our one-page valuation questionnaire.

A: Once annual revenue grows to more than $1 million, there are a lot of nuances beyond revenue which affect the value of a business. The preferred valuation method for larger firms is a discounted cash flow model. This approach can be augmented by a market comparables analysis, multiple of cash flow and multiple of revenue models. Once a value is established, we can divide the gross revenue by the EBITDA (earnings before interest, taxes, depreciation and amortization) to determine an EBITDA multiple. As firms grow and have more total AUM and revenue, the multiple of EBITDA tends to expand.

A: CX Institutional is the legal name of our SEC registered RIA. Credent Wealth Management is the dba name of our business for our retail clients.

A: Providing a consistent client experience across locations requires a single brand.

A: We have custodial relationships with TD Ameritrade and have the ability to add other custodians on a case by case basis. 

A: Delivering a consistent client experience includes using a standard investment management process. Our advisors and clients really appreciate the breadth of strategies available to help meet client goals. In addition, centralized investment management means advisors no longer need to pick and monitor investments, place trades or explain inconsistent results. Our GIPS certified investment platform is a strong differentiator and gives both clients and advisors real confidence in the investment management process. It also helps advisors win business from competitors.

A: GIPS stands for Global Investment Performance Standards. GIPS is a standardized and rigorous method of calculating and reporting investment performance. What this means for advisors and clients is that you can rely on audited actual investment performance, not a hypothetical. You can learn more at www.gipsstandards.org.

A: CXI has built a tiered household fee schedule. This means that we can look at all the assets a household has with the firm, not just one account at a time. We are able to provide lower fee rates as client assets on our platform increase. As a matter of fairness to all clients, we aim to have a consistent fee schedule.

A: All of our personnel are employees of CX Institutional. This allows us to provide a very robust suite of benefits including health, life and disability income insurance; employer portion of FICA; 401(k) with a generous company match; paid time off; health club reimbursement and others.

A: Each of our roles has a career path with salaries based on the responsibility of the role. Financial advisors may get paid up to five different ways. Please request our article, Five Ways to Pay Ensemble Advisors.

A: We have a project manager, a large operations team and extensive support from our custodians to make the transition as smooth as possible. We can prepare new account documents in paper or electronic formats.

A: Developing a communication is a critical part of the onboarding process. Our Corporate Development team and marketing specialists will work together with you to craft your unique message.