Flat Fee Portfolios - FAQs
- Who is MACRO Consulting Group?
- What is a flat fee?
- What are the Flat Fee Portfolios?
- What are the fees for this service?
- What is the minimum amount needed to establish a portfolio?
- What is included in the management fee?
- Are these the only fees?
- Where are my accounts held?
- Does the Flat Fee Portfolios team have to contact me before executing trades in my account?
- Will I get trade confirmations after changes are made in my portfolio?
- Can I add money to an account after it's established?
- How easily can I withdraw funds from the account after it's established? Are there any penalties?
- What is the cost to terminate the Flat Fee Portfolios program?
- What is the relationship between MACRO Consulting Group and our custodians?
- Is my personal information kept secure?
- How often will I receive statements?
- Can I monitor my account online?
- What if my situation gets complicated and I need financial planning advice?
- Do you manage or provide advice for stocks, bonds, and mutual funds that are held outside of a Flat Fee Portfolios?
- I have additional mutual funds, stocks and bonds that I do not want to sell. Can I hold them in a Flat Fee Portfolios account?
- How quickly can I get started?
Who is MACRO Consulting Group?
MACRO Consulting Group is one of New Jersey's most distinguished financial planning firms. As an independent firm established in 1992, MACRO Consulting Group remains flexible in our offerings of investment products and services. We combine the knowledge, experience and energy of our staff to ensure each client receives unsurpassed personal and professional attention.
MACRO Consulting Group's Senior Partner, Mark Cortazzo, CFP®, is one of the most accomplished financial advisors in the industry today. Since founding MACRO in 1992, Mark has been profiled in many industry publications and has earned numerous awards and accolades. His recent achievements include being named "Advisor of the Year" by Boomer Market Advisor magazine and being named to Barron's listing of "America's Top Financial Advisors" for 2009 and 2010. Mark has also been named to several other Top Advisor lists including, Worth Magazine naming him as one of "The 250 Best Financial Advisers in America", being awarded "Super Broker" and one of the "Top 50 Independent Advisors for 2008" by Registered Rep. Magazine, being named by Reuters AdvicePoint as a "Top Advisor for 2008" in multiple categories, acceptance into the "2003 Hall of Fame" by Research Magazine, being chosen as one of New Jersey's "Top Forty Under 40" by NJ Biz Magazine and appeared in Fortune Magazine in 2008 as one of "America's Top Financial Advisors".
Due to his success, Mark is regularly utilized as a resource for many national publications and periodicals, including The Wall Street Journal, Barron's, Kiplinger's Personal Finance Magazine, InvestmentNews and Bloomberg Personal Finance.
Mark has made multiple television appearances which include being a FOX Business co-host twice, as well as a repeat guest on CNBC’s Business Day programs and Consuelo Mack’s “WealthTrack” on PBS.
What is a flat fee?
In the investment management industry, professionals are generally compensated in one of two ways. On one hand, a stockbroker might charge a commission to execute a transaction on behalf of a client (for example, the purchase of a mutual fund or shares of stock). He/she is compensated based on the number of buys and sells in accounts, and not for any advice provided to clients. Alternatively, a financial advisor typically charges a fee for advice based on a percentage of the assets they are managing for a client. In these situations, the fee increases as the size of the account grows, but the fee decreases when the size of the account falls. A conflict of interest could occur if a client is seeking advice from an advisor about whether or not to take a withdrawal thereby decreasing the assets in the account.
In the Flat Fee Portfolios program, the management fee per account is a fixed monthly fee otherwise known as a flat fee. It does not fluctuate like a fee based on assets under management therefore it helps to minimize potential conflicts of interest. It is designed to be transparent, simple, and fair.
What are the Flat Fee Portfolios?
Each Flat Fee Portfolio is designed to provide clients with discretionary investment management services. There are currently three distinct investment strategies available:
- The Active Strategy offers models containing actively managed mutual funds. Our team performs due diligence and screens money managers based on tenure & historical returns. A fund's fees are considered, with a focus on no-load funds.
- The Passive Strategy offers two distinct strategies utilizing ETFs and Dimensional Funds. While the philosophy behind each approach is different, both strategies are low-turnover and low-cost.
- The Tactical Strategy adjusts to market conditions. When the markets begin to break down, our managers can take a defensive position and move a portion of the assets into a conservative, fixed income sector. As the markets begin to recover, managers can return to being fully invested, to capture upside opportunities.
Additionally, Flat Fee Portfolios also offers an Alternative Investment Portfolio. The portfolio is designed to be a low volatility, low correlation compliment to a low-cost passive strategy.
What are the fees for this service?
The fee is $199 per month for a portfolio of $250,000 or greater. This pricing applies to retail accounts under $1,000,000. Investors at this asset level have access to the Active, Passive, Tactical, and Alternative strategies with semi-annual client reviews.
Our Emerging Investors Program is designed for portfolios under $250,000 for a fee of $129 per month. In this program we have designed modified Active and Passive strategies with annual client reviews.
The fee for accounts over $1,000,000 is a flat 0.24%.
What is the minimum amount needed to establish a portfolio?
While there are no account minimums, we typically do not recommend this program be utilized for accounts under $100,000.
What is included in the management fee?
Included in the management fee are the following: portfolio construction, account-related services, quarterly market commentary, quarterly performance reporting, online account access, and annual or semi-annual client reviews.
- An account with greater than $250,000 has access the Active, Passive, and Tactical Strategies with semi-annual client reviews.
- For an account with less than $250,000 we have designed modified Active and Passive Strategies with annual client reviews. These strategies are offered at a reduced expense.
Are these the only fees?
Outside of our monthly management fee, mutual funds and exchange trade funds also have their own internal expenses. Additionally, separate transaction costs may be charged by the custodian to place trades in the accounts. Many of the mutual funds and ETFs in our models do not have transaction costs; however some do. Where possible these trades will be executed at a discounted rate with the custodian. Please note that our advisors do not receive any portion of these additional fees.
Where are my accounts held?
Clients in the Flat Fee Portfolios program have the comfort of knowing their accounts are held at a third party custodian. In this type of arrangement, clients grant us limited power of attorney to (1) monitor the accounts on a daily basis, (2) place trades on a discretionary basis, and (3) deduct our monthly management fee from the account.
TD Ameritrade, Inc. is one of the firms that we use to custody our client assets.
Fidelity Investments also provides clearing and custody services to Flat Fee Portfolios. Through our relationship with Fidelity Investments, you will receive a simplified, consolidated statement each month reflecting all your investment positions and transactions in your Fidelity brokerage account.
Fidelity Investments is one of the world’s largest providers of financial services. For more information about Fidelity Investments, visit Fidelity.com. Fidelity Institutional Wealth Services is a leading provider of trading, custody, and brokerage services to Registered Investment Advisors, Trust Institutions, and Third-Party Administrators.
Does the Flat Fee Portfolio team have to contact me before executing trades in my account?
No. Each Flat Fee Portfolio is managed on a discretionary basis according to the strategy agreed upon between the investor and Flat Fee Portfolios. Once established, we assess the account’s investment objective with you during your reviews.
Will I get trade confirmations after changes are made in my portfolio?
The custodian automatically notifies you by regular mail or e-mail each time a trade is placed in your Flat Fee Portfolios account. You can track your account on a daily basis through the custodian's website.
Can I add money to an account after it's established?
Yes, you can deposit additional funds into an account at any time.
How easily can I withdraw funds from the account after it's established? Are there any penalties?
MACRO Consulting Group does not assess any penalties if you need to withdraw funds; however these portfolios are managed according to a philosophy of long-term investing. Periodic withdrawals may affect the performance of the account. The proceeds of a sale in your account are available upon the settlement date which typically occurs three business days after the trades are placed.
What is the cost to terminate the Flat Fee Portfolio program?
There is no cost to terminate the Flat Fee Portfolios service and both sides reserve the right to do so at any point in time and for any reason. We do require a written request to terminate the relationship and the last month's fee will be prorated based on the final day of management. At that time you may withdraw the total account balance or convert your account to a self-directed account at the custodian.
What is the relationship between MACRO Consulting Group and our custodians?
MACRO Consulting Group is not affiliated with the custodians who hold our clients' accounts and we receive no direct compensation in way of fees or commissions from them. Our compensation is derived directly from our client relationships. The custodians do make available the use of their proprietary technology for account management, trading, and access to research reports. We may also attend custodian sponsored professional education conferences.
Is my personal information kept secure?
All personal information given to us is held in the strictest confidence and protected under our written privacy policy. We are fully committed to safeguarding your information using state of the art data security and encryption services. Also, as fiduciaries for our clients' accounts, we are required by the Securities Exchange Commission to comply with current privacy laws.
How often will I receive statements?
Custodians provide monthly statements documenting holdings and detailing transactions in your account. Additionally, you will receive quarterly performance reports with market commentary from MACRO Consulting Group posted directly to your online account portal.
Can I monitor my account online?
MACRO Consulting Group offers online access to your account through the custodian. You have the ability to access this service from the FlatFeePortfolios.com website.
How can you offer this at such a low fee?
We believe in a separation between financial planning services and portfolio management services. We offer a portfolio management solution at an unparalleled price. By not bundling the costs for all possible services into a "one size fits all" fee structure, we are able to offer this solution for $199 per month
What if my situation gets complicated and I need financial planning advice?
We can recommend an hourly planner local to your area.
Do you manage or provide advice for stocks, bonds, and mutual funds that are held outside of a Flat Fee Portfolio?
For clients enrolled in a Flat Fee Portfolios program, a CERTIFIED FINANCIAL PLANNER™ is available to provide investment planning services. These services are considered separate engagements and will be agreed upon in writing, in advance of work being done.
The hourly rate for investment planning services is based on the scope and complexity of the project and ranges from $150 per hour to $200 per hour.
I have additional mutual funds, stocks and bonds that I do not want to sell. Can I hold them in a Flat Fee Portfolio account?
A Flat Fee Portfolio is managed based on the specific strategy outlined in your Investment Policy Statement. If you would like to consolidate outside mutual funds or other securities we can do the following: your advisor will work with you to incorporate these funds into the portfolio or your advisor will help you set up a separate account at the custodian. We will waive the flat monthly fee for these separate "unmanaged" accounts.
How quickly can I get started?
Visit our Get Started Now page or call us at 855-223-2300. We look forward to hearing from you and talking further about Flat Fee Portfolios.
Fidelity Investments is an independent company, unaffiliated with MACRO Consulting Group. Fidelity Investments is a service provider to MACRO Consulting Group.
There is no form of legal partnership, agency affiliation, or similar relationship between your financial advisor and Fidelity Investments, nor is such a relationship created or implied by the information herein. Fidelity Investments has not been involved with the preparation of the content supplied by MACRO Consulting Group and does not guarantee or assume any responsibility for its content.
Fidelity Investments is a registered service mark of FMR LLC.
Clearing, custody, or other brokerage services may be provided by National Financial Services LLC or Fidelity Brokerage Services LLC.
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