4695 Chabot Road,
Are you a Fiduciary?Yes. I've been under the fiduciary rule since becoming a Certified Public Accountant in 1987. Carr Wealth Management, LLC is a Registered Investment Advisory firm licensed in California. RIA's are required to be fiduciaries. See Fiduciary page.
Are you independent?Yes. As a small business owner in the ultra-competitive financial industry, I must assure my clients that I am always working in their best interests, and I truly feel the only way of accomplishing that is to remain free of any ties and obligations, which include being employed by, any company which sells proprietary products.
Do you participate in any sales contracts or award programs creating incentives to favor particular vendors?I've always felt that working in our client’s best interests was compromised if I worked at a company that sells proprietary products and competed with other producers to win trips and awards. I know where that money is coming from.Will you itemize all your fees and expenses in writing?Yes. Financial planning fees are charged on an hourly basis. The investment management fee is a fee-only non commissioned percentage of the investments the company is responsible for managing. Planning fees may be waived if clients become investment management clients.Do you earn fees for referring clients to specialists like estate attorneys or insurance agents?No. Our fees are derived exclusively from our clients directly. The company has no other income sources.
What is the Company’s investment philosophy?Carr Wealth Management, LLC's investment philosophy has remained the same since I began managing investments in 1999. Coming from the public account industry, I gravitated toward an investment philosophy backed by academic evidence. I believe compounded growth is the most potent investment strategy, and ineffective strategies and excessive costs are hindrances to maximizing investment returns. Taking advantage of the market's historical process of rewarding long-term discipline is best accomplished through low-cost, well-diversified, and tax-efficient investments. Our objective for our clients is to "let the market work for you."
Do you believe in technical analysis or market timing?No. My philosophy is certered around academic evidence that strongly supports that strategies attempting to outperform market returns is not only non-productive, but also counterproductive.
Do you believe you can beat the market?Only a small percentage of managed portfolios can outperform the markets on an annual basis, but there is no evidence to support anybody consistently beating the market. Our objective is to match market returns with diversified investments that segregate into various asset class indexes representing the markets. Since these market indexes are not real investments, there are no expenses or fees subtracted from the index performance.
How often do you trade?As little as possible. The initial investment allocation is based on a thorough review of your current financial situation, your goals, and a determination of your risk tolerance. Following the initial allocation, rebalancing occurs when needed (annually), and changes to your investment allocation typically only change when there has been a change in your situation or goals.
Do you consider yourself and active or passive investment manager?I never much preferred the term "passive" when labeling the distinct management styles of active v. passive investing. Instead, I would label the different management styles as "transaction-oriented" versus "goal-oriented" investing. We remain disciplined with our allocations and rebalance when necessary. Disciplined, or long-term investing, is more oriented toward attaining your goals. Short-term investing, or active management, is more transaction-oriented to earn above-market returns with consistent buying and selling of securities. There is overwhelming evidence to support that active management strategies have historically underperformed passive management strategies because of the additional costs.
What areas do you offer services in?We focus on areas we consider to be the main areas of asset management - the growth, distribution, preservation, and protection of assets. We can help those who need advice in just one area or help develop a more comprehensive plan.
Who is your typical client? Anyone who has set financial goals for themselves and would like help reaching those goals can qualify as a client. Those who are in, or close to, retirement, usually require more help since they face more issues in more areas. Younger individuals tend to be more interested in the growth and protection of their assets while those in retirement may also need help with their income distribution and family transfer issues as well.
What is the process to help clients with their financial planning needs?We begin with a no-charge initial consultation that will reveal which areas the client is looking to get help with and if we are an excellent fit to help them. Then, specific information is gathered to help create a thorough financial plan that identifies pre-retirement and post-retirement income sources, current assets and investments, and, most importantly, financial goals. Once a plan is implemented, monitoring the plan requires regular "check-ups" to determine if any significant changes have been made to the client's financial circumstances.
What type of issues do new retirees face?New retirees face a balancing act between all the main areas of asset management – the growth, distribution, preservation, and protection of their assets. They are nearing or at the end of the accumulation phase, where higher risk tolerances and greater potential returns could be afforded due to longer time horizons and lower liquidity concerns. Now that they’ve reached or will soon be reaching retirement, their risk factors begin changing – their income may be reduced, sometimes significantly; their sources of income may have varying tax consequences; time horizons grow shorter, and inflation and liquidity concerns become greater. Meanwhile, they keep an eye on asset preservation as family transfer goals become increasingly important, along with ensuring they have sufficient assets in the event they live beyond their life expectancies.
Which companies do you work with?The brokerage company that Carr Wealth Management, LLC uses as custodian of client funds and to process transactions with is the institutional side of Charles Schwab, which provides the institutional platform to independent Registered Investment Advisors. Charles Schwab is a member of the Securities Investor Protection Corporation (SIPC). For details, please visit sipc.org. Charles Schwab offers Innovative technology, outstanding client service, seamless account integration, and a breadth of products and services.
Carr Wealth Management mainly uses only two investment or mutual fund companies for client investments - Vanguard and Dimensional Fund Advisors. Both companies have an investment philosophy that specializes in providing low-cost, well-diversified, and tax-efficient mutual funds designed to achieve long-term capital appreciation.
RISKS Investments involve risks. The investment return and principal value of an investment may fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original value. Past performance is not a guarantee of future results. Diversification neither assures a profit nor guarantees against loss in a declining market. There is no guarantee that strategies will be successful.
Please review our website for more information on our planning and investment management services. I hope the above questions and answers provide you with sufficient information to schedule a consultation to determine if our firm can help you with your planning goals. Our first priority is helping you take care of yourself and your family. We want to learn more about your personal situation, identify your dreams and goals, and understand your tolerance for risk. Long-term relationships that encourage open and honest communication have been the cornerstone of my foundation of success.