Consolidating your assets with one advisor

Michael Machny, Financial Advisor - Consolidating your assets with one advisor

You’ve got one investment account here, your RRSP and TFSA there, and some more assets over at that other place. You’re “diversifying,” right? That tactic could, however, be raising your risk, inviting costly fees and preventing you from creating a sound retirement strategy.

It is not uncommon for some investors to think a well-diversified portfolio means spreading your assets out among different financial institutions or advisors. Indeed, media hype may suggest multiple advisors can enhance the security and success of your portfolio.

The Risks to Your Money

As the saying goes, quantity does not trump quality. Risk can increase if you are overweight or underweight in some investment classes. A well-balanced portfolio provides checks-and-balances for market ups-and-downs — strategies that can only be implemented with complete knowledge of the extent of your assets.

There can also be tax consequences. Say you have a large capital gain with one advisor, and he or she suggests creating capital losses by selling underperforming stocks to help reduce taxes owing at year-end.

If you haven’t consolidated your portfolio, though, that advisor may not know you already have major capital losses elsewhere and you could end up with unjustified losses arising from the incomplete overall picture of your investments.

Consolidation is even more important as you prepare for retirement. There are key decisions to be made in structuring a retirement strategy, including optimizing your many income sources, such as pensions, government benefits, RRSPs, TFSAs, RRIFs, and any on-going employment income. With a consolidated view of your assets, one advisor can help you decide how and in what order you could be withdrawing from your income sources to help maximize after-tax income.

Benefits of Consolidating with One Advisor

There are very clear benefits to having a single, trusted advisor help manage your assets:

Smarter Asset Allocation: More than picking the “right” stock, identifying and rebalancing your optimal asset allocation over time may determine the strength of your returns. Multiple advisors blindly buying different funds or stocks without a proper overview means you may likely not know your true risk.

Lower costs: Consolidating assets with one advisor typically lowers the management and transaction fees you pay since prices can differ among institutions and some fees are paid on a sliding scale tied to the value of your assets.

Simpler Reporting and Administration: With one advisor, paper or online statements come from one source, and tax reporting related to investment income and dispositions can be easier to manage.

Easier Estate Planning & Settlement: You can avoid the nightmare that so often happens when deceased investors have accounts in multiple locations — some of which may be forgotten. With one advisor, your surviving family members or beneficiaries have one point of contact you trust.

With a consolidated approach, you may feel more confident knowing you and your advisor are “on the same page,” and there will be fewer statements to manage.

Your advisor can help make consolidation easy with helpful advice and simple transfer documents. Speak with your Edward Jones advisor for more information on creating a more focused and cost-effective approach to managing your money.

For more information contact:

Michael Machny, Financial Advisor at Edward Jones Investments, 158 A Oriole Road, Kamloops BC V2C 4N7.  Office 250-377-3885, fax 1-877-335-0405, or go to: