A: We provide our services to individuals, families, businesses, trusts, partnerships, nonprofit organizations, and retirement plans that wish to pursue long-term goals based on our strategic approach to managing wealth. At Forest, we use a sophisticated financial planning method, investment management, tax efficiency, and personal relationships to help clients achieve their financial goals.
A: We conduct initial and ongoing deep discovery to determine our clients’ financial needs in relation to their unique values, goals, personal, professional, and institutional relationships, assets, and interests.
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Essentially, they mean that we have completed rigorous testing and continue attending classes and seminars yearly to keep abreast with the constant changes in personal finance and tax law.
Mark and JoAnn are both CPAs or Certified Public Accountants. To become a CPA, you must pass a rigorous 2 ½ day exam, have completed an undergraduate degree in accounting, and take at least 40 hours per year of continuing education. We are also both CFP®s, CERTIFIED FINANCIAL PLANNERS. This designation requires another 2 day examination, 3 years of financial planning experience, and 30 hours of continuing education every 2 years. Mark also has a Master's Degree from DePaul University with a concentration in Tax (MST), and JoAnn also has a Master's Degree from DePaul University with a concentration in Finance. We are both Personal Financial Specialists or PFSs, the accounting industry's equivalent of a CFP®.
A: We provide fee-only investment management, with all fees paid by the client. We accept no commissions or revenue sharing arrangements. Our fees are based on a percentage of your assets that we manage. We feel that this approach best aligns our interests with yours, helping us meet our fiduciary obligation as a Registered Investment Advisor firm. Our fees are tier-based with breakpoints at which your fees decrease on additional assets. We take a family approach to investing, aggregating assets to determine your fees (while still managing each portfolio according to its distinct policies) so we can provide favorable rates for your immediate family. Please see our fee schedule and examples below.
A: Our minimum fee is $2,500 annually, charged quarterly at $625 per quarter. If your assets under management exceed $200,000, you would use our normal fee schedule. Please see our fee schedule and examples below.
A: Our fee schedule is based on assets under management (AUM).
| Account Value | Annual Fee |
|---|---|
| $200,000 to $499,999 | 1.25% |
| $500,000 to $999,999 | 1.00% |
| $1,000,000 to $1,999,999 | 0.90% |
| $2,000,000 to $2,999,999 | 0.80% |
| $3,000,000 to $4,999,999 | 0.70% |
| $5,000,000 or greater | 0.60% |
| Minimum Account Balance | $200,000 |
| Minimum Quarterly Fee | $625 per quarter |
For example: Clients with $700,000 in AUM will be charged 1% annually, or $7,000 per year or $1750 per quarter. Clients with $1,200,000 AUM will be charged 0.9% annually, or $10,800 per year, or $2,700 per quarter. Clients with $5,500,000 AUM will be charged 0.6% annually, or $33,000 per year, or $8,250 per quarter.
A: Before making any changes, we analyze your existing portfolio and discuss our recommendations with you. Our overall goal is for your portfolio to make sense for you and your lifetime objectives in the most cost-effective and tax-efficient way possible. We achieve this by capturing your unique willingness, ability, and need to take on market risk via appropriate, often global, diversification. We minimize investing expenses, manage the appropriate asset location between taxable and tax-sheltered accounts, and eliminate any unnecessary complexity within the collection of accounts in your portfolio. We leave existing holdings that lend themselves to these objectives in place and work with you to ensure that any transitions due to warranted changes occur as smoothly as possible. This process may be implemented over several years due to tax constraints.
A: While we need a Limited Power of Attorney (LPOA) to execute transactions on your behalf, you will remain in control of your assets. Accounts are held in your name at a quality custodian such as Schwab Institutional, Fidelity Investments or TIAA.
A: We offer a prudent approach to managing your portfolio based on our fiduciary relationship with you as your trusted investment advisor. Fiduciary duty is generally considered one party's highest legal duty to another. As a Registered Investment Advisor firm, we have a legal responsibility to always act in your best interests and take that responsibility very seriously.
Our evidence-based investment approach tailors your portfolio's level of risk (and expected returns) to your preferences, goals, and circumstances. Evidence-based funds retain the benefits of indexing. They are relatively low-cost, low turnover, and tax-efficient. We adhere to the tenets of Modern Portfolio Theory and to the guidelines provided by the American Law Institute in drafting the Uniform Prudent Investor Rule. They indicate that the overwhelmingly largest determinant of portfolio performance is its asset allocation -- how your assets are exposed to various risk factors. We build portfolios accordingly, typically using low-cost institutional managers who provide evidence-based mutual funds or exchange-traded funds and diversifying globally to reduce non-market risks.
Many other firms offer an approach based on "active management," which assumes the markets are generally inefficient and allows clever individuals to regularly exploit and profit from the anomalies (beyond the costs of consistently seeking and executing such trades). However, there is overwhelming academic evidence that all market players' collective wisdom- especially in today's electronic era- results in highly efficient markets. Markets reflect fair pricing almost instantaneously upon releasing any good or bad price-related news. Our evidence-based approach heeds the academic wisdom and assumes that the opportunities to exploit inefficiencies are too few and far between to effectively and affordably pursue.
A: Our philosophy is that equity investments are for growth. Fixed-income investing has a vital mission: to control overall volatility in a portfolio and provide a stable financial base. It should offer steady, reliable income and contingency reserves. We address your fixed income needs as integral to your overall portfolio and by considering the unique needs, characteristics, and (often hidden) costs inherent in the bond market.
If a custom bond portfolio makes sense for you, we build one by analyzing each bond’s full range of characteristics (sector, maturity, credit rating, and more). Our relationship with Buckingham Strategic Partners (BSP), an affiliated entity of the Buckingham Family of Financial Services, gives access to strategic fixed-income resources and a network of local and national bond dealers that help ensure a wide range of security availability as well as fair and competitive institutional level pricing for you.
A: One value add that comes to mind is assisting clients with college planning. We help clients calculate how much to save, research and assist with 529 savings plans, sort through the complex tax credits, and plan ahead to take advantage of them. We help them fill out their FAFSA forms and keep them current on changes in tax law regarding education.
We do not charge to manage these accounts because, in most cases, we can find a state direct-sold plan to meet their needs and provide a tax deduction. In doing so, we leave more in the child’s account for higher education. A new client often comes to FAM with an expensive broker-sold 529 plan, and they have no idea there are lower-cost alternatives available. We help them transfer the account into their state plan to save money and receive a tax deduction. By doing so, we provide huge savings for them and their family.