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January 02, 2018 at 07:00 PM
Sometimes I come across a new idea so good that it makes me want to slap my forehead and exclaim: Why didn’t I think of that?! Happily, I came across just such an idea the other day, when a friend suggested that I contact Anders Jones, the CEO of Facetwealth.com, in Baltimore.
FacetWealth is a relatively new company created to solve a problem that has plagued the independent advisory business for decades: what to do with less affluent clients who have been referred by a firm’s best clients, but who are too small to be served profitably now and yet could become good clients someday. FacetWealth appears to have come up with a workable — and novel — solution for both themselves and for partnering independent firms.
By way of background, Jones is a technology guy. Two years ago, Brendan Weiss, his good friend who was a CFP at large advisory firm, had a problem. It seems that Weiss’ parents had reached the point where they wanted the help of a financial advisor, and he was happy they wanted to work with him.
However, it seems Weiss’ parents weren’t wealthy enough to meet his firm’s minimums, and rather than waive the minimum, his boss told Brendan he couldn’t take on his parents as clients. Shortly after, he related this story to Jones, who remarked that given the relatively basic services that most smaller investors require, today’s technology should be able to provide a cost-effective solution.
After some research, Jones and Weiss found that the parents’ dilemma represented a rather widespread problem, and they began working on a solution. What they came up with is half technology, and the other half, extraordinary business savvy.
On the tech side, I won’t bore you with the details, (and I’m sure the FacetWealth folks would be happy to give you a demo).
On the advisory side, they did some very smart things. First, they staffed their firm with CFPs (like Weiss) to create a financial plan and investment portfolio for each client and registered the CFPs under an RIA, which has a fiduciary duty to all clients, all the time.
