Investment Management

Many people are comfortable managing their own investments when the stock market is performing well. But when the market declines, many investors don’t know how to react. Without the advice of professionals, investors can stumble into decisions they later regret.

We at Reason Financial Advisors are qualified professionals. Reason Financial Advisors is a Registered Investment Advisor with the State of Illinois and meets all the strictest government and professional standards for handling your investments.

When we serve as your investment advisor, we include our customized financial planning program option. That’s important because when we manage your investments, it is always with a view toward meeting your goals as laid out in your financial planning program.

Our investment philosophy

We seek to build long-term relationships with our clients. Our fee-only way of doing business guarantees that we always act in your interest because we will not direct you to any products that pay us a commission.

Our guiding principle is that every client is unique; what may be right for one person may not be appropriate for you. From us you will never receive advice in a standard format; our counsel will be customized to your needs. To achieve this, we believe that client involvement is key to success. We don’t just meet once then move on as if nothing—your goals, the economy—ever changes. From time to time we will ask for your help by giving us additional information and thoughts. This is key.

Long-term results are our primary focus. Excess concentration on the short term could be counterproductive. Portfolio diversification avoids the risk of tying your goals to only a few investments. Mutual funds and exchange trade funds help reduce risk and should be the core of most investor portfolios. Funds that are intended to be used in less than three years should not be in equities; money markets or short-term fixed incomes securities with similar maturities are better.

As your Registered Financial Advisor, we will:

  • Review, in personal, face-to-face meetings, your goals, helping you to prioritize and quantify them. We will assess your tolerance for risk and your need for growth.
  • Design an Investment Policy Statement—a roadmap to your goals—to achieve your desired balance between risk and growth
  • Present you with a Recommended Securities Listing identifying all suggested investments prior to your plan’s implementation.
  • Handle your investment transactions on a fee-only basis with no commissions.
  • Provide you with quarterly reports including performance information.
  • Arrange for your investments to be transferred to an agreed-upon custodian. The custodian will forward all trade confirmations and account statements directly to you. Most of our clients choose to maintain their Investment Advisory Accounts at TD Ameritrade where we have established a special relationship.

We offer two types of Investment Management Accounts:

  • You authorize us, through a limited power of attorney, to purchase and sell investments in your brokerage account, based on our best judgment. This is called discretionary investment.
  • You may choose instead to manage your own investments, based on our written recommendations. [Do clients actually execute the trades, or do you execute them, after their approval?] This non-discretionary investment does not require a limited power of attorney.

How do you calculate fees?

The fee for our Investment Advisory Service is calculated on the amount of assets under management. To see our current fee schedule in our ADV brochure click hereRemember: Our fee-only policy ensures that our advice will be conflict-of-interest free.

Other services for the Investment Management option

Cash Distributions

Most accounts can be set up with check writing privileges. You may also call us to have funds sent to you directly by the custodian in the form of a check, ACH transfer or a wire transfer.

Income Tax Considerations

On a personal income tax return, fees paid for investment advice may qualify as a miscellaneous itemized deduction under Section 212 of the Internal Revenue Code, subject to a two-percent limit on adjusted gross income.

Cost Basis Information

Because accurate records are critical for tax purposes, we track the cost basis on all investments we purchase or sell for accounts we manage. We encourage you to discuss your current cost basis information with your tax accountant, attorney or tax preparer.

Year-End Tax Reporting

Reason Financial Advisors, Inc. will prepare a Realized Gain/Loss Report to help you with your income tax preparation. It will show the long- or short-term gains or losses realized from any sales occurring during the year.