The following case studies depict three “composite” Emerson Investment Management clients to illustrate some of the many ways we have helped clients since 1985. The cases should not be interpreted as advocating a particular course of action.
Client No. 1: Developing a cohesive, simplified strategy among several accounts.
Situation: Referred by friends who were Emerson clients, a young couple came to us with numerous investment accounts totaling $1.8 million. Some investments they had created personally, others were established through their employers as qualified retirement plans [e.g. 401(k)s], and some were set up by their parents and grandparents (e.g. trusts and 529 savings plans).
Actions: The couple sat down for an exploratory meeting with us to assess our wealth building practices and meet the Emerson Investment team. They brought a stack of account statements in for review, asked lots of questions, and mentioned their shared dream of owning a ski home in Utah. We proposed a comprehensive wealth plan that simplified and accounted for the various pools of capital. After consulting with their estate planning attorney, they decided to move forward and retain our services.
Outcome: Our work had the benefit of eliminating unnecessary duplication of investments and asset classes while creating an approach that allowed the couple to pursue their goal of owning the Utah home. In addition, we further refined an investment strategy for the accounts that helped the clients to stay on track with the discrete objectives of each investment account.
Client No. 2: Tax solutions, estate plan assistance and investor education.
Situation: A 74-year-old client sold her late husband’s distribution business for several million dollars. The sale created a large unanticipated capital gain, which she was not prepared to manage. She turned to her accountant for advice and he recommended she meet with Emerson to review her whole financial situation.
Actions: Aiming to preserve as much of her wealth as possible, we created a wealth preservation strategy that complemented her accountant’s tax strategy to minimize the gains she realized in her portfolio.
Outcome: The recommended strategy reduced her tax liability while helping with general portfolio maintenance and optimization. We also reviewed her estate plan and discussed steps to take, in conjunction with her attorney, to keep the plan up to date and indicative of her current life circumstances. Because she was not comfortable with making investment decisions, we spent time with her, illustrating the fundamentals of investing.
Client No. 3: Goal planning and risk management, even as retirement nears.
Situation: After having a serious heart attack in his early 50s, this successful client took stock of his “big picture.” He had spent his life working and amassing retirement savings, yet was too busy running a business to give real and sustained thought to a long-term wealth management strategy. He had numerous accounts scattered among several managers. He also lacked a plan and a time horizon for what he hoped would be a rewarding retirement. He wanted to retire in five years with enough money to launch the second phase of his life.
Actions: Realizing he needed a professional wealth manager and some timely advice, he came to Emerson. Our first step was to create a comprehensive wealth strategy for him to better manage his wealth today and for his future financial needs. Since the client’s salary-earning years were nearing an end, we changed his asset allocation to manage his risk through a more conservative mix of assets.
Outcome: We provided him with scenarios to illustrate how much money he would need to pursue his post-retirement dreams. These models included the projected income streams that would help him maintain his current lifestyle. A year later, his comfort and relationship with his advisors at the company prompted him to volunteer to serve on our Client Advisory Board.
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