To Top

Fiduciary

We provide the highest level of care and accountability. Everything we do must be in your best interest.

Complete Transparency

No magic tricks or distractions. Everything we do is transparent. Log into our online system to see your accounts any time, from any device, no matter where you may be.

Experienced

We have been serving client needs for over 30 years which means we probably have experience in situations like yours.

Local & Available

We are not a large institution. We are your neighbors who happen to offer financial expertise. When you call, we answer. When you need someone, we are here.

Different People. Unique Needs

Some people need help accumulating and growing wealth. Others need assistance with the responsibilities wealth creates. No matter your money issues, we will help you find the solutions which best fit

Retire Confident

Retirement is a once-in-a-lifetime experience, but we have helped people retire comfortably and confidently for over 30 years. We can help you too.

Get Comfortable

We provide a safe and relaxed environment where you can be comfortable with your money.

The media provides exposure, not advice

In this age of information overload, there are an over-whelming number of financial opinions. We help you focus on your specific financial goals by using our experience and knowledge as a filter to cut through the constant noise and chatter.

You are not your neighbor

There is no magic formula that works for everyone. We have the knowledge, experience and tools to help you plan and achieve your goals.

Independence brings freedom

Our “product” is our guidance and advice, not specific investments. We are neutral and transparent when selecting the solutions necessary to implement your plan.

It is a journey,
not a destination

No matter what your stage of life and career, we can help you. As you change and grow, we adjust so your plan continues to fit your needs.

Simplicity

It is our job to explain your money in simple and straight-forward terms, not to impress you with jargon and investment “speak”. You can never ask too many questions. 

Investing, not trading

It is not flashy, but the long term outlook has stood the test of time. We seek to capitalize on this trend through patience and discipline rather than guessing when to zig and when to zag.

It takes two to tango

We provide the know-how; you provide direction and guidance. 

Wealth is not determined by money

Wealth is determined by love, happiness, and relationships. The number of dollars in your account does not make you more or less than anyone else.

Putting it all together

All the parts of your life are connected. Getting to know you goes beyond your finances. We want to know your values, hopes, and dreams so your success is not purely financial. A life measured only in dollars can never be rich. 

Blog Posts
 

What is a Unit Investment Trust?

This is the third article in a short series. You may want to start at the beginning, Three Really Good Questions

The biggest difference in the next investment structure, the Unit Investment Trust or UIT, and mutual funds is timeframe. An open ended mutual fund may continue forever. The oldest US mutual fund, The MFS Massachusetts Investors Fund (MITTX) was launched March 24, 1924 is still open today and will likely be around for decades to come. Investors will come and go, the holdings will change, even the prospectus can change with shareholder approval but unless the fund sponsor can no longer profitably operate the portfolio a mutual fund is like the Energizer Bunny… it keeps going.

What is a Unit Investment Trust?

A Unit Investment Trust is in many ways similar to a mutual fund. A group of investors pool their money together to own a common set of securities which are selected by a professional manager. However, a UIT follows a very specific timeline. Before the UIT is made available, the sponsor selects the investment holdings and announces the trust's beginning date, closing date, and ending date. On the beginning date, the trust is open for new investments and remains open until the fund closes to new money. Once closed, the trust typically holds the portfolio, without making any changes, until the trust's ending date. On that day, all the holdings are sold and value is returned to the investors.

It is apparent why a mutual fund can be used for a "buy and hold" strategy but a Unit Investment Trust offers a "buy and hold for a specific period of time" strategy.

Advantages of a UIT over a Mutual Fund

  • Complete transparency – When you own a Unit Investment Trust, you always know what you are invested in. UIT's announce their holding before they accept investors. As money is added to the trust, they purchase additional shares of securities but the portfolio's balance remains fairly constant. Even if the portfolio sponsor decides to change the underlying investments, the change is announced as soon as it becomes effective.
  • Known Expenses – Since UIT's typically hold their investments until the trust terminates, there are very few trading costs and other variable expenses. UIT sponsors publish the cost of ownership as a known percentage which is not subject to unknown costs such as "plus expenses". Additionally, most UIT's do not have a large, up-front, sales charge. Over any given year, the cost of owning a UIT is fairly similar to owning a mutual fund but without the added costs of expenses or sales charges, the UIT often ends up costing less.
  • Minimizes Taxes – Under current tax law, the strategy of buy, hold for a fixed period of time, and then sell offers tax benefits as long as the holding period is at least 12 months. After 12 months, when the investments are sold they are taxed as capital gains at a maximum of 15%. And the issue of embedded gains simply does not apply to UIT's like it does to mutual funds.
  • It is easier to anticipate the market – The shorter your outlook, the harder it is to anticipate the market direction. For example, just because I am bullish on the economy does not mean that I have any faith in tomorrow's market direction. But over the next couple years, I am pretty certain the market will rise. The difficulty of anticipating short term market trends can also make it difficult to decide when to hold and when to sell. The UIT takes all that away. You enjoy the benefit of looking ahead in the market 15 – 24 months, and your liquidation is based on a date… not on market conditions.

Disadvantages of Unit Investment Trusts

  • Not effective for systematic investments – Every trust has a relatively short (1 to 3 month) open window for new investments. If you are contributing regularly, you will end up with small investments in many different series of the same trust. If your strategy is to dollar cost average, mutual funds are probably more efficient.
  • Not appropriate for the smallest investors – Many mutual funds allow for no initial investment and a small regular systematic investment of $50 per month. Most UIT's require a minimum of $1000 per trust. If the plan was to buy several different UIT's to achieve portfolio diversity, it will take a larger initial investment.

Next up … Exchange Traded Funds

Photo energizer-bunny by Agitproper