Michael came to us after managing his own portfolio for years. He had recently gone through some big life changes and recognized the need to work with someone who would allow him to refocus his attention on his business ventures and personal ambitions. At first, he struggled with the fear of working with an advisor who would force him to hand over the reins to his portfolio. However, through collaborative partnership, he came to appreciate the peace of mind achieved from developing a financial plan and portfolio strategy that aligned with his goals, beliefs, and plans for the future.

Michael came to us after managing his own portfolio for years. He had recently gone through some big life changes and recognized the need to work with someone who would allow him to refocus his attention on his business ventures and personal ambitions. At first, he struggled with the fear of working with an advisor who would force him to hand over the reins to his portfolio. However, through collaborative partnership, he came to appreciate the peace of mind achieved from developing a financial plan and portfolio strategy that aligned with his goals, beliefs, and plans for the future.

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Tell me about how your partnership started with Michael. How did you determine that working with Morton Capital would help satisfy his needs?

Michael was actually a referral from another client whom I’ve worked with for the last few years. During my initial call with him, I could sense that he was looking for direction. Within the previous year, he had finalized his divorce and the last of his three children had moved out. It felt like Michael was not just looking for an advisor, but rather someone who would really be a financial partner in his life to help him tackle all these life changes, calm his fears about the market and political environment, and even to plan for the future.

He’s a successful executive in the entertainment industry, but with COVID and even just the nature of the industry itself, Michael shared the fear that he may not always have the level of income he has now. One of the things I love about Morton Capital is how we manage wealth personally. I told him that going through our Empower Process and building a comprehensive cash flow plan would help calm a lot of the nerves he shared.

When we dug into those fears a little deeper, we realized that he was used to controlling everything, being the financial guru for his family, and even self-directing his defined benefit pension plan. As we see with most clients, he was hesitant to let go of this control, but he also admitted he desperately wanted to get all this off his shoulders and delegate to someone he trusted. And I think, for him, trust was the key factor.

In a time when he was having to juggle a lot of life adjustments, I was excited to give Michael the peace of mind that he had a team of people at Morton Capital to support him and work with him every step of the way.

What differentiated Morton Capital from other advisors?

Our team model is one of the things, in my opinion, that truly sets us apart from other firms. Rather than Michael having a silo advisor, working with us gives him access not only to his personal advisory team, but to all of our teams. For example, he mentioned self-directing his defined benefit pension plan. I’ve worked with these plans in the past, but I wouldn’t consider myself the expert on this topic at our firm. However, we do have another advisor who joined our firm a few years ago with a prior specialty in these types of accounts. So while brainstorming plan benefits and how to maximize contributions, I was simply able to hit the “Zoom” button on my computer to conference in that team member, and others, for collaboration.

Unlike the big brokerages, we don’t have to call an 800 number and talk to a “home office” to get help from New York. No matter what the issue, we have entire teams dedicated to financial planning, investment research, private alternatives, custodial issues, and even a team that helps plan client events like our virtual wine tasting we did earlier this year.

How did you and your team start the partnership with Michael?

After I was introduced to Michael, I was excited to jump right in. Knowing the power of our financial planning process, I was confident that we would be able to provide Michael with so much peace of mind. I spent probably three weeks with him at the start in what we call data gathering and put all his information in one place. We created his personal dashboard as an accountability tool so we could make sure we covered all the bases.

Our dashboards cover everything: goals, cash flow, insurance, taxes, and investment recommendations and updates. Over the last few years, we’ve enhanced our financial planning service to include estate reviews as well. These estate reviews cover everything from the basics to complex estate planning issues.

Michael was shaken up after his first marriage and, with thoughtful conversations, we explained the benefit of protecting assets for his children in his estate documents. Protection from creditors and changes in family dynamics are important to add as an extra layer of security that may never be applied but is a lifesaver when it is used. We actually discovered that his IRA was still designated to his previous wife, so we were able to discuss the benefits of outright distributions to his kids or flowing these assets through a trust.

We also collected his external bank statements, double-checked his insurance policies for accurate coverage, and dove into his tax return to see if we could come up with strategies to reduce his tax liability. He was amazed at how comprehensive our process was and so glad he had a team crossing the t’s and dotting the i’s.

What were some of the personalized solutions that you came up with as you built out his cash flow plan?

Well, that’s what we do! One of the things we uncovered was Michael’s concern about his industry and fluctuating income. Being an executive and businessman, numbers matter to him, and not knowing the numbers keeps him up at night. We were able to show him a “base plan,” which is essentially a picture of his current financial status extended over his lifetime. Once his base plan was established, and this is the exciting part, we were able to build in various scenarios, good and bad, to model years where income might be more sporadic. We were able to show him how we could create strategies to layer on top of these scenarios to make up for the dips in his income. We ended up creating an emergency fund with cash and short-term investments to provide 3–5 years of cash flow to cover his lifestyle in the case that his industry had a few rough years. He loved being able to see the graphical depiction of his finances extending through his lifetime and even more so how and where we would draw from his portfolio, if needed. From there, we were able to make confident recommendations on how to diversify the rest of his portfolio, balancing risk and reward, to accomplish his other goals of providing for his kids, his future grandkids, traveling, and even dating again!

How did you determine what investment allocation would help him achieve his goals?

When determining any client’s allocation, we always start with the three tenets of our investment philosophy: risk management, true diversification, and cash flow. During the financial planning process, we found out that he already had some real estate exposure. He had an affinity for tangible assets that he believed would appreciate more steadily than the market. That brought us back to our initial discussion with him around his values and being overwhelmed with the burden of control he had. As a firm, we agree with him around utilizing real estate as a growth asset, but we shared with him how we could offer him geographically diverse real estate exposure through equity and lending funds that would free him from the burdens of being a landlord, being responsible for collecting rents and maintenance, or even thinking about when and how to sell.

We were able to add further diversification through providing private lending strategies with consistent cash flow, gold as a hedge against inflation, and some alternative credit solutions. We created tax efficiencies within the portfolio by placing income-generating assets in the defined benefit plan. Overall, we are confident in the allocation we came up with. Michael recognized that we matched his investments to his financial plan, and that by lowering his correlation to the equity markets, he would not be completely subjected to the whims of those markets. You could see the sense of relief on Michael’s face when we presented this to him and he could see how we thought about his wealth from so many different angles.

Beyond the initial cash flow planning and investment strategy, what does partnering with Michael look like today?

We’re still in the beginning stages of our relationship with Michael. He has been a client for about a year now, fully invested for about six months after patiently dollar cost averaging into some equities. We did this to be strategic and mindful of the tax consequences of taking over management of some of his taxable accounts. He enjoys that he has access to his Morton Capital portal, where he can check on the status of his accounts and access our market commentaries or see client webinars on our website. He also likes that he has the ability to review private investment recommendations directly and that we don’t have a cookie-cutter approach to investments where everyone just owns the same thing. We call this our “farm-to-table” investment approach. We’re always looking at new opportunities or “what’s in season.”  Our investment team allocates a significant amount of time to due diligence to ensure what we “pick” accomplishes the goals we have for each of our clients.

What type of interaction can a client expect after becoming a part of the Morton Capital family?

Michael knows he can reach out to us anytime to model in a new scenario to his financial plan. He actually called me last week because his oldest son and daughter-in-law are expecting a baby! He wanted to see how helping with a down payment on a home for them would impact his financial plan. In his heart, he knew he could afford it, but he really wanted the peace of mind to see what long-term effect it might have on his plan. When reviewing scenarios like this, where you see an overall “cost” or “decrease” to the plan, I love highlighting that decisions like this are not really a value “lost,” but a value “transferred.” Rather than sitting there, crunching numbers on Excel spreadsheets and worrying about how $100k would affect him, he was able to spend that time looking at homes with his son. It’s moments like that, for me, that remind me that these plans really give people like Michael time that he didn’t know he was missing before. I love that he brought this to us, because it’s what we are here to do—to partner with our clients through all of life’s decisions and to celebrate life’s joys and excitement with them. In my opinion, this is how we truly help our clients get the most life out of their wealth.

Disclosures: Client stories are provided for illustrative purposes only and are intended solely to provide an example of Morton Capital’s process and methodology. These client stories are based on scenarios that an actual client might experience, but should not be construed as a representation that any client/prospective client has experienced or will experience a certain level of results or satisfaction. Your experience may vary based on your individual circumstances, and you should not rely upon this client story when making decisions regarding your financial adviser.

This information is presented for educational purposes only and is not intended to constitute investment, legal, or tax advice. Morton Capital makes no representation that any strategies described are suitable or appropriate for any person. You should consult with your financial, legal, and tax professionals to thoroughly review all information and consider all ramifications before implementing any transactions and/or strategies concerning your finances.

Michael came to us after managing his own portfolio for years. He had recently gone through some big life changes and recognized the need to work with someone who would allow him to refocus his attention on his business ventures and personal ambitions. At first, he struggled with the fear of working with an advisor who would force him to hand over the reins to his portfolio. However, through collaborative partnership, he came to appreciate the peace of mind achieved from developing a financial plan and portfolio strategy that aligned with his goals, beliefs, and plans for the future.

Michael came to us after managing his own portfolio for years. He had recently gone through some big life changes and recognized the need to work with someone who would allow him to refocus his attention on his business ventures and personal ambitions. At first, he struggled with the fear of working with an advisor who would force him to hand over the reins to his portfolio. However, through collaborative partnership, he came to appreciate the peace of mind achieved from developing a financial plan and portfolio strategy that aligned with his goals, beliefs, and plans for the future.

Hear how Michael transitioned from self‑managed to a partnership with us

Hear how Michael transitioned from self‑managed to a partnership with us

Play video to watch Michael’s story
Read video transcript