WORTH MAGAZINE DISCLOSURE
1998 “The 300 Best Financial Advisers”
Published by Worth Magazine
Award Criteria Summary:
Mary McGrath submitted an application to be considered for this award. This publication did not charge an application fee.
The following criteria for this award listing was excerpted from the magazine:
“We (Worth Magazine) began our selection process this year by asking every person we know whom he or she would recommend as a financial planner. We mean this literally—we posted a notice in the magazine asking readers for nominations. We also turned to the experts: trade organizations such as the International Association for Financial Planning and the National Association of Personal Financial Advisors, as well as advisers who made our list in years past. If a recommendation came from a professional at a rival firm, we gave it more weight than on from somebody at the same firm.”
“This harvest of nominations yielded a large universe of names. Each nominee was asked to fill out a six-page questionnaire detailing his or her personal and professional background and credentials, the size and scope of his or her practice, and the way he or she gets paid. We (Worth Magazine) asked for both personal and professional references.”
“Among the questions we (Worth Magazine) asked our candidates was how long they had been in practice. We preferred to see ten years’ worth of experience, but an otherwise outstanding planner who had been practicing since only, say, 1990 could still make our final list. We also made sure the planners carried professional liability insurance. Most of our applicants keep around $1 million in coverage. To us, this is merely a sign of prudent business practice—one that helps us sleep a little easier.”
“Another important question for the planners: Have you ever been a defendant in a lawsuit? If so, what was the outcome? We (Worth Magazine) checked with the Lexis legal database and court records, but since lawsuits are a matter of public record, a planner should be willing to divulge this information without your having to research it. (We eliminated those planners who failed to list lawsuits they had faced.)”
“But if an adviser has paid a hefty judgment, or if there have been several serious suits, we’d (Worth Magazine) steer clear.”
“We (Worth Magazine) also asked about fee structures. We’ve always favored fee-only planners, who make their money from the direct billing of clients rather than from commissions on such things as insurance policies and mutual funds. Fee-Only planners accept either an up-front lump-sum fee or a percentage of the assets under management. We believe this is the best way to ensure that the planner avoids any potential conflicts when recommending financial products. Seventy-two percent of the professionals on our list are fee-only planners.”
“At the same time, we (Worth Magazine) do recognize that there are excellent, unbiased planners who accept commissions. We asked each planner who accepts commissions if he or she would tell clients the source and amount of any commission received from the products sold. We dropped any adviser unwilling to make this disclosure.”
“We (Worth Magazine) also asked for sample contracts and plans from each nominee.”
“We (Worth Magazine) wanted to see if the planner had listened carefully to the client’s needs and responded appropriately. Each plan listed the client’s goals; if the goal listed was “wealth accumulation” or something similar, that wasn’t good enough. Even if a client’s sole ambition is wealth accumulation, it’s the planner’s job to help identify what else needs to be done to ensure the client’s security.”
“Does the adviser follow prudent rules of investing?”
“Also, does the adviser offer choices? Is the plan clear and easily understood? Are the recommended steps easy to follow? Are there scenarios that account for differing future rates of inflation and market returns?”
“One important thing we (Worth Magazine) tried to determine, particularly with this glittering class of well-known advisers, was whether they had gotten too big to provide personal service.”
1999 “The Worth 250 Top Financial Advisers”
Published by Worth Magazine
Mary McGrath submitted an application to be considered for this award. This publication did not charge an application fee.
The criteria for this award was not mentioned in the September, 1999 original magazine.
2001 “The Nation’s 250 Top Financial Advisers”
Published by Worth Magazine
Award Criteria Summary:
Mary McGrath submitted an application to be considered for this award. This publication did not charge an application fee.
The following criteria for this award listing was excerpted from the magazine:
“Zeroing in on the Nation’s Best Financial advisers is a rigorous process. We (Worth Magazine) culled nominees from a vast pool of new recommendations and past members of our list. We then ask the candidates to complete an extensive questionnaire detailing their credentials, professional distinctions, and compensation structures. The advisers under scrutiny must also submit a financial plan and a letter of recommendation from a client or a professional peer outside their firm. We review all this from the client’s perspective: We scour each submission for clarity, completeness, and attention to individual needs. We also query nominees for their best ideas and recommendations, and we expect carefully reasoned and thoughtful responses.”
“Next we (Worth Magazine) check nominees’ backgrounds. Registered Investment Advisers must send us their Form ADVs, which describe the firms’ services and fee structures and the advisers’ qualifications (this is a great resource that all advisers should be willing to share with their clients). We verify credentials and make inquiries with industry associations, local courts, and the Lexis legal database.”
“Eighty-four percent of the advisers on our (Worth Magazine) list are fee-only planners: They earn a percentage of assets under management or negotiate fixed fees. The rest are commission-based planners who clearly outline their fee schedules to clients (something every above-board adviser should be willing to do).”
2002 “The 250 Best Financial Advisers in America”
Published by Worth Magazine
Award Criteria Summary:
Mary McGrath submitted an application to be considered for this award. This publication did not charge an application fee.
The following criteria for this award listing was excerpted from the magazine:
“The advisers on our (Worth Magazine) list are selected for their creativity, depth of knowledge, and dedication to their clients.”
“Selecting the best advisers from among the many standouts who counsel America’s wealthy is no easy task. We (Worth Magazine) start by accepting nominations from readers, industry associations, investment firms, and the advisers we know. Candidates are asked to complete and extensive survey detailing their backgrounds, professional designations, client-retention rates, and average portfolio returns. We also ask candidates for their best ideas about wealth management and study them carefully. Advisers in the running must submit a sample financial plan and two letters of recommendation. Registered investment advisers must also supply their Form ADVs, which describe their services, fee structures, and disciplinary histories (this is a document that any prospective client should review). We verify credentials with industry associations and check backgrounds using the Lexis legal database to search court records.”
“Most advisers on our (Worth Magazine) list carry the Certified Financial Planner, or CFP, designation (see story for details), but it’s by no means a requirement. A Certified Public Accountant, or CPA, who is also a Personal Financial Specialist, or PFS, should also be equipped to provide broad-based advice on investments, taxes, and other wealth management issues.”
“All the advisers on our (Worth Magazine) list are taking new clients.”
“About 80 percent are Fee-Only advisers who earn a fixed fee or a percentage of assets under management. The rest accept fees and commissions.”