Frequently Asked Questions
What is your management fee?
The annual investment management fee charged by Portfolio Solutions® is 0.37% for the first $3 million of investment assets managed, and 0.20% for assets greater than $3 million. A total relationship value below $1,000,000 is subject to a $925 minimum quarterly fee in lieu of the 0.37% annual management fee.
What is the minimum size relationship needed to get started?
A minimum relationship of $500,000 is required. There are no limits on the number of investment accounts or balances per account.
How can you charge such a low management fee?
Portfolio Solutions® is committed to charging you a fair price. A typical investment manager charges clients fees of 1% per year on average. That’s much too high given advances in the investment management industry over the past 20 years. High investment manager fees persist because the public doesn’t know that a low-cost solution has been available for more than a decade at Portfolio Solutions®.
Will I have an advisor assigned to me?
Yes. Every client at Portfolio Solutions® has a dedicated Investment Specialist who will understand your specific individual goals and objectives and work with you to align them with your investment strategy.
Are you a financial planner?
Portfolio Solutions® is an investment management firm. We are not “traditional” financial planners. However, as part of developing your ConfidenceMap®, we will discuss financial planning-related topics.
Is Schwab the only custodian available to Clients?
Yes. They act as a custodian of all our Clients' assets, which means they hold securities and cash and facilitate trading activities. Portfolio Solutions® has selected Charles Schwab & Co., Inc. (Schwab) as custodian because of their commitment to client service, low trading cost, and a dedication to operational efficiency. Our management fees are kept low because of the operational efficiency created by having only one custodian.
Is Portfolio Solutions affiliated with Schwab?
No. Portfolio Solutions® is not affiliated with Schwab, nor are we compensated by Schwab in any way through fees, commission, or incentives. In the spirit of full disclosure, our firm is supplied necessary software that allows our in-house portfolio management system to work efficiently and cleanly with Schwab’s back-office operations and trading desks. This software is available to all investment advisors.
Do I have to go to a Schwab office to open an account?
No. There is no reason to visit a Schwab office. We will assist you in opening a Schwab account and we will send you all the necessary Schwab paperwork . If there is a Schwab office nearby, you may go there to deposit checks rather than mailing money to Schwab. That would reduce the time it takes to deposit money into your account.
How quickly can you start managing my investments?
The process to start managing your investments can vary, depending on your availability to talk with an Investment Specialist to develop your ConfidenceMap®. For a motivated investor, the process may take as little as a few business days.
Am I involved in the day-to-day portfolio decisions?
Each portfolio follows an investment strategy that is decided and approved by you in advance and is outlined in your ConfidenceMap®. You are hiring Portfolio Solutions® to monitor and manage your accounts, according to your ConfidenceMap®. As such, you will not be hassled by us seeking permission to perform routine management and monitoring. If you have questions about your account(s), simply contact us by phone or e-mail.
Where is my money held?
All client accounts are held by a qualified independent custodian, Schwab. Portfolio Solutions® has selected this custodian because of its commitment to client service, low costs, security and a dedication to operational efficiency.
Does anyone at Portfolio Solutions® have access to my money?
No. Portfolio Solutions® employees do not have access to your money. Your money is held in an account in your name by Schwab. Portfolio Solutions® only has limited authorization to trade securities with discretion and deduct our quarterly management fee from the account under management. We have no other access or authority to your account(s).
Will I have internet access to my account?
Yes. Free internet access is available to Clients through a special Schwab website 24 hours per day, 7 days per week. The website also is the source for immediate information on account activity and provides you with many reports including year-end tax information.
How often do I receive statements and reports?
Schwab sends monthly statements to all clients for all accounts. These statements show account balances, trades, cash flows, and unrealized gains. Statements are available in paper as well as through email. In addition, Portfolio Solutions® will send a detailed performance report each quarter that compares your portfolio’s performance to a series of relevant market benchmarks. We urge you to compare your monthly statements from Schwab with the quarterly statements we send you.
Will I receive reports that will help with tax preparation?
At the end of each year, Schwab will send a Form 1099 to each client that has a taxable account. Included in your Form 1099 will be a realized gain/loss report that will assist you in preparing your annual tax return.