Q. What is a Certified Financial Planner™?
A. Today more than ever, CERTIFIED FINANCIAL PLANNER™ professionals are an essential resource. From budgeting, to planning for retirement, to saving for education, to managing your taxes and your insurance coverage, “finances” doesn’t mean just one thing for most Americans- and “financial planning” means much more than just investing. Bringing all the pieces of your financial life together is a challenging task. CFP® professionals understand all the complexities of the changing financial climate and will make recommendations in your best interest. - See More


Q. Who is Heritage Financial Advisors?
A. We are a fee-based financial advisory firm that provides comprehensive financial planning, investment management, retirement plans, college savings plans, mutual funds, annuities, life and disability insurance and long-term care insurance.


Q. What investment strategy do you follow?
A. Our investment philosophy follows the covenants of Modern Portfolio Theory, which uses different asset classes to increase overall portfolio diversification and reduce risk. Our passive philosophy follows the Prudent Investor Act, which requires advisor’s to act in the client’s best interests at all times. Structured and passive management provides several advantages: low expense ratios, low turnover, and favorable returns from reliance on a broad range of each asset class, performance that usually exceeds that achieved by the majority of active managers over time, low cash positions, and the ability to consistently provide market returns.


Q. What makes Heritage Financial Advisors different from other money managers?
A. Heritage Financial Advisors is an independent advisory firm with over 64 years of combined financial experience. We pride ourselves on adhering to the highest level of ethical standards and believe in building a relationship which is founded upon trust by serving our clients with honest, unbiased, goal oriented financial advice. We act as a fiduciary to you, our client. Our investment strategy follows the Prudent Investor Act, which requires advisor’s to act in your best interest at all times.


Q. What is the Prudent Investor Act?
A. The Uniform Prudent Investor Act was adopted in 1992 by the American Law Institute’s Third Restatement of Law of Trusts. The law reflects a “modern portfolio theory” and “total return” approach to exercise fiduciary investment discretion. A fiduciary’s performance is measured on the performance of the entire portfolio, rather than individual investments. Diversification is explicitly required as a duty for prudent fiduciary investing. The Act has been cited as a source of guidelines for state legislatures on fiduciary responsibility. The majority of states have revised “prudent investor” statures.


Q. What is a fiduciary?
A. A fiduciary is a person, company or association holding assets in Trust for a beneficiary. The fiduciary is charged with the responsibility of investing the money wisely for the beneficiary’s benefit. Examples of fiduciaries are Executors and Trustees.


Q. What is an independent advisory firm?
A. An Independent Advisory Firm comprises of a group of financial professionals who offer unbiased advice on financial matters to clients and recommend suitable financial products.


Q. What safeguards are in place to protect my money against fraud?
A. We use Schwab Institutional as the custodian and record keeper for clients’ assets. Schwab is a member of the Securities Investor Protection Corporation (SIPC), and assets invested by clients through us will be insured by SIPC.

The Securities Investor Protection Corporation (SIPC) insures up to $500,000 for accounts held in each separate capacity (e.g., joint tenant or sole owner), with a limit of $100,000 for cash balances. Excess account protection is provided through underwriters at Lloyd’s of London. Under the policy secured with Lloyd’s underwriters, securities and cash are insured by the Lloyd’s policy up to an aggregate of $600 million, limited to a combined return to any customer, from a Trustee, SIPC and Lloyd’s of $150 million, and cash accounts of up to $900,000. The Lloyd’s of London insurance is intended to cover amounts exceeding the coverage provided by the SIPC limits. This coverage does not cover fluctuations in the market value of the securities held in clients’ accounts.


Q. What is passive management?
A. Passive management is a buy and hold strategy which seeks to hold multiple (12-14) asset classes and minimize portfolio costs.


Q. What is active management?
A. Active management is the art of stock picking and market timing. Active managers rely on research, market forecasts, and their own judgment and experience in making investment decisions.


Q. What is an asset class?
A. A category of investments with similar characteristics. For example, large-cap, mid-cap, small-cap, value and growth asset classes, both domestic and international companies.


Q. What is a proprietary product?
A. A proprietary product is a specific product line that is the primary product line a firm sells. The proprietary product line a firm sells may offer the sellers commissions for primarily selling their product.


Q. Do you guarantee performance or rates of return?
A. We do not guarantee performance or rates of return on securities.


Q. What is a benchmark?
A. An investment benchmark represents “the market” and is used as a comparison to measure the performance in a portfolio.


Q. What benchmarks do you use to compare returns?
A. We use the S&P 500, Russell 2000, MSCI EAFE Index and other benchmarks to compare our portfolio returns.


Q. What are your fees?
A. Our management fees are calculated on the value of the client’s portfolio at the end of each quarter and billed quarterly in arrears. Structuring our fees in this manner puts Heritage’s interest squarely with those of its clients. If the account increases in value, the fees increase also. Conversely when the market and the account fall, our fees do likewise. This also avoids the potential for conflicts of interest that can arise through use of commission-based fee structures that reward advisors who frequently buy and sell.

Our fees are low by industry standards, and include professional investment management services as well as access to institutional mutual funds. Heritage’s fee includes professional financial advice, face-to-face meetings, monthly market updates, (as well as occasional weekly updates during tumultuous market conditions), portfolio reviews, and regular monitoring and rebalancing of clients’ portfolios.


Q. What do you mean by “fee-based”?
A. The client is charged based on the value of the assets in the client’s portfolio at the end of each quarter instead of taking compensation from commissions on each transaction.


Q. What are internal costs?
A. Internal costs are comprised of the expense ratio and turnover within the fund. Ordinarily investors pay these costs without ever seeing them. These costs are an important consideration when evaluating costs and fees within a mutual fund. High internal costs produce a dramatic adverse effect on the return that the investor receives on his or her accounts.


Q. What is an expense ratio?
A. The expense ratio is the fund’s total operating expenses as a percentage of the fund’s assets. While investors don’t pay these expenses directly, these expenses do impact overall fund performance because they are deducted from fund asset before any earnings are distributed to shareholders.


Q. What is turnover?
A. The turnover ratio measures how long a fund holds the securities in its portfolio. The longer a fund holds securities and the less trading a fund does, the lower the turnover ratio. Since a fund incurs costs every time it buys/sells a security, a lower turnover ratio generally translates into lower transaction costs for the fund.


Q. Why are share classes important?
A. It is important to identify the type of share class you are purchasing because some share classes are costly to buy and sell. A costly front-end load (A share) or back-end load (B share or Contingent deferred sales charge- CDSC) share, the more adverse effect on the return the investor receives on his portfolio.


Q. What are institutional shares?
A. Institutional shares are a mutual fund share class typically available for sale to institutional investors with amounts of $500,000 or more to invest. These share classes are typically no-load shares due to the large amounts of shares purchased at one time. The majority of the mutual funds we offer are institutional shares.


Q. If I retain your firm, who controls my money?
A. We use Schwab Institutional as the custodian and record keeper for clients’ assets. Your financial advisor works with you to determine your goals and objectives. You always have the right to access and control your accounts.


Q. How do you keep in touch with your clients?
A. Our contact management system allows us to track all client interactions. We implement call schedules and track annual reviews to ensure we are connecting on a regular basis with clients. Additionally, you receive monthly statements and our monthly investment newsletter. We always encourage clients to contact us with any questions or concerns.


Q. What if my financial circumstances change?
A. We conduct an annual review of your accounts and your financial circumstances. Life events may postpone or change your original financial plan, in which case, we determine the best course of action to remedy your situation should your financial circumstances change.


Q. What if I change my mind about retaining Heritage Financial Advisors?
A. If you change your mind about retaining us as your advisor, you are under no obligations.


Q. How do I get started investing with Heritage Financial Advisors?

A. First, you would meet with an advisor to establish your goals and objectives as well as determine your risk tolerance. Once these are established and paperwork is completed, a portfolio is created based on the information you discussed with your advisor.