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We won’t settle for average. We continually seek top managers or securities and meld them into superior custom portfolios. Each palette of investments is carefully tailored to personal or family goals. We enlist excellent managers, research, resources, and effort for our clients. Don’t settle for average. You deserve excellence.
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Cutting Fees When Investing for Non-Profits Can Lead to a Boost in Profits
Do you have a favorite charity? If so, you want to see their investments do well so your favorite cause can receive the maximum amount of assistance possible … and in turn, so they can do the most good possible. You may not consider this often, but investing for non-profits is an important part of funding .
Here’s some insight from Dan Danford, founder/CEO of Family Investment Center, on how your favorite nonprofits can see a better return on their investments, which will allow them to do more for those they serve.
First, it’s important that a non-profit gets the best returns possible on their investment. That means whoever is managing the investments should aim to choose stocks, bonds, mutual funds, or other investments that seek to balance risk with reward.
As most of us know, nobody can predict exactly what the market is going to do. If there were such a person, they’d be unbelievably wealthy. But it is important for someone managing a non-profit’s funds to understand the balance between risk and reward. And perhaps more importantly, you want them to have the utmost transparency when it comes to fees.
When times are great and the market is booming, a non-profit may not be worried about fees, especially if it’s half of a percent. But what about when the market sours and funding is desperately needed for all the programs the non-profit administers?
When the economy takes a nose-dive and investments are suddenly reduced to one percent returns (or worse), that fee of half of one percent becomes a massive piece of the equation. This may be the time a non-profit finds out about all the extra fees they’ve been paying for years and never knew about. The new fiduciary rule, which went into effect in June of this year, should help stamp out any fine print that left people unaware of these fees.
If a non-profit wants to boost their portfolio returns, they should look for a safe and insured custodian with a figurative allergy to high fees. Find one that will provide verified statements. Also, it could be a good move to shift portions of a portfolio to a low-cost index or institutional-share manager. Finally, if a non-profit is happy with the performance of a current investment advisor, they can simply ask them if they’ll reduce their fees – some will take that cut.
At Family Investment Center, we’ve always operated as a fiduciary, which means we put our clients’ best interests first. Need advice investing for non-profits? Contact us today.