FAQ

Fee-Only Registered Investment Advisors* have a fiduciary responsibility to choose investments that are in your best interest.

Onyx Financial Advisors is a Fee-Only Registered Investment Advisor. This means that neither the advisors nor the firm receive any commissions for the investment recommendations we make to you. We don’t accept payments from any brokerage firm, mutual fund company, or insurance company. We’re only paid by you, through your standard asset management fee.

This approach is intended to reassure you that we are not financially incentivized to select or recommend any particular investment product. Simply put, we believe that the greater an advisor’s dependence on commission income, the greater the conflict. In the end, that conflict can cost you both in out-of-pocket expenses and in the quality of advice you receive.

As an Onyx client, you only pay a periodic fee that is based on a percentage of your assets under our management. The fee includes all the services we offer so you receive the maximum benefit of working with Registered Investment Advisors who are also CPAs. We want you to benefit fully by taking advantage of our comprehensive 360° Wealth Management, which goes well beyond just investment advice.

This fee structure also provides you with full transparency and no surprises; you always know exactly how much you’ll pay for your financial services. And you never have to worry about us recommending investment options or insurance products that aren’t in your best interest.

For more information on fiduciary responsibility, see “What is ‘Fiduciary Standard of Care’ and how does it affect me?”

*A Registered Investment Advisor must be licensed and register with the state or SEC.

Onyx’s investment philosophy is founded upon academic research with no hype. We believe that:

• Markets are efficient and the chosen asset-allocation will determine the expected return of a portfolio.
• Portfolios should be built with assets that capture the appropriate elements of the market as efficiently as possible.
• Diversification reduces risk.
• Higher expected returns come with higher expected volatility (there is no free lunch).
• Investments should be managed based on sound academic research, not attempts at timing markets with a crystal ball.

The investment recommendations you receive from us are based on your goals, your needs, and your risk-tolerance levels. After your initial investments are made, your portfolio is regularly “rebalanced” to the unique mix specified in your financial plan in order to maintain consistent market exposure for you.

Leading academic research has proven that the vast majority of people who try to “time market movements” underperform market returns. In other words, it is very unlikely that an advisor can ever predict the future and outperform the market.

If you’re someone who likes to gamble or make big bets or are looking for someone who believes they can predict market movements, we are not a good fit for you. Or if you watch the markets constantly and panic or are inspired to make sudden moves whenever the market fluctuates, we are not a good fit for you.

However, if you want a long-term investment approach that follows your own personal financial plan on a consistent basis where your goals are always front and center, we believe we are a great fit.

Onyx’s 360° Wealth Management approach provides you with the most comprehensive way to plan for and achieve your goals. We will work with you to:

• Protect and grow your wealth through a conservative investment philosophy.
• Mitigate your annual taxes, making wise strategic decisions.
• Look for tax-efficient ways to pass your assets on to your heirs, while keeping with your wishes.
• Evaluate whether or not your insurance coverage is sufficient to protect your wealth against catastrophic loss and other vulnerabilities.
• Fulfill your charitable goals in an impactful and meaningful way.
• Access on-going financial advice by using Onyx as your personal “Chief Financial Officer."

Compare these advantages to working with advisors that limit their services to just recommending investments.

In addition, we work directly with your current CPA or tax preparer, estate planning attorney, insurance agents, and other professionals where needed. You can rest assured that we’ll coordinate seamlessly with the rest of your professional team to simplify your life and to ensure everyone stays up to speed on your goals and needs.

For more information, see “What is 360° Wealth Management?”

Fiduciary standard of care is the highest degree of business responsibility one person can have to another. It means that those who provide you with advice always put your interests ahead of their own.

A federal law, the Investment Advisers Act of 1940, requires Registered Investment Advisors to meet this fiduciary standard of care.

No matter whom you select to provide you with investment advice, we recommend that you require them to agree, in writing, to meet the fiduciary standard of care provided for by the Investment Advisers Act of 1940.

Deciding whom to entrust your life savings with is not a decision you’ll make lightly. Because there are no educational or professional background requirements to become an advisor, all financial advisors are not equally skilled or qualified.

Care & Chemistry

Probably the most important initial consideration is the advisor’s demeanor and personality. Be sure that you’re comfortable with him or her and that he or she really listens to you. Your advisor should ask questions about your individual circumstances and demonstrate that your answers are truly understood.

To help you become more familiar with the advisors at Onyx, see our biographies that tell you not just about our advisors’ education and past work experience, but also something about who we are as people and how we work. Hopefully, you’ll find this to be a good starting point to know if you might be in the right place at Onyx.

Approach & Incentives

Different advisor firms have very different investment philosophies that dictate their approaches to managing your assets. Some try to predict market or stock movements for the purpose of timing adjustments of your asset allocation in an attempt to outperform the markets. See “Is Onyx’s investment philosophy right for me?”

Others guide you (without neutrality) toward the purchase of the specific products they happen to sell. There are some substantial differences in how advisors get paid and you should always be aware of where their payment comes from. See “Why should I use a Fee-Only Registered Investment Advisor?”

These differences significantly impact the advice you receive and the way your investments are managed over time.

Be Informed

To help you understand what different advisors do or don’t do, and what distinguishes one from another, we developed these FAQs and several articles and white papers.

Before you interview potential advisors, check out this article “Finding a Trusted Financial Advisor” written by Terry Roe. It provides four questions that you should ask your prospective advisors.

In the end, choose an advisor you can become comfortable trusting and who is most closely aligned with the philosophy you believe best suits your goals and needs.

You are always welcome to visit with us to learn why Onyx provides wealth management the way we do and what you can expect if you work with us.

Call 208-522-6400 to schedule a meeting. There’s never a charge for our initial consultation and we’re sure you’ll walk away with good information and some new ideas.

Unfortunately, no standardized education is required for someone to call himself or herself a financial advisor. You’ll find huge disparity in the backgrounds and qualifications of people who provide investment advice. This can make selecting your advisor confusing and challenging.

As you search for the right person to guide you, it’s helpful to know about two credentials that help you determine an advisor’s level of education and training. These are:

CERTIFIED FINANCIAL PLANNER™ (CFP®)

CERTIFIED FINANCIAL PLANNER™ is a professional designation attained by a person who has successfully completed the requirements of the Certified Financial Planner Board. To become a CFP®, an individual must fulfill the education requirement of holding a bachelor’s degree and completing an education program registered with the CFP Board or obtaining another degree or professional credential, such as a CPA license. He or she must pass a comprehensive 6 hour CFP® exam and have a minimum of 6,000 hours of professional experience related to the personal financial planning process. 

Additionally, all CFP® professionals must agree to abide by a strict code of professional conduct, known as the CFP Board’s Code of Ethics and Professional Responsibility, which requires that they act with honesty, integrity, competence, and diligence; act in the client’s best interests; exercise due care; avoid or disclose and manage conflicts of interest; maintain the confidentiality and protect the privacy of client information; and act in a manner that reflects positively on the financial planning profession and CFP® certification.

Personal Financial Specialist (PFS)

The PFS credential demonstrates that an individual has met the minimum education, experience and testing required of a CPA in addition to a minimum level of expertise in personal financial planning.  To attain the PFS credential, a candidate must hold an unrevoked CPA license, fulfill 3,000 hours of personal financial planning business experience, complete 80 hours of personal financial planning CPE credits, pass a comprehensive financial planning exam and be an active member of the AICPA.  A PFS credential holder is required to adhere to AICPA’s Code of Professional Conduct, and is encouraged to follow AICPA’s Statement on Responsibilities in Financial Planning Practice.  To maintain their PFS credential, the recipient must complete 60 hours of financial planning CPE credits every three years.  The PFS credential is administered through the AICPA.

Absolutely. You can use any CPA or tax preparer you wish. Many of our clients have long-standing relationships with their tax advisor who is familiar with their histories and the reasons for certain tax planning strategies.

If you use your own tax professional, we collaborate closely with him or her in several ways:

• First, we make sure that your investment plan coordinates with any tax mitigation strategies that you may already have in place.
• Second, we review any recommended changes to things like your retirement plans, Roth IRA conversions and similar activities with your tax advisor to make sure everyone is in agreement before moving forward.
• Third, we make sure your tax advisor receives all the investment and related information necessary to prepare your tax return.

Because we are also CPAs, we speak your tax preparer’s language, respect their deadlines, and know well ahead of time exactly what information they will need from us. We either have this information or know exactly where to get it, so this not only makes their job easier but spares you from having to fuss with keeping and supplying various documents to your tax advisor.

See Strategic Alliances to learn more about how we work with other professionals on your behalf.

We believe that your tax advisor will love having us as your financial advisor.

DFA is one of the main mutual fund managers we use. They are a pioneer in financial engineering based on the science of capital market analysis.

While other mutual fund managers waste their time and your money speculating on which securities they should buy and sell, DFA developed a disciplined structure that is based upon the various elements of the market.

DFA does this at a very low cost and in a tax efficient manner. One of the ways they keep costs down is by limiting access to DFA funds. Instead of offering funds directly to individual investors, DFA chooses to make their funds available through a select group of fee-only advisors, which helps control turnover and trading costs.

Onyx Financial Advisors is one of the select advisors authorized to work with DFA funds. Working with DFA is one of the many ways we reduce your costs thereby increasing the net return on your investments.

For more information on DFA, visit DFA’s website.

Every investor’s situation is unique so every investment should have a purpose and be appropriate based upon that situation and purpose.

The advisor you select should help you establish a written Investment Policy Statement (IPS) or investment plan. The IPS should always address factors that include:

• the reasons for your investment
• the investment time horizon, and
• the degree of risk you can comfortably tolerate.

Your IPS serves as a guide to achieving your long-term goals and it’s referred to on a regular basis over the years. It should be developed before your advisor makes any investment recommendations.

Onyx does have a minimum portfolio size. This is because people with investable assets approaching or exceeding a certain amount tend to have complexities in their planning needs and tax circumstances that merit the extremely high level of service that we provide to every client—inclusive in our pricing.

Working with Onyx, you experience a significant amount of care, attention, and account monitoring. We commit to being your personal CFO. Plus we continually collaborate with your other advisors. And there are no extra charges for any of this.

We’ve elected to give every client unlimited access to us as well as providing a variety of other special touches. This level of service requires us to establish some minimums rather than pare back our service for people with lower investable assets who may not want or need the full extent of what we do.

Those who choose to take advantage of our comprehensive wealth management services typically have investable assets of $500,000 or more. However, even if your investments are less than this, we still encourage you to contact us.

In nearly every case, with a free initial consultation, we’re able to evaluate your situation and make valuable recommendations to help you achieve your financial goals. We are happy to do this whether you end up working us or with someone else. We have strong relationships with other advisors who can probably help you with your investments if we cannot. And we’re pleased to make that introduction.

You have nothing to lose by talking with us. We are delighted to meet with you and will help you in any way we can.