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Identifying and tracking progress of client financial goals

by Feb 7, 2018Advisor perspectives

Identifying and tracking progress of client financial goals

by Feb 7, 2018Advisor perspectives

Brian Mock, EA • Peoria, AZ
M&A Wealth Management, LLC • Innovation Partners, LLC
Read full biography below

Proactive Advisor Magazine: Brian, talk about the evolution of your wealth-management practice.

I was born and raised in the Phoenix area. I attended a local community college after high school and then moved on to the University of Phoenix, where I graduated with a degree in business marketing. I am a big sports fan and was a pretty good athlete. I originally had thoughts of going into a sports-related field like broadcasting or sports medicine. Though sports remain a personal passion, I decided that field was just not going to be the best career choice.

My father had been in corporate accounting for AT&T and became an enrolled agent, starting a successful independent tax and accounting firm in the Phoenix area in 1980. My mother later began working at the firm. Over the years, my father acquired his insurance and securities licenses and expanded his practice to helping individuals and small-business owners with some basic investment needs, such as 401(k) rollovers or opening IRAs.

I had taken a variety of accounting and tax courses in school and started working in the tax practice while I was still attending college. I also became an enrolled agent and have since acquired securities, advisory, and life- and health-insurance licenses. The business has evolved to where we have both a distinct tax and accounting practice and a wealth-management practice that I run. My personal time is spent about equally on the two practices. We have developed a specialty of representing individuals or businesses before the IRS on tax matters in addition to our tax preparation and accounting work. On the wealth-management side, I work with individuals, families, and small-business owners and provide financial consulting on a wide range of financial needs, including investments.

How do you approach the planning process in working with wealth-management clients?

We are committed to maintaining the highest standards of integrity and professionalism in our relationships with our clients. We work hard to understand the specifics of their financial situation and provide high-quality information, services, and products to help them meet their goals. This can include areas such as cash-flow planning, risk-management and insurance needs, retirement and investment planning, college planning, and legacy planning.

We employ a step-by-step process in working with wealth-management clients that includes

  • establishing and defining our working relationship,
  • gathering data and working together to establish broad goals and priorities,
  • analyzing and evaluating the client’s current financial status and placing that in context of their desired objectives,
  • developing and presenting recommendations and discussing the pros and cons of alternative approaches, and
  • implementing the approved recommendations and monitoring progress toward goals.

I consider the discovery process to be critically important. Listening closely to clients is a distinct skill that I have worked hard to develop. My process initially is to let clients express their financial and life concerns and their aspirational goals. Then I hone in on the major items where we can start making positive improvements. Through this give and take, I will ask them to identify what their biggest hot button is. If they have six or seven major issues, we will try to rank them from most to least important. Then we can come up with strategies to start to address these priorities, not necessarily all at once, but in a disciplined and timely fashion.


Describe your overall investment philosophy.

I keep myself current in the industry and attend numerous conferences, seminars, and other continuing education activities. I have developed a strong belief that the old-school industry approach to traditional portfolio management is no longer appropriate in today’s investment environment. For most of my clients, I use active money management that has risk management as one of its strongest priorities.

I think that if a client’s portfolio is not being actively managed, it may potentially face a disastrous scenario and severe drawdowns at some time in the future. History tells us that markets move in cycles, and there is simply no reason to think that a bull market will run on indefinitely. The sequence-of-returns issue is very important for clients to understand, especially those who are moving closer to retirement.

Most new clients that I see assume that if they have a traditionally diversified portfolio they will be OK. It is amazing to me how quickly people forget what happened during the credit crisis. We learned then that a well-diversified portfolio with a default mix of equity and fixed income across various asset classes could not weather the storm well. From 2007 to 2009 it essentially did not matter how diversified a portfolio was. During the extreme volatility of that period, everything was so closely correlated that most asset classes went down hard.

“For most of my clients, I use active money management that has risk management as one of its strongest priorities.”

The solution for this, I believe, is portfolio construction for clients that employs active, risk-managed strategies. These strategies come in many forms but most have an objective to mitigate the degree of drawdowns to a client portfolio during stressed market conditions. These strategies would be hard-pressed to avoid all losses. But I have personally analyzed the performance and actual returns of several such strategies during the 2007–2009 period, and the losses they experienced were nowhere near the losses of the overall market.

One of the things I do is explain some market history to clients and how the mathematics of mitigating large losses can work heavily in their favor over the long term. There are really two major impacts from a portfolio management perspective. First, it takes more than a 50% gain to overcome a 50% loss—a 100% gain is needed. Most people do not realize that, and it is why avoiding those steep losses is so important in the long-term compounded growth of a portfolio. Second, when a portfolio can avoid large losses, there is more opportunity to increase exposure to the market in growth-oriented strategies when markets do start to recover. That is important not just from a practical investment perspective, but also a psychological standpoint. Clients who have not experienced the pain of huge losses should be far more willing to let rules-based, quantitative strategies take on more exposure to the markets early in the rebound of the investment cycle.

How do you approach the development of an investment plan for clients?

Our firm approaches this stage in a very process-oriented way. We work closely with third-party asset managers. One, in particular, has a process and tools for clients that we think are excellent in helping to develop an investment portfolio for clients. This manager has an investment philosophy that I think closely matches my own as I work with clients. They have a statement that I share with clients: “The markets weren’t created to have a goal that matches yours”—which means it’s important for your clients to have an investment plan that fits well with their specific objectives.

There are five stages in our investment-planning process, starting with understanding the client’s goals, time horizon, and risk profile. We then design an investment solution that will usually consist of both traditional and alternative investments that can be represented in both strategic and tactical strategies. At this point, we discuss with the client how their specific blended portfolio has performed from a historical perspective and set appropriate expectations for their investments. There are no guarantees of course, but we think we can identify a range of performance that has a high probability of representing the performance their portfolio should see over full market cycles.

Once the client approves, we start the implementation stage and move forward with the investment plan. We have a process for continuous assessment to monitor how the portfolio is doing versus a client’s goals. Multiple management approaches have a goal of reducing market risk. Finally, the client will receive regular reporting that shows where their portfolio stands versus their objectives in a user-friendly format. If adjustments to the investment approach are required, we will work to identify midcourse alterations to the portfolio.

I explain to clients that we are identifying an acceptable range of outcomes based on their input, managing investments with their specific goals in mind, and tracking the progress of their investments within their specific time horizon. Within this broad framework, we may use multiple sophisticated, rules-based strategies that proactively employ a number of traditional and alternative asset classes. The feedback I receive from clients is very positive—they understand the process we are following and greatly appreciate the tracking versus their specific goals. While financial markets spend large amounts of time going up and down, clients can be assured we are working diligently through this process toward the goal of preserving and growing their wealth.

Effectively managing the client investment process

Brian Mock of M&A Wealth Management employs a step-by-step process in working with wealth-management clients on investment planning. For most clients, he uses active money management that has risk management as one of its strongest priorities. His process for clients includes the following steps:

1. Defining their investment time horizon and risk tolerance to set portfolio objectives and define expectations.

2. Designing a portfolio solution that may include multiple traditional and alternative asset classes and strategic and tactical strategies.

3. Implementing the investment plan based on the recommended management approach, allocations, and objectives.

4. Managing the portfolio to the targeted objectives, using the services of third-party managers.

5. Reporting on progress toward portfolio objectives on a regular basis.

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About Us

Brian Mock is the principal owner of M&A Wealth Management, LLC, located in Peoria, Arizona. He is also a partner at Mock and Associates, Inc., a tax and accounting firm established by his father in 1980. Mr. Mock says, “We believe that the family is one of the strongest bonds that exist in our world today. It is with this spirit that we provide our service to each of our clients.”

Mr. Mock actively assists his clients in evaluating their financial needs. As an enrolled agent, he is committed to providing practical advice to help his clients mitigate the impact of their federal and state taxes and to represent them effectively in tax resolution issues. He also works with his clients in many aspects of personal financial planning, from proper protection to wealth management. He says he helps his clients “determine their investment and income tax objectives and devise a sound strategy for achieving their goals.”

A native of the Phoenix area, Mr. Mock attended Glendale Community College and graduated from the University of Phoenix with a degree in business marketing. He resides in Buckeye with his wife and two young boys and enjoys traveling, the outdoors, and spending time with his family and friends. He also enjoys sports of all types, is a “huge fan” of the local Arizona professional teams, and is a supporter of his high school’s athletic program.

Disclosure: Securities and investment advisory services offered through Innovation Partners, LLC, member FINRA/SIPC. M&A Wealth Management, LLC, and Innovation Partners, LLC, are unaffiliated entities. Innovation Partners, LLC, and their representatives may not offer legal or tax advice. Individuals should consult their tax or legal professionals regarding their specific circumstances.

Photography by Brandon Sullivan

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