Sample Investment Policy Statement
*to be customized for each client*
Cash Assets (Checking, Savings, CDs: $150,000 | Taxable Assets (Individual, Joint, Trust): $250,000 | Retirement Assets (IRA, 401k, 403b, Roth accounts, etc): $550,000 |
Taxable Account: Increased growth potential with access to money if needed before retirement.
Retirement Accounts: Invest for growth to provide income during retirement.
Investment Contribution Rate: 15% of Income | Duration or number of years to invest: 15 yrs to retirement | Rate of Return Goal: 5% annual return based on Financial Planning analysis | |||
Risk Tolerance: Moderate | Short-term liquidity needs: Low (0.0% - 2.0%) |
U.S. Stocks | 20-80% | Large-Cap | 50% | Mid-Cap | 25% | Small-Cap | 25% |
Foreign Stocks | 0-40% | Dev. Markets | 50% | Em.Markets | 25% | Int. Small-Cap | 25% |
Bonds | 0-80% | Short-Term | 25% | Int.-Term | 50% | Long-Term | 25% |
The Process begins with your goal as the foundation of the Investment Management Process. Each subsequent step should serve to build and strengthen the likelihood of the goal being achieved.
We listen to your current financial situation and what you would like to accomplish in order to structure a long term, diversified strategy that best fits your personal financial plan. We work to anticipate (not predict) the market and evolve your portfolio to reflect the ever-changing environment while helping you achieve financial security, maximize your gains and protect your assets.
Favor the long term growth potential of stock funds and use bond funds for diversification from stocks, capital preservation, income and inflation protection. Hold cash and short-bond funds for near-term expenditures. Use Active, Passive, and Retirement Buckets Investment Strategies as necessary.
RANGE OF STOCK, BOND & BLENDED TOTAL RETURNS - Annual total returns, 1950-2019
Morningstar Analyst Rating | Fee Level | Morningstar Star Rating | Manager Tenure |
Investment Philosophy | Risk / Return | Parent Company | Stewardship Grade |
MONITORING STANDARDS
Rebalance when allocations to broad asset classes are 5 - 10% from the target asset allocation:
Review Portfolio: Annually - Semiannually - Monthly
Progress toward goal | Performance vs. benchmark/category peers |
Tax efficiency of taxable portfolio | Tax-loss harvesting opportunities |
Concentration risk (investment style, sector) | Portfolio performance vs. blended benchmark |
Market Opportunities / Undervalued Stocks | Security fundamentals |
Northbrook Financial
1340 Smith Ave, Ste 200 | Baltimore | MD | 21209 | www.northbrookfinancial.com | (410) 941-9709