Unlike most financial advisors, we practice wealth building. Our approach emphasizes the ‘journey’ of building wealth through a holistic process that incorporates investing, financial planning, tax planning and many other activities. At Brook Wealth Management, LLC your goals, values, and dreams guide every step of the process.
Many potential clients come to Brook Wealth Management, LLC assuming that wealth building is just a fancy name for investing. In practice, building wealth is fundamentally different than investing.
To give you an example of the difference between investing and our process of wealth building, let’s examine a common scenario:
Sally, a 50 year old woman, inherited a $250,000 IRA upon the death her 60 year old husband. She did not need access to the funds in the IRA, so she told her stockbroker, John, to “invest it and make money.” Over the next 21 years, John managed to grow the IRA from $250,000 to about $2 million. John was solely focused on Sally’s investments and their performance. Due to his narrow focus, the importance of estate planning was never properly addressed. Her will had not been updated in over a decade and no provisions were made to protect her estate from estate taxes. Sally died at age 71 with a taxable estate and her IRA passed to the beneficiaries, but only after both income and estate taxes were taken out.
Although John is proud of the investment performance of the IRA, the lack of planning could cause more than half the value of the IRA to go to the government in the form of taxes. Had appropriate estate planning been done for Sally, her family could have saved over $1,000,000 in taxes. When you are building wealth, it is only not what you “make,” but what you “keep” and “leave” that matters.
This is a hypothetical example and is not representative of any specific investment. Your results may vary.
Our advisors treat the wealth building process as a journey. Our approach breaks down the process into five important aspects of wealth building:
- Personal and professional goals – We focus on learning about your goals and dreams because without defined goals, there is nothing to build toward.
- Your current financial situation - This is the starting point to your journey and is the foundation upon which your wealth is built.
- Your investment time horizon - Will this money be used in 5 years or 15 years? When will you need your money? In order to structure portfolios and choose the right investments, we need to understand how long the money can stay in the market.
- Risk tolerance – Can you handle the inherent volatility of the stock market or do you prefer the relative safety of fixed investments? Are you willing to accept more risk to potentially achieve higher returns?
- Tax consequences – There are over 10,000 pages in the Internal Revenue Code and taxes can be a minefield for your wealth when not considered in the wealth building process.
By adopting a holistic and integrative approach to your personal and financial decision-making, Brook Wealth Management, LLC can help you manage wealth.
As an independent investment advisory firm, proprietary products are not a part of our investment toolkit. As CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals, our fee-based approach ties our success to your account value not to sales commissions.