Firm Description
REDW WEALTH LLC, was founded in 1997 under the original name of
Rogoff & Stanley Financial Advisors and is a New Mexico Limited Liability
Company. The name was changed to REDW Stanley Financial Advisors,
LLC in 2000 when it registered with the Securities and Exchange
Commission. In January 2019 REDW Stanley Financial Advisors changed
their name to REDW WEALTH LLC.
REDW WEALTH LLC provides personalized confidential financial planning,
investment and wealth management services to individuals, pension and
profit sharing plans, trusts, estates, charitable organizations, small
businesses, and Native American tribes. Advice is provided through
consultation with the client and may include: determination of financial
objectives, identification of financial problems, cash flow management, tax
planning, insurance review, investment management, education funding,
retirement planning, estate planning and retirement plan investment services.
REDW WEALTH LLC is a fee-based wealth management firm, meaning the
only revenue received is that from the client. The firm does not receive
commissions for purchasing or selling annuities, insurance, stocks, bonds,
mutual funds, limited partnerships, or other commissioned products. No
finder’s fees are accepted. No soft dollars are accepted from mutual fund
companies or other investment product providers. REDW WEALTH LLC
receives some economic benefit from discount brokers and custodians in
connection with giving advice to clients.
Investment advice is an integral part of financial planning. In addition, REDW
WEALTH LLC advises clients regarding cash flow, cash management,
college planning, retirement planning, insurance planning (although REDW
WEALTH does not sell insurance products), tax planning, stock option
planning, planning for life changing events, cash needs at death, income
needs of surviving dependents, analysis of investment alternatives as well as
trust and estate planning.
REDW WEALTH LLC manages portfolios and gives investment advice for a
fee. REDW WEALTH LLC does not act as a custodian of client assets. Some
clients provide us access to their accounts through an account aggregator
tool, which gives us custody and is subject to an annual surprise audit.
REDW WEALTH LLC generally places trades for clients under a limited
power of attorney.
Other professionals (e.g., lawyers, other accountants, real estate
professionals, insurance agents, etc.) are engaged directly by the client on an
as-needed basis. Conflicts and potential conflicts of interest will be disclosed
to the client in advance of the event they should occur.
The initial meeting is free of charge and is considered an exploratory
interview to determine the extent to which financial planning, investment
management, or wealth management may be beneficial to the client.
Principal Owners
All members of REDW LLC, the parent company and holding company are
equity owners of REDW WEALTH LLC. Control of all policies and procedures
related to investments, planning, and management of REDW WEALTH LLC
vests with one principal: Paul Madrid, Chief Compliance Officer and Principal
in Charge.
Types of Advisory Services
REDW WEALTH LLC provides investment supervisory services, also known
as asset management services; manages investment advisory accounts not
involving investment supervisory services; furnishes investment advice
through consultations; issues newsletters and special reports about securities
and markets in general. Charts, graphs, formulas, or other analysis may be
provided to clients for use in evaluating securities or portfolio allocations.
These types of information are available to our clients from service providers
we use such as Morningstar, YCharts, our custodian Charles Schwab , JP
Morgan, as well as various consulting research firms.
REDW WEALTH LLC furnishes advice to clients on matters not involving
securities, such as wealth management, insurance, financial planning
matters, taxation issues and estate planning.
Types of Agreements
The following agreements define the typical client relationships:
Financial Planning/Wealth Management Agreements
A financial plan is designed to help the client with all aspects of financial
planning with or without ongoing investment management after the financial
plan is completed.
The financial plan may be detailed or strategic and may include, but is not
limited to: a net worth statement; a cash flow statement; a review of
investment accounts, including reviewing asset allocation and providing
repositioning recommendations; strategic tax planning; one or more
retirement scenarios; a review of retirement accounts and plans including
recommendations; a review of insurance policies and recommendations for
changes, if necessary; estate planning review and recommendations; and
education planning with funding recommendations, stock option analysis
including tax strategies, and planning or other more specific analysis as
requested by the client.
Generally, specific investment advice and recommendations are provided as
part of a financial plan. Implementation of the recommendations is at the
discretion of the client. A separate investment advisory agreement may be
agreed upon but is not required in a financial planning engagement.
After delivery of a financial plan, future meetings may be scheduled as
necessary. Additional fees may apply and are usually billed at normal hourly
rates. Monitoring and or implementation of recommendations are considered
separate wealth management engagements and a separate engagement
letter will be prepared for either a higher negotiated percentage of assets
under management, or for a stated flat fee. Fees may be negotiated and are
dependent upon the various services requested.
Investment Advisory Service Agreement
Many financial planning/wealth management clients choose to have REDW
WEALTH LLC manage their assets in order to obtain ongoing in-depth
investment advice. Realistic and measurable goals are set and objectives to
reach those goals are defined in an Investment Policy Statement which is
recommended. As goals and objectives change over time, portfolio
allocations and specific investment recommendations are made and
implemented on an ongoing basis. Investment Policy Statements are
updated as needed.
Assets are invested primarily in exchange-traded funds and no-load mutual
funds at net asset value, usually through discount brokers or fund companies.
Fund companies charge each fund shareholder an investment management
fee that is disclosed in the fund prospectus. Discount brokerages may charge
a transaction fee for the purchase of some funds.
Investments may also include: equities (stocks), warrants, corporate debt
securities, commercial paper, certificates of deposit, municipal securities,
investment company securities (variable life insurance, variable annuities,
and mutual funds shares), U. S. government securities, options contracts,
futures contracts, and interests in partnerships. Brokerage firms typically
charge commissions and/or transaction fees in connection with securities
trading activity. REDW WEALTH LLC does not receive any compensation
from fund companies or brokerages.
Initial public offerings (IPOs) are generally not available through REDW
WEALTH LLC but may be available by individual client requests approved by
the Investment Committee, and available from the custodian.
The scope of work and fee for an Investment Advisory Service Agreement is
provided to the client in writing prior to the start of the relationship in the form
of a standard agreement. Terms, other than scope of work and fee, of the
standard agreement are not negotiable other than for various Native
American Sovereign Nations requiring specific legal language.
Although the Investment Advisory Service Agreement is an ongoing
agreement and constant adjustments are required, the length of service to the
client is at the client’s discretion. The client or REDW WEALTH LLC may
terminate an Agreement by providing five days written notice to the other
party. At termination, fees will be billed on a pro rata basis for the portion of
the quarter completed. The portfolio value at the date of termination
notification is used as the basis for the fee computation, adjusted for the
number of days during the billing quarter prior to termination.
Annual individual federal and state tax preparation work may be performed as
part of the Investment Advisory Service Agreement or billed
separately at
standard hourly rates, depending upon the level of service chosen and the
negotiated fee agreement. Eligible federal and applicable state returns are
filed electronically without additional fees. To the extent provided, tax
preparation services are rendered in the professional’s separate capacity as a
tax preparer, and not in their capacity as a representative of REDW WEALTH
LLC.
Retainer Agreement
In some circumstances, a Flat Fee or Retainer Agreement may be executed
in lieu of a standard hourly consulting or percentage or assets engagement
when it is more appropriate to work on a fixed-fee basis. The annual fee for
this type of arrangement is dependent upon all facts and circumstances and
generally is not negotiable. At termination flat fees or retainer agreements will
be billed on a prorate basis for the portion of the quarter completed.
DST and 1031 Exchange
REDW WEALTH LLC provides assistance to clients in research, analysis,
and advice on DSTs and 1031 Exchanges. That assistance involves working
with all of the various parties engaged in such transactions in order to obtain
the best possible offer for the client. REDW WEALTH LLC acts as a fiduciary
in all matters pertaining to the sale of these transactions. No commissions or
payments are received from any third party as a part of this process. Clients
are billed a stated flat fee for our assistance and consultations.
Tax Preparation Agreement
Tax preparation work may be included in the Wealth Management or
Investment Advisory fee arrangement or it may be billed separately at
standard hourly rates or a flat fee, depending upon all circumstances and fee
negotiations. Separate tax preparation engagement letters will be necessary
annually without regard to fee arrangement. Tax preparation work is done in
the professional’s separate capacity as a tax preparer and not as a
representative of REDW WEALTH, LLC.
Hourly Planning/Consulting Engagements
REDW WEALTH LLC provides hourly planning and consulting services for
clients who need advice on a limited scope of work. The hourly rate for
limited scope engagements depends upon the standard billing rate for
individuals assigned to an engagement and the skill sets needed. These fees
can generally be estimated and included in the limited scope engagement
letter.
Automated Investment Program
We offer an automated investment program through Charles Schwab
Institutional Intelligent Portfolios® platform. We are independent of and not
owned or affiliated with Charles Schwab. We are solely responsible for the
program and the management of the portfolios. We charge a fee for our
services described in fees and compensation. We do not pay Charles
Schwab Institutional Intelligent Portfolios® a fee for the platform.
Tailored Relationships
The goals and objectives for each client are documented in our client files or
client relationship management system. Investment policy statements are
created for asset management and investment consulting clients that reflect
the stated goals and objectives. Clients may impose restrictions on investing
in certain securities or types of securities and may or may not agree to certain
documentation requests.
It remains REDW WEALTH LLC policy that individual advice and treatment
will be accorded to each advisory client. REDW WEALTH LLC strives to
ensure equality among clients, however at any given point in time one or
more clients may require additional time and attention and may have different
fee structures.
REDW WEALTH LLC clients are clients of the firm and not the individual
advisor.
Miscellaneous Disclosures
Account Aggregation Platforms. REDW WEALTH LLC can provide clients
with access to one or more account aggregation platforms. In addition to
allowing for aggregate viewing of account assets managed by REDW
WEALTH LLC, these aggregation platforms can also incorporate client
investment assets that are not part of the assets that REDW WEALTH LLC
manages (the “Excluded Assets”). Unless agreed to otherwise, in writing, the
client and/or the client’s other advisors that maintain trading authority, and not
REDW WEALTH LLC, shall be exclusively responsible for the investment
performance of the Excluded Assets. Furthermore, unless otherwise agreed,
in writing, REDW WEALTH LLC does not provide investment management,
monitoring or implementation services for the Excluded Assets. The client can
engage REDW WEALTH LLC to provide investment management services
for the Excluded Assets pursuant to the terms and conditions of the
Investment Advisory Agreement between REDW WEALTH LLC and the
client. If REDW WEALTH LLC is asked to make a recommendation as to any
Excluded Assets, the client is absolutely not obligated to accept the
recommendation, and REDW WEALTH LLC shall not be responsible for any
implementation error (timing, trading, etc.) relative to the Excluded Assets.
Retirement Rollovers: A client or prospective client leaving an employer
typically has four options regarding an existing retirement plan (and may
engage in a combination of these options): (i) leave the money in the former
employer’s plan, if permitted, (ii) roll over the assets to the new employer’s
plan, if one is available and rollovers are permitted, (iii) roll over to an
Individual Retirement Account (“IRA”), or (iv) cash out the account value
(which could, depending upon the client’s age, result in adverse tax
consequences). If REDW WEALTH LLC recommends that a client roll over
their retirement plan assets into an account to be managed by REDW
WEALTH LLC, such a recommendation creates a conflict of interest if REDW
WEALTH LLC will earn new (or increase its current) compensation as a result
of the rollover. No client is under any obligation to roll over retirement plan
assets to an account managed by REDW WEALTH LLC.
ERISA / IRC Fiduciary Acknowledgment
When REDW WEALTH LLC provides investment advice to a client
regarding the client’s retirement plan account or individual retirement
account, it does so as a fiduciary within the meaning of Title I of the
Employee Retirement Income Security Act (“ERISA”) and/or the Internal
Revenue Code (“IRC”), as applicable, which are laws governing
retirement accounts. The way REDW WEALTH LLC makes money
creates some conflicts with client interests, so REDW WEALTH LLC
operates under a special rule that requires it to act in the client’s best
interest and not put its interests ahead of the client’s.
Under this special rule's provisions, REDW WEALTH LLC must:
•Meet a professional standard of care when making investment
recommendations (give prudent advice);
•Never put its financial interests ahead of the client’s when making
recommendations (give loyal advice);
•Avoid misleading statements about conflicts of interest, fees, and
investments;
•Follow policies and procedures designed to ensure that REDW
WEALTH LLC gives advice that is in the client’s best interest;
•Charge no more than is reasonable for REDW WEALTH LLC’s
services; and
•Give the client basic information about conflicts of interest.
Cash Positions. At any specific point in time, depending upon perceived or
anticipated market conditions/events (there being no guarantee that such
anticipated market conditions/events will occur), REDW WEALTH LLC may
maintain cash positions for defensive purposes. In addition, while assets are
maintained in cash, such amounts could miss market advances. All cash
positions (money markets, etc.) shall be included as part of assets under
management for purposes of calculating REDW WEALTH LLC’s advisory fee.
Periods of Portfolio Inactivity. REDW WEALTH LLC has a fiduciary duty to
provide services consistent with the client’s best interest. The REDW
WEALTH LLC will review client portfolios on an ongoing basis to determine if
any changes are necessary based upon various factors, including, but not
limited to, investment performance, market conditions, fund manager tenure,
style drift, account additions/withdrawals, and/or a change in the client’s
investment objective. Based upon these factors, there may be extended
periods of time when REDW WEALTH LLC determines that changes to a
client’s portfolio are neither necessary, nor prudent. Clients remain subject to
the fees described below during periods of account inactivity.
Assets Under Management
As of December 31, 2023, REDW WEALTH LLC manages $1,004,648,408 in
assets on a discretionary basis for approximately 439 clients.