About the Company |
| How do your fees compare with the fees charged by other firms? |
| Our fees are very attractive when compared to most brokerage firms and banks. We keep our internal costs low and pass on these efficiencies to our clients. |
| What’s the difference between Pacifica and a firm such as Merrill Lynch or UBS? |
| Think David and Goliath. Pacifica is a small and independent firm dedicated solely to our clients. We do one and only one thing—look after our clients’ finances. Providing comprehensive wealth management advice is just one of a dozen things the bigger firms attempt to do. In addition, we don’t have our own investment products, we don’t provide loans, we don’t have an investment banking arm, we don’t charge commissions, we don’t sell insurance, and we don’t have a multi-million dollar advertising campaign (we don’t advertise). Gargantuan firms such as Merrill Lynch, UBS, Smith Barney, Morgan Stanley, and others attempt to be all things to all people. They have many masters to serve, and sometimes there can be conflict. They may make millions taking a company public and publicly recommend their clients buy that same stock to boost its price while, at the same time, criticizing that company behind closed doors. Many of these firms got into trouble doing this during the tech boom of the late 1990’s.
Pacifica is a registered investment advisor governed by the SEC, not a broker-dealer. What does this mean? Unlike the big (or small) brokerage firms, we are a fiduciary to our clients.
Click here to read what BusinessWeek has to say about fiduciaries and why you need one. |
| How are you compensated? |
| We are only paid by our clients. We receive no commissions, referral fees, or any other kind of outside fees. We typically charge our clients a fee based on the assets we manage for them. |
| What is a typical fee for a financial plan? |
| Most financial plans are $5,000+. In some circumstances, a financial plan can cost less. A typical financial plan takes anywhere between 25 and 40 hours of work and can consume a substantial amount of time and resources. Therefore, they are not cheap, but they are worth their weight in gold. It’s the only way to really be able to plan, develop an appropriate investment allocation, and make sure your finances are optimized. |
| What is a typical ongoing management fee? |
| This fee is generally between 0.40% and 1.25% per year of the assets we manage. |
| What are the firm’s expansion goals? |
| We don’t think bigger means better. In fact, in many ways, we think small and agile is better. We don’t want the inefficiencies that come with operating a large firm. We prefer to know our clients deeply and to remain small enough to serve them well. We will expand only as much as it takes to continue to provide our clients with unsurpassed customer service and expert financial advice. |
| What does the firm’s support staff look like? |
| We have a team of credentialed and experienced individuals available who are dedicated to supporting our clients. Our combined backgrounds include decades of legal, accounting, and investment experience. |
| Does Pacifica receive commissions on investments or insurance? |
| No, never. Our compensation is not tied to the advice we provide. When we recommend a particular investment or insurance policy, we want our clients to know that this advice is only for their benefit and not because we are earning a commission. To remain independent and objective, we only receive compensation directly from our clients. We never receive commissions or referrals fees. |
| Does Pacifica provide financial advice besides investments? |
| We provide 360 Wealth Management; we want to know about anything that affects our clients financially so we can provide the best possible advice on risk management, insurance, identity theft, tax planning, estate planning, cash-flow, and more. |
| I’ve heard about “fee-only” advisors. What are they and is Pacifica a fee-only firm? |
| We are a fee-only firm and staff fee-only advisors exclusively. Fee-only means that we don’t earn commissions or take referral fees; we are compensated exclusively by our clients. This ensures that the advice we provide our clients is in their best interests. |
| What makes Pacifica, which is a SEC Registered Investment Advisor, different from a brokerage firm? |
| A brokerage firm is a firm that is considered a “broker dealer” and is governed by the NASD, which is a self-regulatory body. An SEC Registered Investment Advisor is governed by an independent government body—the Securities and Exchange Commission. While financial advisors at brokerage firms (e.g., Merrill Lynch, UBS) have a fiduciary duty to their firm, Registered Investment Advisors have a fiduciary duty to their clients. For this reason, we are NOT a broker dealer. When you you’re your financial advisor, know his advice is independent and objective, and know his fiduciary duty is to you, you can be sure he is serving your best interests. You can read what BusinessWeek had to say about this if you click here. |
| What professional organizations does the firm belong to? |
| We are proud members of:
The Financial Planning Association (www.fpanet.org), the largest organization for our industry.
The National Association of Personal Financial Advisors (www.napfa.org), the largest organization for fee-only investment advisors; fee-only means we don’t earn commissions or referrals fees.
The Certified Financial Planner Board (www.cfp.net), the organizing body that issues and supervises CFP practitioners. |
| Does the firm focus on primarily serving Southern California? |
| While most of our clients live in Southern California, we have clients across the United States. Through technology, it’s just as easy to serve a client 3,000 miles away as it is to serve a client who lives just down the road. |
| Does Pacifica have a disaster-recovery plan? |
| Actually, we have two. All investment advisory firms are required to have a “business continuity plan,” as they are called. These are required by the NASD and SEC. There is certain language they need to see in the plan and our plans meet their standards. We also have an internal disaster-recovery plan that goes above and beyond what is required. When we work with clients, we try to identify and plan for nearly all kinds of emergencies and problems. We did the same thing for our firm; we looked at all of the things that could go wrong—earthquakes, fires, floods, disabilities, death, sickness—and came up with a back-up plan for each situation. Our primary goal is to improve our clients’ quality of life. If there is a disaster, we want our clients to know we will be up and working again with minimal delay or inconvenience to them. |
| How big is the firm? |
| We’re a small firm dedicated to doing one thing and only one thing—providing exceptional wealth management and investment advice to our clients. We have a small but passionate team. Unlike a large firm such as Merrill Lynch that creates their own research, we have the ability to utilize all research available and are not encumbered by (or conflicted by) producing our own. Our clients benefit from objective third-party research from many sources. |
| What is Pacifica’s vision? |
| Our vision is for every single person (both clients and non-clients) to achieve their goals and to not worry about money or their finances. It’s a tall order, but one we are passionate about delivering. We work closely with our clients to accomplish this vision, and we also help others through the free financial makeovers Robert provides, speeches, articles, and through Robert’s ground-breaking book, The Six-Day Financial Makeover. |
| What kind of technology does the firm use? |
| We utilize technology as much as possible to protect our clients’ documents and privacy, to research the markets, to create and monitor portfolios and investments, to provide greater efficiencies, and to provide unparallel customer support. This may mean having the latest and greatest hardware and software, but it may also mean using what we know works.
We use the latest Dell computers, privacy software, encryption, and backup technology. Our phone lines can be forwarded at the touch of a button to ensure constant access in case of an emergency. We use servers, external hard drives, and remote secure backup. Data is our lifeblood and our clients mean everything to us; we do everything possible to protect them. |
| Why does Pacifica have a “paperless office” and how will it benefit me? |
| We strongly believe in utilizing technology to better serve our clients. We are a paperless office. This means that instead of paper documents and file cabinets, we have electronic copies of everything. What’s the advantage? There are several. First, we can pull up your 2003 tax return, living will, or March account statement in seconds. Having access to all of your information instantly let’s us provide more timely and better advice. Second, we tend to become warehouses for our clients’ records. If you misplace your living trust or need an old tax return, we can get you a copy in a hurry. Third, we can store and backup these files. If there’s a fire or a natural disaster, we can quickly relocate offices and still have access to all of your records. With paper files, this just isn’t possible. |
| How many locations does the firm have? |
Currently, Pacifica has two locations. One in Orange County and one in Los
Angeles, California. The Orange County location is at 26041 Acero, Suite
500, Mission Viejo, CA 92691. The Los Angeles location is at 12100 Wilshire
Blvd., Suite 800, Los Angeles, CA 90025.
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| Does Pacifica have E&O Insurance? |
| Absolutely. E&O stands for “errors and omission.” It’s similar to a doctor’s malpractice insurance. We’ve never needed it, but we have it for our clients’ protection. |
| How long has the company been in business? |
| The company was founded in 2006 by Robert Pagliarini, who has over a decade of experience in the financial services industry. |
| What kinds of clients does the firm focus on serving? |
| Pacifica is a specialized firm that serves a select group of clients. While nearly everyone could benefit from good financial advice, we have chosen to focus on a narrow market. Our clients have different passions and come from all backgrounds, but they all have the following characteristics in common:
- They look forward to having a long-term relationship with a firm they trust
- They like the fact that we look at their total financial picture and not just a single account
- They are open to advice
- They are willing to take action and implement the financial advice we provide them
- They understand and appreciate the need for financial planning and investment advice
- They are friendly and easy to serve
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| Do I need to sign a contract that locks me with Pacifica for a set period of time? |
| We bill our clients quarterly, but you can terminate your relationship with Pacifica at any time and receive a refund of any fees you are owed. |
| How much time do you spend working with existing clients versus bringing in new clients? |
| Over 99% of our time is dedicated to serving existing clients. We spend very little time marketing, prospecting, and networking for new clients. |
| What is the firm’s policy on protecting client data and privacy? |
| We take client confidentiality very seriously. You can read our full privacy policy here. |
| Has the firm or have the principals been involved in any investment-related arbitrations or lawsuits? |
| No, never. |
| How does Pacifica typically get new clients? |
| Unlike the huge brokerage firms, we do not have an advertising budget. Our clients come to us exclusively from existing clients and other professionals—CPAs and attorneys, for example—who have experienced our service and expertise and refer people to us. |
| What is Pacifica’s assets under management? |
| Pacifica advises on nearly $200 million of client assets. |
| Will I be asked to provide Pacific with client referrals? |
| No. We’ll never ask you for a single referral. |
| Can I review a copy of your Form ADV? |
| Absolutely. Send us an e-mail request, and we will provide you with a copy of our Form ADV. |
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About Our Services |
| What is the process of working with a new client? |
| After making the important decision to become a client, we meet for a discovery meeting. A discovery meeting usually takes a couple of hours and gives us a chance to learn a tremendous amount about your background, your goals, your fears, and your current financial situation. We’ll get copies of your tax returns, estate planning documents, account statements, and insurance policies. We then take this information and analyze it—looking for hidden opportunities and ways to optimize your current resources. Our objective is to take what we learned about your hopes and dreams in the discovery meeting and create a financial roadmap to help you achieve your goals.
Once we know where you want to go and how to get there, we open Schwab investment accounts and transfer your assets into them. We recommend an investment strategy based on your goals, timeframe, age, risk tolerance, and other factors. Once the assets are at Schwab, we invest based on the allocation we agreed upon. We constantly monitor your asset allocation, the investments you own, economic factors, the markets, and other factors to determine if any changes are necessary.
We will sit down with you at least once a quarter to discuss the performance of your investment accounts and to discuss any changes we recommend and any changes or issues in your life that require our assistance and support. We are available for questions throughout the quarter as well. |
| Where are my investments and money held? |
| We utilize Charles Schwab’s Institutional division. Charles Schwab is a $22 billion company that is entrusted with nearly $1.3 trillion in client assets. Schwab has over 14,000 employees across 300 offices worldwide. Approximately 5,000 independent investment advisors are in custody of 1.5 million client accounts with Schwab. Your assets will be in good company. |
| Do you help with things such as planning for college tuition, buying or leasing a car, refinancing, etc.? |
| Yes. These are very important issues in our clients’ lives, and we make sure we are involved. We help our clients reach their goals—not just invest their money. There are a lot of factors to consider when thinking about saving for college, buying a second home, investing in real estate, leasing a car, refinancing, etc We empower our clients so they can make the best financial decisions possible. |
| Do you sell life, disability, health, or any other kind of insurance? |
| To remain objective and conflict-free, we don’t sell any kind of insurance. We do analyze the need for each type of insurance and recommend the specific policy you should purchase. We’ll even help you get quotes and select the best policy and company for your needs. |
| How often will we meet face to face? |
| Typically, we see our clients between two and four times per year—and more often if necessary. It’s important for us to know what is happening in your life so we can determine if there are any financial implications and/or strategies we can recommend. For example, it’s always helpful if we know about any large one-time expenses in advance, any changes to your employment, issues at work, or hundreds of other issues that can come up in a conversation.
We take advantage of the quarterly meeting to go over a client’s portfolio’s performance over the last three months. It is a great time to discuss what’s happening in the economy and in financial markets, what we predict for the future, and any specific allocation changes we recommend for a client’s portfolios. |
| Can I call and ask questions? |
| Definitely. Since we don’t charge by the hour, our clients feel welcome to call us with any questions, issues, or just to brainstorm. We look forward to these calls and take pride in our ability to help our clients in any way we can. |
| Will I need to buy and sell investments myself or will Pacifica do this for me? |
| We can do this for you. Once we agree on an appropriate investment allocation and which investments are right for you, we can make those purchases for you through Schwab. This ensures that you stay abreast of the big picture while you let us handle the details. |
| How are investments bought and sold in an account? |
| Through our relationship with Schwab, we are able to buy and sell investments for you using a special secure website and through a dedicated trading phone line. |
| What fees I will be paying? |
| You will pay three types of fees:
1. Pacifica Management Fee – This is the fee you pay us for financial planning and ongoing investment management.
2. Investment Fee – The investments we recommend may have their own internal fees. For example, if we recommend a mutual fund, the fund will charge you a fee. This fee automatically comes out of the fund and goes directly to the mutual fund company.
3. Incidental Fees – These include such things as transaction fees when you buy or sell an investment (usually between $30 and $75 depending on the transaction size) or wire fees.
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| Will I receive information on the performance of my investment accounts? |
| Yes. Pacific will send you a quarterly performance report that summarizes how all of your accounts at Schwab have performed over the previous quarter. Click here to see a sample quarterly performance report. |
| Will I receive account statements from Schwab? |
| Yes. Schwab will send you (either via mail or e-mail, depending on your preference) monthly account statements for each of your Schwab accounts. Click here to see a sample Schwab account statement. |
| What kind of return can I expect on my investments? |
| There are many factors that determine your investment performance, including your allocation and the return of the overall market. We’d need to have a conversation about your portfolio before we could predict the kind of long-term return you can expect. |
| Will you help me invest my 401(k) or employer-sponsored retirement account? |
| Yes. We’ll look at all of your investments and make recommendations for all of them, including your 401(k). |
| How often will I get account statements? |
| Charles Schwab will send you monthly account statements directly, and Pacifica will send you quarterly performance reports.
Click here for a sample Schwab statement.
Click here for a sample Pacifica quarterly report. |
| Will I get help opening new investment accounts? |
| Our clients are busy and the last thing many of them want to do is mess around with paperwork. We’ll do all the work for you. We will complete 100% of the account forms and provide them to you for review and signature. |
| Can I leave my investments where they are currently instead of transferring them to Schwab? |
| Yes. If you have an existing relationship with a firm and/or advisor but you want a second opinion, we can be that extra layer of comfort and peace of mind. We can do a one-time review of your finances or provide ongoing support and advice in conjunction with your current advisor. |
| What is our view of money? |
| Money is something to be earned, invested, and enjoyed. It has no intrinsic value—and is valuable only because of what it can provide. What it provides means different things to each client. For some, it means security and knowing their family will always be taken care of. For others, it means independence and options. Part of our job is helping our clients discover what money means to them. |
| Is the firm conservative or aggressive? |
| This is a good question, but a hard one to answer. When we work with a client, our focus is on their specific and unique situation. We try not to have pre-conceived ideas or notions that can cloud our advice. We prefer to approach each client with a clean slate so we can provide the very best solutions that meet their needs. We are cautiously optimistic. Our tendency is to be more conservative than aggressive. We hope for the best but plan for the worst. |
| Will I have access to my investment accounts on the Internet? |
| You sure will. Schwab provides 24/7 client access to their accounts over the Internet. |
| How have your clients’ investments performed over the last few years? |
| This is a good question. One we are most often asked and one that is nearly impossible to answer effectively. As a potential client, you deserve to know how a firm that may be managing your hard-earned money has performed. It’s easy to talk a good game, but when the rubber meets the road, how have we done? We do not expect our clients to blindly trust us. However, it is difficult to provide a general answer to this question.
An investment return is based, in part, on the allocation. Different clients have different allocations. One client may be in nearly all cash (for strategic reasons appropriate for that client), while another may have 80% of their portfolio in stocks. These two clients with very different allocations will also have very different investment returns. Which is more accurate? Each allocation and return is entirely accurate for that individual.
This is why it is important to discuss your situation so we can make projections based on an allocation that may be right for you. We can then speak generally about how others in situations as close to yours as possible have performed. |
| What factors do you consider when you recommend an asset allocation? |
| Our objective is to know our clients and to create an allocation designed to meet their unique needs and goals. To accomplish this, we learn as much as we can about where that client has been, what resources they have available, their employment, goals, risk tolerance, and myriad other factors. We blend these personal factors with our thoughts and projections on the economy and financial markets. We run statistical calculations using complex software programs—adding the human element of reason and experience—to generate what we think is an appropriate investment allocation for a client.
We then find what we consider to be the best institutional mutual funds, retail mutual funds, exchange traded funds, and private investments for each asset class we have identified within your allocation.
Never content, we monitor this allocation and take changing market forces and changing client needs and objectives into consideration. What was appropriate last week may not be appropriate any longer. We engage in thoughtful research, contemplation, discussion and timely action. |
| What is your philosophy on allocation and diversification? |
| Our philosophy of asset allocation and diversification is based on broad and deep theoretical knowledge and extensive practical experience. It is a very dynamic, working philosophy.
Like other aspects of professional and successful investing, asset allocation is part science and part art. A successful practitioner must have both fluency in the language of science and capital markets and the creativity to utilize that language in the service of a pragmatic and dynamic investment strategy.
The process starts with the client. What are the client’s current and future funding requirements, adjusted for taxes and inflation? We consider quantitative and qualitative factors of their risk capacity and risk tolerance. We also consider trust and estate issues. We use an asset/liability and duration matching process to develop realistic cash-flow projections and the final allocation recommendations.
Our perspective on asset allocation and diversification is supported by our ongoing education and research, which includes studying the work of leading academics and practitioners, as published in textbooks and professional journals, and our own experience in a variety of markets. The discipline of Behavioral Finance has made important contributions to our understanding of how investors and markets interact. The evolving field of investing has made a number of important advances in recent years. Some of the more robust advances are incorporated into our overall strategy and are mentioned in the following paragraphs.
Asset allocation is less formulaic than once thought. Following the basic tenets of Modern Portfolio Theory in lock-step fashion may not generate the client’s’ required returns or the expected reduction in volatility. The basic premise that a portfolio of risky assets is less volatile than any one of those assets alone is still true. Attempting to put that theory into practice presents serious challenges.
In theory, the correlations are stable. In the real world, the correlations between the major asset classes are very volatile. In theory, the markets are rational. Was the technology bubble rational? In theory, a long-term investor with a well-diversified portfolio will experience superior risk-adjusted returns. In practice, two or three extreme negative performance periods, coupled with cash demands on the portfolio, can put the portfolio in a loss position from which it will never recover.
These factors and others require us to go beyond traditional weightings and asset classes to generate the hoped for risk-adjusted return in a client’s portfolio. We carefully evaluate asset classes to determine where the cost of active management is warranted; when it is not justified, we use low-cost, passive strategies. In some cases, we carefully match up managers with contrasting strategies and uncorrelated performance to form a less volatile strategy within an asset class. To determine if one or multiple managers should be used in a particular asset class, we conduct cost/benefit analyses. Our clients’ portfolios are adopting an increasingly global approach to asset classes in recognition of the somewhat reduced significance of national boundaries. Above all, alertness and flexibility are required to manage a tactical asset allocation strategy.
Once the overall allocation has been determined, we can begin the process of determining what type of management will be most efficient for a particular client. Taxable accounts in general benefit from investment styles marked by low turnover. However, tax-advantaged strategies are of no value within an account structure that is already tax-advantaged. Passive strategies, such as Electronically Traded Funds and indexed mutual funds are characteristically low in cost and may be strategically utilized to lower the overall portfolio management cost. In certain asset classes, careful selection of active managers can lead to substantial improvements over benchmark returns. All of these factors must be carefully evaluated for each portfolio. |
| Do you recommend individual stocks? |
| No. We don’t recommend investors hold individual stocks for a couple of reasons. First, as an investor, you take on additional risk by holding stock in a handful of companies—specifically, you are taking on the risk of each company. Individual companies can suffer unique setbacks and problems that other companies, even in the same industry, do not. For example, a company could be charged with accounting fraud (e.g., Enron), have to recall millions of units of its product for safety reasons (e.g., Dell), or lose FDA approval for a drug (e.g., Pfizer). When you invest in an individual company, you take on these risks.
Second, we specialize in analyzing asset classes, monitoring mutual funds, and creating and monitoring asset allocations against an ever-changing economy. We do not specialize in looking at the balance sheets of individual companies, projecting an industry’s growth rate, or analyzing a company’s products or competitors. We leave this critical task to the mutual fund managers who have teams of researchers and analysts on staff focusing on their holdings, speaking to CEOs, and staying acutely abreast of their small slice of the market. |
| Who votes proxies, Pacifica or me? |
| A proxy is a way for investors to vote on company-related matters without having to be present at a shareholder’s meeting. Most clients want us to vote their proxies, and we are happy to provide this service. Some clients prefer to vote their own proxies, and this is fine too. |
| Do you monitor your clients’ investments? |
| Absolutely. This is one of our areas of expertise and a critical service our clients want us to provide. Discovering a great investment is one thing, making sure it continues to stay a great investment is another thing. In addition to the initial due diligence we undertake, we continuously perform both qualitative and quantitative research on each investment. A buy and hold (or hope, as I like to say) can be dangerous. |
| What kind of research do you perform on your clients’ investments? |
| Because we are an independent firm, we have access to almost an unlimited amount of research. In other words, we are not tied to just the research our firm produces since we don’t produce any proprietary research of our own. This gives us great flexibility. It also takes a tremendous amount of work. Life would be much easier if we generated our own research and went with it, but it wouldn’t necessarily be better for our clients. We like to look at all of the factors, read research arguing both sides of the topic, and make our own decisions. Our research includes a tremendous amount of reading and digging. We use software and technology to help us gather and analyze the data. |
| How often do you buy or sell investments in a client’s account? |
| We suggest changes to a client’s portfolio when one or more of the following occur:
1. If we anticipate changes to the economy or financial markets, we will overweight/underweight certain asset classes to protect our clients’ portfolios and/or to take advantage of an investment we think will perform well. For example, if we think small cap stocks are poised to perform well, we will shift more of a client’s investments in this asset class. Conversely, if we think real estate is overvalued, we will decrease our clients’ exposure to this asset class.
2. If we think an existing investment will under-perform, we’ll suggest selling it and moving into an alternative investment. We conduct a great deal of due diligence on the investments we recommend, and we monitor them constantly. There are a multitude of factors we consider including both qualitative (e.g., the broadness of a manager’s investment mandate) and quantitative (e.g., performance versus its peers). If, at any time, we are not happy with an investment, we’ll recommend selling it and buying a different investment.
3. Changes in our clients’ lives may necessitate changes in their portfolios. This is why it is important for us to know what’s happening with our clients so we can adapt their portfolios to their lives.
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| Will you file our tax returns? |
| No. We provide investment related tax advice but we are not CPAs, and we do not file our clients’ tax returns. We work closely with our clients’ CPAs to make sure they have all the information they need and to brainstorm creative tax strategies. |
| Will you create or modify our estate planning documents (e.g., living trust, Will)? |
| No. Although we work closely with attorneys (we even have one on staff), we do not provide legal advice. We are more than happy to refer you to attorneys we’ve successfully worked with in the past, though. |
| How often are financial plans updated? |
| We update them as often as necessary throughout the year. |
| Does the firm have relationships with CPAs, estate planning attorneys, and other professionals I may need? |
| We work closely with our clients’ other professional advisors. Most of our clients already have existing relationships, and we are happy to become part of those clients’ teams. If a client doesn’t have a relationship with other professionals, we are more than happy to introduce them to CPAs, attorneys, mortgage brokers, and realtors. |
| Do you recommend investments in private companies? |
| Private equity and venture capital investing can produce very substantial returns. All huge companies were once small. A nominal investment in the beginnings of Microsoft or Starbucks would undoubtedly be worth a substantial sum today.
For some clients, investing a small part of their assets in riskier companies can make sense. We help our clients evaluate private equity deals and how they might fit into their overall investment allocation. |
| What is your typical response time to a phone call or e-mail? |
| We pride ourselves on being accessible. We return every e-mail and phone call within 24 hours and often within an hour or two. |
| Will you provide client references we can speak to? |
| Yes, we will provide both client references as well as references of CPAs and attorneys with whom we have worked. |
| How long does it take to complete a financial plan? |
| From start to finish, it usually takes about four weeks to develop the kind of comprehensive plan we provide our clients. |
| Do you manage client assets on a discretionary or non-discretionary basis? |
| We do both. There are two options: discretionary and non-discretionary. A discretionary agreement gives Pacifica the ability to buy/sell investments without first contacting you. In practice, however, we involve clients in these decisions and try to get their approval first. A non-discretionary agreement requires Pacifica to receive written authorization from you before buying or selling any investment. Regardless of which type of management you choose, you will be absolutely involved in the investment process. |
| What’s your opinion of using passive index funds? |
| We highly recommend using passive index funds in an investment allocation. They are inexpensive, tax efficient, and a great way to match the performance of an index (something many active managers have a hard time doing consistently). |
| What’s your overall philosophy on insurance? |
| Bad things happen to good people all the time. You can’t prevent some things from occurring, but you can make sure you are protected if something wrong happens. You hope and pray that you never need it, but we recommend many forms of insurance for our clients. We will help you analyze your current insurance and let you know if you need more or less auto, homeowners, life, long-term care, disability, or excess liability. Our advantage is that we don’t sell any form of insurance. Our recommendation is 100% independent and objective. |
| If I want to stop working with Pacifica, what’s the process for leaving? |
| It’s very easy. You just need to send us a letter. We would immediately inform Schwab that you are leaving Pacifica, and they would transfer your accounts from their Institutional Division to their Retail Division. Your account numbers would stay the same. Pacifica would also refund any fees you were owed. |
| Do you use funds with front-end loads or back-end loads? |
| No. We only recommend no-load funds that don’t have these expenses associated with them. |
| What’s the firm’s philosophy on hedge funds? |
| For the right kind of client, they can make sense for a small part of the portfolio. It can be difficult to select a good hedge fund because there are so many different types of hedge funds and so many different funds themselves. Also, most are very secretive about their strategies and exactly in what they invest; that makes the due diligence process even more difficult.
In choosing hedge funds, we prefer those that have strong risk management procedures in place and that limit or prohibit any use of leverage. There have been several hedge fund “blow-ups” over the years—including Long-Term Capital Management, and most recently, Amaranth Advisors, which lost over half of its client assets in a week. |
| Are there any assets classes that you do not invest in? |
| Yes, depending on our analysis, there may be one or more asset classes that we will not recommend to our clients because we think there is too much risk or because we think the asset class is overvalued and may drop in value. |
| Can I set investment parameters such as not wanting to invest in tobacco, alcohol, or firearms companies? |
| This is typically called “socially conservative” investing, and it can be done. We’ve had success doing this for other clients, but we should discuss all of the factors thoroughly before implementing this strategy. |
| Do you invest for income or for growth? |
| First and foremost, we invest for total appreciation; this includes both income AND growth. A 10% income return and a 10% growth return is still a 10% return. We will shift between income and growth depending on a client’s goals, risk tolerance, income objectives, and tax situation. |
| Do the quarterly meetings occur in person or over the phone? |
| We are happy to accommodate our clients with either type of meeting. |
| Do you meet with clients in their home or do you prefer they come to Pacifica’s office? |
| It’s best if clients come to our offices. We have access to our internal network, forms, client documents, and specialized financial programs that make the meeting more productive for everyone. |
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About Our President |
| Why does Robert do what he does? |
| We live in a country where anyone can do almost anything. It doesn’t make any sense why some people settle in jobs or careers that they aren’t passionate about. Robert loves what he does for many reasons. He loves to be able to connect one-on-one with someone and to learn what inspires them and worries them. He loves being able to help someone who is confused and frustrated and become confident about their finances. He feels joy in helping others figure out their passion and in helping them achieve their goals. |
| What is Robert’s personal and professional background? |
| Robert Pagliarini, author and financial motivator, provides action-based financial advice that cuts through “financial fog”—the complex jargon and wishy-washy advice that can make it hard for the average person to understand and implement positive financial planning.
Robert’s Passion
Over the years, Robert has helped clients from all economic backgrounds—from those unable to pay their bills to those with hundreds of millions of dollars. Robert’s firm, Pacifica Wealth Advisors, is dedicated to serving the affluent, but Robert has a personal passion to also help those with less as a result of growing up with an abundance of love but very little money. His parents separated when he was very young, which put significant financial pressure on the family. Consequently, Robert has vivid memories of what it is like to be poor. Robert saw first-hand how a single event can turn one’s world upside down in the span of mere weeks.
Now, years later, he works closely with individuals and families to prevent such financial disasters from occurring and to help his clients prepare financially for the best and the worst. Robert’s mission is to help those of all means develop and follow a sound, long-term, and all-encompassing financial plan so they can reach their goals.
Professional Experience
Through his entrepreneurial spirit, Robert has been at the forefront of creating successful new financial concepts and institutions throughout his career. Robert is the founder and president of Pacifica Wealth Advisors, a boutique, independent financial planning and investment consulting firm serving affluent clients and sudden money recipients. Pacifica Wealth Advisors has offices in Orange County and Los Angeles, California.
Robert’s previous professional experience includes a tenure at a Los Angeles based wealth management firm that maintained a focus on serving clients with investments between $5 million and $100 million, co-founding a web-centered investment bank and consulting practice that served both private and public clients across the U.S., and as a branch manager of a Beverly Hills-based financial services firm, for which he oversaw the development, deployment, and marketing of one of the first Internet investment trading websites in the world.
Media Savvy
The Six-Day Financial Makeover, Robert’s first personal finance book featuring his unique approach to saving and investing, was released by St. Martin’s Press in October 2006. Robert also pens a monthly column in Affluent magazine and a personal finance newsletter, Six Steps or Less . . . to Financial Success™. The objective of the Six Steps or Less newsletter is to break complex and difficult-to-implement financial issues down into short, action-oriented steps.
The media calls on Robert to take the complex and craft it into easy-to-understand ideas and action steps. Robert has been interviewed by such prestigious publications and organizations as Newsweek, Money Magazine, CNN, CNN Financial, The Wall Street Journal, The Associated Press, Dow Jones Newswire, The Los Angeles Times, The Chicago Tribune, Woman’s Day, MSNBC.com, Bloomberg Wealth Management, Bankrate.com, Business 2.0, InvestmentNews, TheStreet.com, The Los Angeles Business Journal, and many others. He has been a featured guest National Public Radio’s financial program MarketPlace, CBS Radio, and other live radio programs.
Education
In addition to his Certified Financial Planner™ designation, Robert holds a master’s degree in financial services—an advanced financial degree obtained by only a few thousand professionals worldwide. Robert earned the distinguished personal financial planner designation from UCLA and his B.S. in psychology from Washington State University.
At Home and At Play
When he’s not working, Robert enjoys going on family outings with his wife, Elizabeth, and their daughter Alexandra “Bean,” watching movies, working out, reading, and listening to music.
Robert is a proud Christian and was honored to serve the Lord as a deacon at Bel Air Presbyterian church in Los Angeles until his move to Orange County in 2006.
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| Why did Robert Pagliarini, the president of Pacifica, write a personal finance book? |
| Robert grew up in a pretty poor family. He saw the effects of poor financial health first-hand. Although he works with affluent families through Pacifica Wealth Advisors, he also has a personal passion to help the everyday family that is struggling to pay the bills and figure out a way to save for retirement and college for their children. Since Robert’s professional practice is dedicated to working with the affluent, he decided the best way to help the most people would be to share his insight in a book. |
| What is The Six-Day Financial Makeover? |
| It’s a personal finance book written by the president of Pacifica Wealth Advisors, Robert Pagliarini. You can read more about the book at SixDayFinancialMakeover.com. |
| What was Robert’s first job? |
| His first “real” job was washing dishes in a pie shop. He was 14 and worked at a restaurant over the summer. He had to get up at dawn, the hours were long, the job was dirty, and the pay minimal, but he was able to buy day old pies for a buck! |
