Tiedemann Advisors Review 2022 - MagnifyMoney
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Tiedemann Advisors Review 2022

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Tiedemann Advisors and its affiliated brands focus on investment management, wealth planning, trusts and estates and impact investing for wealthy individuals and families, as well as other entities including foundations and endowments. The firm is independently owned and operates on a fee-only basis, meaning it has no financial incentive to push affiliated products or services.

The bottom line: Tidemann Advisors is a New-York based wealth management firm that caters to high net worth investors.

  • Has a focus on impact investing
  • No transparent published fee schedule
  • Offers family office services

All information included in this profile is accurate as of August 13, 2021. For more information, please consult Tiedemann Advisors’ website.

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Overview of Tiedemann Advisors

Tiedemann Advisors LLC, a subsidiary of Tiedemann Wealth Management Holdings LLC, is a privately owned wealth management firm that caters to the wealthy. In 2016 and 2017, respectively, the firm combined with Presidio Capital Advisors and Threshold Group, which increased its footprint as well as its expertise around impact investing and multi-generational families.

Today, Tiedemann Advisors has a staff of close to 130, around 85 of whom are investment advisors. The team includes specialists in law, trusts, accounting and taxes.

A look at the founder of Tiedemann Advisors

The late Carl Tiedemann spent decades on Wall Street in the research, investment banking and hedge fund businesses, and founded Tiedemann Investment Group in 1980. But he found himself unsatisfied with the services available at the time to manage his own family money.

In 1999, Tiedemann teamed up with his son, Michael, and Craig Smith, a trust and estates attorney turned wealth advisor, to launch Tiedemann Advisors. The advisory firm was originally founded as a trust company and later rebranded into a wealth management firm. The founders’ aim was to invest client money with outside independent managers, instead of peddling their own products or proprietary funds.

Carl Tiedemann died in 2016, at the age of 89.

Tiedemann Advisors’ pros

  • Fee-only: The firm is typically compensated through an annual fee based on the amount of money the client invests, rather than the specific products sold, which is known as a fee-only model. Thus, advisors are not financially incentivized to recommend one investment over another.
  • Flexible services: Clients can choose how involved they want to be in investing their wealth, since they have the option of discretionary or non-discretionary management.
  • Options to make an impact: The list of investment possibilities at the firm that focus on a specific cause is broader than most: social, environmental, workplace diversity, women entrepreneurship, affordable housing, community based lending, education and more.
  • Industry accolades: Tiedemann has earned “Best Of” designations from authoritative sources. The firm has ranked among the top private registered investment advisors in the country on the coveted Barron’s list for 2019 and 2020. In 2020, the firm earned the best estate planning advisory service title from Family Wealth Report.

Tiedemann Advisors’ cons

  • Caters to the wealthy: Tiedemann focuses on serving high net worth clients — investors with smaller nest eggs will need to look elsewhere. Of the firm’s current individual clients, all are high net worth.
  • Limited geographic footprint: The firm has only 10 offices around the country (although it has jurisdiction in 15 states). Clients looking for a nearby, in-person relationship will need to look elsewhere if they do not reside near one of the firm’s offices.
  • No published fee schedule: The firm does not print a standardized fee schedule, so quickly assessing your costs without shopping advisors is difficult. The firm does state that the maximum annual advisory fee a client will pay the firm is 0.85%.
  • Potential conflict of interest with broker selection: Tiedemann Advisors may have an incentive to select a specific broker for clients based on the fact that it receives research from that broker, for which it would have to pay a potentially hefty amount if it were to find that information on its own.

What types of clients does Tiedemann Advisors serve?

The firm mainly works with high net worth individuals and families, which the SEC generally defines as investors with at least $750,000 in assets under management or a net worth of at least $1.5 million. It does not currently serve any individual clients who do not meet this definition.

In addition, the team provides advice to private investment funds, which are only available to Tiedemann clients. The minimum needed to invest in those funds varies, but the requirement can be waived or modified by the managers. That said, investors in the funds must generally be accredited investors, meaning they must have meet one of the following requirements:

  • Has an earned income that exceeds $200,000 (or $300,000 with a spouse or partner) in each of the prior two years, and reasonably expects the same for the current year
  • Has a net worth over $1 million, either alone or together with a spouse or partner (excluding the value of the person’s primary residence)
  • Holds a Series 7, 65 or 82 license

Services offered by Tiedemann Advisors

Wealthy clients can enlist Tiedemann Advisors for comprehensive wealth management services, which includes managing their investments and planning their financial lives, including their estate, philanthropy, tax, insurance, succession and cash needs. For clients who want their money to work toward specific causes close to their heart, they can find a broad list of impact investing options.

The firm handles client investment accounts through both a discretionary relationship, meaning clients turn over the day-to-day decision making and control of their accounts to the firm, and non-discretionary management, where the client maintains control.

In addition to the above services, Tiedemann provides some family office services, including administrative tasks such as bill paying, although additional charges may apply.

Here is a full list of services offered:

  • Investment advisory services/portfolio management
  • Impact investing
  • Financial planning
    • Charitable planning
    • Succession planning
    • Tax planning and management
    • Liquidity planning
    • Insurance/risk management
  • Trusts and estates (administered through the affiliated Delaware Trust Company)
  • Governance and education
  • Family office services

How Tiedemann Advisors invests your money

As an independent firm, unaffiliated with any big banks or brokerages, the firm has flexibility around its recommended investments. It uses a “manager-of-managers” approach, meaning client money is generally placed with outside managers that the firm sources and monitors.

These unaffiliated managers include investment advisors, portfolio managers and investment funds that invest globally across all asset classes. Investments can be made directly with these outside managers, or indirectly through commingled funds managed by Tiedemann.

With managed account clients, the firm combines third-party manager exposure/investment themes with shorter-term (around 12 to 24 months) investments in asset classes or regions that the advisor believes will offer a good risk-adjusted return. In general, tactical investment choices typically consist of mutual funds or ETFs, but may also include:

Clients interested in impact investing can choose from two broad themes: environmental sustainability and socio-economic development.

Fees Tiedemann Advisors charges for its services

Clients generally pay an advisory fee calculated as a percentage of assets under management. The fee varies based on a number of factors, including how much money the client invests, the asset classes in which they invest and the strategies being used. The maximum asset-based fee paid to the firm is 0.85%.

In addition to this advisory fee paid to Tiedemann, clients also owe fees to the third-party managers used. Clients are also responsible for custodian and brokerage fees, as well as other internal fees for underlying investments, such as mutual fund or ETF fees.

The fees are typically paid quarterly and can be deducted from client accounts.

Tiedemann Advisors disciplinary disclosures

Tiedemann discloses no disciplinary events over the last 10 years, meaning it has a clean track record.The SEC requires all registered investment advisors to disclose in their Form ADV any legal or disciplinary actions including criminal, civil or regulatory issues that may be material to a client evaluating the advisor or the integrity of its management team.

For more on the firm, you can go to its IAPD page.

Tiedemann Advisors onboarding process

  1. Reach out to the firm: Potential clients can reach out directly to one of Tiedemann Advisors’ 10 offices or fill out the Get In Touch With Us form provided on the firm’s website.
  2. Get a formal investment policy statement: Advisors will work with clients who decide to move forward with the firm to develop a formal investment policy statement that reflects the client’s goals, risk tolerance and investment objectives.
  3. Choose a custodian: Clients typically custody their assets with Fidelity or Charles Schwab, but can choose another custodian if they prefer.
  4. Receive regular reports and account reviews: Clients can expect to receive monthly or quarterly reports from their custodians. Tiedemann reviews client accounts each month.

Where Tiedemann Advisors is located

Tiedemann Advisors has offices in the U.S. in the following locations:

  • New York
  • Bethesda, Maryland
  • Dallas
  • Seattle
  • Aspen, Colorado
  • Wilmington, Delaware
  • Palm Beach, Florida
  • San Francisco
  • Portland, Oregon

Is Tiedemann Advisors right for you?

Tiedemann Advisors targets a niche clientele: high net worth individuals, families, institutions or businesses. Wealthy investors looking for financial planning, investment management and trust and estate services grouped together in one place could consider the firm. Philanthropists particularly interested in using their investments to contribute to certain causes close to their hearts, such as diversity or the environment, should inquire about the firm’s impact investing resources. Clients worried about potential conflicts of interest with advisors may appreciate that the firm is independently owned and earns money through a transparent annual fee.

That said, clients with more modest net worths will need to look elsewhere, as will investors who want an in-person relationship with their advisor but do not live near one of Tiedemann Advisors’ nine offices. Before you make your decision, be sure to research multiple firms to ensure you find the right advisor for you.

The “Find a Financial Advisor” links contained in this article will direct you to webpages devoted to MagnifyMoney Advisor (“MMA”). After completing a brief questionnaire, you will be matched with certain financial advisers who participate in MMA’s referral program, which may or may not include the investment advisers discussed.