High Net Worth / Trusts-Estates
Midwest can help to manage your financial assets.
Midwest can help you over the next ten years.
Global stock and bond annual forecasts from 2023 to 2032 are 8.0% and 4.6% before inflation, fees, and taxes.¹
Both estimates are lower than their 10.2% and 5.0% averages from 1926 to 2022,2 and these levels are prudent under current circumstances. Accordingly, investors are encouraged to allocate at least 50% of their publicly held assets to highly diversified portfolios.
In addition, many accounts should be managed in a passive, low-cost manner. Most actively managed portfolios underperform investable indices due to persistent subjectivity, egregious annual fees, and the current status of America’s financial system. There is also a higher uncertainty of investment returns, and administrative duties are increased.
Midwest builds and manages High Net Worth portfolios using mostly Vanguard funds based on specific client goals.
- Over the past ten years most of Vanguard’s funds have outperformed the peer-group averages.3 That relative performance should continue.
- Research shows that properly balanced portfolios earned similar inflation-adjusted returns during both expansions and contractions from 1926 to 2010.4
- Vanguard’s fee control structure is impressive and transparent.
- Most portfolios are highly diversified and can be tailored to owner-beneficiary circumstances, including tax-efficient strategies.
- Their custodial services are considered among the best and safest with respect to their fiduciary, compliance, and other responsibilities.
Midwest oversees all portfolios in an unbiased, cost efficient, and easy-to-understand manner.
Expenses do matter.
As the chart below shows, the return difference on an efficiently managed $1 million low-cost vs. high cost portfolio over ten to forty years can be $100,000 to $3,000,000 or more.
To create the 6.3% expected annual balanced return below, ten-year 8.0% stock and 4.6% bond estimates were used.¹ For lack of available forecasts, the same assumptions were used for the eleven to forty-year periods.
Midwest passive fees range from 0.1% to 0.3%. External fees are generally less than 0.2%. Accordingly, Midwest’s total passive expense estimates are less than 0.5%. Peer passive or active expense estimates are 1.5%.
Contact us for a free, confidential consultation.
¹ Benz, C. Experts Forecast Long-Term Stock and Bond Returns: 2023 Edition, Morningstar.com, January 24, 2023 and others.
² Vanguard 2017 economic and market outlook: Stabilization not stagnation, December 2016, pp. 20-25, for 1926 to 2016 period. From 2017 to 2022 various indices compiled by Midwest Asset Management, Inc.
³ Vanguard performance report: Indexing | Vanguard Advisors, 10 years to September 30, 2021, p. 4., and others. 2022 Edition pending.
4 Vanguard performance report: Recessions and balanced portfolio returns, October 2011, p. 2.
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