Advisor Evaluation Process

We have distinct due diligence processes for each type of firm on our platform (financial advising, tax, and trust & estate). They are all interviewed and screened for over 120 attributes to measure the quality of their services. They are rigorously evaluated upfront and also re-audited on an annual basis based on ongoing client feedback.

We strive to refer you to the “best” firms, and while we are conscious of awards, educational backgrounds, local/national prestige, and other measures of performance, we recognize that “best” means different things to different clients: small vs. large firms, in-person vs. digitally-forward firms, specialized vs. general service firms, communication style, etc. Therefore, our curated firms are diverse, in order to serve the ultimate goal of helping you find advisors that are a perfect fit for your needs.

Across the board, advisors at firms selected by Harness Wealth typically have at least 15 years of experience, hold advanced degrees (MBA, JD, MST, etc.), and have a variety of speciality certifications (CFP, CFA, CPA, EA, etc.).

Financial advisory firms

Compliance

• SEC and BrokerCheck: Clean BrokerCheck with issues (if any) explained and signed off by the Chief Compliance Officer. SEC registered and must act as fiduciaries.
• Investment oversight: Clearly defined investment procedure, Chief Investment Officer and/or research team, and compliance oversight.
• Top custodial platform: Must custody client assets at Charles Schwab, Fidelity, Bank of New York Mellon, Raymond James, or Pershing.

Fees

• Fee-only: Independent/fee only advisors. If hybrid advisors, must only hold legacy commission accounts as a breakaway.
• Investment independence: Investment decisions must be done by an in-house investment team.
• 100% client-aligned incentives: The firm may not decide on, nor may advisors recommend products based on commission rates to the advisor.
• Financial planning services: Financial planning are a core offering and are included in asset-based fee structure unless the AUM fees are 40% below the industry average for a combined service package.
• Competitive fees: Firms must charge at or below industry standard fees. For any firms charging more than 1.5%, these firms must offer additional, more comprehensive services in addition to investment management and financial planning, including but not limited to: tax planning, estate planning, family office services.

Services and expertise

• Responsiveness: Firm responds to client inquiries within 24 hours and demonstrates a high level of client service attention and sophistication.
• Assets under management (AUM): Minimum of $300M in discretionary assets. We make exceptions to this minimum for qualifying wealth managers on our platform who solely provide standalone financial planning.
• Financial planning offering: Firm must offer financial planning as part of the overall investment management service.
• Tax-loss harvesting: Tax-loss harvesting must be included in their investment management process for all clients.
• Client demographic: Accepts clients with investable assets between $250k – $25MM.

Staff

• Certifications: Each advisor must have an industry-specific designation or working towards a designation. Eligible list: CFP, CFA, CIMA, JD, CPA.
• Team structure: Minimum of 3 partners, minimum overall team size of 10 (operations, services, internal).
• Team-based approach: Firm must have a team-based approach to relationship management.
• Industry experience: Firm advisors must collectively have 30 years of industry experience.

Security and technology

• Technology standards: Required client portal and use of leading advisor technology for financial planning, risk management, portfolio management, and reporting. Must be a technology-forward firm with strong infrastructure.
• Data entry and calculations: Preference for in-house data entry. Financial planning cannot be manually calculated.
• Client data: Firm has a defined cybersecurity and information security policy with demonstrable procedures to protect client data.
• No recent data breaches: Firm has not had any significant data breaches in the last 5 years.

 

Tax firms

Services and expertise

• Tax planning: Firm must offer tax planning in addition to annual tax preparation services.
• Tax complexity: Firms must have a strong track record working with clients who have either multiple K1s and file in several states, or with clients who have several equity compensation related needs.
• Geographical coverage: Firms must serve multiple states, with a preference for full national coverage

Staff

• CPA designation: Partners must include CPAs, with a preference for CPAs with Big Four accounting experience (Deloitte, Ernst & Young, KPMG, PricewaterhouseCoopers).
• Team structure: Minimum of 3 partners, minimum overall team size of 10 (operations, services, internal).
• Industry experience: Minimum of 10 years on average of experience for every advisor at the firm, and a minimum of one firm leader with 15 years of experience.
• Peer review relationships: Preference for firms who offer audit services for other CPA firms.
• Industry membership: Firm must be a member of the AICPA (American Institute of CPAs). Membership in additional CPA governing bodies (state-specific CPA societies) preferred.
• Alliance membership: Must be part of a CPA network or alliance to supplement firm tax services, including but not limited to: BDO, PrimeGlobal, MGI, Nexia, NASBA, CPA Associates International, state-specific organizations.

Security and technology

• Technology standard: Firm uses one of the leading tax technology providers (CCH, Canopy, etc.) and also uses one of the leading document sharing technology providers with client data security. Must be a technology-forward firm with strong infrastructure.
• Data entry and calculations: Preference for in-house data entry.
• Outsourced data entry: If data entry is outsourced to an outside firm or technology, firms must detail the due diligence on the outside entity and internal checks and balances to ensure data integrity.
• Client data: Firm has a defined cybersecurity and information security policy with demonstrable procedures to protect client data.
• No recent data breaches: Firm has not had any significant data breaches in the last 5 years.

 

Trust & estate firms

Services and experience

• Document creation: Firm must offer trust & will creation.
• Addition estate planning services: Strong preference for firms which offer Trust & Estate Administration, Probate Litigation.
• Client demographic: Accepts clients with investable assets between $250k – $25MM.

Security and technology

• Client data: Firm has a defined cybersecurity and information security policy with demonstrable procedures to protect client data.
• No recent data breaches: Firm has not had any significant data breaches in the last 5 years.

Affiliations and references

• References from other law firms: Firm has a minimum of two existing relationships with other law firms for referral purposes or for working together on various client matters and these other firms would be able to provide a recommendation.
• ACTEC:  Preference for a minimum of one firm member recognized by ACTEC as an ACTEC fellow. ATEC is the American College of Trust and Estate Counsel, a national organization of more than 2,500 lawyers and law professors peer-elected to membership.

Staff

• Industry experience: A firm-wide average of 10 years experience is required.

 

Additional screening factors for all firms

• Communication skills and style: Sensitivity and EQ around personal issues and topics.
• Specialty areas of expertise: Startup equity, industry-based experience, regional experience and licenses.
• Diversity in leadership, advisors, and staff: The percentage of female advisors (ex: industry average for financial advisors is 15%, the Harness Wealth average is 28.5%), international backgrounds, and foreign language capabilities.