Empower Advisor Review
Empower offers a range of financial advisory services for many types of clients. Learn about the firm’s products and fee structures here.
Based in Greenwood Village, Colorado, Empower is a large financial services company that offers a range of services, including financial advice, wealth management, managed portfolio solutions, and planning. It also provides savings accounts, IRAs, and brokerage accounts. In 2022, it scored an AA rating from S&P Global and an A+ from AM Best.
In this review, we’ll outline the advisory services Empower offers, as well as the fee structure it uses. We’ll also discuss its investment philosophy and give an overview of the disclosures it has on file with the U.S. Securities and Exchange Commission (SEC). Finally, you’ll find out some ways to get in contact with the company or talk to an advisor
Assets Under Management
Number of Advisors
Edmund F. Murphy III
8515 E. Orchard Road
Greenwood Village, CO 80111
Types of Clients Empower Serves
Empower’s advisory products serve various types of clients. This includes both average and high-net-worth individuals, as well as businesses, pension and profit-sharing plans, and charities.
While the company serves people and entities with different financial situations, each of its products have unique account minimums. To use its Personal Strategy portfolio management product, you’ll need at least $250,000 in assets under management. However, the amount you’ve invested will decide what tier you belong in.
Here’s a breakdown of the tiers and minimum investments for Empower’s Personal Strategy product:
|Product Tier||Minimum Investment|
|Investment services||Below $250,000|
|Wealth management||Between $250,000 and $1 million|
|Private client||Over $1 million|
To use Empower’s other products, such as financial planning and managed services for its IRAs and 401(k)s, you must already be enrolled in one of its retirement plans.
Financial Advisor Services
Empower offers a wide variety of advisory products, including discretionary and non-discretionary management and financial planning. However, whether you can use many of them hinges on you having a retirement plan or brokerage account with the firm. Below are the products the company offers:
Online Advice and Managed Account Services
Empower offers online advice for clients enrolled in its retirement plans or IRAs. According to the brochure for the product, the company uses technology created by Morningstar Investment Management to help clients with tracking retirement objectives and asset allocation strategies. Empower makes it clear, however, that it doesn’t implement these recommendations for you. Ultimately, you’re in charge of how much advice, if any, you use.
The firm also offers managed account services on a discretionary basis. Under this arrangement, Empower will manage the investments and assets within your account. The company will have the authority to make decisions on your behalf and implement diversification, asset allocation, and rebalancing measures.
Another service the company offers is financial planning; however, as noted, you must have a retirement plan or IRA with the company to qualify. You may also be eligible through other advisory products, such as portfolio management.
If eligible, you’ll sit down with an advisor and go over various details about your financial situation, including your goals, risk tolerance, and expenses. The company says it will also review your accounts under it to better understand your holistic circumstances. Then, your professional will help you design a plan that focuses on one or more of the following elements:
- Cash flow
- Managing debt
- Estate planning
- Life insurance
Wrap Fee Portfolio Management
Empower offers portfolio management through its Personal Strategy product. This employs both technology and traditional in-personal advice. The company also offers a similar product for retirement plan account holders called Personal Strategy+.
After meeting the AUM requirement of $250,000, the company will help you build a portfolio tailored to your needs, and then manage it on a discretionary basis. To select investments that fit you, the company says it will ask you questions and then use an algorithm to structure your portfolio.
Over time, a manager will assess your portfolio’s performance and, if needed, take steps to align it with your goals. This may include tax-loss harvesting, rebalancing, and other miscellaneous risk management techniques.
Fee structures can vary based on the product you have. For example, if you have a service via your retirement plan, your rate may depend on what your sponsor has specified. Your rate could also be unique if you’ve negotiated with the company or one of its representatives.
For its portfolio management, however, Empower predominantly uses a wrap fee structure. This means you pay a single annual fee for all the services you receive, including trading costs and management. The fee you pay will rely on the dollar amount of your assets under management (AUM) with the firm.
The company’s fee structure follows a tiered system, meaning that as your portfolio’s value grows, your annual fee will decrease, giving a higher incentive for you to stay with the company if you’re a wealthier client.
Here is a chart from the company’s Form ADV that displays the fee schedule:
|Minimum Investment||Percentage of AUM|
|First $1 million||0.89%|
|First $3 million||0.79%|
|Next $2 million||0.69%|
|Next $5 million||0.59%|
|Over $10 million||0.49%|
It’s critical to understand a company’s investment philosophy, especially if you’re allowing its representatives or technology to have discretionary control over your investments. In its Form ADV, Empower says that it uses strategies such as asset allocation and diversification, and that it will incorporate these as your situation and goals shift. When it selects securities, the firm says it thoroughly considers the risk and reward and how well it would suit your portfolio.
The company also says that it favors passively managed index funds over actively managed mutual funds. This is likely because the former tend to follow the market rather than beat it, making them generally less volatile.
Overall, it seems that Empower uses standard investment strategies. While constructing and maintaining your collection of investments, it aims to use relatively safe investments, such as index funds. It also considers a range of factors, including overall risk and how each asset factors into your overarching objectives.
Empower Advisory Group, LLC is registered with the SEC as an investment advisor firm. With this registration, the company must disclose all disciplinary and regulatory actions to the public on its Form ADV.
In its most recent filing, the firm checked “no” on almost every box for disciplinary actions. The company did, however, say that a federal, state, or foreign financial regulatory authority has entered an order against it or an affiliate in connection with an investment-related activity. While what happened is unclear, this means that a government agency either made a ruling on the company or found that it violated something investing-related.
To contact an Empower representative or advisor, you’ll have to call the phone number related to your service or plan sponsor. To find a full and up-to-date list of these, we recommend visiting the company’s contact page.
Tips for Choosing a Financial Advisor Firm
There are several vital factors to consider before choosing a financial advisor company. One of the biggest, however, is finding one that offers the services you need. Not all companies offer the same services. Empower, for instance, specializes in discretionary portfolio management. Other firms, however, may emphasize planning or may offer more non-discretionary options.
Another important detail to consider is whether the company has accessible account minimums. Some companies set high account minimums and only serve wealthy clients, while others may open their doors to people with a more average net worth. Empower has something for most clients, offering products for both wealthy and regular clients.
To get a head start on your search for an advisor, a good strategy is using matching tools such as this free one. It’ll ask you a set of questions about your goals and situation. Then, it’ll list up to three professionals in your area.
The information in this review is based on publicly available information directly from Empower’s website, the SEC, and FINRA. Neither the firm nor its representatives have any say on what we’ve included on this page.
Frequently Asked Questions
Is Empower a fiduciary?
Since Empower Advisory Group is registered with the SEC as an RIA, its employees must uphold a fiduciary standard. Its discretionary portfolio managers, listed on its Form ADV Part 2A, also carry professional designations such as Certified Financial Planner (CFP) and Chartered Financial Analyst (CFA). The organizations that issue these titles also require professionals to practice with a fiduciary duty and hold a client’s best interest at the forefront.
Is Empower a reputable company?
Empower is a large company with a lot to offer. Reputable organizations such as S&P Global, Moody’s, and A.M. Best have given it excellent ratings. In the way of disclosures, its advisory subsidiary has steered clear of glaring disciplinary actions, which is somewhat uncommon for large companies.
How much money do you need for Empower?
To use Empower’s portfolio management services, you’ll need at least $250,000 AUM. If you have more assets, you may receive additional services or better annual rates. For other programs, you’ll need to be enrolled in a retirement plan or have an IRA with the company.
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