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Unique Money Method

Many of the financial service firms in our industry continue to use asset allocation as the sole way to reduce risk in a portfolio. At McPherson Financial Group, this is where we begin the process of de-risking your portfolio; however, we find that using asset allocation modeling for risk reduction is only part of the solution. Asset allocation modeling is still subject to large market swings and interest rate swings that can impact performance and risk on portfolios when used in isolation.

We feel that ideology offers a limited scope for asset management and income planning and can leave many holes that are not adequately addressed. As a result, we developed our proprietary solution, the Unique Money Method to address the limited scope the industry has in retirement planning and attempt to fill the holes that are not addressed in traditional planning.


Based on an age-weighted asset allocation strategy, for some clients we traditionally believe your total portfolio should have 65% invested in stable, or income-producing assets, and the remaining 35% in growth-orientated investments. However, sometimes we will recommend using non-traditional modeling techniques with the goal of reducing some of the interest rate risk in the bond markets and market risk in the equity markets. Our goal is to minimize market volatility, to increase portfolio stability, and increase overall long-term interest and growth.


Many asset allocation modeling uses bonds, high-yield bonds, treasuries, dividend paying stocks, and income funds as stable or income asset management models. One potential flaw in this form of modeling is that there can be significant interest rate risk on bonds and market risk on dividend paying stocks. We do use the above asset types in our modeling in addition to utilizing index annuity strategies that offer guaranteed minimum crediting rates and help reduce market volatility.


Many asset allocation models focus on growth investments like stocks and mutual funds. Sometimes REITs and oil and gas programs will be mixed in to add diversification. Meanwhile, our modeling will not only include those but also mutual fund strategies for our conservative-growth clients.

For clients seeking more aggressive growth we may recommend incorporating managed stock portfolios, so stocks can be incorporated strategically to take advantage of money flows and volatility. Our portfolios are also monitored by WealthGuard, an account monitoring software that alerts our client and us when a predetermined level of risk is reached.


Typical income models based on portfolios consisting of equities, bonds, and cash typically reflect income at a 4% withdrawal rate. This type of modeling projects funds lasting the standard length of retirement of 30 years or more based on a normal life expectancy. Since we may be using non-traditional asset allocation modeling in your portfolio as an alternative strategy for income and growth, we may be able to increase that income using products offering reduced market volatility and minimum interest rate guarantees.

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