With a Fiduciary Duty: Oak Advisors, LLC Celebrating 10 Years
Author: Kitty Bartell | Photographer: Photography by Anne
John Chiacchiero, managing partner at Oak Advisors, LLC
Oak Advisors is located at The Plaza at Belfair, 3 Clark Summit Drive, Suite 201 in Bluffton
Managing Partners Michelle Myhre, and John Chiacchiero with Senior Advisor Al Cerrati
It took 11 years from the stock market crash of 1929 to Congressional passage of the Investment Advisers Act of 1940—the foundation on which the Lowcountry’s Oak Advisors, LLC, still stands today. Responding to a 1935 report presented by the Securities and Exchange Commission, the Act set out to define the roles and responsibilities of an investment advisor. With the Great Depression having driven the U.S. economy to the brink, the passage of the IAA gave investment advisors a clearly-defined set of rules and regulations, and provided depression-shocked investors with a level of assurance that their best interests would be at the core of every portion of advice given.
“We have a fiduciary duty to our clients; meaning we have to provide advice that is in the best interest of our clients; we are on the same side of the table,” said John Chiacchiero, managing partner at Oak Advisors, LLC. “You have to act in the client’s best interest—put the client’s interests ahead of any firm or personal interests.”
The investment-portfolio management environment is complex and in a constant state of flux. Having a partner on the same side of the table provides clients with a level of comfort and confidence not found elsewhere when seeking financial planning and investment advice, portfolio management, and performance monitoring for individuals, corporations, trustees, and administrators.
Oak Advisors, LLC was founded by Chiacchiero and managing partner Michelle Myhre, CFP®. Celebrating the firm’s tenth anniversary on November 15, the partners have worked together in the industry since 1997 and have carefully assembled a team of equally passionate financial professionals. “It starts with a common vision,” Chiacchiero said. “We have all worked in the registered investment advisory industry from the very beginning.”
The team’s depth of experience includes two Certified Financial Planners, one Chartered Financial Analyst, one Chartered Financial Consultant, one Chartered Life Underwriter, and three MBAs—all with only six team members. In addition to Chiacchiero who currently is an adjunct professor at the University of South Carolina Beaufort and was recently appointed to the Technical College of the Lowcountry Foundation Board, and Myhre, who has over 18 years of financial planning experience and is a regular media contributor on all things financial, the team includes portfolio manager Christopher Kiesel, CFA, Al Cerrati the firm’s senior advisor, Jennifer Thompson, CFP®, client services administrator, and client services coordinator Earl Nelson.
Experiencing many of the same challenges the financial industry faced coming out of the 1930s, Chiacchiero said, “We are in unprecedented times, because we’ve had a lot of central bank intervention, not only in the U.S., but around the world, in response to the 2008 financial crisis. We’ve been operating outside the norm for quite some time. Even now, as we’re poised for higher interest rates, we’ve got equity valuations that are somewhat stretched. This is one of the most challenging times to manage client assets that we’ve ever had.”
Even if their fiduciary responsibilities were not mandated by law, the team at Oak Advisors, LLC understands that this is how they would want to operate, regardless of the regulations. “Needless to say, we had no grandiose vision for Oak Advisors when we started,” Chiacchiero said. “Our goal was to make a decent living, doing something we loved, doing it well, and doing it honestly. As it turned out, these simple values—a commitment to excellence and high ethical standards—have played a huge role in the success and longevity of Oak Advisors and they are very relevant today in ways we did not consciously anticipate in 2005.”
Consulting with people in all stages of their investing life begins with the discovery process. “Our relationships are very long lasting,” Chiacchiero said. “Many of our clients have been with us since 1997. I think it goes back to our ‘tell the doctor everything’ approach. If you don’t disclose to me what you have, what you’re doing, even if you made mistakes in the past, our firm can’t render advice that’s in your best interest. You must tell the doctor everything.”
Oak Advisors never charges for a first meeting, however, everyone they sit down with will come away with some actionable items related to their financial health. “Our discovery process is going to cover their income and expenses, their assets and liabilities, and their insurance and estate planning,” Chiacchiero said. “We don’t sell insurance; we don’t do legal work; we don’t do any of the accounting work; but through the process of working with these other industry professionals, we know how to uncover and find out what they need to do.” The discovery process is of special importance to people moving to the area from other states, particularly with issues related to wills and financial and estate planning executed outside of South Carolina. “No matter what your intentions are, it might not be happening that way,” Chiacchiero said.
After the interview process, Oak Advisors will propose a financial plan—an investment policy agreed on by the team and the client. “We work on a discretionary basis,” Chiacchiero said. We help clients open their accounts with Charles Schwab & Company, and then we have discretion to buy and sell in their accounts. As a fee-only Registered Investment Advisory Firm, we charge a percentage fee based on the assets that we manage for the client.”
With their hearts deeply ingrained in the local community, Oak Advisors sponsor their annual Oak Advisors Scholarship of Excellence, an award given to a local graduating high school senior heading on to higher education. “We want to give something back to the community, but also want to encourage kids to pursue careers in what we do. One of the tenets of the scholarship is that the student has to intend to major in business, finance, or economics,” Chiacchiero said.
Members of the SEC were reacting to great challenges in the monetary world when they made their recommendations to Congress in 1935. The regulatory roots of the advisory industry were planted during shaky economic times, but are still rock-solid at Oak Advisors, LLC.
Oak Advisors, LLC is located at The Plaza at Belfair, 3 Clark Summit Drive, Suite 201, Bluffton. For more information, call (843) 757-9339 or visit oakadvisors.net.