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Updated on Friday, August 7, 2020
Hightower Advisors is a Chicago-based private equity-backed network of advisors, many of whom operate under individual brand names. The advisors provide discretionary advisory, wealth management and financial planning services, among others.
Currently, Hightower Advisors has 344 investment advisors working in offices across 34 states. It serves mostly individuals and high net worth individuals, as well as a selection of institutional investors. The firm oversees $57 billion in assets under management (AUM).
All information included in this profile is accurate as of August 7, 2020. For more information, please consult Hightower Advisors’ website.
|Assets under management: $57,000,000,000|
|Minimum investment: None|
|Fee structure: A percentage of AUM; hourly charges; fixed fees; retainer or service fees|
|Headquarters:||200 W. Madison St., Ste. 2500|
Chicago IL 60606
- Overview of Hightower Advisors
- What types of clients does Hightower Advisors serve?
- Services offered by Hightower Advisors
- How Hightower Advisors invests your money
- Fees Hightower Advisors charges for its services
- Hightower Advisors’s highlights
- Hightower Advisors’s downsides
- Hightower Advisors disciplinary disclosures
- Hightower Advisors onboarding process
- Is Hightower Advisors right for you?
Overview of Hightower Advisors
Hightower Advisors is a private equity-backed registered investment advisor that offers financial advisory services through its network of over 100 advisory firms across the U.S., many of which operate under different names. The firm was founded in 2008 by Elliot Weissbluth, an attorney and financial services executive, who served as the firm’s CEO until 2019 and is now chairman.
Private equity firm Thomas H. Lee Partners acquired a significant stake in the business in 2017, and is now a majority owner of the firm, although some advisors and employees also have an ownership stake. In recent years, the firm has grown via RIA acquisitions, a strategy that it plans to step up in the near term.
Hightower Advisors has 566 employees, including 344 who serve as investment advisors. The firm has a presence across 34 states, with locations in most regions.
What types of clients does Hightower Advisors serve?
Hightower Advisors serves both individuals and high net worth individuals, though its predominant focus is on individuals without a high net worth. For reference, the SEC defines high net worth individuals as those with at least $750,000 under management or a net worth of at least $1.5 million. In addition to individual investors, Hightower Advisors also works with pension and profit-sharing plans, charitable organizations and corporations and other types of businesses.
The firm does not have a minimum account balance. However, it notes that certain services and fee structures may not benefit portfolios of less than $500,000 due to the impact of trading and transaction costs.
Services offered by Hightower Advisors
Hightower Advisors provides a range of financial services to clients, including financial planning and investment advisory services, offered through its individual investment practices that each have their own strategy and focus.
Most of Hightower Advisor’s investment management services are offered on a discretionary basis, meaning that it does not consult the client before making every trade. Advisors may or may not regularly review and update client financial plans, depending on the terms of the client agreement.
Here is a full list of services that Hightower Advisors is capable of providing:
- Investment advisory services
- Financial planning
- Retirement planning
- Estate planning
- Education planning
- Cash management and certain treasury services
- Asset allocation review and recommendations
- Insurance planning/risk management
- Advising for retirement plan sponsors or trustees
- Private fund management
How Hightower Advisors invests your money
In early 2020, Hightower Advisors launched a new branding campaign centered around the tagline “well-thy. rebalanced,” aimed at conveying the firm’s collective focus on holistic wellness.
The firm uses several methods of analysis when managing portfolios:
- Charting: Reviewing an investment’s performance in graphic form
- Fundamental analysis: Evaluating a company’s past and present financial statements
- Technical analysis: Looking for patterns and trends within a specific sector or security
- Quantitative analysis: Using mathematical and statistical models to understand the behavior of a sector or security
Hightower Advisors creates portfolios using a variety of investment strategies, including long- and short-term purchases, trading, options, shorts and margin transactions.
Fees Hightower Advisors charges for its services
Depending on the services provided and the agreement between the client and the advisor, Hightower Advisors earns money through a percentage of assets under management, fixed fees and/or other one-time fees. Clients who receive limited-scope financial planning or wealth management may pay hourly fees, which are also determined on a case-by-case basis.
Wealth management clients can either get services through a wrap program, in which the fee will cover all transaction costs, or they can opt out of the wrap program and pay all transaction costs separately.
Hightower Advisors’s highlights
- Broad accessibility: Hightower has no minimum balance requirement, making it possible for most investors to connect with an advisor at the firm. However, Hightower does suggest that some services and products wouldn’t be a good fit for those with less than $500,000 to invest due to trading and transaction costs.
- Industry recognition: The firm’s advisors have received numerous awards and accolades, including recognition on the Forbes 2020 list of “Top Women Wealth Advisors,” Barron’s 2020 list of the “Top 100 Financial Advisors”; and Barron’s 2020 list of “America’s Top Wealth Teams”.
- Clean disciplinary record: The firm has not had to disclose any civil or regulatory issues over the last 10 years.
Hightower Advisors’s downsides
- No published fee schedule: Since clients’ fees are set on a case-by-case basis, it’s impossible to know what services will cost without speaking to an advisor. Additionally, some clients may pay based on a different fee schedule for some services than others and could see a variation in fees even when similar investment strategies are used.
- Preferred brokers: Hightower Advisors has an established relationship with several broker-dealers, including Fidelity, National Financial Services, Schwab, TD Ameritrade, JP Morgan and Pershing, and it will generally recommend these brokers to clients. While Hightower does not receive financial compensation for using these brokerages, clients may be able to purchase some investments at lower prices from a different firm.
- Potential conflicts of interest related to commissions: Hightower Advisors may receive commissions for the sale of certain insurance products and annuities as well as for services provided under as registered representatives for Hightower Securities, LLC, a broker-dealer under common ownership with the firm. This creates potential conflicts of interest as advisors may be financially incentivized to recommend certain products.
Hightower Advisors disciplinary disclosures
Hightower Advisors did not have any disciplinary events to disclose, meaning it has a clean record. All registered investment advisors are required to disclose any civil, regulatory or criminal events related to the firm, its employees or its affiliates in their Form ADV paperwork that they file with the SEC.
Hightower Advisors onboarding process
To get started working with the firm, find a local advisor using this online tool. If after connecting with an advisor you decide to move forward, you’ll sign either a discretionary or a non-discretionary client agreement, which outlines the services you’ll receive and the associated fees. Discretionary clients will also work with their advisor to create an investment policy statement, which the advisor will use to create and manage an appropriate portfolio.
Investment management clients will receive a review at least once per year from their advisory team, although many advisors are in touch more frequently. Communications may take place via phone calls, in-person meetings and strategy reviews. Additional reviews may take place as necessary when there’s a significant change in the financial picture of the client or economic events.
Is Hightower Advisors right for you?
Hightower Advisors may be a good choice for investors looking for holistic financial planning and discretionary portfolio management. The firm’s presence in 34 states also makes it accessible for investors in many regions. However, some of the firm’s products and services may not be a good fit for investors with less than $500,000 to invest. Additionally, some advisors may earn commissions for recommending certain insurance products, which could pose a conflict of interest.
As always, when choosing financial services, it’s important to understand the experience of the provider and how much you’re paying for its services. Be sure to research multiple firms before selecting the one that’s best for you.