Review of Stratos Wealth Partners 2021

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Updated on Friday, September 3, 2021

Stratos Wealth Partners is an independent investment advisory firm headquartered in Beachwood, Ohio. The firm has built a national network of financial advisors who are largely independent contractors. These advisors offer financial planning, portfolio management and other services primarily to individual investors as well as to certain institutional investors, such as charitable organizations.

The bottom line: Stratos Wealth Partners is a wealth management and financial planning firm with a large network of independent advisors located across the country.

  • Caters mostly to non-high net worth individuals
  • Offers a robo-advisor option
  • Charges fees that may be above the industry average
Assets under management: $8,498,228,840
Minimum investment: Varies by account type for portfolio management
Individual investor to advisor ratio: 55:1
Fee structure: A percentage of AUM, hourly charges, fixed fees, other (a percentage of AUM with third-party managers)
Headquarters: 3750 Park East Drive, Suite 200 Beachwood, OH 44122
Website:www.stratoswealthpartners.com
Phone: 440-519-2500

All information included in this profile is accurate as of August 25, 2021. For more information, please consult Stratos Wealth Partners’ website.

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Overview of Stratos Wealth Partners

Stratos Wealth Partners was founded in 2008 by its current CEO, Jeff Concepcion. Of its team of close to 500 employees, around 260 serve in investment advisory roles. Some of the firm’s employees are also separately licensed as broker-dealers and insurance agents, and a handful work as registered investment advisors for other investment advisory firms as well.

The firm’s advisors are generally independent contractors. Thus, they may market their services under their own name or brand, but still work for and are registered under Stratos Wealth Partners. The firm’s network of advisors receives services such as compliance, technology, operations and marketing support from the firm.

Additionally, many of these advisors hold equity in the firm’s owner, Stratos Wealth Holdings, LLC. Stratos Wealth Holdings also owns the registered investment advisor Fundamentum, which primarily acts as a sub-advisor and offers portfolio options to clients of Stratos Wealth Partners.

A look at the founder of Stratos Wealth Partners

Before founding Stratos Wealth Partners, Jeff Concepcion spent two decades in senior management positions at Lincoln Financial. He has been featured in publications including CityWireUSA, RIABiz and Barron’s. Additionally, he hosts a podcast called The Evolving Advisor, which offers tips and knowledge to independent advisors.

Stratos Wealth Partners’ pros

  • Accessible to modest-income investors: The bulk of the firm’s clients are individual investors who aren’t high net worth. At Stratos Wealth Partners, clients with as little as $10,000 can find account options available, and the firm also offers a robo-advisor product with a minimum of just $5,000.
  • Provides employer-paid financial planning to some workers: In a unique offering, employers can hire Stratos to provide financial planning and consulting to their employees. The cost of the planning advice is borne by the employer, though the individuals may still owe commissions and other fees.
  • Has earned national accolades: The firm ranked No. 20 on Barron’s 2020 list of the country’s top 50 registered investment advisors. Stratos Wealth Partners has appeared on the list for several years, ranking as No. 16 in 2019. The rankings are based on factors such as assets, revenue and quality of practice.
  • Boasts a clean disciplinary record: The firm reports no disciplinary disclosures. (See more on this below.)

Stratos Wealth Partners’ cons

  • Potential conflicts of interest: The firm can earn revenue from recommending specific products and services, such as insurance, or from referring clients to specific third-party investment managers, including the affiliated firm Fundamentum. Thus, potential conflicts of interest exist since the firm has a financial incentive to recommend one product over another. Similarly, the firm also has a financial incentive to recommend that clients custody their money at LPL Financial, where many of the firm’s advisors are also registered as broker-dealers.
  • No uniform fees and services list: Advisors negotiate their own fees, which means that the same service can carry a different price tag at each advisor. Thus, potential clients won’t know how much they’ll pay for services without shopping each advisor. When shopping, make sure to confirm what services the advisor provides, since not all services are offered by each advisor or in each state.
  • Potentially high fees: Firm policy allows clients to pay up to 3% in total annual fees, depending on the account and whether third-party investment managers are used. Fees are negotiable and clients may pay less. But when fees approach the high end of that range, clients are paying well above the industry average rates, which generally hover around 0.50% to 1.25% of assets under management.
  • Pays for referrals: Stratos Wealth Partners pays a handful of individuals or firms to solicit advisory clients for the firm. Advisors also can set up offices inside unaffiliated bank branches and pay the bank for access to the location and for client referrals. Thus, potential clients should always ask specifically why the firm is being recommended to them.

Which types of clients does Stratos Wealth Partners serve?

Most of Stratos Wealth Partners’ clients are individual investors. The firm also serves some high net worth investors, who the SEC defines as those with at least $750,000 in assets under management or an overall net worth of at least $1.5 million.

There is no minimum asset amount required for the firm’s financial planning services. For investing services, the minimum investment varies by account type. The firm’s robo-advisor program, offered through LPL Financial using FutureAdvisor, requires a $5,000 investment. Minimums for third-party investment advisory programs range from $10,000 to $250,000.

Services offered by Stratos Wealth Partners

Stratos Wealth Partners primarily offers portfolio management and financial planning to individuals and families. For financial planning, clients can opt for the one-time creation of a financial plan, continuous services or hourly consulting services. As for investment management, clients can choose to have their advisor build a custom portfolio, or pick from various model portfolios and strategies offered by affiliated and unaffiliated portfolio managers. Clients also have the choice between using a wrap fee program, which bundles advisory, trading and custodian charges into one fee, or paying separately for each of those services.

Stratos Wealth Partners also advises certain individuals on their retirement plans, through the Retirement Plan Consulting Program. Finally, certain employers pay the firm to provide financial planning services to their employees.

Separately, many of the firm’s advisors are licensed through LPL Financial as broker-dealers. Thus, in addition to providing ongoing services, these advisors also buy and sell securities for clients who pay per transaction.

Here is a full list of services offered by Stratos Wealth Partners:

  • Portfolio management
  • Financial planning
    • Retirement planning
    • Estate planning
    • Charitable planning
    • Education planning
    • Business planning
    • Tax planning
    • Insurance needs analysis
    • Cash flow analysis
    • Spending analysis and budgeting
    • Sports and entertainment management
    • Executive planning
    • Corporate benefit consulting
  • 401(k) consulting for individuals
  • Pension consulting
  • Selection of other advisors
  • Robo-advisor service (Guided Wealth Portfolios)

How Stratos Wealth Partners invests your money

Since investment advisors at Stratos Wealth Partners are generally independent contractors, advisors make their own investment decisions based on the client’s situation. No single firm philosophy exists.

Clients can choose to give their advisors full discretion over their account, meaning clients do not sign off on each transaction, or they can retain control of trading decisions, known as non-discretionary management. The vast majority of the firm’s assets under management are managed on a discretionary basis, however.

As for how client money is allocated, advisors can create custom portfolios based on a client’s goals, risk tolerance and time horizon. Alternatively, clients can choose among portfolios offered by sister firm Fundamentum, which is a registered investment advisor also owned by Stratos Wealth Holdings, LLC. Clients also have access to certain other third-party managers, including LPL Financial, where many of Stratos’ advisors are also registered as broker-dealers.

Client money may be invested across:

  • Stocks
  • Bonds
  • Exchange-traded funds (ETFs)
  • Exchange-traded notes
  • Load and no-load mutual funds
  • Cash and cash equivalents
  • Options
  • Structured products
  • Annuities
  • Alternatives, such as hedge funds and managed futures

Fees Stratos Wealth Partners charges for its services

Investment advisory fees: The annual advisory fee for the firm’s investment management services is typically calculated as a percentage of assets under management. Fees are negotiable and vary by advisor, since each advisor acts as an independent contractor. That said, the firm has instituted a maximum rate for each program that advisors cannot exceed.

For the firm’s managed account programs, the maximum annual advisory fee a client can pay is 3.00% of assets under management, with 2.00% being the maximum Stratos advisory fee and 1.00% being the maximum third-party investment advisory fee. The maximum fee charged for advisory programs offered through LPL Financial is also 3.00%, as outlined in the table below.

Stratos Wealth Partners Fees for LPL Advisory Programs
Manager Access Select Program3.00%
Optimum Market Portfolios Program2.50%
Personal Wealth Portfolios Program2.50%
Model Wealth Portfolios Program2.83%
Small Market Solution Program1.20%
Guided Wealth Portfolios Program1.35%

Keep in mind that clients who do not have a wrap fee account may still owe trading and custody charges. Clients in both wrap and non-wrap accounts will owe internal fees for mutual funds and ETFs in which they are invested.

Financial planning fees: Clients pay separately for financial planning services. Fees vary by advisor and service but the firm has instituted maximum rates. Hourly fees typically max out at $500 per hour, and advisors will provide an estimate of how many hours they’ll need prior to beginning the work.

Stratos Wealth Partners disciplinary disclosures

Stratos Wealth Partners discloses no criminal, civil or regulatory actions over the last 10 years and thus has a clean disciplinary record. The Securities and Exchange Commission (SEC) requires all registered investment advisors to disclose any legal or regulatory actions against the firm, its employees or its affiliates that are material to a client’s evaluation of the firm or the integrity of the management team in its Form ADV paperwork.

For more information on the firm, you can go to its IAPD page.

Stratos Wealth Partners onboarding process

To find a Stratos Wealth Partners advisor in your state, you can use the firm’s search tool on its website. Interested parties can also reach out to the firm directly on their contact page by filling out the form. Keep in mind that some advisors use their own brand names but are still affiliated with Stratos Wealth Partners.

Clients of the firm typically use LPL Financial, Fidelity, TD Ameritrade or Charles Schwab for custody services, although not all services are available through all custodians. Clients using certain third-party investment managers may need to sign a separate agreement with them.

Account reviews are generally provided on an ongoing basis, including when using third-party managers. Clients will receive regular written reports and statements on their account.

Where Stratos Wealth Partners is located

Stratos Wealth Partners offers advisory services through independent advisors across the country. The firm lists nearly 100 office locations in its Form ADV filings, with offices in the following states:

  • Arizona
  • California
  • Connecticut
  • Georgia
  • Iowa
  • Louisiana
  • Maryland
  • Mississippi
  • New York
  • Ohio
  • Pennsylvania
  • South Carolina

Is Stratos Wealth Partners right for you?

Investors may consider Stratos Wealth Partners if they are looking for independent registered investment advisors who are unaffiliated with the large banks and financial institutions and accept clients with less money to invest.

That said, you should directly address with each potential advisor their fees and services, since no standardized list exists for you to browse in advance. You’ll also want to confirm with the advisor why they are recommending a specific investment, product or custodian, since they may stand to earn revenue from making certain recommendations, creating potential conflicts of interest. Before you make your decision, make sure to research multiple firms to ensure you find the right advisor for you.

The “Find a Financial Advisor” links contained in this article will direct you to webpages devoted to MagnifyMoney Advisor (“MMA”). After completing a brief questionnaire, you will be matched with certain financial advisers who participate in MMA’s referral program, which may or may not include the investment advisers discussed.