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Updated on Friday, June 4, 2021
Transamerica Financial Advisors, Inc. is a dually registered investment advisory firm and broker-dealer headquartered in Florida. The firm provides products and investment portfolios for financial professionals who want to open their own business as an investment advisor. It has nearly 1,200 advisors throughout the country who provide investment management, retirement plan services and brokerage services through Transamerica Financial Advisors.
All information included in this profile is accurate as of May 17, 2021. For more information, please consult Transamerica Financial Advisors’ website.
|Assets under management: $2,070,956,104|
|Minimum investment: Varies by program, starting at $10|
|Fee structure: A percentage of AUM, commissions|
|Headquarters:||570 Carillon Parkway
St. Petersburg, FL 33716
Phone: (727) 299-1800, ext.123-2080
- Overview of Transamerica Financial Advisors
- What types of clients does Transamerica Financial Advisors serve?
- Services offered by Transamerica Financial Advisors
- How Transamerica Financial Advisors invests your money
- Fees Transamerica Financial Advisors charges for its services
- Transamerica Financial Advisors’ pros
- Transamerica Financial Advisors’ cons
- Transamerica Financial Advisors’ disciplinary disclosures
- Transamerica Financial Advisors’ onboarding process
- Is Transamerica Financial Advisors right for you?
Overview of Transamerica Financial Advisors
Transamerica Financial Advisors is part of Transamerica, a large insurance and brokerage company that launched out of San Francisco. The company launched Transamerica Financial Advisors in 1984, which registered as an RIA with the Securities and Exchange Commission (SEC) in 1991. Today, Transamerica Financial Advisors is owned by Aegon N.V., a multinational financial services company.
Transamerica Financial Advisors has nearly 1,200 employees and all work in an advisory capacity. The firm also has over 3,000 independent registered representatives who are not formal employees, as those who want to open their business as an investment advisor can sign up with Transamerica Financial Advisors to offer their insurance and financial products.
While Transamerica Financial Advisors has its headquarters in St. Petersburg, Fla., its advisors work across the country. The team currently oversees nearly $2.1 billion in assets under management (AUM).
What types of clients does Transamerica Financial Advisors serve?
The vast majority of clients working with Transamerica Financial Advisors are high net worth individuals (for reference, the SEC defines someone as high net worth when they have at least $750,000 under management with an advisor or a total net worth of at least $1.5 million.) It takes a minimum opening deposit of just $10 to open some of the Transamerica Financial Advisors investment accounts, so they are accessible for any type of investor.
With that being said, Transamerica Financial Advisors does work with high net worth individuals as well, and they make up a decent share of the firm’s AUM. Transamerica Financial Advisors also works with employer retirement plans, businesses, trusts, estates, charitable organizations and educational accounts like 529 plans and UGMA/UTMA plans.
Transamerica Financial Advisors itself does not specialize in serving any one type of client group. However, the advisors themselves may decide to specialize in certain areas like retirement planning and support for small businesses.
Services offered by Transamerica Financial Advisors
Transamerica Financial Advisors offers asset management, life insurance and financial advisory services to its clients. The advisors can manage client funds both on a discretionary basis, where they can make trades on their own, or on a non-discretionary basis, where clients need to approve all trades. Clients can also sign up for robo-advisor managed accounts from Betterment through the Transamerica® ALPHA Program.
Besides working with individuals, Transamerica Financial Advisors supports workplace retirement plans. Transamerica Financial Advisor also functions as a broker-dealer and can process investment trades for its clients. Last, they have partnerships with over 100 different companies like Nationwide, Pacific Life and Prudential so the Transamerica Financial Advisor representatives can sell their products.
- Investment advisory services
- Financial planning
- Retirement planning
- Trust and estate planning
- Charitable planning
- Education planning
- Business planning
- IRA and 401(k) rollovers
- Life insurance
- Employee benefit plan fiduciary services
- Educational seminars and workshops
- Brokerage services
How Transamerica Financial Advisors invests your money
Transamerica Financial Advisors does not have an underlying investment philosophy or strategy. Instead, it provides its representatives with access to a large variety of investment portfolios and funds. Representatives can then choose the ones that best fit their client’s goals.
Transamerica Financial Advisors designed some of its programs to meet specific goals. For example, it offers I-Series portfolios to meet goals like an aggressive risk tolerance, which would have more high-growth but risky investments, a social impact fund that focuses on promoting socially responsible investments and an alternative fund that looks to hedge against market volatility with assets like precious metals and natural resources.
Ultimately, the way your money will be invested can depend on which representative you sign up with. Your representative will help you decide which of the portfolios and strategies makes sense for your situation. Be sure to ask the representative whether they follow any specific investment philosophy when it comes to their recommendations.
Fees Transamerica Financial Advisors charges for its services
Transamerica Financial Advisors charges clients based on a percentage of AUM for its portfolio management services. The rate will depend on which program you enroll in and the size of your portfolio. In general, rates can range from 0.65% to 2.60% a year. You are able to negotiate the fees with your advisor when you sign up.
|Fee schedule for Transamerica Financial Advisors’ advisory programs|
|Third-party money management programs (non-variable product)||Not to exceed 2.60%|
|Third-party money management programs (variable product)||Not to exceed 1.20%|
|Transamerica® ONE Wealth Management Platform||Not to exceed 2.00%|
|Employee retirement services||Not to exceed 1.10%|
|Transamerica® ALPHA Program||0.65% to 0.95%|
|Transamerica I-Series® Program||Not to exceed 2.50%|
On top of the advisory fee, you may owe extra for the investment expenses like administration charges, 12(b)-1 fees for mutual funds and transaction charges. In addition, for the firm’s I-Series program, you will owe an additional $25 per quarter fee if your account dips below $100,000.
Transamerica Financial Advisors and its representatives can also make commissions by selling insurance and investment products.
Transamerica Financial Advisors’ pros
- Account minimums are very low and accessible: It does not take a massive portfolio to join with Transamerica Financial Advisors. Some of its programs require an opening deposit of just $10. In contrast, many financial advisory firms require account minimums in the tens or even hundreds of thousands of dollars.
- Large variety of products and strategies: Transamerica Financial Advisors provides its representatives with a large variety of portfolios to meet all kinds of different financial goals. They can also sell insurance products, mutual funds and annuities through their parent organization, Transamerica, giving clients access to a wide range of products and services.
- Extensive partnerships with other firms: Transamerica Financial Advisors has partnerships with over 100 product providers such as Nationwide, Pacific Life and Prudential. This allows its representatives to offer even more products and services.
- National network of advisors: Transamerica Financial Advisors has representatives spread throughout the country. As they aren’t limited to just one region, clients in a number of areas may be able to find an advisor near them.
Transamerica Financial Advisors’ cons
- High advisory fees: Transamerica Financial Advisors’ advisory fee can go all the way up to a maximum of 2.60% per year. This is very high, especially as the average advisor fee is 1.17% according to a 2019 study from RIA in a Box.
- Commissions pose potential conflicts of interest: Since Transamerica Financial Advisors and its representatives can earn commissions by selling investment and insurance products, this could influence their advice and create potential conflicts of interest.
- Numerous disciplinary disclosure: Transamerica Financial Advisors has run into disciplinary issues, including some in which some of its representatives allegedly mishandled client recommendations (see more on this below).
Transamerica Financial Advisors disciplinary disclosures
Over the past decade, Transamerica Financial Advisors has faced 10 incidents that required a disclosure in its Form ADV filing with the SEC. For reference, all registered investment advisors are required to report such events — including any criminal charges, regulatory infractions and civil lawsuits faced by the firms and its employees or affiliates — from within the past 10 years.
All of Transamerica Financial Advisors’ disclosures are government regulatory actions, with four from the SEC, three from the Financial Industry Regulatory Authority (FINRA) and three from state regulatory agencies. Below is a summary of the firm’s disciplinary disclosures, categorized by the regulatory agency.
- March 11, 2019: The SEC alleged that Transamerica Financial Advisors failed to disclose conflicts of interest from fees it collected on certain mutual funds. The firm paid $5,364,292.04 plus $658,780.64 in interest to settle with the SEC.
- August 27, 2018: The SEC alleged that Transamerica Financial Advisors failed to disclose errors in investment models provided by other companies, and that it didn’t have the proper internal controls to catch this error before selling to clients. The firm paid a penalty and refunded money to clients who used this product.
- April 3, 2014: Per the SEC, Transamerica Financial Advisors allegedly failed to factor in the proper advisory discounts for some of its clients and ended up overcharging fees. The firm paid a fine, refunded the clients and hired a consultant to review its procedures to prevent this from happening again.
- November 22, 2010: Transamerica Financial Advisors paid a fine, without admitting to wrongdoing, in response to allegations that it had failed to properly supervise agents in a California office who then made unsuitable investment recommendations to clients.
- December 21, 2020: FINRA alleged that Transamerica Financial Advisors failed to properly supervise its representatives for the sale of variable annuities, mutual funds and 529 plans. Transamerica Financial Advisors was censured for this and paid a $4.4 million fine, while also refunding the money to clients.
- July 27, 2015: FINRA alleged that the firm had failed to identify and apply volume discounts for some of its clients’ purchases. The firm agreed to pay a fine and refund the money to certain clients.
- January 20, 2015: Transamerica Financial Advisors paid a $50,000 fine to settle FINRA allegations that it had provided inaccurate and misleading information on a Form U5 after terminating one of its registered representatives.
- August 2, 2011: Transamerica Financial Advisors paid a $50,000 administrative fine in response to allegations from the state of Florida that it had failed to properly supervise a representative according to Florida state law.
- May 17, 2010: Transamerica Financial Advisors agreed to pay restitution and a fine in response to allegations that registered representatives of the firm in Arizona sold unapproved products to clients.
- April 15, 2010: Transamerica Financial Advisors paid $382,200 in restitution as well as the cost of the state investigation after the State of Nevada Securities Division found that one of the firm’s representatives had sold unregistered securities to six clients without the firm’s knowledge.
Transamerica Financial Advisors’ onboarding process
To work with Transamerica Financial Advisors, you first need to connect with one of the firm’s representatives. Its website has an Agent Finder tool where you enter your ZIP code to pull up a list of the closest agents and offices. The tool will also provide the name, address, phone number and email address for these representatives. You can contact them directly or request a call through the website to get the process started.
Some of the firm’s agents have pages and websites where they list their specialties but others do not, which can make it a little difficult to learn much about them, besides location.
When you set up a meeting with an agent, they will get to know your financial situation, needs and objectives. From there, they will put together a recommendation of the Transamerica Financial Advisors products and investment recommendations. If you are happy with the plan, you can sign on as a client. There is no charge for the meeting so you can see what their recommendations would be without paying upfront.
Is Transamerica Financial Advisors right for you?
If your portfolio is on the smaller side but you still want an investment advisor, Transamerica Financial Advisors could be worth considering. You can sign on for some of its plans with an initial investment of just $10. This can be useful for clients who can’t meet the high minimums of other advisors that may require $500,000 or more in assets to join. Additionally, Transamerica offers a large selection of products thanks to its many partners and dual registration as a broker-dealer.
On the other hand, these affiliations can pose potential conflicts of interest for the firm as the team may be financially incentivized to make certain recommendations. Additionally, Transamerica Financial Advisors’’ investment management fees are comparatively very high, even for large portfolios. Ultimately, the choice of a financial advisor comes down to your personal preferences and unique needs, and it is critical that you find an advisor who suits you and who you feel comfortable working with.
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.