CUSO Financial Services Review - MagnifyMoney
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CUSO Financial Services Review

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CUSO Financial Services operates as a dually-registered investment advisor and broker-dealer, which specializes in working with credit unions and banks to support their financial professionals. The firm is headquartered in San Diego and has over 900 additional locations in credit unions across the country. CUSO Financial Services has more than 670 employees, with nearly 500 of them performing investment advisory functions. It currently oversees more than $3.5 billion in assets under management (AUM).

The bottom line: CUSO Financial Services works with credit unions and banks to help provide investment advisory services to their members and customers.

  • Offers investment planning services with varying minimum investment requirements
  • Fees are variable
  • Provides services to individual investors, including financial planning, but also administers employer retirement plans

All information included in this profile is accurate as of January 21, 2022. For more information, please consult CUSO Financial Services’ website.

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Overview of CUSO Financial Services

CUSO Financial Services was founded in 1996 by Valorie Seyfert, the firm’s current president, and Amy Beattie, who had served as chief operating officer before her retirement. The firm is currently owned by Atria Wealth Solutions, a privately-owned wealth management company. The firm is also affiliated with Sorrento Pacific Financial, a limited liability company (LLC) that’s a registered investment advisor and broker-dealer.

CUSO provides over 200 asset management programs that are used throughout the country by its investment advisor representatives at various banks and credit unions. It also offers support to those institutions’ financial professionals.

CUSO Financial Services’ pros

  • Large selection of investment options: The firm serves over 200 different investment programs, giving its clients a wide range of options. Investing services can also be provided on either a discretionary or non-discretionary basis, depending on the client’s needs or preferences.
  • Choices with no minimums: CUSO offers asset management programs and financial planning with no minimum investment requirements, making the firm’s services accessible for a wide range of investors.
  • Accolades for technological innovation: The firm has won numerous awards over the years for its innovations in technology. Most recently, in 2020, it received the Technology Innovation Award from the Bank Insurance & Securities Association (BISA) for its work in the financial services industry. Additionally, the company’s co-founders, Valorie Seyfert and Amy Beattie, were recognized by BISA for their commitment to the profession.

CUSO Financial Services’ cons

  • Multiple fees: Rather than charging one fee for services, the firm charges multiple fees in various layers, based on the program used. As a result, the total fee clients pay could be higher than the industry average fee, which typically ranges from 0.59% to 1.18% of assets under management, according to a recent study by AdvisoryHQ.
  • Some minimums are high: While there are some programs with no or low minimums, other asset management programs offered by CUSO have minimums that may be out of reach for some clients, ranging up to $500,000. Even the firm’s digital investment program, for example, comes with a $5,000 minimum.
  • Potential conflicts of interest: Some advisors may receive a commission for referring clients to third parties or recommending their products. In addition, some advisors are also insurance agents, which could financially incentivize them to recommend certain products and thus pose potential conflicts of interest. Further, some advisors may also serve as registered representatives of broker-dealers, a role in which they can earn additional compensation.

What types of clients does CUSO Financial Services serve?

CUSO mostly focuses on serving individuals, including some who are high net worth — defined by the Securities and Exchange Commission (SEC) as those with more than $750,000 under management or a net worth of at least $1.5 million. It also works with a selection of institutional investors, including businesses and charitable organizations. CUSO serves its clients through its network of investment advisor representatives at financial institutions across the country.

Different investment programs are offered through the firm, with some of them requiring no minimum to participate. However, for other programs, participants might need between $5,000 and $500,000 to start investing. The firm’s customized asset management program, for example, requires a minimum investment of $250,000.

Services offered by CUSO Financial Services

For the most part, CUSO offers investment advisory and asset management services through its team of investment advisor representatives — though it is also possible to get financial planning help with CUSO as well. The firm also uses third parties when providing some of its services, including access to different mutual funds and certain investment programs.

Depending on the situation, the firm offers both discretionary and non-discretionary management services, based on a client’s needs and preferences. With discretionary management, the firm can make investment decisions on a client’s behalf without first seeking their express approval, whereas a non-discretionary arrangement requires the client’s signoff.

For reference, here is a list of services offered by the firm:

  • Asset management (discretionary and non-discretionary)
  • Digital investment program
  • Financial planning
    • Asset allocation
    • Budgeting
    • Cash flow analysis
    • Business succession planning
    • Corporate 401(k) analysis
    • Disability insurance
    • Education planning
    • Estate planning
    • Investment goal setting
    • Long term care
    • Major purchase planning
    • Portfolio analysis
    • Retirement planning
    • Retirement income and longevity planning
    • Life insurance
    • Risk management
    • Risk tolerance assessment
  • Employer-sponsored retirement plan services
    • Administrative and record-keeping assistance
    • Assistance with finding third-parties to select and monitor plan investments
    • Review of plan investments
    • Help with plan enrollment
  • Brokerage services

How CUSO Financial Services invests your money

CUSO offers asset management services that are based on a client’s individual needs. These portfolios typically use mutual funds, exchange-traded funds (ETFs), stocks, bonds and unit investment trusts (UITs). In addition, the firm has a number of investment programs that offer access to different types of investments and strategies, many of which are provided in conjunction with other companies. CUSO Financial Services also offers a robo-advisor program, which generally invests clients’ funds in mutual funds, ETFs and cash.

The techniques used to determine investment advice or make decisions regarding asset management may vary depending on the advisor. In general, however, advisors use the following methods to analyze investment opportunities:

  • Fundamental analysis: Looking at financial statements, management, competitors, markets and other information about the investment
  • Technical analysis: Reviewing historical data and trends and using that information to try to forecast the direction of an investment’s price

Analysis might also include the economy and various financial data. Advisors consider risk tolerance when making decisions regarding asset allocation and which investments are used.

Fees CUSO Financial Services charges for its services

For the most part, CUSO charges clients a fee based on a percentage of assets under management. The firm retains a portion of this asset-based fee, and remaining portions go to the investment advisor and, if applicable, the advisor’s institution.

Clients at this firm generally negotiate fees. Different programs have varying maximum rates, though fees could end up being higher than the program’s listed fee caps. Depending on the program, clients may also owe additional account fees and program fees. Clients will also be responsible for charges from custodians, brokers, third party investment-advisors and other third parties, as well as any fund fees.

For financial planning services, clients will generally pay an hourly rate or a flat fee; the services that will be provided and their fees are generally agreed upon before the planning begins. Rates are negotiable, with the maximum hourly rate generally set at $250 per hour and the maximum flat fee at $10,000 within a 12-month period.

CUSO Financial Services disciplinary disclosures

The firm has disciplinary disclosures reported on its Form ADV, which is filed with the SEC. For reference, the SEC requires all registered investment advisors to report any civil, criminal or regulatory events from within the last 10 years involving either the firm or its employees or affiliates that would materially impact a client’s view of the firm and its management team.

In particular, CUSO reports that in the past several years the SEC has filed actions related to its investment advisor representatives failing to disclose some of the fees related to mutual funds. The investment advisor representatives failed to disclose the sale of mutual funds that paid 12b-1 fees on mutual funds when there were share classes of the same funds available at lower costs. CUSO Financial Services self-reported the failures and the firm settled with clients and refunded the fees, with no IARs getting a portion of the fees. It has also taken measures to address share class deficiencies.

For additional information on CUSO Financial Services and its disciplinary history, visit the firm’s Investment Adviser Public Disclosure (IAPD) page.

CUSO Financial Services onboarding process

It’s possible to sign up with CUSO Financial Services through a participating credit union. You can also sign up by calling the firm at 800-686-4724 or filling out the online contact form, which includes a space for you to enter where you bank. CUSO Financial Services can then further direct you on the necessary steps to set up an account and determine which services you need.

When signing up, clients work with an investment advisor representative. This representative will review their investments and provide quarterly performance reports; as well, clients will also receive accounts statements at least quarterly. On top of that, depending on the program, there might be additional account reviews conducted based on different triggers related to asset allocation, position concentration and account performance.

Where CUSO Financial Services is located

CUSO Financial Services operates out of over 900 credit unions across the country, and has jurisdiction in all 50 states and in Washington, D.C.

Headquartered in San Diego, CUSO has regional program management offices in:

  • California
  • Massachusetts
  • Minnesota
  • New Mexico
  • New York
  • North Carolina
  • Ohio
  • Pennsylvania
  • Texas

Is CUSO Financial Services right for you?

CUSO Financial Services might work for someone who wants a broad selection of investment program options, or who already works with one of the financial institutions through which CUSO provides its services. The firm has a wide range of account minimum requirements, making it accessible for most levels of investors, and it also boasts an impressive network of locations.

That being said, CUSO Financial Services does have a disciplinary track record, and its numerous affiliates and dual registration as a broker-dealer can pose potential conflicts of interest. Before deciding which financial advisory firm to use, it’s smart to review a number of choices to make sure you find a financial advisor who best suits your unique needs.