Understanding Liability-Driven Investing - FCS

Understanding Liability-Driven Investing



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At FCS Private Wealth Management, we seek to be more than just an investment practice in Kansas City. Our goal is to provide our clients with the highest caliber service as an asset management company utilizing wealth management strategies rooted in your unique goals.

Liability-driven investing is a core tenant of effective portfolio management. Let’s dive into why and how we utilize this method at FCS.

Key components of liability-driven investing

Liability-driven investing is a basic premise. Our goal is to make sure that your investments are well matched with your current and future liabilities, particularly when we start looking at long-term retirement planning.

Often, what this means is we project current and future expected liabilities to determine how to structure the liquidity of your investment assets to match your potential needs for future withdraws.  This designs the portfolio to help maintain your current lifestyle in to the future through different types of market environments.

The key tenants are:

Maintaining cash flow

We consider your liquidity needs and anticipate how to best maintain your cash-flow independent of how the market at large is performing.

Striving to avoid principal loss

Utilizing strategic investments, we aim to grow and sustain your wealth to help ensure liquidity in fixed assets to continue your withdraw needs during difficult investment markets.  Thereby allowing your very diversified and more volatile equity holdings the time they need to work through down cycles in the economy and markets.  During the portfolio construction process, we strictly evaluate investment choices against your risk tolerance. 

Discipline and execution

Our team maintains active portfolio management to help ensure that we rebalance as necessary. We work closely with our clients to help make sure their investment plan is always working optimally.

Why you need a trusted financial advisor

While liability-driven investing is typically thought of as being focused on retirement planning, at FCS we consider it an important aspect of all the portfolios we create.

Professional guidance

A dedicated financial advisor evaluates events that may affect your financial objectives and studies the trends and developments in the investment environment. This information allows your advisor to provide essential guidance for your portfolio.

Customized portfolio

We create customized portfolios for each of our clients because every client has different needs and goals. Before we build your investment plan, we discuss everything from retirement planning and risk management to charitable giving and saving for your child’s (or grandchild’s) college education.

Striving to protect your investment

Liability-driven investing is about striving to protect your financial future from the inevitably changing market. Our investment planning team has years of experience navigating some of the most difficult markets in history while seeking to protect our clients’ investments.

FCS: your partner in wealth management

FCS Private Wealth Management is here to help simplify the complexities of long-term investment planning. With over 3 decades of experience, our team provides comprehensive wealth management services utilizing the most sophisticated strategies.

Our financial advisory team is divided into two offices, allowing us to adapt our services for both high-net-worth individuals (via our Private Wealth team) and ultra-high-net-worth individuals (via our Family Office). This structure allows us to better serve the unique needs of our clients while maintaining our high standards of service. 

Reach out, and let’s get the conversation started.

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