Why an Over-Diversified Portfolio Is a Problem
June 14, 2023
Meet Patrick Klacka, CFP®
Wealth Manager at Lucia Capital Group
Together, we’ll craft a personalized strategy to help you work towards your financial goals.
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Connect with Patrick Klacka, CFP®
Patrick Klacka, CFP® Associates
Patrick Klacka, CFP®
Wealth Manager
Meet Patrick, a dedicated family man and a valued financial planner specializing in wealth management for engineers. With a bachelor’s degree in computer engineering from UCSD and over two decades of experience in software development and engineering management, Patrick understands the unique financial needs and goals of engineers and their families. As a husband and father, Patrick knows the importance of ensuring financial security and preparing for times of uncertainty.
Patrick’s journey to financial planning was driven by a deep personal commitment to take care of his family. His bout with skin cancer in 2016 further reinforced his belief in the need for planning. Leaving behind a successful career as an engineering director, Patrick embarked on a new path to help other families secure their financial futures. He’s now retired from engineering but considers himself a “recovering engineer” who still applies the same dedication and attention to detail to his client’s financial well-being.
With Patrick, clients can trust that their financial goals will be managed with the same rigor and precision as a well-engineered system. His mantra, “You work hard – shouldn’t your money work hard too?” encapsulates his dedication to ensuring that every dollar is used efficiently and effectively. You’ve heard the adage “cost, schedule, and quality – pick two.” Patrick believes financial planning should aim to deliver on all three fronts and provide comprehensive solutions that empower his clients to confidently work toward pursuing their dreams.
Patrick and his wife Sarah have three kids, two of whom are now studying at local 4-year universities. In their downtime, they practice permaculture principles on their property in the suburbs of San Diego, embodying their belief in sustainable living and responsible stewardship of the environment.
See Patrick in Action
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Information About My Transition to Lucia Capital Group and LPL Financial
About the Transition, Frequently Asked Questions, and Next Steps
It’s my pleasure to share with you some exciting news!
Starting on Wednesday March 13th, I will be replacing Charles Schwab (the firm that provides trading and custody to 15Equity) with Lucia Capital Group, which offers securities and advisory services through LPL Financial (LPL).
Much of what Charles Schwab does on a daily basis happens behind the scenes, so from that standpoint you may not notice anything new, but I’m excited about this affiliation, and I’m confident that you’ll be pleased with the range of services I’ll be able to offer to you at Lucia Capital Group.
The most important thing to note is that I am now, and will continue to be going forward, your financial advisor, just as I always have been. Absolutely nothing will change there. This new affiliation with Lucia Capital Group and LPL will allow me to offer more comprehensive wealth management solutions, and also delegate much of the paperwork and regulatory duties to them, rather than having to handle all of that on my own. I want my focus to remain solely on meeting with each of you personally, with the goal of providing you with professional financial advice to help you manage your retirement objectives.
It’s similar to this: a doctor works best when seeing his or her patients all day, and dispensing medical advice to each individual based on their needs. Getting bogged down in medical and insurance paperwork is an onerous task that’s best done by a team of professionals who specialize in those areas. In that regard, I’ve decided to allow a team of professionals to take care of the back-office work for me as well.
So here’s what’s next. Starting today, I’ll be updating my account agreements with you so that I can continue to provide you with ongoing advice and management of your accounts, just as I do now. This is very important, and I’ve made the process simple for you. I recently sent you a privacy notice form to sign to simplify the account agreement process. If you responded to it, you’ll receive several emails for your electronic signature. The important part is you need to sign those as soon as possible, because I can’t manage your accounts at LPL until I have your signature on those documents. If you did not respond to the privacy notice, please contact me and we can get started on updating your account agreements together.
This is just my initial announcement to you, and I’ll provide you with further details as they become available. You can expect further correspondence from me with some important details in the coming days and weeks. As always, thank you for the trust you put in me.
Is there anything I need to do?
Yes. You will need to sign some new account paperwork, advisory agreements, money movement and transfer paperwork in order for me to open accounts, transfer assets and continue managing your portfolio. I will send most of these documents to you for electronic signature, but some may require you to print and sign and scan the documents back to me.
What if I have questions regarding the documentation I receive? The information used to prepare the documents you receive is information I have in my files. If you have any questions or would like to make updates to any of the information, please let me know. In some cases, such as your years of investment experience and your net worth percentage breakdown, I may round the years or percentages to the nearest 5 or 10 years or percent. If you have any questions, please let me know.
Patrick, why did you decide to make this change to LPL?
Because I’m independent, I have choices as to what entities I may use to help support me in my efforts to serve you, and I’m constantly looking for ways to improve upon all the services I provide.
This new affiliation with Lucia Capital Group and LPL will simply allow me to delegate much of the paperwork and regulatory duties to them and to my new extended partners, rather than having to handle all of that on my own. In this industry, there is a LOT of required paperwork that is normally handled by a back-office support staff. LPL can take over those tasks for me, so that my focus can remain solely on meeting with each you personally, with the goal of providing you with the best financial advice to help you meet your retirement objectives.
It’s similar to this: a doctor works best when seeing his or her patients all day, and dispensing medical advice to each individual based on their needs. Getting bogged down in medical and insurance paperwork is an onerous task that’s best done by a team of professionals who specialize in those areas. In that regard, I’ve decided to allow a team of professionals to take care of the back-office work for me as well.
I firmly believe they will be valuable partners with me going forward.
Will my investments change?
No. Your investments will electronically transfer to LPL. My advice and how I manage your portfolios will also remain the same.
Will my brokerage fees change?
You will likely see a different fee schedule for brokerage-related costs, such as trading costs and IRA fees. Some account-specific fees may be higher or lower. I believe overall my clients will experience lower total costs.
Will my distributions change?
No. While you will need to sign new paperwork to update your distributions to the new broker dealer, no other changes will occur.
Will my advisory fees change?
Generally no. I’ve arranged for my portfolios to move to LPL as they are and negotiated similar client level fees.
Will I have to sign new documents?
Yes. You will need to sign new account paperwork, advisory agreements and transfer paperwork in order for me to continue managing your portfolio. I will send most of these documents to you for electronic signature, but some may require you to print and sign and scan the documents back to me.
Will my statements change?
Yes. Once your account is opened and transferred from Charles Schwab to LPL, you will begin receiving new statements from LPL. As accounts transfer, you will receive statements from Charles Schwab showing your account value is zero and a new statement from LPL showing the value of your accounts. The timing of these statements can be different by a few days.
Will I begin receiving information from LPL?
Yes. Once an account is established at LPL for you, you will begin receiving regulatory and disclosure notifications from LPL regarding the account(s) opened, your document settings, changes made to information on your account, the transfer of assets and more. You can review the information listed and contact me with any questions you may have.
How do I get access to my accounts at LPL online?
If you’d like to set up access, once one account has been opened for you, you can go to www.myaccountviewonline.com and click Sign Up, enter the information requested and follow the prompts to establish your account.
If I have set up a direct deposit or electronic funds to transfer from my bank account or elsewhere to my Charles Schwab account, do I need to do anything?
If I set the transfer up from Charles Schwab, then the new paperwork I send you will change these instructions. If, however, you set this transfer up directly with your bank, using your banks forms, please contact me and I’ll discuss with you what steps should be taken to change the funds transfer to your new LPL account. If you’re not sure, feel free to contact me to review the instructions.
As I described in my prior communications to you, I’ve replaced my Registered Investment Adviser 15Equity, with Lucia Capital Group, which offers securities and advisory services through LPL Financial (“LPL”). At the same time, I’m in the process of moving accounts custodied with Charles Schwab to LPL.
I decided to align with Lucia Capital Group and LPL so that I can relegate the regulatory and back-office work to them, allowing me to focus all my time and efforts on meeting with each of you individually and providing you with the best possible financial advice. To me, that’s the best part of this job!
While many of the benefits of this change will happen behind the scenes, I think you’ll also notice some direct benefits to you, specifically in the areas of account brokerage costs, client statements and online account access.
The Next Steps:
- Account Repapering; I am updating my account agreements with you so that I can continue to provide you with ongoing advice and management of your accounts. This account agreement update is very important, and I’ve made the process simple for you. You’ll receive several emails for your electronic signature and emails from my team with documentation you will need to print, sign and scan back to us. The important part is you need to sign those as soon as possible, because I can’t open, transfer and manage your accounts at LPL until I have your signature. Also, please note that you may see eSign requests from new members of my expanded team at Lucia Capital Group: most likely either Ann, Monique, Wade or Lani. If you see a request from them, just know that it originated from me as well. Having this team available to help me is another one of the many new benefits of my move.
- Transfer of accounts; Your accounts will usually transfer within a week or two after you sign your paperwork.
- Online Access; I appreciate the fact that any time accounts are transferred, you may want to track them. Of course, I will be tracking them for you, but you’ll be able to do so as well with online access to your LPL accounts via their website and app called MyAccount View. It’s similar to the way you may have done it through the Schwab website. If you’d like to set up access, once one account has been opened for you, you can go to MyAccountViewOnline.com [https://www.myaccountviewonline.com], click Sign Up, enter the information requested, and then simply follow the prompts to establish your account. If you prefer to go paperless, there’s also an option for that within MyAccountView. Just go to the Preferences tab, click on the “Paperless Settings” section, and choose which option(s) and settings you want.
- Monthly Statements; For your accounts, you will receive two account statements for the month your account is transferred — one from Charles Schwab and one from LPL. Additionally, in the first quarter of 2025, you’ll be getting two different tax documents for each non-qualified account that you have — one from Charles Schwab, and one from LPL. So please make sure you have both sets when you do your taxes next year.
- As a reminder, I’ve created a series of Frequently Asked Questions and have answered the most common questions there. Please take a few moments to review the additional information.
I’ll have more to come over the coming months, but for now, that’s about it. And by the way, if you happen to miss any of my email updates, you can always check back at my website for the latest information. If you have any questions at all, please reach out to me directly and I’ll be happy to help you out!
How can we help you the most?
Schedule a meeting with Patrick Klacka, CFP®
Step 1: Introductory Call
It all starts with a phone call that allows us to get to know each other and to find out if our advice and philosophy are a good match for your situation. During this call we’ll get into what your specific goals are, where you’d like to be in the future, and how we may be able to help you get there.
Step 2: Meet with Your Advisor
During this meeting, you'll see exactly how we would implement your strategy and what it would look like to work together. At this point, we'll ask you to take some time to think about whether you believe if we're the right fit for you. It's important that you make an informed decision, and we encourage you to take whatever time is necessary.
Step 3: Getting Started
If we all believe this is a good fit, we'll begin the process to get you on board as a client of the firm. We'll take you through our client agreement, your investment policy statement, and the initial logistics of implementing your financial plan.
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