More Than Just Returns: How Good Advice Can Add 3% (and a Lot of Confidence)
If you’ve ever wondered what your financial advisor really does besides tell you to stay the course, rebalance your 401(k), or send polite reminders about Roth contributions… this one’s for you.
We’re celebrating 25 years of Vanguard’s Advisor’s Alpha® framework—a concept that proves good advice isn’t just comforting, it’s quantifiably valuable. In fact, Vanguard estimates that applying this approach can add up to 3% per year in net returns over time. No, that’s not a typo. Yes, it’s backed by research. And no, we’re not asking for a raise.
So, what exactly is Advisor’s Alpha, and why does it matter to you?
The Three Hidden Sources of Value
1. Smart Portfolio Construction
This is the science behind the scenes. Your portfolio isn’t a random grab bag of investments—it’s built with care:
- Globally diversified
- Matched to your goals and risk tolerance
- Implemented with individual stocks, low-cost ETFs, and funds (because why pay more?)
Over time, these foundational decisions help your money work more efficiently—and avoid performance-chasing distractions.
2. Wealth Management That’s Actually… Manageable
You know how taxes, rebalancing, and retirement income strategies can make your head spin? That’s where we come in.
- Tax-loss harvesting
- Smart drawdown strategies (hello, sequence-of-returns risk)
- Asset location for tax efficiency
It’s like financial feng shui—moving things around to create balance and flow.
3. Behavioral Coaching (AKA “Don’t Panic”)
Arguably the most important part of the job: helping you avoid the urge to do the wrong thing at the wrong time. Whether it’s:
- Selling at the bottom
- Overbuying at the top
- Following hot stock tips from your neighbor’s cousin’s dog walker
We help keep emotion out of the equation and long-term goals in focus.
But Can You Really Put a Number on That?
Actually, yes.
Vanguard estimates that applying Advisor’s Alpha consistently can add about 3% per year in value. Now, that’s not 3% every year like clockwork—it’s more like compound benefits over time from:
- Better decisions
- Fewer mistakes
- Smarter strategies
It’s not sexy, but it’s powerful.
Why This Matters More Than Ever
Financial advising has evolved. We’re no longer stock pickers with crystal balls. Today’s advisors are guides, educators, accountability partners, and yes—occasionally therapists during market meltdowns.
Your goals are personal. So is your financial plan. And helping you navigate the complexity of retirement, investing, taxes, estate planning, and even just staying calm—that’s where the real value lives.
In Short: Good Advice is Worth Its Weight in Alpha
As Vanguard puts it, we’re here to help you thrive—financially and emotionally. Because a plan only works if you stick with it. And people tend to stick with things when they feel confident, supported, and informed.
Here’s to many more years of helping you stay on track, feel confident, and maybe even smile during a market correction (okay, we won’t push our luck).
Want to revisit your plan or talk through your goals? Let’s set up a time. As always, we’re here to help you navigate the path forward—no crystal ball required.
About Charles
Charles McNamara, III (Charlie), is a Founding Partner, Financial Advisor, and President at Paragon Wealth Management, a financial services firm based in Doylestown, Pennsylvania, dedicated to professionally supporting, educating, and providing informed direction to each and every client. Charlie’s passion for working with clients one-on-one to find specialized solutions to pursue their financial goals drives the firm’s client-focused mission and continued success. He values the confidence clients have in him to always keep their best interests in mind.
A veteran of the financial services industry since 2000, Charlie brings an extraordinary level of knowledge and experience to the financial field. After obtaining a business finance degree from Delaware Valley University, he began his career as a financial advisor with Prudential Financial in 2001, and was promoted to management in only three years due to his hard work and dedication. With an entrepreneurial spirit and a passion for helping people solve problems, he launched his own practice in 2007.
When he’s not at work, Charlie spends time with his wife, Lisa (co-owner of local salon Moxie), daughter, Carissa, and their two dogs and cat. He enjoys weightlifting, running, golfing, fishing, and giving back to the community through his church, Our Lady of Mt. Carmel, and local organizations, such as the Travis Manion Foundation. To learn more about Charles, connect with him on LinkedIn.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All investing involves risk including loss of principal. No strategy assures success or protects against loss.