Investment Fund FAQs
Below are answers to common questions about the investment programs offered by the United Methodist Foundation of Michigan. If you have additional questions not addressed here, please feel free to contact us.
What are the Foundation’s qualifications for managing funds of UM Churches and related organizations?
The Foundation has served Michigan congregations since its inception in 1926. Our professional fund managers hold advance credentials as well as CFP®, CFA®, and CRPC. In 2008, Plansponsor magazine recognized our fund managers, the Howell-Sharp Group, as among the top 5 investment adviser teams in the country.
What is your underlying philosophy and mission statement as an investment advisory consultant?
The Foundation offers professional investment management as part of our comprehensive stewardship ministry. We pool funds entrusted to us by congregations and UM related agencies and retain professional fund managers at a fee structure that only the very largest churches could obtain individually. We believe that it is critical for United Methodist Congregations to make a witness through their investments. Accordingly, we require all our fund managers to screen investments using a rigorous process that considers products, environmental impact and community relationship as well as corporate citizenship.
We recognize our stewardship responsibility to ensure that Foundation funds are invested consistent with United Methodist values. To this end, we require all funds managers to follow the Domini Social Principles.
Extensive diversification is achieved through the use of six separate equity managers, each with a dedicated style of investing. This strategy assures that all our investment “eggs” are never in a single “basket”.
How is the Foundation different from other investment companies?
The Foundation is a not-for-profit United Methodist agency. As such, we do not serve stockholders, but, rather the UM congregations of Michigan. We do not need to maintain branch offices nor do we employ a sales force. We keep our costs low and pass through the savings to our client churches. We offer a wide variety to churches-stewardship and planned giving programming, estate and financial planning consultation for committees and individuals United Methodists. All these services are provided without charge to our constituent churches. We see ourselves as partners with churches in the task of funding ministry.
Also, keep in mind that our fund is unique in that if follows the socially responsible investment requirements according to the United Methodist Discipline. Learn more...
How can the Foundation assist in lowering our investment costs?
The UMF of Michigan pools church funds to create a critical mass of more than $50 million to be invested. We have negotiated an all-inclusive fee structure of 1% (100 basis points) charged annually. This fee includes all costs for management, custody, transactions as well as monthly statements. It has been our observation that such a fee cannot be obtained with accounts less than $1,000,000.00. There is an additional annual $25 account fee.
What suggestions would you give our Investment Committee for asset allocation?
The majority of our investment accounts are endowment funds that share the stated goal of long-term growth as well as current income. Accordingly, we recommend a significant portion of fund assets to be invested in common stocks along with a portion in fixed income assets. Our Collective Investment Funds offers complete asset allocation discretion to each congregation through which they may select a mix of from 0-100% in stocks or fixed income instruments. We are frequently asked to keep the church's account "balanced," in which case we keep the asset allocation as near 50/50 as practicable. There are many
publications, articles, and resources that can assist a committee to form its judgment regarding asset allocation matters. In addition, we offer individual consultations as desired -- please contact us for more information.
What is the relationship between the Foundation, Merrill Lynch and BlackRock?
We have retained BlackRock to provide the actual security selection and to execute the necessary trades to accomplish our stated goals through the diversified stylistic investment methods; large cap growth and value, mid-cap growth and value, global equity and international investing. Both BlackRock and Merrill Lynch monitor the practices of the several funds managers to ascertain their compliance with their disciplines. The Howell-Sharp Group of Merrill Lynch provides linkage between BlackRock, the Merrill Lynch Trust Bank and the UMF of Michigan.
How is access to funds handled?
Foundation accounts are valued daily. Requests for funds are processed weekly (account closing may take a few extra days). We maintain liquid reserves to provide for flexible access to your funds that may not be available with all the individual assets within our pool.
You many change the asset allocation of your account at any time with a written request.
Does the Foundation offer online services?
Foundation clients may check their account activity and balances 24/7. We provide an extensive website for viewing investment performance. View our current fund performance.
How often are statements issued?
Statements are mailed monthly, in addition to the online access provided. View our current fund performance.
Is there a Money Market Account?
The Foundation offers a money market fund through Merrill Lynch that provides an institutional rate of return, often superior to similar money market funds. There is no mark up on the money market funds. We pass through the costs incurred and recover nothing for our administration.
Learn more about the investment programs offered by the United Methodist Foundation of Michigan.
©2006-2012 The United Methodist Foundation of Michigan. All Rights Reserved This website does not attempt to make specific legal or tax advice. For advice on how to handle your individual situation, the services of a competent legal, tax, or financial planning professional should be obtained.