The Cambridge System™

The Cambridge System™ is a revolutionary approach to financial planning. The brainchild of Bert Whitehead, MBA, JD, it rejects the traditional approach to financial planning (including the financial plan document and asset allocation models developed for institutional investors) and instead places emphasis on the needs, including taxes and personal real estate, of real people. It packages these services to be profitable for both the advisor and the client.

The Core Concepts

The Core Concepts are the foundation of the Cambridge System™.

The holistic approach. Transformation takes place in the context of relationships, not transactions. It is through the ongoing relationship with the client, the active participation of the client, and the integration of that client's finances, goals and values that the advisor can guide the client to financial independence and peace of mind.

The prevalence of financial dysfunction. Clients often think they are doing the right thing, even when their choices are inappropriate for their goals. Frequently these choices are the result of incorrect information or understanding. They may also be the result of paradigms rooted in childhood or purely emotional associations. We believe one role of a holistic financial advisor is to correctly diagnose and treat financial dysfunction.

The primacy of the endogenous view. A leading cause of financial dysfunction is an exogenous view--thinking that factors outside yourself control your financial future. We believe that the factors over which clients can exert some control; factors like how much they earn, how much they save, how much they pay in taxes, and how well their investments are diversified, are much more important to their financial independence than those factors they cannot control; factors like where interest rates are heading, what the market is doing, or what is happening in the world at large.

The progression of the Financial Life Cycle. We believe that individuals progress through a series of stages in their financial development and that completing the fundamentals of a stage is crucial to success in later stages. It is frequently this unfinished business from prior stages, or difficulty in making the transition from one stage to the next, that prompts someone to seek out a financial advisor.

Functional Asset Allocation. This is our revolutionary approach to asset allocation in the real world. Its premise is that each asset category serves an important function or purpose in people's lives and that understanding these unique functions allows the use of assets to be optimized. Real estate, in the form of the personal residence, is a prime example. It usually represents the largest and most profitable investment a family has, provides the best protection against inflation, and adds value beyond a financial calculation because of the personal enjoyment derived from its use. Yet most money managers do not include it when constructing an asset allocation strategy.

The History of ACA

In 1995, Bert Whitehead made the presentation "Marketing Fee-Only to Middle America" to the National Association of Personal Financial Advisors (NAPFA). (We'll send you a free copy of this presentation when you complete our Membership Inquiry Form.) He described his practice model and was subsequently deluged by requests from advisors wanting to know how to replicate his success. Cambridge Advisors, LLC was formed as a result. Wanting to assure the organization's longevity and to better express the collaborative efforts of its members and the evolution of the Cambridge System™, the original company was replaced in 2002 by a 501©(6) not-for-profit corporation.

Over the years, hundreds of advisors have been trained in the Cambridge System™. Some joined just for that training, but many more have chosen to build a thriving supportive community that respects the individuality of each practice. This unique blend of commonality and diversity has created an environment where innovative solutions to client issues and practice management challenges are nurtured and realized.

We are looking for financial advisors who share our values and passion to join us in our alliance. To learn more, read about becoming a member or complete our Membership Inquiry Form.