A promise to empower clients in planning their financial future
A promise to empower clients in planning their financial future
Proactive Advisor Magazine: Nicole, what motivated you to become a financial advisor?
I think there were two key factors. First, I had been working for about five years as a college consultant, helping prospective college students and their families build a funding plan for college. As part of that process, I would dig deeply into a family’s finances and, in effect, help them create an informal financial plan that touched on cash-flow management, household budgeting, debt management, and other financial issues.
College planning is an emotional and significant issue for families. I enjoyed the client interaction and helping families handle one of the biggest financial decisions of their lives. This experience led me to consider working in a financial-planning role that touched on broader financial issues for clients.
The second factor is really a function of my personality. I think it is a very good fit with the advisory business. I am an outgoing, energetic “people person.” I think I have an ability to win the confidence of clients, and I have a true desire to help them shape a better financial future. I studied education in college and worked for a period as a teacher. The client education side of the advisory business is something I enjoy, and it comes naturally to me.
Describe the overall philosophy of your firm in terms of how you serve clients.
One of my mentors at the firm developed a mission statement that we take to heart. We talk about “promises” a lot, in terms of empowering clients to keep the promises they have made to themselves, their families, and their community. Through our planning process, we are dedicated to making a meaningful positive difference in the financial lives of our clients. We want to become trusted advisors for clients and to develop productive relationships based on mutual respect and understanding.
Our office operates by using a team approach. We have three advisors in our office, and each has a set of strengths and a different level of experience with various aspects of financial and retirement planning. After the discovery process has taken place with a new client, we will often meet as a team to discuss potential directions for strategic planning recommendations. This becomes especially beneficial for clients as we consider investment options. The three of us evaluate different portfolio directions and identify those we collectively think will help a client progress toward their objectives.
What are some core principles of your firm’s approach to investment management?
In very basic terms, we want to build client portfolios that are responsive to clients’ overall financial goals, their time horizon, and their risk tolerance. So, before we get to the stage of portfolio recommendations, it is very important to understand a client’s or client family’s specific circumstances and needs. Why are they investing in the first place? What are their long-term goals? Are they still in the accumulation mode with many years left before having to touch their assets, or are they approaching retirement and need to start planning a distribution strategy? If college planning is a priority for a family, the time horizon is likely much shorter for their investments, and a conservative, risk-managed approach becomes very important.
Our firm has two core beliefs about investment management. First, we want to develop a customized approach for each client. The needs of every family can be very different. If, for example, I am working with conservative clients beyond retirement age and with relatively modest assets, their overall investment plans are going to look very different from that of a young couple with a healthy joint income and no immediate need to draw upon their assets.
Second, we believe in risk management and the use of professional third-party money managers. In most cases, no matter what the overall objectives of the financial plan are, we will likely consider risk assets at some level of allocation. Whether those assets are earmarked to provide conservative growth to fund retirement distributions over the years, or to provide more aggressive growth, capital preservation is paramount. So, we use a core of third-party managers who have many different types of risk-managed strategies. We can blend them into the portfolio structure and allocation in a way that makes the most sense for a specific client.
What are your clients’ attitudes toward the markets and risk in this bull market?
I think there has been a big shift in attitudes since the 2008–2009 financial crisis. I saw this during my college-planning years, and it continues to this day. It is interesting to me to read about the growth of passive index investing, because I do not see that bias in our client base. Back 10 or more years ago, I do think the mindset for clients was to invest in mutual funds and then to just forget about them for years. That is not the case now. Our clients are very concerned about facing another market downturn or crisis where they could potentially see significant portfolio losses.
“Our team works diligently to identify the risk-return parameters of each portfolio recommendation.”
We certainly do not encourage an attitude of being anxious about the markets, but we do want to portray a realistic outlook to clients. There will eventually be another bear market—history tells us this is pretty much a given. Putting forth an understanding of the facts of market cycles is a big part of client education. So, how do we help clients deal with that, both in terms of their emotional outlook regarding investing and their actual portfolio structure?
That is why our team works diligently to identify the risk-return parameters of each portfolio recommendation. We do not present strategy recommendations to clients without context, and our investment managers help us by providing detailed strategy histories. We are especially concerned with how a strategy or strategy blend performed during times of market stress. Clients obviously would like to see growth in their portfolios, and we believe that can be accomplished within a risk-managed approach that can help mitigate the worst of losses during down markets. Though there are no guarantees in anything related to investments. I explain to clients that our investment managers are monitoring the markets constantly and can adjust portfolios according to current market conditions. That is a reassuring message that is well-received by our clients.
How do you get involved with your firm’s business-development efforts?
There are a number of ways. When I first joined the firm, I took on responsibility for many aspects of account management for current clients, and that presented a strong opportunity for business development. I wanted to make sure that clients were receiving regular contact about their financial plan and to present the firm in a proactive manner. This could be over the phone or in a face-to-face meeting. The goal was to make sure we had the most updated information on their family’s situation, to be aware of recent major life events, and to offer our services in any way that would be helpful to the client. I think this will ultimately lead to managing a larger share of a client’s total assets, but even if it does not, it is a worthwhile relationship-building effort.
I have also been working with our team on greater penetration of the small-business segment. Small-business owners present a threefold opportunity: (1) They have many needs for financial services for their business. (2) They may have complex personal financial-planning circumstances. (3) They may be able to refer other relatively higher-net-worth individuals in their company or within their personal network. So, I am actively trying to develop contacts with local business owners. The 401(k) area is a major focus for the small-business market, and our senior advisor will generally take the lead on introductory meetings. We also plan on ramping up informal events that target small businesses in the near future, offering information sessions on topical subjects appropriate for that segment.
A final area relates back to my experience with college planning. The firm tries to leverage that in discussions with current clients, in meetings with prospects, or in seeking out referrals. I think it is a valuable area of expertise that helps to set our firm apart. In this era of ever-rising college costs, it is something that is top-of-mind for many families. Conversations about college planning can lead to opportunities to discuss our firm’s other capabilities. When we identify those opportunities, we are confident we can deliver on our promise of helping clients plan for a more secure financial future.
Nicole Jones is a financial representative with United Professional Advisors, an independent advisory firm with multiple offices in the upstate New York area. Ms. Jones’ firm provides a wide variety of financial services to individuals and businesses, including retirement planning, investment management, employee benefits and insurance, and estate planning.
A native of Rochester, New York, Ms. Jones has traveled extensively and has resided in New York, Ohio, North Carolina, and Beijing, China. She is a graduate of Cedarville University in Ohio, where she studied history and education and played for the women’s soccer team for four years. She spent a year in China using her education skills to teach advanced English to Chinese secondary students.
Ms. Jones has been affiliated with United Professional Advisors firm for almost three years. Before joining the firm, she worked for more than five years as a college consultant. In that role, she helped families understand the true cost of college and make informed decisions about how to minimize the debt taken on by a student and family. She says working with families to handle these important financial decisions was excellent experience for her current position.
A single mother of “two energetic and busy kids, ages four and six,” Ms. Jones works hard “to keep the family’s schedules coordinated.” She is an avid athlete who enjoys fitness training and plans to run in the New York City Marathon. Ms. Jones helps raise funds for the New York Road Runners Team for Kids and is active in her local church.
Disclosure: Securities and investment advisory services offered through Ameritas Investment Corp. (AIC), member FINRA/SIPC. AIC, Proactive Advisor Magazine (PAM), and United Professional Advisors (UPA) are not affiliated. Additional products and services may be available through Nicole Jones or UPA that are not offered through AIC.
Photography by John Clark