Active investment management’s weekly magazine for fee-based advisors

How independent advisors define their role in serving clients

by Sep 2, 2020Advisor Interviews

How independent advisors define their role in serving clients

by Sep 2, 2020Advisor Interviews

With more people likely to seek financial guidance in the face of an uncertain economy and volatile markets, the role of financial advisors has taken on increased importance. Advisors share how they see their mission and focus in serving the wide-ranging needs of new and existing clients.

According to many observers, the COVID-19 pandemic has accelerated several trends in the global wealth-management industry that were already in place entering 2020.

Wealth managers and financial advisors are continuing to move to the independent and RIA channels. Along with this movement, individual investors, retirees, and households of all types have been increasingly seeking out financial advice.

To the latter point, one large international advisory firm noted that inquiries from new clients were up 24% in April versus March—and they expect ongoing increased interest in their services as prospective clients’ financial priorities shift.

According to Nigel Green, founder and chief executive of deVere Group,

“With financial matters back in sharp focus, for many ‘I should have’ becomes ‘I need to have.’ … The same thing happened following the 2008 financial crash. That too served as a wake-up call to many people to ensure that they become financially secure and there was a subsequent increase in demand for advice.” 

John Porteous, of the U.K. wealth-management firm Charles Stanley, says,

“Given the degree of uncertainty and disruption that society has faced so far in 2020, the value of structured and professionally thought through financial planning is significant. Equally, against a backdrop of market volatility and economic disruption, the value offered must be explicit and communicated in a fashion that resonates with clients (eye of the beholder). Increasingly, a positive value exchange cannot just be assumed—it should be agreed.”

In the U.S., commentary at reinforces this theme, emphasizing the importance of one-on-one, personalized financial guidance:

“With the pandemic continuing to rage, no one knows how markets will perform through 2020 and beyond. Amid this uncertainty, financial advisors are in greater demand than ever. People of all ages, from millennials to baby boomers, want smart counsel during times of market volatility and economic uncertainty. Investors want to know they are doing everything they can to protect and grow their wealth. …

“Advisors know as well as anyone that pure passive investing is built for bull markets, and that clients of all types need a degree of personalization in their portfolio construction and management … the personal touch associated with active portfolio management. …

“When stock markets crater by over 25% in a single month—as happened in March—people don’t want to receive generic responses from chatbots about what to do with their life savings. They want to speak with a person they know and trust, and who intimately understands their unique situation and investment objectives.”

Diamond Consultants notes that the investor needs have changed over the past few years, well before the pandemic, as a more knowledgeable pool of clients and prospects looks for personalized service and a singular focus on their needs:

“Clients have become far more devoted to the individual advisors who serve them—eschewing the dated belief that their needs were best served by big-name firms. Instead, as the term ‘fiduciary’ has become more universal, clients are demanding that advisors put their best interests first, and act as objective stewards—unencumbered by the limiting agenda of the brokerage firms.”

The independent financial advisors we have interviewed for Proactive Advisor Magazine offer highly valued guidance to their clients and a commitment to placing client needs first—especially during stressful periods.

In this issue, we look at how several of those advisors articulate their mission, values, and focus in guiding clients toward their financial and investment objectives.

How do you define your role in serving clients?

Jason Palmer • Cottonwood Heights, UT
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“I offer financial planning to families, individuals, and businesses using a holistic, economics-based approach. We work in concert with our clients to uncover their financial goals, review their financial health, identify financial blind spots, and help them design holistic investment and insurance strategies. I selected the name ‘Resonant Financial Planning’ for my business after a lot of careful consideration.

“I believe that when professional, process-driven financial advice resonates with clients’ values, people can become empowered to make decisions with clarity and confidence. I incorporate a wide variety of financial strategies and products within my practice and work closely with other professionals as I strive to be my clients’ best financial resource. I feel fortunate to work in a profession that I find rewarding, fulfilling, and enjoyable, and to have the opportunity to work with incredible clients and colleagues.”

Mary Lyons • Dallas, TX
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“We help people view their retirement-planning options in a whole new light. The name of our firm [Personal Economics Group] says a lot: How can people construct a viable financial plan that can react effectively to a changing economic landscape, and how can they apply sound economic principles to their own financial-planning situation?

“I believe people work hard throughout their lives to establish a certain lifestyle. When they retire, they should not necessarily view that as a time of retrenchment. Instead, we want to help them have their assets work as hard as possible for them over a long time frame and to seek wealth protection via various strategies—so they may pursue their desired lifestyle. Our ultimate goal is to help clients get to a place where they can do the things they are most passionate about. …”

“We believe financial strategies need to be integrated throughout a client’s life. No financial product can provide a perfect solution, but the probabilities for success can be dramatically improved. Insurance and investments are both important parts of an overall plan—and when our clients understand these tools, they can learn how to use them in ways that most advisors don’t talk about.”

William Donner • Livonia, MI
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“Most of our clients are approaching or already in retirement and seek our guidance to navigate what they view as a complicated process to meet their retirement and legacy goals. We want to help simplify their view of that process and help them make informed decisions. … Their four chief concerns are (1) achieving a comfortable lifestyle in retirement, (2) not running out of money later in retirement, (3) making sure their health care and long-term-care needs will be covered, and (4) having the ability to leave a legacy to their children or grandchildren. They want to make good, sound financial decisions and to grow and preserve their capital.

“They understand that financial markets go up and down, but almost all do not want their portfolios subjected to the kind of volatility and drawdowns we saw in 2008 and 2009. The third-party managers we work with place a high priority on a risk-managed approach to portfolio management. Downside protection, to the degree possible, is extremely important to our clients. Most of our managers have a systematic methodology to adjust their strategies and portfolio allocations when market conditions change. We are seeking to achieve a smoother investment ride for clients over the long term, looking to capture reasonable returns while managing risk and avoiding steep drawdowns. Our third-party managers are an integral part of helping to make that happen for clients.”

Philip Saponaro • Wilmington, DE
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“First, and perhaps most importantly, we take a highly customized, goals-based approach to developing investment plans with clients. We consider their overall financial objectives, attitude about risk, time horizon, and how their investment objectives mesh with their retirement-planning goals, whether they are still in the accumulation stage or are moving into the distribution phase. We help clients determine short- and long-term strategies that are best suited for achieving their objectives, monitor the progress they are making, and periodically review and revise—if appropriate—our recommendations. We recognize that financial- and investment-planning needs change over time as clients experience life transitions or unexpected events. …

“Almost all of our new client prospects are introduced through an existing client or a personal relationship that I have developed. Several of our older clients introduced their children to us years ago, and, while it is hard for me to believe, some of those individuals and their spouses are now approaching retirement themselves. We encourage all of our clients to help their children and grandchildren to become more educated about financial matters.

“I enjoy working with young people who are just starting out in their careers and are interested in understanding how they might start building an investment portfolio. We discuss setting goals and the types of investment vehicles that might be appropriate for their financial situation, age, and attitude about risk. I love having these types of conversations with young people—it reminds me why I feel my career is so rewarding.”

Diana Avery • Atlanta, GA
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“We believe everyone should feel more confident about their financial future. Our firm’s chief priority is to guide clients through ongoing education and financial planning that can adapt to changes in their life priorities. Through seeing how all of the financial pieces of their lives fit together, clients will hopefully be able to successfully navigate the path to financial independence and security for their retirement years.

“We are committed to excellence in our process of working with clients—through adding value and delivering highly personalized service. We treat our clients as we would want to be treated ourselves and strive to create meaningful long-term relationships. We act as a fiduciary, which means we are held to a high standard and work only in our clients’ best interests. As an independent firm, we can review a wide universe of products and services with clients and help guide them toward solutions that meet their unique needs and objectives. We apply our holistic approach for clients from all walks of life and age ranges, everyone from millennials to those already in their retirement years.”

Jon McCardle • Lafayette, IN
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“I think there are some core principles that define how we would like clients to perceive our firm. First, that they believe we have worked hard to understand who they are and what is important in their lives, not just their financial situation. Second, that we have constructed a systematic process that makes the working relationship easy for them. There may be uncomfortable questions at times, but I believe they know we are at their side diligently seeking positive outcomes. Third, it is all about accountability, and that is critically important for both parties in the client-advisor relationship.

“Our clients come to us for professional guidance and trust us to help them grow and protect their assets over the long term. I make three commitments to clients: (1) they will always know where their money is, (2) they will know why it is there, and (3) they will know what we are trying to achieve as a team. Education is a critical component in all three of these points. I think this philosophy has served us well. One of the greatest compliments we receive from clients is, ‘I wish I had found your firm earlier in my life.’”

The opinions expressed in this article are those of the author and do not necessarily represent the views of Proactive Advisor Magazine. These opinions are presented for educational purposes only.

David Wismer is editor of Proactive Advisor Magazine. Mr. Wismer has deep experience in the communications field and content/editorial development. He has worked across many financial-services categories, including asset management, banking, insurance, financial media, exchange-traded products, and wealth management.

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