An Advisor’s Global Perspective & How We Run the Business Across the USA (and the World)

I often get asked how I manage Walnut Hill Advisors when I am often away from the office or out of state. The short answer = we use some excellent technology and have a great team. The longer answer is below, but first I want to address some perceptions in our industry that I seem to encounter often. Allow me a couple of paragraphs to address how the public views the field of financial planning and the people who work as financial planners.

When someone pictures a “financial advisor” at the retail level, their image will depend oftentimes on their level of wealth. For those of us in the below mega-millionaire category, we often assume the guy at the bank pushing “CD replacement” ideas, or the insurance agent down the street. I know this because when I am referred to a new client, almost every time they are not working with a comprehensive financial professional, but they have likely done business with a financial salesperson.

Sometimes, others may  assume a stock broker with a well-known firm like JP Morgan or Morgan Stanley. I say “sometimes” because after a few conversations with brokers (now “advisors”) from these large firms, they seem not to be interested in clients with less than $750,000 to invest. And $750k means you’re likely the smallest non-relative.

However, mainly – and because “financial advisor” has become a catchall term used liberally by anyone who works in the financial field –  clients likely expect a guy (usually a guy, older, around 55) who sits at a desk and opines about the stock market all day. At least that’s what the people I talk to expect or have already dealt with.

via Flickr by UK in Italy
Is this your image of an “advisor?” (via Flickr by UK in Italy)

However, when I think of financial advisor -and I prefer “financial planning” and “financial planner” as appropriate to the field that we at Walnut Hill Advisors  are in because it has the proper long term viewpoint in the phraseology –  I think of someone who has a global perspective and a comprehensive outlook. Global and comprehensive  meaning not just in viewing the world economically and politically, but also a person’s plan. I still don’t understand, for example, the following situations I see oftentimes in the planning for those with under $10M category who visit my office  (I’ll go in order of the ‘financial house’ that I discuss with clients and this is not an exhaustive list):

  1. no legal planning or terrible legal planning
  2. legal planning that does not match their other financial planning
  3. poor insurance coverage – terrible liability coverage, no disability or long term care coverage and life insurance that does not match the financial plan
  4. poor use of debt – paying off low interest/tax deductible debt first; refinancing unsecured debt into secured debt when trouble arises, poor credit card use
  5. no emergency fund – ridiculous consumption priority put over security
  6. tax planning that does not optimize client situation – overemphasis on write-offs vs goals, poor use of deferral, poor use of financial tools to lower tax bite
  7. investment planning that does not match the client’s values and goals – too much risk, too little risk, not enough being put aside, consumption placed ahead of savings

In other words, NO FINANCIAL PLANNING IS BEING DONE. PEOPLE ARE OFTENTIMES BEING SOLD PRODUCTS OR SERVICES WITH ZERO COMPREHENSIVE PERSPECTIVE.

So in a personal sense, I see very little global/comprehensive perspective in the plans of the people I meet. I assume that people with $20M have a fancy advisor that pulls all of this together but I don’t see this often for clients that the industry has termed “mass affluent” or just merely, “wealthy.”

And many people (in my opinion) in the field serving the mass market are local guys who haven’t traveled much. They oftentimes haven’t spent much time outside of their state, never mind their country. So they sometimes lack the global  perspective and open-mindedness that comes from seeing people, places and things that are not familiar and learning from them.

Traveling = A Real Education

Al and I have not only traveled a lot, we’ve learned a lot. Al worked in Europe and Japan extensively for Fidelity’s Devonshire Investments before coming to Walnut Hill Advisors. He was advising large HR companies and operating companies for Fidelity’s portfolio businesses. I’ve traveled to Europe (most recently the UK and Ireland), Asia (Singapore, Thailand and Malaysia), North America – including Mexico City, Cuernavaca, and Vancouver and specifically in the US – almost every major city besides LA. And from my blog posts in the past, you know I visit with the locals, study the real estate market, and ask people how the economy is moving.

I know personally I haven’t always been right (one example being the US markets this year) but who is? Our global perspective has helped us help our clients and given us a better vantage point on global economic and political issues.

How We Run the Business Away From Our Desk

Technology has allowed us to do amazing things. I am going to give you a run down of how we manage our operations and keep your information secure.

Our client management and scheduling system is cloud based. We track client activity, appointments and documents from our cloud-based CRM provider (Client Relationship Management). We have access to this secure system wherever we have a secure internet connection.

Our client documents are backed up to the CRM, a second back up is located on a separate secure cloud based backup system, and a third backup is secured on a local hard drive. Bottom line – docs are backed up and nothing short of a situation out of the TV series Revolution will knock this out!

Our phone system is awesome – we use RingCentral which rings to our office where Lauren sits, and connects to extensions there. if we are not in the office, our extensions follow us to our mobile phones where we either get the call through the RingCentral mobile “app” or it forwards to our cell number. So if our building were to fall down tonight, we could fully service our clients from home, or Starbucks or wherever. Our client accounts are typically held in custody by TD Ameritrade or Fidelity and they have backup systems that are even spiffier than ours.

Bottom line – when I am in San Francisco (or St Louis where I will head to shortly), or Boston, and whether Al is in Singapore or Westwood, we are in business as if we were next door. And we are getting more perspective and insight to bring to our service to you. So when people ask us how we run our business – it’s quite easy and we wouldn’t have it any other way. The world can pass you by when you’re stuck behind a desk.