An Ottawa-based advisor tells WP how his business has evolved to meet the changing needs of clients
As a financial advisor, it’s always preferable to have many strings to your bow. Graeme D. Baird certainly realized that soon after making his start in the business as a sales rep for Standard Life Assurance Company.
“When I started with Standard Life in 1992 there was a focus towards life insurance,” he explains. “I was lucky because a lot of the senior advisors there had started doing seminars on pensions, so I was exposed to the money business at a younger age.”
Those years under the learning tree served him well and by 1999 he had incorporated his own practise, G.R. Baird Financial Group. 18 years later, and the Ottawa-based business has grown to reflect the changes in the advisory business, stretching from investment advice and estate planning into group benefits and retirement plans.
The multi-purpose practise he oversees today is the result of the conversations he had back in those early days at Standard Life. Having proved his mettle selling insurance plans, clients would invariably ask about other financial products. The fact he could answer those questions meant the foundations for what would become G.R. Baird Financial Group were laid.
“It unfolded that people started to ask me more questions about lines of credit, or mortgages, or saving for their kids’ education,” says Baird. “That meant that although I may have been referred to a person for a specific product, by the second or third meeting you are doing a full financial plan and are in charge of all of their financial affairs.”
When it comes to the wealth creation side of his business, Baird’s approach to investing has changed over the years. The quantitative easing period that has lasted almost a decade means Baird has moved away from fixed income towards safer equities that can generate some yield.
“Traditional assets have let people down, not because they are poor investments, but because the interest rate environment has been so low,” he says. “Because of that you have to take on a little more risk with exposure to equities. We try to explain to people that looking at dividend paying stocks as an alternative to traditional bond-type investments, you almost have no choice.”
Equities do carry an element of risk, but Baird tends to direct his clients to those stocks with a long track record of solid performance. In Canada, that invariably means financials, and 2016 was a good year for the banks to say the least. It’s not a tough sell for clients, especially considering the alternatives available in the bond markets.
“Equities are easily understood by most clients – they understand that if they own part of RBC or TD Bank they will be somewhat comfortable,” he says. “If you had a GIC at the Royal Bank of Canada technically the money is sitting in the bank’s account and they pay you 1%. If you owned stock instead, the dividend yield will be close to 4%. It is better to own stock in these companies today.”
Baird has resisted any urge to move to a fee-based business. While many of his peers are doing exactly that, he is of the opinion that a practise that isn’t broken doesn’t need to be fixed.
“We normally do embedded commissions like 1% trailers and that is fully disclosed up front,” he says. “Over the past 18 months we have explained to every client how we are paid. So far it has made more work for us but that has paid off because we are taking in more assets.”
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“When I started with Standard Life in 1992 there was a focus towards life insurance,” he explains. “I was lucky because a lot of the senior advisors there had started doing seminars on pensions, so I was exposed to the money business at a younger age.”
Those years under the learning tree served him well and by 1999 he had incorporated his own practise, G.R. Baird Financial Group. 18 years later, and the Ottawa-based business has grown to reflect the changes in the advisory business, stretching from investment advice and estate planning into group benefits and retirement plans.
The multi-purpose practise he oversees today is the result of the conversations he had back in those early days at Standard Life. Having proved his mettle selling insurance plans, clients would invariably ask about other financial products. The fact he could answer those questions meant the foundations for what would become G.R. Baird Financial Group were laid.
“It unfolded that people started to ask me more questions about lines of credit, or mortgages, or saving for their kids’ education,” says Baird. “That meant that although I may have been referred to a person for a specific product, by the second or third meeting you are doing a full financial plan and are in charge of all of their financial affairs.”
When it comes to the wealth creation side of his business, Baird’s approach to investing has changed over the years. The quantitative easing period that has lasted almost a decade means Baird has moved away from fixed income towards safer equities that can generate some yield.
“Traditional assets have let people down, not because they are poor investments, but because the interest rate environment has been so low,” he says. “Because of that you have to take on a little more risk with exposure to equities. We try to explain to people that looking at dividend paying stocks as an alternative to traditional bond-type investments, you almost have no choice.”
Equities do carry an element of risk, but Baird tends to direct his clients to those stocks with a long track record of solid performance. In Canada, that invariably means financials, and 2016 was a good year for the banks to say the least. It’s not a tough sell for clients, especially considering the alternatives available in the bond markets.
“Equities are easily understood by most clients – they understand that if they own part of RBC or TD Bank they will be somewhat comfortable,” he says. “If you had a GIC at the Royal Bank of Canada technically the money is sitting in the bank’s account and they pay you 1%. If you owned stock instead, the dividend yield will be close to 4%. It is better to own stock in these companies today.”
Baird has resisted any urge to move to a fee-based business. While many of his peers are doing exactly that, he is of the opinion that a practise that isn’t broken doesn’t need to be fixed.
“We normally do embedded commissions like 1% trailers and that is fully disclosed up front,” he says. “Over the past 18 months we have explained to every client how we are paid. So far it has made more work for us but that has paid off because we are taking in more assets.”
Related stories:
The challenges faced by single clients
Court’s pro-BlackRock ruling could set unsettling precedent
