Going solo – sans big firm – can be daunting for any financial planner. But still so many continue to dream. One advisor who overcame that fear now wants to help guide others through it
Going solo – sans big firm – can be daunting for any financial planner. But still so many continue to dream. One advisor who overcame that fear now wants to help guide others through it
Knowing when to walk away and having the courage to do so don’t necessarily happen in tandem.
Financial advisor John Lindsey knows first-hand the hesitation and fear that fester when an advisor even contemplates going solo.
But, Lindsey hasn’t looked back – at least not in regret – since he did two years ago.
Now very much an independent, the advisor once a major player with a large international firm has launched a website – The Bold Advisor– offering encouragement and support to others, like him, who yearn to do the same.
“I’m trying to be a voice for those who want to go independent and are afraid,” he says. “Or, who wanted to go independent and were being bullied by their current broker dealer or (are dealing with the) threat of being bullied by their current broker dealer.”
Lindsey’s road to independence was by no means a smooth one – there was a lawsuit (which he won), tens of thousands of dollars poured into legal fees and one of the greatest tests endured on his moral character. With a high-profile reputation and solid book of business, Lindsey says he cut back his clients, fighting hard for those he wanted to keep. He combatted accusations (which included stealing ‘corporate secrets’) that had the potential to soil his career. And, he guarded his jealously protected the composure necessary to come through to the other side.
BREAK ON THROUGH
So, how did Lindsey make it through?
“I had an incredible spouse. I had an incredibly supportive family. I had an incredibly supportive staff,” he says. “Luckily, I had the financial wherewithal to be able to withstand it.”
One thing Lindsey stresses is that his decision to leave his firm was not driven by money. Instead, after more than 15 years with his former firm, Lindsey says he was disgruntled by the corporate culture, the investment philosophy and how he was expected to service his clients. He was also dissatisfied with the proposed succession plan, which, according to Lindsey, would have handed over the bulk of his clients to unknown advisors despite the years he spent developing these relationships.
Once he committed himself to making the move, Lindsey searched thoroughly (two years in total) for his next firm. He interviewed with five different companies, visited corporate headquarters and analyzed which teams aligned best with his moral and business values.
“I did a tremendous amount of due diligence. I flew to different cities,” he says. “I had offers from all five (companies), but I took the one that wasn’t necessarily the largest. I took the one that gave me the most freedom, the most integrity with my clients, and the most ability to do what is right for the clients. I didn’t want to be owned in an indentured-servitude type of manner.”
TO THE OTHER SIDE
And, so with 160 household clients - down from 500, most of whom were “garage” clients he left with the firm – Lindsey started doing business his own way. He settled on a new firm and launched Lindsey and Lindsey Wealth Management, Inc. in 2012.
“I cleaned up my book because there were a lot of assets on the book that weren’t profitable and had been collected over the course of time,” he said. “I got almost 70 per cent of my book, which is unusual…” He now offers clients a diverse range of products – including real estate, annuities and other investment options that weren’t on his former firm’s grid – with better money management and risk assessment options and a more-efficient compliance department, he says.
“My time is my own. I’m not being asked to volunteer all the time and have no compensation for it,” he says. “I’m able to offer my clients a much broader spectrum of investments. It’s the difference between chicken salad and chicken parmigiana.”
Not only are the products notches above those he used to select from, but Lindsey says the technology he uses is far superior as well. Everything is web-based, so much so, that he can access client portfolios and complete trades via his mobile phone. When he attends a national conference, he wears a badge with an electronic chip that automatically allocates him CFP credits when he attends certain seminars.
(Story continues on next page)
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FOLLOWING FOOTSTEPS
When he considers the advice so often sought by other advisors considering the leap from a mammoth firm or bank, Lindsey isn’t short of words.
Firstly, he reiterates what every advisor should already know. The firm you are with does not own you. “They are just renting you. They (advisors) lose sight of that,” he says. “If you know you haven’t done anything wrong, truth will prevail.”
Secondly, make sure you have some funds to tap into, or find an attorney who is willing to work on contingency and counter sue, if the necessity arises.
Third, do your research when seeking another firm or broker with which to align yourself. Visit the headquarters and get a feel for the corporate culture.
Fourth, be unwavering about the ethics, ideals and morals you stand for, and everything else will fall into place, he says.
Fifth, always do what is right for the client. “Even if there are times you don’t get paid for it, something will fall in your lap that you didn’t expect,” he says.
And last,, in the words of U.S. basketball coach John Wooden: “’Be more concerned with your character than your reputation,’” he says. “Your character is what you really are while your reputation is merely what people think you are.”
“Anybody who just says ‘well it’s the client’s fault for getting duped’ is skipping right past the opportunity to ask questions. It’s more constructive to ask, what were the questions that should have been asked? What were the promises made? And were the promises reasonable?” says Gillian Stovel Rivers, CFP with Assante Wealth Management in Burlington, Ont.
According to Stovel Rivers, many of these things happen because of poor financial planning habits. “Most of the time when people are looking at an opportunity like this, it’s to make up for lost time. It’s because they need to hit a finish line that’s two kilometers away and they have 100 metres to do it in. I think that people in a state of denial will sometimes forget to ask the tough questions of things that seem too good to be true.”
When clients come to Stovel Rivers with what she calls “alternative” investment ideas, she uses it as an opportunity to help them become better independent decision makers. “Although I think advice is really important, we can’t always be with a client and we can’t always stop them from making these decisions. But we can help them get better at asking some questions about opportunities that seem too good to be true,” she says.
Stovel Rivers notes that she also always looks for multiple layers of due diligence in any investment opportunity and suggests that her clients do the same. “Multiple layers of due diligence is a great way to know that the tough questions have been asked by the people who know what the tough questions should be,” she says.
One problem for advisors, however, is that sometimes clients are not forthright with all of their investing activity. Tim Kelly, a financial advisor at Sun Life Financial in Richmond Hill, Ont., recalls one client who was taken for $20,000 by a neighbour in an “investment opportunity.”
“I only found out about it after the fact. My client never asked me for advice. I didn’t know about any of this at the time,” he says.
This is one of the reasons it’s important to express to investors that an advisor cannot help them achieve their goals unless they are given the whole financial picture, according to Stovel Rivers.
“It’s like a doctor taking on a patient who’s not telling them all of their symptoms. How am I going to make a proper recommendation for us to work together as a team to help that person achieve what it is they’re telling me they want to achieve if I don’t have the whole playbook sitting in front of me with all of the facts?” she says.
Beyond teaching financial decision-making skills and encouraging investor transparency, the industry should also be coming together to educate the public about what qualifications and qualities to look for in the person they trust to handle their money.
Kelly says that during the course of one of his first appointments as a financial advisor in 1991 that the person told him he was only there for himself and not to help them. “That taught me that much of the public is already on high alert when it comes to investing their money. I think there’s a stigma attached to this business and every advisor has to do their due diligence,” he says.
MacCoy argues that organizations like Advocis are working towards ensuring all planners meet certain standards, take part in continuing education and adhere to a professional code of conduct. As well, the Canadian Securities Administrators works to keep tabs on fraudulent practices in the industry.
However, MacCoy warns that any implementation of new standards or requirements has to be implemented slowly and with consideration as to how it will affect the industry as a whole.
“In principle it’s a good idea. But in the U.K. they put in more regulations and pushed it so far that a substantial number of advisors quit. The problem is if they implement really strict requirements, a lot of people will leave the business. And if we go from a commission base to a fee base, the average Canadian won’t be able to afford advisors,” he says.
John C. Lindsey CFP® is an award-winning financial advisor – based in California – who served as a regional leader, limited and general partner with one of North America’s top-rated advisory firms for more than 15 years. His site www.theboldadvisor.com offers more tips on the journey to independence.
Wealth Professional Canada
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Knowing when to walk away and having the courage to do so don’t necessarily happen in tandem.
Financial advisor John Lindsey knows first-hand the hesitation and fear that fester when an advisor even contemplates going solo.
But, Lindsey hasn’t looked back – at least not in regret – since he did two years ago.
Now very much an independent, the advisor once a major player with a large international firm has launched a website – The Bold Advisor– offering encouragement and support to others, like him, who yearn to do the same.
“I’m trying to be a voice for those who want to go independent and are afraid,” he says. “Or, who wanted to go independent and were being bullied by their current broker dealer or (are dealing with the) threat of being bullied by their current broker dealer.”
Lindsey’s road to independence was by no means a smooth one – there was a lawsuit (which he won), tens of thousands of dollars poured into legal fees and one of the greatest tests endured on his moral character. With a high-profile reputation and solid book of business, Lindsey says he cut back his clients, fighting hard for those he wanted to keep. He combatted accusations (which included stealing ‘corporate secrets’) that had the potential to soil his career. And, he guarded his jealously protected the composure necessary to come through to the other side.
BREAK ON THROUGH
So, how did Lindsey make it through?
“I had an incredible spouse. I had an incredibly supportive family. I had an incredibly supportive staff,” he says. “Luckily, I had the financial wherewithal to be able to withstand it.”
One thing Lindsey stresses is that his decision to leave his firm was not driven by money. Instead, after more than 15 years with his former firm, Lindsey says he was disgruntled by the corporate culture, the investment philosophy and how he was expected to service his clients. He was also dissatisfied with the proposed succession plan, which, according to Lindsey, would have handed over the bulk of his clients to unknown advisors despite the years he spent developing these relationships.
Once he committed himself to making the move, Lindsey searched thoroughly (two years in total) for his next firm. He interviewed with five different companies, visited corporate headquarters and analyzed which teams aligned best with his moral and business values.
“I did a tremendous amount of due diligence. I flew to different cities,” he says. “I had offers from all five (companies), but I took the one that wasn’t necessarily the largest. I took the one that gave me the most freedom, the most integrity with my clients, and the most ability to do what is right for the clients. I didn’t want to be owned in an indentured-servitude type of manner.”
TO THE OTHER SIDE
And, so with 160 household clients - down from 500, most of whom were “garage” clients he left with the firm – Lindsey started doing business his own way. He settled on a new firm and launched Lindsey and Lindsey Wealth Management, Inc. in 2012.
“I cleaned up my book because there were a lot of assets on the book that weren’t profitable and had been collected over the course of time,” he said. “I got almost 70 per cent of my book, which is unusual…” He now offers clients a diverse range of products – including real estate, annuities and other investment options that weren’t on his former firm’s grid – with better money management and risk assessment options and a more-efficient compliance department, he says.
“My time is my own. I’m not being asked to volunteer all the time and have no compensation for it,” he says. “I’m able to offer my clients a much broader spectrum of investments. It’s the difference between chicken salad and chicken parmigiana.”
Not only are the products notches above those he used to select from, but Lindsey says the technology he uses is far superior as well. Everything is web-based, so much so, that he can access client portfolios and complete trades via his mobile phone. When he attends a national conference, he wears a badge with an electronic chip that automatically allocates him CFP credits when he attends certain seminars.
(Story continues on next page)
#pb#
FOLLOWING FOOTSTEPS
When he considers the advice so often sought by other advisors considering the leap from a mammoth firm or bank, Lindsey isn’t short of words.
Firstly, he reiterates what every advisor should already know. The firm you are with does not own you. “They are just renting you. They (advisors) lose sight of that,” he says. “If you know you haven’t done anything wrong, truth will prevail.”
Secondly, make sure you have some funds to tap into, or find an attorney who is willing to work on contingency and counter sue, if the necessity arises.
Third, do your research when seeking another firm or broker with which to align yourself. Visit the headquarters and get a feel for the corporate culture.
Fourth, be unwavering about the ethics, ideals and morals you stand for, and everything else will fall into place, he says.
Fifth, always do what is right for the client. “Even if there are times you don’t get paid for it, something will fall in your lap that you didn’t expect,” he says.
And last,, in the words of U.S. basketball coach John Wooden: “’Be more concerned with your character than your reputation,’” he says. “Your character is what you really are while your reputation is merely what people think you are.”
“Anybody who just says ‘well it’s the client’s fault for getting duped’ is skipping right past the opportunity to ask questions. It’s more constructive to ask, what were the questions that should have been asked? What were the promises made? And were the promises reasonable?” says Gillian Stovel Rivers, CFP with Assante Wealth Management in Burlington, Ont.
According to Stovel Rivers, many of these things happen because of poor financial planning habits. “Most of the time when people are looking at an opportunity like this, it’s to make up for lost time. It’s because they need to hit a finish line that’s two kilometers away and they have 100 metres to do it in. I think that people in a state of denial will sometimes forget to ask the tough questions of things that seem too good to be true.”
When clients come to Stovel Rivers with what she calls “alternative” investment ideas, she uses it as an opportunity to help them become better independent decision makers. “Although I think advice is really important, we can’t always be with a client and we can’t always stop them from making these decisions. But we can help them get better at asking some questions about opportunities that seem too good to be true,” she says.
Stovel Rivers notes that she also always looks for multiple layers of due diligence in any investment opportunity and suggests that her clients do the same. “Multiple layers of due diligence is a great way to know that the tough questions have been asked by the people who know what the tough questions should be,” she says.
One problem for advisors, however, is that sometimes clients are not forthright with all of their investing activity. Tim Kelly, a financial advisor at Sun Life Financial in Richmond Hill, Ont., recalls one client who was taken for $20,000 by a neighbour in an “investment opportunity.”
“I only found out about it after the fact. My client never asked me for advice. I didn’t know about any of this at the time,” he says.
This is one of the reasons it’s important to express to investors that an advisor cannot help them achieve their goals unless they are given the whole financial picture, according to Stovel Rivers.
“It’s like a doctor taking on a patient who’s not telling them all of their symptoms. How am I going to make a proper recommendation for us to work together as a team to help that person achieve what it is they’re telling me they want to achieve if I don’t have the whole playbook sitting in front of me with all of the facts?” she says.
Beyond teaching financial decision-making skills and encouraging investor transparency, the industry should also be coming together to educate the public about what qualifications and qualities to look for in the person they trust to handle their money.
Kelly says that during the course of one of his first appointments as a financial advisor in 1991 that the person told him he was only there for himself and not to help them. “That taught me that much of the public is already on high alert when it comes to investing their money. I think there’s a stigma attached to this business and every advisor has to do their due diligence,” he says.
MacCoy argues that organizations like Advocis are working towards ensuring all planners meet certain standards, take part in continuing education and adhere to a professional code of conduct. As well, the Canadian Securities Administrators works to keep tabs on fraudulent practices in the industry.
However, MacCoy warns that any implementation of new standards or requirements has to be implemented slowly and with consideration as to how it will affect the industry as a whole.
“In principle it’s a good idea. But in the U.K. they put in more regulations and pushed it so far that a substantial number of advisors quit. The problem is if they implement really strict requirements, a lot of people will leave the business. And if we go from a commission base to a fee base, the average Canadian won’t be able to afford advisors,” he says.
John C. Lindsey CFP® is an award-winning financial advisor – based in California – who served as a regional leader, limited and general partner with one of North America’s top-rated advisory firms for more than 15 years. His site www.theboldadvisor.com offers more tips on the journey to independence.Wealth Professional Canada
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