Jason Pereira explains why clients get anxious about their money, and how advisors can help
Even as a high school student, Jason Pereira knew the importance of planning ahead. He wasn’t even out of his junior year when he started thinking about what direction he wanted to take during university. “I figured I could go to different co-op placements in industries of interest at the time, which to me included advertising and finance,” he said. “I had taken a few finance classes, and as a kid, the flashiness of the markets appealed to me.”
It was arguably the turning point of his life. He ultimately managed to get placed into one of the larger brokers in downtown Toronto, where he cultivated a working relationship so good that he got brought back during his undergraduate years, all through university, and even when he graduated.
Since then, he has attained success as one of the more versatile financial advisors in the country. Over 20 years in the industry, he has earned multiple designations and charters, including the CFA, CFP, and CIWM. He has also gained national and international recognition for his work in the wealth industry.
“I have a craftsman’s attitude toward my job, which is a combination of two things,” said Pereira, partner and senior financial consultant at Woodgate Financial. “The first part is skill, which comes from intellectual curiosity. Certain sections of the Tax Act could be boring to someone else, but if I hear that it does something, I start wondering and exploring how it could affect everything else in someone’s financial plan. That’s let me build a wealth of knowledge, which has taken a lot of work.”
The second part is simply being a person, which he thinks tends to get overlooked. In his view, advisors tend to forget that the numbers they see onscreen represent people’s lives, aspirations, and goals. The purpose of an advisor — and, ultimately, what Pereira gets satisfaction from — is helping clients achieve what they want.
“A lot of clients say they want their money handled a certain way; maybe they want to preserve capital, or maybe it’s something else,” he said. “I often tell them that money is only really good for what it’s going to buy you and what you experience out of it. If it gets you a sense of security providing for your kids, that’s great. If it lets you enjoy life, even better. At the end of the day, we’ve got to stop looking at account values as scorecards and start looking at what money can facilitate in one’s life.”
Pereira has found that money is a source of stress for people because they don’t see their financial situation realistically. “One of the biggest things that keeps people working longer is the fear that they won’t have enough money by the time they’re unable to,” he said. “And you hear these random numbers, like ‘you need 70% of what you make pre-retirement.’ Who says? What if someone makes a million dollars a year and lives off a hundred thousand? Rules of thumb don’t work for everybody, and it’s very dangerous when they don’t.”
To alleviate that anxiety, Pereira looks at people’s actual spending patterns and financial situation. Using financial plans and stress tests to determine the rates of return they need, he’s given many clients much-needed reassurance and peace of mind. “We’ve been able to tell people that based on the lifestyle they’re living, they could retire tomorrow and never run out of money,” he said. “You physically see the weight coming off their chests as you’re telling them that.”
Painting an accurate picture of people’s finances is important — and so is giving them an honest accounting of the fees they pay. “We look at the US, the UK, all these other places and what they’re doing,” Pereira said. “We’ve been giving clients a document explaining all their fees, with a nice pie chart and simple explanation, for years now, well beyond the criteria of CRM2.”
The next frontier his firm is focused on is technology. As developments in investment, CRM systems, and other areas of fintech come to a head, Pereira believes that the industry is going through unique and interesting times. “There’s a really good opportunity for someone who understands this stuff to cobble together these solutions and streamline and automate their business to a very large degree,” he said. “So that’s what we’re trying to do: focus on making processes that are more scalable and more repeatable, which will let us do things using far less time and far less manpower.”
But while Pereira embraces the increasing role of fintech, he’s concerned about the industry’s obsession with returns and lack of focus on planning. “Look at any of the studies on the value of advice, and you’ll see that it’s not about trying to pick the best manager or trying to beat the index,” he said. “The real tangible benefit advisors provide to people is from planning, and that’s everything from financial coaching, to tax planning, to estate planning, to taking care of your clients overall.
“If I shave off 5% worth of tax for the rest of my clients’ lives, make sure that they can achieve their life goals, get the wills and powers of attorney in order before they die, and ensure they’re protected with adequate insurance in case the worst happens … isn’t that of more value that trying to eke out 1% more than the TSX?”
Related stories:
Advisor: How I took matters into my own hands
A value-oriented approach
It was arguably the turning point of his life. He ultimately managed to get placed into one of the larger brokers in downtown Toronto, where he cultivated a working relationship so good that he got brought back during his undergraduate years, all through university, and even when he graduated.
Since then, he has attained success as one of the more versatile financial advisors in the country. Over 20 years in the industry, he has earned multiple designations and charters, including the CFA, CFP, and CIWM. He has also gained national and international recognition for his work in the wealth industry.
“I have a craftsman’s attitude toward my job, which is a combination of two things,” said Pereira, partner and senior financial consultant at Woodgate Financial. “The first part is skill, which comes from intellectual curiosity. Certain sections of the Tax Act could be boring to someone else, but if I hear that it does something, I start wondering and exploring how it could affect everything else in someone’s financial plan. That’s let me build a wealth of knowledge, which has taken a lot of work.”
The second part is simply being a person, which he thinks tends to get overlooked. In his view, advisors tend to forget that the numbers they see onscreen represent people’s lives, aspirations, and goals. The purpose of an advisor — and, ultimately, what Pereira gets satisfaction from — is helping clients achieve what they want.
“A lot of clients say they want their money handled a certain way; maybe they want to preserve capital, or maybe it’s something else,” he said. “I often tell them that money is only really good for what it’s going to buy you and what you experience out of it. If it gets you a sense of security providing for your kids, that’s great. If it lets you enjoy life, even better. At the end of the day, we’ve got to stop looking at account values as scorecards and start looking at what money can facilitate in one’s life.”
Pereira has found that money is a source of stress for people because they don’t see their financial situation realistically. “One of the biggest things that keeps people working longer is the fear that they won’t have enough money by the time they’re unable to,” he said. “And you hear these random numbers, like ‘you need 70% of what you make pre-retirement.’ Who says? What if someone makes a million dollars a year and lives off a hundred thousand? Rules of thumb don’t work for everybody, and it’s very dangerous when they don’t.”
To alleviate that anxiety, Pereira looks at people’s actual spending patterns and financial situation. Using financial plans and stress tests to determine the rates of return they need, he’s given many clients much-needed reassurance and peace of mind. “We’ve been able to tell people that based on the lifestyle they’re living, they could retire tomorrow and never run out of money,” he said. “You physically see the weight coming off their chests as you’re telling them that.”
Painting an accurate picture of people’s finances is important — and so is giving them an honest accounting of the fees they pay. “We look at the US, the UK, all these other places and what they’re doing,” Pereira said. “We’ve been giving clients a document explaining all their fees, with a nice pie chart and simple explanation, for years now, well beyond the criteria of CRM2.”
The next frontier his firm is focused on is technology. As developments in investment, CRM systems, and other areas of fintech come to a head, Pereira believes that the industry is going through unique and interesting times. “There’s a really good opportunity for someone who understands this stuff to cobble together these solutions and streamline and automate their business to a very large degree,” he said. “So that’s what we’re trying to do: focus on making processes that are more scalable and more repeatable, which will let us do things using far less time and far less manpower.”
But while Pereira embraces the increasing role of fintech, he’s concerned about the industry’s obsession with returns and lack of focus on planning. “Look at any of the studies on the value of advice, and you’ll see that it’s not about trying to pick the best manager or trying to beat the index,” he said. “The real tangible benefit advisors provide to people is from planning, and that’s everything from financial coaching, to tax planning, to estate planning, to taking care of your clients overall.
“If I shave off 5% worth of tax for the rest of my clients’ lives, make sure that they can achieve their life goals, get the wills and powers of attorney in order before they die, and ensure they’re protected with adequate insurance in case the worst happens … isn’t that of more value that trying to eke out 1% more than the TSX?”
Related stories:
Advisor: How I took matters into my own hands
A value-oriented approach
