Hunting for the ‘Right’ Adviser Can Be Overwhelming

Searching for a talented financial adviser in Tulsa is a little like taking a drink from a fire hydrant — so much information to absorb in too little time.
Investing in general is hot, which creates opportunity for agents.
There is quite a market for these services right now, said John Stolper, president of Stolper Asset Management, 1924 S. Utica Ave.
“It’s a big market,” he said.
And, with 9,562 agents, 165 investment adviser firms and 19 broker-dealer firms in Oklahoma, individuals have a steep learning curve, said Irving L. Faught, administrator of the Oklahoma Securities Commission.

Supply & Demand
Interest is strong because stocks are at an all-time high, he said. As more people anguish over what to do with their cash, more and more people rush to fill the need — supply has risen to meet demand.
Financial planning is a broad field that is not specifically regulated, so it is difficult to assemble firm figures on the actual number of people engaged in providing planning serves, said Tim Stifel, manager of External Relations of the CFP Board.
“Some of the advisory activities typically conducted by financial planners require investment adviser registration with the Securities and Exchange Commission or with the securities administrators of individual states,” he said.
The CFP Board has not made an independent study of the current number of registered investment advisers, but 300,000 is often cited, he said.
The number of certified financial planners is 49,117 nationwide, up nearly 28 percent since 2001, according to industry statistics.
And, that’s just the serious ones. Plenty of phonies strut their stuff, sprinkling bad investments everywhere, Faught said.
“Investors need to learn the basics, develop a financial plan and start checking out financial professionals, such as brokers and financial planners,” Faught said. “The alternative is that these investors will remain ‘sitting ducks’ for investment fraud and abuse.”
There are a number of firms, Stolper said.
“If you look in the yellow pages, you’ll see the names of the bigger firms who you would recognize. They have a definite presence here. But there are a number of independents, too, like me, and several others,” he said.

Many Feel Called
Financial planning attracts a diverse group. Everyone from young college graduates to people good with numbers to financial professionals enter the profession, said Beau Ballinger, public relations manager of The Financial Planning Association, a Denver-based group that represents planners nationwide.
“There are a surprising amount of second career folks in financial planning,” Ballinger said. “Many of our members have come from other financial career paths, like estate planning attorneys, CPAs or insurance sales, but many of them have also pursued a career in financial planning from completely different career paths like teaching and nursing.”

Investing for the Ultra Wealthy
The sector is divided into different categories in Tulsa, Stolper said.
“Planners serve the ultra-wealthy, the wealthy and the well-to-do,” he said. “What seems to be happening in the marketplace on a national level is the competition for serving the ultra-wealthy—clients who have more than $50 million in assets to invest—is fierce. So if the market of serving the wealthy—clients who have $10-50 million—all of the levels are very competitive.”
The market of $1 million to $10 million is also competitive.
“What seems to be happening is the national firms have taken less interest in clients who have less than, say, $1 million. Those relationships for many of the national firms aren’t as profitable as some of the larger relationships are, so you find that a number of them tend to focus on the large relationships,” he said.
In this part of the country, compared to the coasts, there are fewer potential relationships, geographically, that exist that are like the ultra-wealthy relationships, he said.
“That being said, I would say that the opportunity for wealth management in general is very good in this part of the country. (But) it may be on a different scale than that of the coasts,” Stolper said.

More to It Than the All-Seeing Eye
Financial planners offer many services, but often it is merely to double-check on the everyday decisions individual investors make, Ballinger said. They simply do not want to handle financial management on their own.
“There is a lot more to financial planning than just wealth management/investing or insurance, although those are both certainly part of the financial planning process,” Ballinger said. “Financial planning really exists to help people achieve their dreams and life goals, whether it be buying a home, starting a business, saving for college education, taking a dream vacation, reducing taxes or retiring comfortably.”
Financial planning is the process of managing the cash so that people can achieve goals, while helping them negotiate the financial barriers that inevitably arise in every stage of life.
“We’ve found that many people first consider using a planner due to some major life event, like marriage, children or a medical emergency,” Ballinger said. “It’s also important to remember that having an established relationship with a financial planner can help ease the financial burden of such events.”
For many people who don’t have a trusted adviser already, much of the time they rely on a referral from a friend or a professional they know, Stolper said.
“Someone who has had experience with an individual and with whom they have had a positive experience is often times one of the best ways people find advisers,” he said.
“It seems like sometimes the perception in the wealth management field is that the further away a person is, the more expertise that they have. I would argue that there are a number of very reputable financial advisers locally and one need not search further than here to find highly capable wealth managers,” Stolper said.

Alphabet Soup
Ballinger, with the FPA, believes people should always work with a certified financial planner professional.
“Some CFPs do also have other various designations — there are a whole lot of designations out there,” he said.
Potential investors have to beware the alphabet soup of designations, Ballinger said. Many titles are trumped-up from self-proclaimed “institutes,” mainly to give cover to high-pressure salespeople.
The North American Securities Administrators Association warns, in particular, against the various types of “elder” or “senior specialists.” For “training,” they’re dipped briefly into a few one-hour courses at a seminar or online.
Their mission: Sell high-dollar investments to seasoned citizens.

Write a Plan, Plan to Write
While creating a financial plan is helpful, Ballinger said, not everyone has to write one.
“Having a written financial plan helps you keep on track in the long run. Since financial planning is a process and not a one-time deal, it helps. Financial planners can help you create that plan by setting realistic financial and personal goals.”
Those goals include:
? Assessing your current financial health by examining your assets, liabilities, income, insurance, taxes, investments and estate plan
? Developing a realistic, comprehensive plan to meet your financial goals by addressing financial weaknesses and building on financial strengths
? Putting your plan into action and monitoring its progress
? Staying on track to meet changing goals, changing personal circumstances, changing stages of your life, changing products, markets, and tax laws
? Setting realistic financial and personal goals
? Assessing your current financial health by examining your assets, liabilities, income, insurance, taxes, investments and estate plan
? Developing a realistic, comprehensive plan to meet your financial goals by addressing financial weaknesses and building on financial strengths
? Putting your plan into action and monitoring its progress
? Staying on track to meet changing goals, changing personal circumstances, changing stages of your life, changing products, markets, and tax laws.
At the same time, a true plan can take hours of talk and analysis to develop. An investor can go through a lot of cash and may not be worth the trouble unless the investor works with the planner over the long haul.
Today, most advice is dispensed on a project basis.
Faught, at the Oklahoma Securities Commission, does not keep up with the latest wealth management ideas. But, he sees all the abusive products.
“People looking at retirement and the elderly must be careful of annuities or any kind of index-based annuities,” he said.

That’s What I’m Here For
When a high-end customer comes to Stolper, “they’re interested in having their money managed.”
“They may have a different set of goals, as far as what they’re trying to accomplish,” he said. “Some might be trying to accomplish income generation. Some may be trying to accomplish preservation of capital. Some may be trying to grow their capital. Some may be interested more in creating strategies so they can give away a lot of money. Some may be interested in strategies that are designed so they can meet charitable obligations. Depending on all of those things and what they’re trying to accomplish helps us to determine what type of investment strategy is appropriate for them.”
In the long run, what’s best for the client is what’s best for everybody, Stolper said.
“It’s a very individual process. Everyone has their unique tolerance to risk and their own investment objectives,” he said. “And, it varies substantially from client to client.” ?



Was this article helpful?

Related Articles

Leave A Comment?