by Michael Gordon, The Suit Magazine
If there is one trend that has remained constant since the nation’s emergence from the Great Recession’s market corrections of 2007 to 2009, it is that today’s investors do not merely desire transparent transactions from their financial advisers – they expect such.
“People have become disenchanted with the constant marketing, the push toward sales of products and a lack of transparency that still pervades too much of this industry,” Phil Bollin believes.
As president of his own firm, Bollin Wealth Management based in Perrysburg, Ohio, Bollin’s statement can’t only be accredited to his status as a Midwesterner. He is talking from the perspective of a financial adviser whose career in the financial services industry began as a broker. He himself became disenchanted with the approach he was told to take with clients, becoming more of a sales person than working as a consultant who could help clients identify the best strategies and products for their personal investing goals. After
starting Bollin Wealth ten years ago, he hasn’t looked back since.
“The people seeking out our firm are people who want a Certified Financial Planner™; they want somebody who is fee-only in terms of their compensation, because that is transparent and allows for a more holistic approach,” Bollin noted. He actively seeks out clients who are willing to be coached away from what Wall Street has drummed into investors for more than 80 years. Bollin admits it is difficult work to retrain an investor well enough to overcome preconceived notions of being active, trend-driven traders rather than long-term, moderately passive investors who are willing to ride out market corrections.
“Yet that attitude is what is required for a successful transition from wealth accumulation during the working years to wealth preservation through retirement, as well as being prepared for a wealth transfer to the next generation or a charitable interest at life’s end,” Bollin said.
“What we found is the clients that are most successful and able to retain the lifestyle they wish to live were able to maintain it if they also maintained their investment discipline, even during severe market corrections. If they did not panic and move everything to cash or go completely conservative, they were fine,” Bollin explained. “Markets rebound. It does take some time and it may not be overnight, but within two to four years, clients had earned back everything they lost and then some, and were further ahead than if they had waited for that alarm to get back into the market – which no one is ever ringing anyway.”
He recognizes that it takes perseverance to remain invested when markets are down. But he also knows it takes coaching from him and a few short trips down memory lane with clients when markets are up. Without assuming any risk, there is no gain, he explains to clients – especially those in retirement.
“Retirees face a higher level of inflation than most of us working people because of the extremely high rate of inflation for health care,” Bollin said. “My clients quickly begin to understand that risk and reward are related and that by taking a smart and reasoned risk with their portfolio, we can also provide a measure of safety through diversification.”