Wealth Managers tell their best money advice ever received

Alvaro Martinez-Fonts
CEO, J.P. Morgan Private Bank Florida, Miami

Best money advice ever received: When I was a commodities trader in Manhattan in the early 1980s, the head trader talked to me about when to sell. He said, ‘If something you bought went up half, lock in the profit by selling half of the position, and let the rest run. If it goes down, you’ve sold 50% and you’ve locked in some profit. If it goes up, you still have 50% of the position to take advantage of the rise.’ If you look at the way I have traded my own account, that’s the way I do it. Violent movements of buy everything and sell everything long term are not the best solution. It’s better to average in and out of investments.

Best money advice he’s ever given: One thing I have advised clients over the years that turned out to be sound advice is don’t bet against the United States. At specific times, like when the Tequila crisis in 1994 began to spread to the United States, clients said it’s time to sell. I believed it was an opportunity to buy, not to sell. It happened again with 9/11. If you sold after 9/11, you would have lost money. J.P. Morgan used to say, ‘Always be bullish on your own country.’ I have reminded clients of that, and it’s the best advice I’ve given over the years.

Advice to clients now: Look to diversify globally into emerging markets. A lot of what America has taken advantage of — innovation, mobile labor, less regulations — are now occurring in non-U.S. markets. The United States is moving toward more regulation while emerging markets are moving toward a free market system. Keep your eye on the United States but look very carefully and deeply at Southeast Asia, Brazil, India and China.

How he’d invest $50,000: If I had any debt, I would pay it off. I would invest in emerging markets. I would invest in private equity funds. That’s hard to do with $50,000, but if I could find something in private equity that’s an emerging markets opportunities fund, that’s what I would do with it.

Q&A — Paul Auslander

Paul Auslander, chairman and CEO of American Financial Advisors in Orlando, will take the helm of the country’s largest organization of financial planners, the Financial Planning Association, next year. Auslander is a registered representative with Foothills Securities and serves on Florida’s Financial Literacy Council, which works to provide a single state resource to the public on financial literacy. The council also studies financial problems that affect consumers. Auslander talked with Florida Trend about wealth management and financial planning.

What’s the biggest misperception about your profession?

So many people think the value of a financial adviser is in picking stocks. Their true value is in understanding clients, maintaining relationships, understanding their risk tolerance and educating them.

What’s your focus for the profession on a national level?

On the regulation side, the fundamental issue is there is no single law that governs providers of financial planning services. I’ve never met a sales professional who doesn’t have some title that suggests they are an adviser or planner or something other than a salesperson. As a certified financial planner or registered investment adviser, you are held accountable (under the Investment Advisers Act of 1940). That makes us fiduciaries, and we have to put your interests first and expose any conflicts of interest. You can sue me if I don’t do that. The same standard does not apply to life insurance agents. We (the Financial Planning Association) sued the SEC over this issue. Now we’re asking for more regulation. It’s the only way to safeguard our consumers.

What was it like to be a financial planner during the financial meltdown?

I didn’t panic. Our job is to keep clients from shooting themselves in the collective feet. I worked with my clients to reassess their asset allocation. I told them, ‘Forget what you see in the papers’ and asked, ‘How much do you feel comfortable losing?’ and then said, ‘Let’s work from that standpoint.’ If you have a relationship with your client, he will come out of the difficult economic climate in fine shape. It’s easy money when everything is going well. When it isn’t, you’ve got to have tough conversations, and our industry is new at this.

Are more people jumping into your profession or out of it?

In the early 2000s, when you read about the professions to go into, No. 1 was some form of financial planning. People felt Baby Boomers and their children would need financial advice to handle the wealth transfer. Nothing weeds out the weak faster than a market crash. For a while, we saw CPA firms moving into financial planning, which was really code for selling investments. At the beginning, it was the greatest thing. Now, no one wants to go near it. For me, teaching financial literacy is a passion. It’s why I chaired Florida’s Financial Literacy Council. I think a lot of what happened in the last three or four years, the financial meltdown, was made worse by a lack of financial literacy. Good people get into the profession to teach their clients. We could have avoided some of the fallout if people were smarter about their money.

Where is your profession headed?

I think you will see the same thing happen in financial planning as it did in accounting. You will get a degree and then spend a fifth year to become certified or get your CFP and then go to work for someone like me or a large firm involved in this. One of the biggest problems is the consumer doesn’t have confidence in financial advisers, mostly because of Bernie Madoff and other unscrupulous people. At the same time, some people are turned off because their financial manager didn’t accurately call the meltdown. They think an adviser is supposed to be clairvoyant. Our profession has a black eye, but we will go forward. The key thing now is to make sure clients are properly diversified with the right asset allocation. You must know your client cold … know exactly what his tolerance is and what his objectives are.

208,400 Number of personal financial advisers in the U.S. in 2008 (the latest figures available), up from 94,000 in 2000 and projected to rise to 271,200 by 2018

19,450 Number of financial planners in Florida in 2008, projected to rise to 24,100 by 2018


Carolyn McClanahan

Certified financial planner/physician/founder of Life Planning Partners, Jacksonville

Best money advice ever received: Find work you love. If you find work you love, you don’t mind doing it. You will invest more of yourself in it and do well financially. I don’t remember who told me that, but I remember saying, ‘Yeah, I’ve got to do that.’

Best money advice she’s ever given: It’s so important to understand your risk and to diversify. I had a client who was widowed and her husband worked for General Electric. He had invested his IRA in GE stock. I told her she has got to sell it and diversify. If she held on to it, it would have gone down to $200,000. She now has $1.2 million.

Advice to clients now: You need to approach the thought of retirement differently. It needs to be a reinvention. People who are happier and healthier are people who stay engaged. You never know what truly will happen in the market. Even if you work one or two days and keep your skills up-to-date, it will give you peace of mind. If your financial world falls apart, you will be OK.

How she’d invest $50,000: I’d put it in my diversified portfolio of passive investments. I’m in 50% equities, half are international, and 50% fixed income.


22% Percentage of U.S. households that use a financial planner for investing


Transferring Wealth: Edward Koren

Edward Koren heads Holland & Knight’s private wealth services group, which has 80 attorneys around the country. Based in Tampa, Koren says he’s not only a business adviser but also a sounding board for his clients whose family matters can get personal and emotional. He shares some strategies for wealth planning and protection.

Where you should start if you have a family business: Determine your objective. Is it to sell the business, or is it to pass it on to the next generation? A business that provides a good living for the founder may not sustain the next generation, and by the third generation you have to have huge growth if you keep slicing the pie. If you don’t want to sell, then figure out the best way to get the business to the next generation while paying the least possible estate tax.

What you should ask yourself as a business owner: Who is best suited to take over the business? Be realistic about the abilities of your family members. Sometimes the best succession plan is a sale to an outsider.

Reason for estate planning with a family business: To avoid burdening the business with debt to pay off estate taxes. If you have a family business, you want to make sure you keep interests within the family unit. We create trusts to help achieve that.

The core techniques for passing along wealth: First, you have the basic outright transfer. An increasing number of people are not doing that because it’s subject to becoming marital property and the property of creditors. For asset protection and business preservation, most people move wealth into a trust. Second, to achieve tax benefits you could move it into specialized trusts, which are as flexible as the imagination of the lawyer drafting them.

Tax law and succession planning: Right now there is certainty for two years, 2011 and 2012. The federal gift tax exclusion amount is now $5 million. It had been only $1 million. I am telling my clients they should take advantage of it. They may need to recapitalize so a smaller portion of ownership has a bigger vote by creating voting and non-voting interests. Then they can transfer value without transferring control. If it’s a big business, between husband and wife, they can make a gift of $5 million each or $10 million together. They could put that into a trust this year and next year. You can leverage off that big amount and make a sale to another kind of specialized trust. You don’t have to pay capital gains and you can transfer the value. You will see a lot of that going on in next two years.

The biggest mistake business owners make in estate planning: Some entrepreneurs are so busy growing businesses, they don’t take the time to teach values at home. They don’t realize you can’t rely on a trust to teach values to your children.

TopRank Florida

Trust Banking Firms

Trust assets in Florida / Florida trust accounts / Senior executive

Northern Trust, NA / Miami

$35.1 B / 20,230 / Sheldon T. Anderson

SunTrust Banks / Orlando

$30.6 B / 11,039 / Debora M. Carswell

U.S. Trust, Bank of America Private Wealth Management / Sarasota

$12 B / 10,000 / Jeffrey A. Kaiser

Salem Trust Co. / Tampa

$6.4 B / 977 / Bradley K. Rinsem

Wells Fargo Wealth Management / Miami

$7.5 B / 6,000 / William D’Antignac

Visit TopRank Florida to purchase a list of Florida’s 25 Largest Trust Banking Firms, featuring data not published in Florida Trend, including top key executive contacts, total trust assets in Florida, and phone, fax, website, and full mailing address.


Matthew Bower
Senior vice president/market executive, PNC Wealth Management, Sarasota

Best money advice ever received: Invest in what you know and understand and stay close to your comfort zone.

Best money advice he’s ever given: I have a client who is still with us today. When her husband passed, she was left with nothing but a $500,000 life insurance policy. An unscrupulous adviser was trying to sell her high-commission products. My advice to her was put a well-thought-out, diversified plan together, stay engaged and have open dialogue with your adviser. To this day, after eight years and taking $25,000 a year in distributions, she is worth in excess of $700,000.

Advice to clients now: Stay engaged. Ask those hard questions and take responsibility for your long-term financial affairs.

How he’d invest $50,000: I would eliminate any non-value debt such as credit card debt or student loans. I would then establish a Roth IRA or a general IRA. Some people would want to put aside some money for their kids’ education. I think the kids could borrow for college. I think it’s imperative to provide for a retirement that could last up to 20 years. Sometimes, financial planners are so cold with their advice. I think it is OK to carve out $5,000 to fly out to see the grandkids or go to your class reunion.

$31 million Average assets under advisement per adviser

Alan Galinsky
Founder/senior wealth adviser, Arch Financial Group, Boca Raton

Best money advice ever received: Don’t spend more than you make.

Best money advice he’s ever given: Always put together a plan before you start investing or start out in business. A plan keeps you on track.

Advice to clients now: The world today is so dynamic. You need to be constantly looking where you need to adapt to change.

How he’d invest $50,000: Long term, I would put 40% in equity and 60% in fixed income. Equities would be mostly large-cap multinationals. The world is expanding and growing. Strong global brand names will do extremely well. Everything that caters to the domestic market will struggle. On the fixed-income side, I would stay with investment-grade corporations. I would not go long term but rather stay intermediate. I like municipals, but it’s time to step aside and go back as the price goes down.

$68,200 Median annual wage for financial planners nationwide

$49,200 Median annual wage for financial planners in Florida


TopRank Florida
Investment Banking Firms
City and senior executive

Allen C. Ewing & Co.
Benjamin C. Bishop Jr.

Calton & Associates
Dwayne Calton

Cross Keys Capital
Fort Lauderdale
Bill Britton; David Burns

Farlie Turner & Co.
Fort Lauderdale
Craig L. Farlie; Michael F. Turner

Florida Capital Partners
Peter B. Franz

Visit TopRank Florida to purchase a list of Florida Investment Banking Firms, featuring data not published in Florida Trend, including phone, fax, website and full company address.

Robert Barboni, president, Ibis Financial Group, Boca Raton

Best money advice ever received: I was told to start a college fund the day each of my two daughters was born.

Best money advice he’s ever given: A very good friend had all his money, his entire retirement savings, in his company’s stock in his 401(k). He was five years from early retirement. I told him to diversify the stock in case anything happened. Fortunately, he listened and did diversify because the company (Enron) went under.

Advice giving clients now: Verify the risk of investments and make sure it matches your risk tolerance. Then, stay the course. Don’t try to time the market.

How he’d invest $50,000: I would take a percentage of it and allocate it toward my future needs. A portion of it would go into a 529 for my kids, and I’d put the rest of it away for retirement.

Adam Carlin
Director of wealth management, Bermont/Carlin Group at Morgan Stanley Smith Barney, Coral Gables

Best money advice ever received: Be careful with leverage. Don’t let the bank own you. Other than sex scandals what gets people in trouble is leverage.

Best money advice he’s ever given: I taught the MBA program at the University of Miami for five years. Two things I would advise the students about investing: Never forget to look at the details — always do your research — and don’t follow the crowd.

Advice to clients now: For a young person, don’t ignore the true potential of long-term compounding; invest at an early age and continue to do so. For all investors, never be afraid to ask questions — ever! Never lose respect for the word ‘risk.’ People don’t understand the word ‘risk’ often until they’ve lost money. Also remember the math. If you lose 20%, you need 25% to get back to even.

How he’d invest $50,000: I would continue to invest in equities, more heavily rated international companies, particularly in emerging markets. I would also invest in high-quality municipal bonds at attractive prices.

Deena Katz
Chairman, Evensky & Katz Wealth Management, Coral Gables

Best money advice ever received: Have a plan for your portfolio and follow that plan in any economic environment. Don’t run around chasing returns. Stay with your plan even when things look scary.

Best money advice she’s ever given: Don’t make any immediate decisions after you’ve suffered a loss.

Advice to clients now: Start saving now for your future. Most of us will live longer than we think, and we will have to pay for it. It will be your responsibility, not the government’s or your employer’s.

How she’d invest $50,000: I would buy passive investments, maybe the S&P 500 or ETFs (exchange traded funds) and leave it alone for the next 20 years.

71% Percentage of financial planners in the U.S. who are employed by firms

Roger Robson
Founding principal, CapTrust Advisors, Tampa

Best money advice ever received: Have a clear understanding of what real risk is, which is a permanent loss of capital. Don’t ever forget that.

Best money advice he’s ever given: It is never too early to begin the habit of saving. Pay yourself first by investing in an IRA or 401(k). There’s no substitute for compounding when you begin investing early in one’s life. Start when you are 21 vs. 31 because you will have wasted 10 years. Saving anything is better than saving nothing. The habit of saving and investing is as important as the dollars.

Advice to clients now: There is more risk in municipal bonds than people care to believe. If you own them, be aware of this and understand what you own. You don’t need to exit the market altogether, but you should be prepared for more uncertainty. Also, consider adding to your bond portfolio if there are more negative developments because that would create more opportunity. … Corporate America has never been stronger. Get ready for significant merger and acquisitions over the next two years. Companies can’t just sit on cash and buy back stock. We think there is merger and acquisition potential in small-cap and mid-cap stocks.

How he’d invest $50,000: I’m an equity guy. There are great companies out there you could own and be well rewarded in next five years, global companies with great balance sheets. There’s a difference between investing and being aggressive. If you buy the company’s products and understand the company well, it’s an easy decision on what to own.

29% Percentage of financial planners who are self-employed

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