#FA Success Ep 307: Dropping Your Broker-Dealer License Without Dropping The Broker-Dealer Platform, With Stacey Hyde

Resources Featured In This Episode:

• Stacey Hyde
• Envision Financial Planning
• Stacey’s Sample Client Advisory Agreement (link to download)
• Commonwealth Financial
• Trello
• Advisor360
• Envestnet MoneyGuide Pro
• RightCapital
• Calmwater Financial Network
• Harvard Business Review – “Management Time: Who’s Got The Monkey”

Looking for sample client service calendars, marketing plans, and more? Check out our FAS resource page!

Full Transcript:

Michael: Welcome, Stacey Hyde, to the "Financial Advisor Success" podcast.

Stacey: Thank you. It's really an honor to be here. I think I've listened to most all of your podcast.

Michael: Awesome. I appreciate that. And I'm excited to have you on today. And I get to talk about, I think there's a really fascinating shift that's happening in the industry right now that I know you're living at the front end, the bleeding edge of. For the better part of the past 20 years or so, there's been this split in the industry of advisors that came up in the broker-dealer environment and continue in the broker-dealer environment, advisors that came up in the RIA side of the industry that continue in the RIA side of the industry. And this slow and steady, but very persistent trickle of advisors that ave been moving from the broker-dealer environment, into the RIA environment. And I still remember when I went through that transition very early on in my career, and I had the 24-month countdown calendar before my FINRA licenses would lapse. Like, let's see how this RIA thing goes, because I still got two years to go back before I have to go retest. And all this fear of, what happens if we drop our FINRA licenses because there's so much change that happens if you do leave a broker-dealer and fully transition to the RIA channel.

And so, this shift has begun in the past couple of years where a couple of broker-dealers have started offering RIA platforms, RIA options, where you can transition to be an RIA and still work within the broker-dealer. I guess use the broker-dealer's platform, but you literally aren't with the broker-dealer side anymore, you're solely operating with an RIA license, not your FINRA licenses. And I know you've done a version of this transition with Commonwealth, who we can give a shout out to them, one of the early broker-dealers that started to make this transition and offer RIA platforms. And so, I'm really excited to hear more of your perspective of this journey of, how do you come to the decision to drop your broker-dealer license, but not your broker-dealer.

Why Stacey Decided To Drop Her Broker-Dealer License [05:41]

Stacey: It's an interesting story. I think the biggest thing that started it was when we would have our branch audits, we never had any feedback about something on the RIA side. It was all like, where's this prospectus? Or, where's this? And what I realized is, we really didn't know how to act not in our clients' best interests. We only knew how to be discretionary advisors and do the right things all the time. And so, it became, quite frankly, the way we were. And so what we did, by dropping our FINRA licenses, was really just align the way we did business with the reality of our registrations.

Michael: So, did that have, I guess, just revenue complications for you? I mean, did you have a lot of business or existing clients on the BD side or paying BD trails, where there were a bunch of economic ramifications of doing this decision? Or had you already largely built your client base on the advisory side enough that it was less of a transition and more of a, let's just turn off the FINRA side since we're not doing much there anymore?

Stacey: We had about 94% of our revenue was advisory fees, and about 6% was legacy trails, or annuity compensation, or something like that. Because we had sold some annuity contracts back in 2007, when it was the great race to who could offer the best income rider and then they all but broke a bunch of insurance companies during the financial crisis.

Michael: Right. Where everyone said the annuities were a bad deal. And it turned out the annuity is actually a really good deal, so much so that the insurance companies struggled to keep them going. And then they repriced all of them. And those deals don't exist in the same way anymore. But very next “hey day” at the time.

Stacey: Yeah, they still try to make them sound as good, but they're not nearly as good. And one in particular that we probably have 15 or 20 of them, and we've turned the income on, on all of them. And the reason that I liked that one, because I've sold very few VAs in my career, but I could do the math on how that rider worked on a piece of legal paper and my calculator. So, it's like, okay, this has to be good for my client because it's this easy to understand. And that's always sort of been my lens, is the easier it is to understand, the better it's likely to be for my client. And so, what we did, and I guess the advantage of being with a broker-dealer is those are now Commonwealth house accounts. But our clients signed an agreement to share information with us, so we can still help our clients with that.

Of course, we can't log in and do it now. We have to have the client on the phone or get Commonwealth to get us a form and get the client to sign up. But we don't have that many. And so, those are good contracts, as we've both said before, they don't exist anymore. And so it just makes all the sense in the world to keep those. And Commonwealth gets that revenue, but that's okay with me, because it's the right thing for my client, and it makes it easier for me to take care of them.

Michael: So none of that revenue comes back to you at this point. Just they're Commonwealth house accounts, so that slice of what was 6% of revenue, it goes to them. And that's what they get for the fact that they have to be part of the calls, they have to facilitate interaction with the insurance company or any transactions, because it's a securities business, you don’t have a securities license now. So, they get that bit of revenue, and then they do that work, and you're good with that trade off.

Stacey: Right. So, we made the transition to give up our FINRA licenses in September 30th of 2020. And then in July 1 of this year, we launched our own registered investment advisor. So, Envision Financial Planning is a registered investment advisor, we're SEC registered, but we stayed within the Commonwealth ecosystem. So that was a very easy transition for our clients. And so now we have a dedicated person at Commonwealth. If we need information on a particular contract for a client meeting, or we need paperwork, we just call or email them and they get us whatever we need for that meeting, or for that research, or whatever it is, whatever the case may be.

Michael: And so, I guess just over time, as clients use those income riders, cash out the contracts, don't need them anymore at some point past, that just the amount of that business slowly winds down of its natural course over time as well.

Stacey: Correct. And especially with the market pullback now, most of those are paying out at 6% or 7%, and have been for the last seven, eight, nine years. And they will continue to pay. So the trails on those are much smaller now because the clients have been taking income.

Michael: Have been drawing them down, yeah. And I guess it's notable, at least relative to how some other broker-dealer environments work, that Commonwealth didn't reassign these client accounts to other advisors when you made this transition. They made them house accounts and have their own internal house account staffing teams, to, I guess, as I think of it, play nice in the sand box. They're not trying to solicit the clients for other business to grow the business. They're just handling the existing house accounts that are there.

Stacey: Absolutely. Because especially in our case, they know we have substantial other relationships with these clients. And that would be...they'd be competing against themselves if they didn't help us facilitate it, because we have the million or $2 million managed accounts, and there's a $200,000 annuity, or used to be a $200,000 annuity, where the client's taking monthly income.

Michael: It's an interesting framing and point that, look, when it's all under the same roof, really, why would it even be in their interest to try to woo the house account clients for more because you're already using their platform for the rest of the business anyways? They're going to do okay, you're already working with them and servicing those clients.

So take me back a little bit more just to the point that you're deciding to let go of the FINRA licenses. Because I know for a lot of us, we spent a long time having those licenses, fought hard to get those licenses, sat for all those exams. Just what was running through your head as you're trying to decide, are we really going to drop these licenses and walk away from this side of the business?

Stacey: I think for us, it was really a pretty easy thing to do. One of our advisors on our team was already IAR only. He had given his FINRA licenses up before he joined our firm. And so, it was just myself and our chief investment officer, who's also our chief compliance officer, I think he may have been a little bit like, "Oh my God, my boss is making me give up my FINRA licenses." But he also is a super smart guy and saw the writing on the wall like I did, and was just as frustrated with some of the stuff that we were having to do on the FINRA side, that it just became much cleaner once that was what we had. And then Commonwealth also, I think we were a little worried about how we handled an accommodation account, company stock or something like that. So, we have what's called a customer service account. So if somebody has just company stock or some legacy position that they want all in one place, but they don't want to pay a fee on it, we just open a separate account for them and put it there, and don't charge a fee on it. And so that works out pretty well for us. We can still trade that account, but it gets the lowest fee type stuff at Commonwealth for transaction costs.

Michael: All right. Because if you want to accommodate holding an existing stock position that isn't being traded, just you need a framework to literally have a non-traded account. But it can't be a regular brokerage account, because you're not securities licensed on that side. So you need like a non-advisory account attached to the RIA side of the business.

Stacey: Right. And we also, selfishly for us, don't necessarily want that to be on the fee-based platform, because then there's fees that get charged to us for that. So, this is a nice option, because we're not being charged anything by Commonwealth for it. And the client is not being charged anything for us for it. But also as they divest of some of that company stock because they meet their employer's holding requirements, and so we start to diversify. We move that over to the managed account and it works great.

How Envision Financial Planning And Commonwealth’s Relationship Is Structured [15:55]

Michael: Interesting. So how does the structure work for... I guess there's sort of a split here since you were on the corporate RIA aside for a while and then transitioned to having your own SEC registered RIA. So I'll come back to the having your own firm part in a moment. But just when you were operating, you dropped your FINRA licenses and said, "We're going to be IAR only under the corporate RIA. Just how does that work in terms of revenue you get, revenue the platform gets. In the broker-dealer world, GDC comes down, I get my grid payout off of GDC. Was it a similar structure on the corporate RIA side, where there's a gross advisory revenue and you get a grid payout? Or is it a different kind of structure?

Stacey: Well, once you go IAR only, your payout goes to 100% on advisory, regular advisory, and then Commonwealth assesses a...it's called an admin fee for billing, the model management system, that sort of support. So we got a raise in that sense. And then the other thing that happened was, because it was IAR, instead of their fee being based on the size of the account, we had one flat fee for our entire books. So it didn't matter if it was a $2 million account or a $25,000 account, it had the same admin fee on it, which was nice.

Michael: Sorry, I just want to make sure I follow. So I guess the admin fee that you're paying for billing, and model management system, and the rest, is that a per account fee, per client fee, or percentage of revenue fee, or basis points on assets fee? Just how does that work?

Stacey: It's basically a basis points of assets in the managed account program. And it includes statements, and performance reporting, and all that stuff. Because we don't pay an Orion or somebody like that, Commonwealth does that. And that's included in that fee.

Michael: And so can I ask, where does that fee sit at? I mean, BD payouts, you're often at 88 to 92-ish range once you hit a certain size and scale, is for the pure independent BDs. So, they get eight to 12%-ish. So, what did it look like for the RIA side? Is it a similar fee? Is it lower? Is it structured differently?

Stacey: It's lower than that. And it's based on what your assets under management are, your number of accounts. And I think it also had a little bit of factor into the funds that Commonwealth got to keep when we went IAR only. So, they did some sort of calculation and came back, because we went from a 95% payout on our managed book to 100%. I guess it really was probably a slight pay increase for us, because we had not a ton of trails and things like that. And we also converted a fair number of non-managed accounts to manage when we made this transition.

Michael: Oh, because you had a few clients that you weren't necessarily working with on the advisory side, but…

Stacey: Or they had an old account that wasn't... Most of the time it was they had one or two accounts that had been there for 20 years, that were American funds when we did. And so, we'd never done anything, but once we did this, we're like, "We can't really do that anymore." And they're like, "Oh, okay, sure."

Michael: All right. Well, I guess the fund business is easy. Like, I go grab my old American funds' A shares or C shares, I put them into F shares. I can move them into an advisory account and apply the fees, which I guess is why, as you said, it's the annuities that got stuck on the other end. Because I can't convert them into advisory structures and put them in an advisory account as easily as I can do with mutual funds if I need to make that transition.

Stacey: Yeah. And we did have a few American funds accounts that were at American funds on the BD side because they had rolled out of a corporate retirement plan. And it was easier just roll them out and leave them there. Those are pretty much… I think all but one of those has paid out, people have withdrawn the whole thing.

Michael: Okay. So you go from your 90-something percent payout on the BD side to nominally the 100% IAR payout minus admin fee of basis points, that gets you to similar place or slightly better take home by the time they get their 5% to 7%. Plus some accounts that convert into advisory, offset partially by some of the business that transitions to house accounts. And so you netted slightly more at the end of the day.

Stacey: Yeah, I think we did. And because the admin fee applied to us before, but it was a different sliding scale. Larger accounts, we definitely pay more because before, when we were duly registered, larger accounts paid a lower amount. But then we had a practice level maximum, and our admin fee actually went slightly below what we had before we transitioned.

Michael: So then the other question I've got just as you were queuing up this transition... Well, I guess first of all, what was the size of the advisory firm at the time? What was the AUM base that you were doing this transition on?

Stacey: With the market pullback, and it was pre-COVID run up, it was probably pretty similar to what it is right now, which is right around [$]200 million.

Michael: Okay. So, you've got this [$]200 million AUM firm at the time as you're deciding, we're not going to keep our FINRA licenses anymore. We're transitioning full to the RIA side. So I guess the next thing I'm wondering is just, did you look at other RIA platforms out there? Did you look at hanging your own shingle and going to the Schwab, Fidelity, TD Ameritrade, Pershings of the world? What was the thought process around doing the Commonwealth RIA versus just there are lots of other RIA platforms out there who would like to talk to a $200 million advisor?

Stacey: I think for us, it really was, we were very happy with Commonwealth when we had... We were originally inside of a local bank and founded and ran their wealth management group for nine years. And we had decided that really, we want to be truly independent. And going through that process, had really gotten to know the folks at Commonwealth well, trusted them, felt like they had our back. And quite frankly, Commonwealth made it very, very easy. There was no repapering of accounts, clients didn't get new account numbers. It was very seamless from the client standpoint. The only people who really had to sign anything were those that had the legacy annuity products. We had to get them to sign authorization to share information. And a few of the direct accounts, we had to do a little bit of paperwork. But it was very, very seamless to the clients. And it wasn't a huge lift on us. I will say the transition team at Commonwealth, I've gone full circle with the same transition coordinator that I worked with in 2010, has now transitioned us to IAR only and RIA only. And she's one of my favorite humans.

Michael: So then now take us forward two years to, it's summer of this year, and I think you said you've now transitioned to your own SEC registered RIA. So you're not on the Commonwealth corporate RIA side. So what led to that change?

Stacey: I think we really wanted to be truly independent. And it also was sometimes clunky to try to explain that, it's Envision, but it's also Commonwealth, but it's this. And we wanted a little bit more flexibility on just how we ran our practice, down to some pretty granular stuff like, the workflows that Commonwealth had available just didn't work for us. And we wanted to use Trello and that sort of thing to run our practice and make it work for us. And so, we got more flexibility that way. We cannot call ourselves fee only as long as we are under the Commonwealth IAR because Commonwealth also runs a broker-dealer, so they're definitely not fee only. And so, being able to have that type of flexibility, I think, worked well for us.

Michael: All right, so I'm curious, you mentioned different workflows and using Trello, which I don't hear a lot. So, what are your different workflows? And how are you using Trello in the firm?

Stacey: So we use Trello to do client reviews. We've got a Trello card with checklists, what needs to be done. When we have client follow up, we put it in there and it is a little bit easier to track, especially because as part of my evolution, I try to spend as much time as possible, especially in the summer when it's 100 degrees with 90% humidity in Summit County, Colorado. And so, Trello allowed me to track where things were without always having to email and go, "Did this get done? Did this get done?" And have to log in to each individual separate account. Trello makes it easy to see, at a glance, where we are on all these different projects. And where they've taken it in the process of getting it done.

Michael: So how do you distinguish that from trying to use workflows within CRM systems?

Stacey: We put everything in our CRM as far as what's going on with a client meeting. After a client meeting, the notes get uploaded, things of that nature. But if there's any knock-on Commonwealth, it's that the CRM is not probably as great as I would like it to be, as far as things like workflows and being able to see at a glance, everything that's gone on with the client. So we actually are very old school, we have a Word document where we dump all the notes from each client after a meeting into there. So it's really easy to go and get a, okay, this is what happened last time, this is what happened two times ago. It has key information at the top of it. So we do some duplicate work. But by having Trello, we make sure that all that stuff gets done.

Michael: Okay. Interesting. And so I take it then your base CRM system is what Commonwealth offers?

Stacey: That is correct, yes.

Michael: Which is their Advisor360 platform?

Stacey: Mmhm.

Michael: Okay. Interesting. So the evolution for you then if I'm following this, is essentially, we're with Commonwealth in the corporate RIA side, but we're having some challenges around how we handle workflows, because Advisor360 isn't quite as deep on the workflow systems as we want from the CRM. So we want to do something outside, which we started doing in Trello, except the corporate ria doesn't want us to live outside in Trello. Because, understandably, compliance wants you to live in the CRM system that they can do their compliance oversight on. And so, then that becomes a challenge point for you, that says, "Well, maybe we just need to stand up our own RIA, and then we can make our own decisions about the systems that we use as our own RIA."

Stacey: And we can be fee only. And we can potentially do some other stuff, although we really haven't done anything outside of what Commonwealth would have let us do. And I think also on the branding side, it's much cleaner now, because we are Envision Financial Planning. And the other thing, like, the disclosure documents, the Form ADV 2A, Commonwealth's is like a hundred and thirty-something pages, and maybe six, or seven, or whatever, are really applicable to our clients. And so now we have our own ADV, we have our own investment advisory agreement that's in plain English, and is all about their relationship with us. And I think that's been hugely popular. I had so many clients going, "I think this is the first time I've ever read this, because this was 5manageable."

Michael: Interesting. So you just went and remade and did your own advisory agreement into how you wanted to word it and say it?

Stacey: Yes, absolutely, we did.

Michael: Out of curiosity, is that something you'd be willing to share, just for others who want to see what does a more plain English advisory agreement look like?

Stacey: Yeah, I don't think I have a problem with that.

Michael: Okay. I appreciate that.

Stacey: I mean, I publish our fee schedule on our website, because that's a pet peeve of mine, hearing about something and wanting a little more information, and then they're like, "Contact us for pricing." I'm like, "Just tell me what it costs."

Michael: I will admit, I am of a very similar mentality as well. We save you time, call us to find out what we cost. That's not saving me time, if I have to call you to find out what it costs.

Stacey: Yeah. And then you're going to call me 82 times and that sort of thing. And also, I think it helps people self-select.

Michael: Yeah. If they look at your fee schedule, and they're going to freak out. I would just rather not talk to you. It just saves me time rather than having you basically freak out about the fee schedule after I talk to you, and then having wasted a half an hour, an hour of my time with someone that just was not going to be willing to pay full fledge advisory fees.

Stacey: Well, and my approach on fees is, I'm probably lower than the industry average, but I don't discount them. Everybody pays the published rate. And it's a very easy fee for me to defend. And I just go at it from a fairness standpoint. I mean, if I give you a discount, then am I overcharging other people? But since I know that my fees are at the lower end, I have no problem whatsoever saying, these are the fees, and this is how we're going to earn them.

Why Envision Financial Planning Implements A Breakpoint Fee Schedule [32:19]

Michael: And so, well, two things, one, just for folks that are interested for the advisory agreement... which sounds oddly glorious to me. Because so many of ours are really not by the time the lawyers do what lawyers tend to do, bless their souls. So, on the advisory fee side, then how are you pricing and structured on the advisory fee side? What does that fee schedule look like for you?

Stacey: We start at 1%. And then at 500,000, we drop to 0.9. Over a million, we drop 0.8. And we do a break point fee schedule. So we charge all assets at one level rate. So it's super easy for people who don't understand.

Michael: So it's not graduated as you go. If I'm over a million, just everything is at the flat 0.8%?

Stacey: Yes. Which is why we don't discount, because we're already kind of a discount.

Michael: So I guess it's not graduated thresholds as you go, a little bit of one, a little bit of 0.9, a little bit 0.8? It's just hard breakpoint thresholds?

Stacey: Correct.

Michael: So just curious, why that structure? Because I feel like, more commonly, I see graduated, then sort of breakpoint cliffs.

Stacey: I guess the mantra that I have always lived is, if I wouldn't like it, then I don't want to offer that. And I also prefer simple. And that is a very simple, it's easy to communicate, and it's very clear. I don't think that anybody is ever surprised that what they're paying or that sort of thing.

Michael: Okay. Interesting. And does it create any wonkiness for you of just... I'm just envisioning fee billing dynamics of like, the client who goes from $998,000 to $1.02 million, and the fee drops dramatically. Or conversely, a client that dips. And I think that means you could dip slightly under a threshold in a market pullback and actually end up with a higher fee, because you crossed that threshold. Does that crop up for you?

Stacey: It does. And I'm sure that I haven't looked at the fee billing for this quarter. But yes, but given where our fee levels are, I don't have any trouble with it. And also in something like this, we're certainly doing a lot more work right now like all advisors are, to try to keep people calm and that sort of thing. And I don't know that it's any... At the end of the day, I think, on average, clients' fees are lower, and so they get that. And like I said, it's pretty straightforward. It is a motivator for some clients to add funds so that their fees go down.

Michael: Okay. Doesn't hurt as well.

Stacey: Yeah.

Michael: I guess, because that's a good point, is truly when you're not just graduated, but you have a cliff schedule, you can literally get to the point where clients can add more assets to cross a breakpoint, end out paying slightly less. But it's a deeper relationship you've consolidated more with them, that probably still turns out very well in the long run for you, even if it's a very short-term fee step backwards, because they added enough assets to cross a threshold.

Stacey: Yeah. And I can think of several instances where it encouraged clients to consolidate assets with us. They had accounts at this broker-dealer, this broker-dealer, and then they're like, "Eh, I'm looking at your fee schedule, I'm just going to give it all to you." And that's a good place to be longer term, because then we can really do a more holistic view of the entire relationship. And quite frankly, it's easier because I'm not trying to go, "Can you bring in that statement? I really want to make sure we're not over-weighted somewhere where we shouldn't be over-weighted."

Michael: Right. Interesting for the fee schedule structure. So as you made this transition to say, we want to be our full standalone SEC registered RIA, did that create any changes for the relationship and structure with Commonwealth? Do they still charge you the same? Is it still otherwise the same service arrangement? What else shifted?

Stacey: It's pretty much the same service arrangement. I'll probably go back to them and renegotiate my admin fee a little bit because they're not "doing our compliance." But they have stood up a whole group that helped us draft our ADV, helped us get everything filed. They really supported us through that whole process. And they've helped us select our email monitoring system, and that sort of compliance tech stack that we've used, we've really leaned on them for that. So from that standpoint, they've continued to be super helpful. Our compliance consultant, she's one of my favorites. We were having some trouble getting Commonwealth's tech people to talk to the compliance monitoring people, so they could get it in there. Oh, man, she had it done within an hour, I think. I don't know what she said to anybody. But all I know is, all of a sudden, we had no more roadblocks. So that was huge.

Michael: So I guess just help me visualize at this point, what does the firm do for you at this point? What did they do for the admin fee versus just what you do in your own firm as your own firm?

Stacey: What they're doing for the admin fee is, they give us a single sign on tech stack, so the whole Advisor360. We use MoneyGuidePro, we use RightCapital. So the sign in for that is through our Commonwealth portal. It's nice, it pulls data directly from our portfolio management. So we're getting portfolio management, CRM, information security, which I will say, that is something that terrifies me, how smart the bad guys have gotten. And so, being able to rely on their expertise in that has been huge. And helping out with storage and backup of that data as well.

Michael: And so all that tech is included in the admin fee? Not just the SSO, but CRM, portfolio management, your financial planning software, is that all bundled in? Or are there still some separate line items?

Stacey: There's a little bit of separate line item, but it's not much. I mean, it's probably less than... Clay and I have a higher one than Hank, because he doesn't use Morningstar and stuff like that. So we have a small fee that we pay each month to Commonwealth for access to a lot of that type of software, and research, and things of that nature.

Michael: Is that a basis points thing or percentage as well? Or is that just a flat fee of like...

Stacey: It's a flat fee.

Michael: Okay. So a little bit of the tech that I guess just doesn't fit the included package flows through and the rest is in the admin fee?

Stacey: That's correct.

Michael: And so are there other things that are tied to the admin fee as well? Or does this serve functionally for you like a tech stack tech solution fee?

Stacey: It's functionally a tech stack solution fee. They also handle billing, which I know that's been a focus of the SEC. And so it's nice to have somebody that has all the right stuff to make sure that those are all getting billed appropriately and that sort of thing. It's also nice to ask an expert. A client asked something that we don't run across all the time. They've got a great advance planning team. So we like that. And I've also made a lot of good friends in the community.

Michael: I guess I'm wondering, in that vein, as you are transitioning to be SEC registered and not under their IAR, did that, again, lead you in any direction of looking elsewhere, or standalone, or other custodians, or other platforms? Did you look around and decide to stay or didn't even want to look?

Stacey: We had a couple people reach out to us and do it. But to me, it felt like, I don't know, that would have been much more intrusive for my clients. I can't say that I would never look around, but we're pretty happy with our ecosystem. We appreciate the support we get. We feel like we're paying all in all a pretty fair fee. Like I said, I'd probably like to negotiate down a little bit. But what we get for what we're paying feels like a good trade off. So yeah, we really didn't take a hard look somewhere else. And now that we are RIA only, if we have clients that really want to use Schwab because they've always used Schwab or whatever. Now, that's an option as well, which might make an acquisition of an advisor or roll in of an advisor that has a book at Schwab, that would make that doable. Whereas previously, it really wouldn't have worked.

Michael: Interesting. So help us understand then, overall, just the nature of the advisory business as it exists today. So you said there's about 200 million under management. So, how many clients is that?

Stacey: It's 206 households.

Michael: Okay. And then what does the team structure look like for you to service 206 households?

Stacey: So we have five employees, including myself. We've got another advisor who has...of that 206, somewhere under 50 are his. And then I have a partner who I actually made a partner in 2021. He is our chief investment officer, and also, he got a new title when we became RIA only, he's our chief compliance officer.

Michael: Oh, he won that prize, okay.

Stacey: He won that prize. So I figured, I had to hold on to the CFO role, because I also am a CPA. So I figured, Clay, can do the CCO. And he's great at it. I think it does make more sense for him to have that function. And it's also a good check on me, since I have the bulk of the clients. It's helpful for me to have somebody to bounce that off of. And then we have sort of a client service office administrator, who has been with this just for a year. I'd known him for a long time, but had really struggled with that position, and finally decided to really up the value that I placed on that. And that has been one of the best decisions I've made. And then we have a college intern who essentially works full time. She works about 35 hours a week.

Michael: Doing what within the firm?

Stacey: She preps for client meetings, does paperwork, that sort of thing.

Michael: Okay. So I'm curious, you mentioned, had struggled with the client service office administrator position. So, would just love to hear more about like, what were you doing in the past that wasn't working and what changed?

Stacey: We had one person who was actually referred to us by a client, that had worked as an assistant in a wire house, and had been let go, and was looking for something else. But I think really struggled with the pace that we had. And so she wound up resigning. And then I had a woman who had recently graduated from college, that her mother and I have known each other since we were 10. And she came on board, but she was a pandemic graduate. So she had never intended to come back to Memphis when she graduated. And she was great, and did a super job. And she would still be here had she not moved, I think. But she got an opportunity to move to Atlanta, wrote her a really great letter of recommendation. And so, she moved. And so, when I started looking around... And she did me a great service, she gave me four months' notice. And so we were able to research and find Courtney, and bring her on board. And then she and Caroline had some overlap. So that was very, very helpful.

And Courtney's been in a lot of different roles, never in financial services, but as far as just great people skills. And that is what I realized that it's very hard to teach that real interest in people, and in just understanding how people work and what they want. And she scales really well. And she also thinks of things that maybe I don't think of. She's also got some great social media stuff. So we launched a podcast, and it was a little bit hit or miss. And now she shows up in my office every Tuesday at 9:00 and says, "Are we ready to podcast today?" And that gets the podcast going, and we get it out there. And it's really a podcast designed for folks that are not in our demographic right now. But it's information that clients tell us that they wish they'd had 15, 20 years ago. So we wanted to sort of put that out there. And that's what we're doing with the podcast, "Better Financial Health In 15 Minutes or Less."

Michael: Very cool. So I guess just help me understand more what changed in the role between where the struggles have been historically and who you ultimately hired. Just what's changed in practice for you in day to day, week to week life?

Stacey: The current person in the role really thinks ahead, and is very bright and says, "Okay, the last three times, Stacey's done this, she's wanted this. I'll just get there before her and have this and hand it to her. And we'll go on." And I've been able to truly... That old Harvard Business School article, "Who's Got the Monkey?" She's been able to take the monkey, and the care and feeding, and I'm able to step back and have full confidence that it's going to get done, it's going to be handled appropriately. And I think my aha moment where I was like, "Okay, this is above and beyond." We have a client who is pretty ill, can't really get out much, but loves to look at her accounts. And for whatever reason, had locked herself out of the portal to see her stuff. Courtney tried and tried to walk her through it and couldn't, and finally just went to her house and did it. And you can't really teach somebody to care about like that. That was the aha moment. And then we also had a referral come in from another client. And she had Googled her ahead of time and sent me this thing about her. And she's like, "Oh, we're really going to like her a lot." And sure enough, we really like her a lot.

Michael: So then, how did you find Courtney?

Stacey: I, in a former life, was a triathlete. And we used to ride bikes together. And when I used to work at another regional bank, her mother, before she retired, ran the big commercial lending unit. And so I had known her mother for years and had known Courtney from my triathlon days, and had kept in touch. And she was running all volunteer services for a charity that my husband and I, it's our biggest charitable gift outside of our church. It's called Church Health. They provide health care to the working poor. So I had stayed in touch and just knew that she was the type of person I would like to be around and I thought my clients would too. And that was a very good judgment call.

Leveraging Corporate Employee Benefit Workshops To Increase Client Growth [51:13]

Michael: So then, share with us now, where do all these clients come from, 206 clients over the years? So, what what's been the growth and business development process for you to bring on clients over the years?

Stacey: Most of our clients come from referrals from other clients. And then we also are part of a group at Commonwealth that was started by an advisor in Nebraska. And it's called The Calm Water Financial Network, that works with Nucor teammates. And so, they got us to help...

Michael: Nucor, like, N-U-C-O-R...

Stacey: Nucor Steel.

Michael: Nucor Steel, okay. That Nucor. Keep going. Okay.

Stacey: And we work with four Nucor divisions. And so as those teammates get ready to retire, because they've worked with us over the last seven years, we become an obvious person to capture that rollover, continue to work with them in retirement. So we get a lot from that relationship as well.

Michael: So, help me understand more of how that works. Just what exactly is the relationship? What do you do? Because it sounds like you're in there earlier than solely, someone gives you a name when they're in the retirement transition.

Stacey: So, what we do is, the division contracts with The Calm Water Network, and we go in and we do new hire presentations, where we go over their benefits, 401(k), stock purchase, disability, the whole benefits package. And then depending on the division, either once a year, or two times a year, or four times a year, sometimes more, they have us come in, and we meet with employees one-on-one for an hour. And they can ask us any question they want about their finances. We'll help them with their 401(k) allocation. We'll help them if they want to sell some stock to fund their child's new car, we'll help them do that. We've helped teammates get out of debt, set up a debt plan. And it's pretty cool, because all the employer finds out about those meetings is, did they show up for their meeting when they had it? And so, we do that and we're there from...we have 16 meetings over two days. And you'll go from somebody who has done everything right, and they're close to retirement, to somebody in their 40s. And they're allowed to bring their spouses, and so sometimes you feel like a marriage counselor. But it's really gratifying work. And I think it's definitely made me a better financial planner, because I've had to meet with so many people. And I've seen so many different scenarios.

Michael: And so, these are not separate engagements that you charge for. This is just part of supporting the Nucor relationship as you do a portion of these?

Stacey: The company pays for us to be on site. So we get paid a fee for our time for being on site those days. And so those two days, we're obviously not in our office, we're at the plant, and we're meeting with teammates all day. And the company pays for that. Now, if they want us to manage money outside of that, that's a separate engagement, and the employee pays those fees.

Michael: Okay. And so in practice, that means you get to start being seen and building some relationships. The company is happy because just employees who have financial questions are getting their financial questions answered, which usually helps reduce turnover and other issues like that. And so, at some point, a portion of them end out becoming longer term clients, because they've had good interactions with you, with Calm Water. So that's the phone call that gets made when they retire.

Stacey: Yes. And in many cases, we have been working with them for years, targeting a retirement date. And helping them, like, okay, you've got to stay till this day, because Nucor has a last day rule on their profit sharing. You have to be employed on the last day of the year to get the profit sharing. And unlike a lot of companies where profit sharing is 3% or 4%, it's often 11%. Last year, it was 30%. So all that couldn't even go on the 401(k). They were getting large cash payouts as well. So, I guess company culture wise, it's quite unique.

Michael: So how do you get to be part of The Calm Water Financial Network?

Stacey: That actually came through Commonwealth because the advisory practice that had started this, they did such a good job, it took on a life of its own. And more and more Nucor divisions were saying, "Hey, we want you to work with our folks." And now they probably have 15 people on their team. But it was way more than what they could accommodate. So they went to the president of Commonwealth and asked Wayne Bloom, "Hey, we've got divisions that want this in these locations, who should I talk to?" And for the ones in our area, Wayne said, "Well, you should talk to Stacey and her team." And so they did. And we were one of the very first groups that joined when they expanded beyond themselves. And so, we've now been doing it since 2014.

Michael: And so you don't necessarily have to pay separately to be part of the network, at the end of the day.

Stacey: They get a percentage of the fees. So because it was their relationship, we get 80% of the fees, and they get 20%. Early on, they got a bigger percentage, because we didn't know that much, and they were having to hold their hands more. But now, we're at 80%, and they get 20% of it.

Michael: And so, the 20[%], that's the advisory firm that originally made this whole Nucor relationship happen in the first place? They're the grand solicitor for the whole relationship, in essence?

Stacey: Correct. And they also still do some stuff. Like, when we have the visits of the division, they have the software that handles the signups, they communicate with the division about those. And they handle the billing for those visits. Now, once it becomes an advisory account, basically, there's a split advisory code that says, "Hey, this 20% goes back to the folks in Nebraska."

Michael: Which I guess essentially, it's a version of a solicitor arrangement, right? Just someone who does the introduction, gets a portion of the advisory fee. They just got a really scaled up one with a really big company, which makes a good opportunity for everyone.

Stacey: Yeah, it is. There's white collar jobs in there, obviously. But there's a lot of blue collar, very millionaire next door folks. I really like the people. And I guess the longer I've been in the business, the more stock I put in being able to understand what motivates people, and how they think, and just liking the people. And I like these people a lot.

Michael: So for the rest of the client base... I mean, I understand that most of the growth comes from client referrals now, but we can only get client referrals going now, if we get clients going initially, it gets to the point that we have clients to refer. So where did the client base come from early on, as you were trying to get to the building point where you could live on mostly a referral-only system?

Stacey: Starting out, I guess, in, I think it was 2002, started out at a regional bank. And so, worked with the commercial banking group, private client group, so got referrals from them. One commercial banker in particular, he really introduced me to a lot of his clients. And still work with basically all of those people today. And he's now retired and I work with he and his wife. And then used to do a lot more retirement plans. Now I just do it if it's attached to other relationships. But one of my TPA partners referred me into a psychology practice, and the senior psychologist there has referred several of his clients to us as well. And so, we've gotten some like that. I think we've gotten a couple because people have Googled me. But that's really been it, because as far as social media marketing and things like that, we really haven't done any of that to speak of.

Michael: And so what kinds of clients do you get at the end of the day? I mean, I can do sort of the math overall, 200 million under management, and 206 clients. So, typical household is about a million dollars. I mean, are you mostly with younger folks? Are you mostly with retirees? Is there a particular type of retirees aside from the Nucor folks? What to find a typical client household for you?

Stacey: I think our typical client household is in their mid-50s, and they're starting to think about retirement. And then our older ones are ones that that was the case then, and now they're 75. Or in the case I'm thinking of now, they're still working, and I keep telling them, I'm like, "You could just sell this and do nothing." But that hasn't seemed to be appealing enough for them to walk away as of yet. So, they sort of run the gamut. And then we've got several instances where we had the parents originally, and now the kids are clients. And we're just continuing on. Our youngest client that's not attached to someone else is mid-30s. And we do have a lower asset minimum for younger clients than we do for retirees, for obvious reasons.

Michael: Right, right, right. And so in a world where most advisors try to grow through referrals with, I guess to say, varying levels of success, some struggle. Do you have a sense as to why you seem to have gotten a lot more traction with growing through referrals than other advisors?

Stacey: I think a little bit of it is some of the value adds we do. It makes people talk about us. Like this time of year, we're helping our clients shop their Part D plan. The ones that are not tech savvy, we actually do it for them. We have a deep understanding of Social Security, and when to claim. And how the Affordable Care Act qualifications for subsidies work. While I don't prepare tax returns, I do a lot of tax planning, and forecasting, and really making sure, possibly even bullying a little bit, to change their charitable contributions to QCDs when they're 70 and a half. We don't sound like your normal stockbroker. And so clients will be talking about that. And then they're like, "Well, my advisor doesn't do that." And then the other group that I think has really, definitely some of my favorite clients is, the husband really wants his wife to understand their financials a little bit better, but she hates his guy. And it's always a guy. And so he's like, "Well, I like Stacey, or so and so told me they really liked Stacey." And so they'll come in and those are fun, because they're like, "You can't gang up on me." And then we of course do something that he's like, "Hey, hey, y'all ganged up on me."

Michael: Interesting. So, kind of a specialization for couples where the husband historically has been the driver, but wants the wife to get more involved, and the wife has no interest in being more involved with the existing advisor or broker relationship. So you end out getting introduced as the person.

Stacey: Yeah. And one client that I can think of, I had handled her husband's retirement plan through his employer. And she came in with a family friend to meet with me, we hit it off immediately. And then as time went on, she had some significant accounts at two other traditional broker-dealers. And she was like, "I don't like them. I like you. You helped me understand, you encourage me to do stuff I want to do." She wanted to do some charitable giving, I was like, "Okay, this is how we'll do it." And so we picked those up. So we do have a fair number of widow clients as well. Either some of them became widows while they worked with us, some of them came to us when they became widows.

Stacey’s Journey In The Financial Services Industry [1:06:06]

Michael: So what has been your journey to come to the business at this point? I guess I'm wondering like, did you start out as an advisor from scratch? Were you like, I want to be an advisor when I grow up out of college and came right into the business? Or did you have a different path for how you came to the advisor career?

Stacey: I started out my career, I'm going to date myself, working for Ernst & Whinney, which very quickly became Ernst & Young. And did municipal finance verification work, which basically means, we checked numbers when a municipality issued new bonds to refund all bonds. And I did that for five years and hated it. I mean, hated it. And I remember when I went in to resign, the partner said, "You can't quit, you're the best we've ever had at this." And it was so empowering because I thought, if I hated this bad, and I'm really good at it, surely if I find something that I like, I'll at least be decent.

Michael: I like that processing. So when the boss says, don't quit, you're the best we've had. That's not a compliment to stay. That just means if I'm this good at this, I'll probably be pretty good at something I actually like. So I'm leaving faster.

Stacey: But the job I took was terrible. I did bank owned life insurance. So I went from one super specialized, boring practice area to another. But I met a woman who introduced me, she was a wholesaler for Pacific Life. And she introduced me to a guy who had a small, independent broker-dealer. He actually owned his own broker-dealer and did financial planning work, and was looking for somebody. And really learned the business working with him. Had to have a heart to heart when he called me his girl. And I was like, "I'm not your girl." But I learned a ton from him. But then when I really wanted to really focus just on growing my own clients and being an advisor, that didn't work. And so I wound up leaving. And that's when I joined the regional bank. So, it took me all over. And I got my CPA when I was at the accounting firm and started my CFA. And then when I was at the BOLI firm, I got my CFP and another level of my CFA, and then finished out my CFA. And I will tell anyone who is considering the CFA, that is by far the hardest of the three designations they have to get, more so than even accounting.

Michael: So how did you land in the current version of advisory business?

Stacey: When I left the regional bank, I went to a local bank. I decided I wanted to go out on my own at that point. That was in 2010. And that's where I started talking to Commonwealth. But then a friend of mine had left to go to a local bank, and they were looking to start a wealth management group. And so she convinced me to talk to them. And ultimately, we decided to start their wealth management group, but with Commonwealth. And so that was kind of the first time I'd ever really sort of run a wealth management group. And then in 2019, we decided we really wanted to be independent of any sort of other organization, and started Envision.

Michael: Okay. So, in the banking context as you're building this, was this, like, you're working within the bank, and they're cross-referring bank clients internally to a wealth management division, and you're building that way? Or were you still largely on your own to build just an under their umbrella with some of the bank's capabilities?

Stacey: Mostly the latter. We were mostly on our own. They would occasionally send us somebody. And sometimes they would be good prospects, sometimes they wouldn't. It was interesting because when the bank examiners would come in, and they'd ask us for our list of annuities we sold, and one year, it was one, and other years, it was zero. And they were like, "Huh, explain to me what it is you do if you're not selling annuities?" I'm like, "We do..."

Michael: Because the bank examiners were used to the fact that most other banks that got into the annuity business, I guess, particularly in that timeframe, the 2010s. A lot of the bank business was just, take the low rate CDs rolling off the books, and roll them into annuities, because the bank ironically got paid more for the annuity than it did for the bank CD.

Stacey: Correct. Yes. And so they were like, "Huh, this is strange."

Michael: You're not selling annuities to CD clients, what are you doing here?

Stacey: "Yeah, no, we don't do that."

Michael: So where does it go from here? What do you think about as coming next from here for the business?

Stacey: I think we would love if any of your listeners are in the Memphis area and are looking for a new position, we would love to talk to you about being an associate advisor. Because we do need some more advisory capacity. But really, I want to take super good care of our clients. I want to make them feel comfortable, secure, that they can go and do with their families, with their friends, exactly, and live the lives they want to live. And I want that for our team too. I want to be able to spend my summers in Colorado, and we'll have zoom calls or come out and stay with us. And I want to give opportunities for growth and ownership to our team, and that they can continue to grow and evolve, and do what they want to do. Because for example, our CIO, CCO, he'd be a great advisor, but that's not what he wants to do. He wants that role. And he's great at it.

And I have to give a lot of credit to Hank, because before Clay and I started working together, everything Clay did, well, except for the CCO stuff, I used to do. And Hank was like, "Stacey, you're best with clients." And he's right. I love taking care of my clients. I love doing financial planning. And I love seeing people think that they want to do something, and setting a plan in place, and really being able to go and achieve that. And Clay's a much better portfolio manager than I am because I overthink it. I'm always like... I'm an ENTP, so I'm always trying to figure out the best way. And sometimes in portfolio management, you just need to leave it. And he's great at that. And we have gotten our portfolio management down to I think something that works exceptionally well for us and our clients. And I think it's given him, now that he's a partner and owner, significant upside potential.

Michael: So is there a vision for how large you want to grow it?

Stacey: I just want to do organic growth and help nice people. But I don't want to ever have to be a conglomerate. I don't really ever want to have to hire a COO. I don't want to get that big. Because to me, that starts to move me further away from my clients, I think. So, we will grow as our clients grow, and as long as we can live the lives that we want to live. And as Carl Richards says, "Yes, I want to run a cute lifestyle practice."

Michael: Carl always likes to put that in air quotes, like, a “cute” lifestyle practice that has $200 million under management.

Stacey: Yeah. So it'd be nice to grow that to 300 or 400. One of the things that comes up a lot in your podcast and others is that, now our minimums are higher than they used to be. We're a little bit choosy about who we work with. And I think that that's been good for us. We've had a couple of clients that weren't nice, that we just told them that we probably weren't going to continue to be a good fit for them. And that's hard to do. But ultimately, do you want your people to enjoy coming to work, enjoy taking care of clients? And you want your clients to feel well cared for.

The Surprises And Low Points Stacey Encountered On Her Journey [1:15:51]

Michael: So what surprised you the most about building an advisory business?

Stacey: How I wish I'd taken more psychology classes in college, because money is not math. The math is probably the easiest part of it. But I think, for me personally, it's the joy I get from telling people, "Yeah, that's kind of crazy, but yeah, we can figure out a way for you to do that." It's less fun telling people that your spending rate is not sustainable. So I think that it's the psychology of that, and really how much personal gratification I get from walking through life with people. And you really do become good friends, and you know things about your clients that quite frankly, nobody but their spouse probably knows about them. And what we do really, really matters, and taking good care of people, and having good advisors out there is so important. Because when you're dealing with people's money, you really are dealing with their life and their security. And so it's not something that I take lightly. And it quite frankly, bugs me, when I hear some people talking about clients as though they're numbers. I mean, these are people's life savings. We have a special trust. And I think that that's a big part of why we are fiduciaries and why we sort of ran toward that label.

Michael: So what was the low point in this journey for you?

Stacey: When we left a previous employer, getting through that shift was much harder than I anticipated. So that was hard. But on the flip side, some of my clients really rallied around me and held my hand through it, and the support. Yeah, it really was. And that's when I found out that I wasn't just somebody's advisor. Actually, one of my clients calls me their other daughter.

Michael: Wow. And so, just all the messiness that comes, unfortunately, sometimes when you transition away from prior firms and transition with client bases. So I guess, was that part of the dynamic that you weren't thrilled in the environment and wanted to make a transition? Or you wanted to make a transition anyways, but then it got messy in trying to leave?

Stacey: I just wasn't happy in the environment. I was ready to grow something that was ours, and not someone else's.

Michael: And that's hard when you work under a large firm or bank environment. They like to put their name at the top of it.

Stacey: Right. And also, just some of the mundane stuff, like the way we would deal with clients and the way we'd communicate, maybe wasn't the way the organization wanted to communicate, but it worked for us. And so that was difficult. And I will say, I was really glad when COVID hit and we started having...every other week, we had these all comer Zoom meetings, where clients could get on, they could be on camera or not, a large number of them were on camera. And we'd talk about what was going on, some silly hack we had found that helped us get through the COVID shutdown, and that sort of thing. That was crazy. People were like, "You let your clients see each other?" I'm like, "Well, they self-selected to come in." And I think it helped everybody to build a community.

Michael: Interesting. So I want to understand this further. So as COVID is hitting, so I guess it's spring of 2020, you just started convening Zoom meetings with clients every other week to just talk? I mean, was there a focus? Was there a theme?

Stacey: There was always a theme. We had Brad McMillan who's Commonwealth's Chief Investment Officer, as a guest on one of them. That was real popular. We talked about different things we'd found. Mine was something to cover up where your rates were growing out. Somebody shared another recipe. Clay talked about noise cancelling headphones, because he has two very young kids, and his wife was sitting right next to him trying to work from home. So it was very personal. And I think everybody was looking for normalcy. And we just gave them something to hang on to. And then once vaccines started coming out, when we would find out if we heard about extra vaccines, we would reach out to clients and say, "Hey, you can go here." And that sort of thing.

Michael: So how long were these Zoom meetings?

Stacey: They lasted about 45 minutes. And then when, as people kind of got more comfortable with the shutdowns or whatever, we noticed that less people were tuning in, so we stopped them.

Michael: So how long did they go? I mean, a couple of weeks, or a couple of months?

Stacey: I think we probably had four or five of them. And then it seemed like life was getting the new normal, or the weird normal. And then we opened up our office probably a lot more than you did in the D.C. area. And so we rotated through, we'd only have a couple people in the office each day. And then we had clients going, "Please, can I come in to see you?" And I was like, "Yes, but you have to wear a mask." And that was good. And then once we got to where we could hug people again, that was my favorite part.

The Advice Stacey Would Give Her Former Self [1:22:05]

Michael: So what do you know now you wish you could go back and tell you from 10, 20 years ago, as you were starting down this advisor journey?

Stacey: I wish I'd gone on my own sooner.

Michael: What was stopping you at the time?

Stacey: I think it's true of a lot of women. We don't think we can. We think we need some support or whatever. And there's a lot of studies that show women won't apply for a job unless they meet all the requirements, whereas men will do it if they meet 50% to 60% of the requirements. And I think that there's some real truth in that. And I've loved having our own firm and being able to somebody come up with an idea and think, "Okay, that's great, let's do that." And not having to go out and vet it with bank management or some other form of management has been super fun.

Michael: And it sounds like for you, just the control ability to be able to just do it the way you want to do it has been a big driver throughout. Using Trello to do the workflows the way that you want, just being able to do the client communication the way that you want. It sounds like that's been a pretty big theme for you throughout.

Stacey: And it has. And one of the things that I have been pretty transparent with my clients is, I take my own advice. So I save the way I encourage my clients to save. My portfolios are managed by Clay in the same models that they're in. And I do have my own personal mission statement. And one of those is to spend more time in Colorado. And so, at first, I was scared that my clients would be like, "Oh, she's not taking care of business." But my clients have figured it out, and I think COVID in some ways helped, that you're really pretty location agnostic. So, when I was in Colorado in September, and it was time... We do surge meetings. Most of our client meetings are in the spring and in the fall. And so we were scheduling them. When I was in Colorado, they just scheduled all the Zoom meetings while I was there. And that was fun, because for the most part, those clients weren't in Memphis anyway. So, it was kind of fun, and I showed them my view, and they were like, "Okay, I wouldn't come back." I had to get over being scared to be authentic. And that was a big one.

Michael: And was there anything in particular that helped you get over that challenge of being scared to be authentic?

Stacey: How much I love Colorado and how much I love being out there. And seeing that I could get it done. And that's something like the Trello, it's asynchronous. I can see, if I'm looking, at 7:00 or 8:00 at night, I know exactly where all the projects were during the day, even if I forgot to send an email at 4:30 saying, "Give me an update." It's all right there. And they like it too because then, it's easy to see... Because if you email two people because you're not sure who's got the capacity to do it, then they have to talk and figure it out. If I put it on Trello, it becomes obvious somebody's grabbed it and is working on it.

The Advice Stacey Would Give To Those Considering A Career As A Financial Advisor [1:25:58]

Michael: So what advice would you give to newer advisors thinking about becoming an advisor today?

Stacey: I would say that it's a very financially rewarding career. But if you really want to be successful, you really have to care about people. Because I think that clients can see that, they can feel it. And you'll always have a little bit of a struggle if everything is not in line, if people intuit that maybe you're not really looking out for them, that you have some ulterior motive. I think it's because fraud is as high as it is. And people are really wanting to engage with somebody that can help them through whatever life throws at them. And if they wanted just somebody cold, they would just use a robo or use the Fidelities, or the Vanguards, or whatever, where it's mostly...the face changes or whatever. So I think that caring about people is the most important thing. And then you can't ever stop learning.

Michael: Spoken as a trooper who has their CPA, and CFA, and CFP, which I feel like is the holy trinity of advanced designations and degrees.

Stacey: I have a funny story about the CPA. So I actually have an active CPA permit. I was going to let it lapse and just go to CPA retired. And a client wrote me a note and said, "I hope you don't do that because your clients really appreciate the value that you add by reviewing our tax returns, and helping us out, and making sure we're aware and being tax smart." And I was like, "Oh, dang, I got 40 hours of continuing ed to do before the end of the year."

Michael: All right, I'll dive on in for the CPE.

Stacey: Yep. And I do love that Kitces gives me CPE. So, thank you very much for that.

Michael: Yeah, well, in that context, I mean, there's so many advisors these days that are coming into financial planning from the CPA side of the business. I think kind of similar to your journey, they started in the numbers accounting side of the business and found they really liked the people side more. And that tends to be a lot of what pulls CPAs over to the financial planning side. So we had all these folks that were CPA, CFP that kept saying like, "Can we just get both in one place, because we don't want to have to do them separately, because that's twice many hours." So, we try to make things simpler for all the CPA financial planners out there.

Stacey: And we appreciate you more than you could possibly know.

What Success Means To Stacey [1:29:0 1]

Michael: Happy to help. So as we wrap up, this is a podcast about success. And just one of the themes that always comes up is the word success means very different things to different people. And so, you built this wonderfully successful advisory business, with 200 million under management. And so the business is going well. How do you define success for yourself at this point?

Stacey: There's an adage out there that you're only as happy as your most unhappy child. That my kids are happy, they're in a good spot. That I can spend time with my husband in our favorite place in the world in Colorado. And that I can provide a very great place to work for my employees, and my clients feel well cared for. And that everybody wants to show up for work. I mean, everybody wants to take their vacations and I encourage them, mandate that they take them. But that coming to work is fun, and they feel value in what they do. And I think that's important in this day and age.

Michael: Yeah. In this world of so-called great resignation and so many people in job changes, it's powerful when you can just actually do work in a firm where you like what you do, and you like who you work for, and you like what you do with them.

Stacey: Yes.

Michael: Pretty cool place to be.

Stacey: Yeah. And I want to keep it that way. And so, we're going to be pretty deliberate about who we work with. And to your point, how we add clients, and who we let on our bus, so to speak.

Michael: Very cool. Very cool. Well, thank you so much, Stacey, for joining us on the "Financial Advisor Success" podcast.

Stacey: It's great to be here. It's truly an honor. Thank you very much.

Michael: Thank you.