Always an entrepreneur, 90-year-old Joe Leonard reflects on almost 50 years in financial services.
In an indirect way, Joseph Leonard played a small
role both in ushering in and closing out World War II. On December 7,
1941, while stationed at Schofield Barracks near Wheeler Field on the
island of Oahu, Leonard witnessed the Japanese attack on Pearl Harbor.
Later in the war, his engineer combat battalion took part in the
American conquest of the Central Pacific island of Tinian and helped
construct an airstrip that eventually was used by the B-29 bomber Enola
Gay on its fateful mission to drop the A-bomb over Hiroshima.
For Leonard, who turns 90 in August, his war years are part of a long list of varied, colorful experiences that crammed a lot living into his long lifetime. In December, he retired from Leonard Wealth Planning, the financial advisory firm in Lincolnton, N.C., that he owned with his son, Cain, who now runs the business. Before he retired, the Leonards believe, Joe was the oldest advisor among the 8,000 affiliated members of their broker-dealer, Linsco/Private Ledger (LPL) Financial Services.
"I treated my customers right," says Joe, "and a lot of people told me, 'Thank you, thank you,' because I made them money. Even my wife."
Leonard was an old-school advisor whose primary focus was picking individual stocks for his clients. "His clients were mainly in individual stocks, with some mutual funds and bonds," says Cain. "My business is more about tax planning and money management." Together, the Leonards built a firm with roughly 500 clients, mostly in the Carolinas, Virginia and Florida.
Cain, 50, was a music major trained in classical and jazz trumpet with aspirations to play in an orchestra and teach music at the college level. But he burned out on music, and he held a couple of business jobs before he teamed up with his father in 1984. Joe took a much more circuitous route to the financial industry. He began a lifetime of serial entrepreneurship at age 12 when he sold soda and snacks from a stand on the family front lawn. Later, he loaded up a small wagon with Moon Pies, drinks, peanuts and chewing gum and sold them to patrons at a baseball field where local and factory teams played.
While still a young teen during the Depression, Joe collected scrap metal, mowed lawns and spent four years rising daily at 5 a.m. to deliver the Charlotte Observer. During a time when his policeman father was the town jail keeper, Joe charged the inmates money to make shopping trips for them for items such as chewing gum and cigarettes. In his later teens, Joe and a friend ran an auto repair and paint shop for two years, and later he operated Joe's Boxcar Diner for four years from a rented trailer. All the while, he managed to graduate from high school.
In 1937, Joe paid $100 each for two trolley cars that the city of Charlotte planned to dispose of, and then paid $150 each to have them delivered to Lincolnton. The cars were in good shape and came fully loaded with mahogany wood, steel and brass screws. They were placed side by side on East Main Street, the two sides that were connected were removed, and the renovated trolleys became The Carolina Diner. While he owned the diner, Joe purchased a 118-acre farm and raised beef cattle for use at his restaurant.
Leonard's entrepreneurial frenzy was put on hold when he was drafted into the Army in June 1941. After basic training at Fort Belvoir, Va., he was assigned to the 34th Engineer Combat Battalion and sent to Schofield Barracks in Hawaii. On the morning of December 7, Joe was on temporary artillery duty at Fort DeRussy, near Hickam Field, an air base adjacent to the Pearl Harbor U.S. Naval Base.
He was up early that day and saw the attacks on both Hickam Field and Pearl Harbor. "I was never afraid because I was too scared to know any better," says Joe. But as he lay under a bulldozer for protection, he recalls that he knew that the U.S. was in for a long war. Leonard served in the army for roughly four years as a member of the 34th and then the 1341st Engineer Combat Battalions. His units built piers, roads, runways and military installations, and he participated in the liberation of the islands of Saipan and Tinian from Japanese control. While on Saipan, Joe served as a war correspondent for his hometown newspaper, the Lincoln County News.
After the war, Joe enrolled at Davidson University in North Carolina and was a two-way lineman on the football team. But he dropped out after one year. "I believed I could make more money doing something else," he says.
Leonard's family ran The Carolina Diner in his absence during the war, and he resumed his duties after the war. On the side, he traded army surplus items awhile. Around this time, he and a friend started an antique and used plumbing parts business called Lincoln Antiques that lasted for several decades. His friend ran the business; Joe was a silent partner.
Leonard's foray into the financial world began in 1959, shortly after he received his real estate license. Somebody told him about a small securities firm in Greensboro, called United Securities, that might be interested in hiring him. Joe got licensed to sell stocks, and in October 1959 opened his own stock brokerage office in Lincolnton with United Securities. Over time, through various mergers and acquisitions, United operated under several different parent companies. The Leonards later worked under the A.G. Edwards umbrella for several years before going independent and affiliating themselves with LPL in 1994.
Given their different approaches-Joe, the traditional broker-dealer, and Cain, the newfangled, broader-based financial planner who is now close to completing his designations as both a certified financial planner and an estate planner-Leonard Wealth Planning was essentially a bifurcated firm with separate client bases. Under Cain, the firm's services include asset management and estate planning. One of his big focuses is helping clients with lots of IRA-related income avoid the big tax hit that could be awaiting them at retirement.
"The theory of tax deferral is to pull money out when you retire and you're supposedly in a lower tax bracket," he says. "But the opposite has happened to a lot of people, because they've done such a good job accumulating wealth that, as they enter the distribution stage, they're in the highest tax bracket of their lives because they're getting a lot of 1099 distribution money. So taxes become their greatest expense." To mitigate the future tax bite, Cain Leonard shifts money into tax-free growth areas such as municipal bonds and various estate planning vehicles.
On the money management side, Cain also favors a more active approach beyond just buy and hold. "We like managers with a good track record who manage risk in a wide variety of markets," he says.
That's a different approach from his father, a buy-and-hold guy who liked dividend-paying stocks, particularly banks and utilities. In retirement, Joe still reads The Wall Street Journal and closely follows the market. He recently purchased shares in home state utility giant Duke Energy and its recent spin-off, the natural gas company Spectra Energy.
"I figure if you buy a house you'll use their electricity and gas products," he says.