Advisor Ji Yao "Jackson" Xu, co-founder of X and Y Advisors, is having a bit of difficulty reaching one of his target client types—young Chinese professionals.
Xu is a financial planner based in El Segundo, a small city in Los Angeles County, Calif. Los Angeles is one of the few major hubs for Chinese immigrants, after the New York and San Francisco metropolitan areas. Xu started his fee-only registered investment advisor firm in 2017 with his wife Xi Ying (Vivianna) Zhao, a certified public accountant.
The couple has given much of their business hours to tax season, since they offer tax preparation along with financial planning. Zhao leads the tax arm with Xu’s support while Xu leads the financial planning arm with Zhao’s support.
Unlike the tax business, which sees a mostly non-Chinese clientele, the financial planning side of their practice draws young Chinese professionals along with individuals from other immigrant groups in the area. However, the near nonexistence of financial planning in China and the lack of fee-only firms serving Chinese immigrant communities near Xu has led one of his target markets to be unaware of his profession and mistake his services for investment management or sales.
“I believe that there are some real financial planners really trying to help people,” said Xu. “I just could not find fee-only financial planners providing real comprehensive financial planning services to the community, at least [not] in California.”
He added there are mostly advisors pushing products and professionals from multi-level marketing agencies selling insurance plans. Xu recalled meeting with a mother looking to save for her child’s college education; she ended up buying an insurance policy from an agent at a multi-level marketing agency. “The policy was clearly not the best option based on the information she shared with me during our meeting.” And when Xu listens in on Chinese forums, he hears similar stories.
But selling is not Xu’s modus operandi; he believes the Chinese immigrant community is underserved and aims to use his skills as a CFP, his capability of focusing on cross-border issues involving China and the U.S. (and matters involving other countries) and his bilingual ability to assist that community.
Xu mentions that there isn’t an estate tax in China; accordingly, he provides education on estate planning. Likewise, the credit system in the U.S. influences numerous aspects of living, but it is a fairly new system in China.
To educate potential clients about financial planning and stress the difference between an investment manager and a financial planner, Xu decided not to take any investment-only clients in his own practice.
“People just don’t get that distinguishment,” he said. “I do offer the service, but I want to be very clear that it is two separate types of services.”