But of course he's not out of the game. He says he's been thinking of what financial planners need to be doing today in the face of the financial crisis and the total loss of confidence in investing.
"Financial planners are going back to blocking and tackling," he says. "If we've just been skimming across the top of things, we need to go back to basics. Planners must be educating their clients. They should also go back to total planning, including all the basic areas of insurance, estate planning, retirement planning and even budgeting. You can't talk about investments in a vacuum. You have to talk about it in context."
Financial planners should be acting as their clients' second brain, he says. People who consider a Bernie Madoff-type investment "must have a rational thinker by their side," he says. "We need to keep clients on the straight path of rationality and not leave them to rely on college friends and relatives for financial advice." Breitbard said the alleged Madoff fraud reminded him of an incident he'd forgotten from the early 1990s. "We had a visit from a guy from Texas who managed a hedge fund that he wanted our clients to invest in."
Breitbard asked him, "What do you invest in?"
The hedge fund manager was offended. "That's the black box," he said. "That's our competitive edge." Breitbard said he was shocked. "That's the first time I'd ever encountered anything like that." When he taught personal finance to the Berkeley MBAs, he said some students were annoyed with him because he wasn't telling them investment secrets. "I'm amazed that people still think that someone has the Midas touch," he says.
Breitbard believes that financial planners should teach clients about the difference between saving and investing. "Even bright people don't know the difference," he says. "Saving means not spending, putting it aside for later. Investment means putting it to work in some growth opportunity." The two can be separated, he says. "If you save money by not spending it, you can wait and worry about investing later. Saving takes willpower and investing takes brain power." The most important lesson financial advisors can teach clients now is that saving is the way to achieve their goals.
And that following your passions, doing what you feel led to do, becomes the measure of a well-lived life, much more so than the assets in a big portfolio. No one can learn this all at once. But it's a matter listening, opening the doors, and taking one step at a time. A matter of slowly coming into your wisdom.
Mary Rowland can be reached at [email protected]. She has been a business and personal finance journalist for 30 years, a half dozen of them as a weekly columnist for the Sunday New York Times. She wrote a column called "Practice Points" for Bloomberg Wealth Manager for six years. She speaks regularly about money and values. Her six books include two written for financial advisors: Best Practices, and In Search of the Perfect Model.