Money was spent on Morningstar classes in Chicago while Thibodeau developed and conducted in-house training. "He would meet with us every couple of weeks," says Kathleen Christensen, a Filomeno & Co. manager. "Each time, we spent several hours going through various investment topics." In between sessions, there were articles, books and more to consume, supplemented with on-the-job training. "I worked with Rick literally step by step on investment plans for client after client," Christensen says.

"We would walk through his thought process and how he analyzes investments." She was present in client meetings, too.
The other two Filomeno CPAs who migrated to the firm's new investments arm, manager Elizabeth DeBassio (who holds a master's in personal financial planning) and partner Mike Tedone, earned, as Thibodeau had, a "personal financial specialist" designation. Tedone says, "I thought having people in our group with that designation would give us added credibility as financial advisors."

Thibodeau ended up becoming securities licensed at this time, since Filomeno & Co. was set up to do business as broker/dealer registered reps. After all, he had to continue serving the clients he brought over. But Thibodeau and his new partners agreed from the beginning that they would ultimately depart the commission-based world.

The Transition To Independence

Three years after Thibodeau joined the accounting firm, it formed a subsidiary, Filomeno Wealth Management LLC, which was registered with the Securities and Exchange Commission as an investment advisor. At the same time, a decision was made to move clients' assets to a new custodian, Schwab Institutional.

"I knew the conversion of the business model and the transfer of assets between custodians was going to be a stressful time for our clients, so it had to be handled extremely well," Thibodeau says.

The task of making the changeover as seamless for clients as possible fell to Kim Lockwood, Filomeno Wealth's administrator (and, according to her colleagues, its MVP). Lockwood, who worked closely with the Schwab team, says clients remained calm and cooperative throughout the potentially painful process and she credits that to a blizzard of communications the advisory firm sent out. It started with a letter describing the new RIA and custodian and explaining what it meant to clients. "And then we explained everything along the way," Lockwood says. "I think keeping our clients informed throughout the entire process made it easier for all parties."

All but two clients made the leap to ongoing investment management (and those two chose merely to continue consulting with the firm). Such a high conversion rate surprised Thibodeau a little bit. "Paying us a fee based on the assets managed increased the cost for most clients, although of course they're getting more service than before," he says.

Filomeno Wealth Management is now fee-only and manages about $80 million. The clients now receive the kind of integrated services that Thibodeau envisioned when he forayed out on his own all those years ago, and the "financial coach" aspect of planning he originally sought thrives at the firm, too. The advisors consider themselves educators. Christensen says, "We provide clients with a lot of charts, graphs and articles written by external investment experts because we want them to understand what we're doing and why. Each year we try to get more detailed and broaden their knowledge."

The firm focuses on tax-efficient, low-cost investing and maintaining a prudent cash allocation. "More than anything, we make sure we completely understand the client's cash flow needs for the next one to two years and set that aside in cash," Christensen says. "For some retirees, that could be $250,000, but they really benefited last fall because no one had to sell anything when the markets were down in order to meet their short-term needs."

Of course, independence isn't entirely a bed of roses. As Thibodeau points out, "You became responsible for what technology you use, developing a Web site, doing all your own marketing and compliance. It all takes time."

Taking the Show on the Road
Thibodeau's mission to bring comprehensive advice to high-income clients isn't over yet. Now he's trying to forge strategic alliances with small- and medium-size accounting firms in the Hartford area that he hopes will refer clients to Filomeno Wealth, since the clients of those firms need investment advice from someone.