Q: What is the typical profile of a family that has a retreat?
A: Whether a family has $3 million, $30 million or $300 million doesn't make any difference. If the family values its $3 million, then it is likely to value sitting down at least once a year and sorting out where they are.
Q: What do you try to do for them?
A: I usually like to see something I call a success definition. If we are successful as a family by March of 2011, what will have happened? What will be different? What were the bogeys or benchmarks that we'll hit? I don't really care about how many zeroes are behind their name.
Q: Since the financial crisis, has there been a change in the tenor of these meetings?
A: The financial crisis was a wake-up call for many people and their financial advisor's phone number and e-mail address is much closer to them than perhaps it was three years ago. This is a great opportunity and one of the reasons I'm doing this interview is for independent financial advisors to offer a new approach to their clients.
Families have now gotten past the period where they stopped opening their investment statements. They're now dealing with the harsh reality of the situation. They are dealing with a lot of new challenges, and they're coming together as a family to figure out where they are and where they're going. That has really driven many retreats right now. "We want to know where we are."
I also have to say that some of the retreats are also driven around, "I'm frustrated by the service levels from my advisors." I know financial advisors that are doing a good job right now, working longer hours, spending more time with their clients, hand holding, answering questions, reassuring people. Many families are planning retreats for the summer now, and this summer there will be an abundance of family retreats. The crisis has brought families together.
It's also led to a decision to prune the stock, which is a very, very sensitive discussion. Over time, the stock over generations gets watered down, percentage-wise, to where one branch or another of the family wants to be bought out. Those are tough, difficult discussions. Another discussion that is now coming up more is selling the family enterprise. So the financial crisis has brought up all of this.
Q: So you think the crisis has affected the way families think about their financial advisors?