You Complete Me

The other night I watched my favorite movie of all time, Jerry Maguire, for the hundredth time. Despite what some may think, Jerry Maguire is not a chick flick. Jerry Maguire is a movie about a person who decides to reexamine his life and live it according to the terms that he wants. It’s about making a decision about who you truly want to be.

As I come up on my two-year anniversary of launching Clearfront Advisory, I thought I would have my Jerry Maguire moment and write my own manifesto.

My tipping point, what pushed me to leave the bank world, where I was working, was seeing that banks and brokerage firms don’t care about their clients. Advisors within brokerage firms and banks are not fiduciaries; they are salespeople. If you have heard this story before, I apologize. I was sitting in a “sales” meeting, and the “sales” manager was talking about the concept of grabbing more “wallet share” from clients. My stomach churned hearing the phrase “wallet share.” It sounded like stealing to me. The “sales” manager went on to discuss credit cards, mortgages, and having clients leverage their securities and borrow against them to pay bills. I thought we were supposed to help clients save more, not spend more. If you weren’t aware, banks make money lending money—it is much more profitable than managing client assets.

Two years ago I planted my flag and went out on my own as an independent financial advisor. It was one of the best decisions I have ever made. When you start your own business, people invariably will think you are crazy. I don’t know why. There is nothing more liberating than waking up each morning and knowing there is no one else to depend on than you. As one client put it when I left banking, “There is nothing better than betting on you.”

I did not pull an all-nighter or do handstand push-ups like Tom Cruise did in the movie while penning his manifesto. But I have given a lot of time and thought to what I want and what I want Clearfront Advisory to be.

·         Keep Clearfront small and intimate. We want to know each client and want them to know us. Bigger isn’t better; bigger creates bureaucracy and distance.

·         Stay true to the simple concept that our clients are everything. We may be investing or advising on their lives’ savings. Treat their money like our own.

·         We don’t want to work with everyone. Not everyone is a good fit. We want to work with clients who believe in us and what we stand for.

·         Keep clients diversified in their investment decisions. Be cost sensitive in investment selections and the fees we charge. Be tax aware when making decisions—remember, it’s not what you make; it’s what you keep.

·         Coach each client to have the discipline to stay the course and not worry about what they can’t control. Focus on what you can control and on what is truly important.

·         Markets work and are efficient; it is fruitless to try to time markets or think you are smarter than the market. A vast majority of professional money managers fail to beat their benchmarks each year.

·         Have a simple and transparent fee structure so that clients know exactly what they are paying for and what services we are providing.

·         This is not a zero-sum game; there are no winners or losers. Everyone should succeed.

·         Be modest. If you hire me to beat the market, you will be disappointed.

At Clearfront we want to be held accountable. If there is something you are not getting from us, tell us. This is a relationship, yin and yang; communication is paramount and a cornerstone of what we believe in.

Thank you for your support and loyalty. We look forward to continuing this journey.

Happy Second Anniversary!