Online Leaders Interview
This is an exclusive interview with financial professional Greg W. Anderson. Fort Collins is where he calls home. Learn more by visiting his blog or connecting on LinkedIn
Summarize your professional background in 2-3 sentences (in the third-person).
Greg wanted to use a Construction Management and Business Finance degree to be the next commercial real estate developer on the cover of magazines with pictures of flashy office buildings and strip centers full of veterinarians, coffee houses and flower shops. “The problem with the plan was I graduated in 1986 just after the Reagan tax reforms - that killed commercial development for the next 10 years,” Greg signed. So mother necessity leads him into the nascent ‘financial services industry.’ Now 27 years in he’s the owner of Balanced Financial Inc., is a Registered Income Certified Professional (RICP) and Certified Estate Planner (CEP). Helping clients plan out their turn from working & accumulating over to retirement and solid income plans.
What Inspired Your Career Choice?
Necessity. The development track just wasn’t going to work in the mid-’80s. So I wanted to continue working with numbers, finance and creating value using financial tools instead of real estate. The whole ‘financial planning’ field was so new and amorphic with New York Life guys running around with a circle of wealth talks to folks at banks being ‘promoted’ from teller to “wealth guides” to any number of warehouse stock jocks passing a weekend class offered by the home office. Planning was new, lacking prestige and understanding by the public.
I just knew that this market place was developing, fracturing … small unknowns becoming dominate and the old line of Met Life and AG Edwards fading away.
What is Your Greatest Achievement in the Field?
Nothing will ever feel better than happy clients coming in for reviews 10 or more years into retirement. Helping folks make the second turn into legacy planning. The first turn into retirement is more obvious and talked about; it's more concrete in folks mind. But then 10 or so years into the retirement mode folks start to think of different questions. What is my obligation to the future, to community, and family.
What’s right and wrong about leaving lots of money to heirs; what good can we do with a solid legacy plan. Once the initial hurdle of ‘do I feel the wife and I have the income level to walk into retirement’ has passed then we find a new itch develops. Thinking through a legacy plan.
This is a slow, semi-private process with a client. The stuff they need to go thinks about … find what jells for them like scholarships, disease research, or the fun boutique efforts to encourage “city beauty” or country libraries. Then clients turn to us to help flesh out the trust planning and financial vehicles to fund their vision. “I have a 2 p.m. tomorrow with a client to meet at the attorney I suggested, to re-fit the living trust around a sliding scale daycare in her home town that made a great impact on her 50 years ago when she was suddenly broke, scared and needing to work with 3 small girls.” “That’s fun being part of doing good in some arena out into the future.” Greg continued.
How Do You Keep Up with the Latest Finance Strategies?
It’s tough. You rely on wholesale folks some, read your magazines – “I set aside Tuesday mornings to do my reading.” Greg explained. “If you don’t make a habit of (the drudgery) you won’t do it.”
Reading firstly. I set aside Tuesday (mornings) for reading. Both trade articles and books coming out on planning. Funny how at my age you start to see the recycle of ideas – the very things I thought were new and innovative cycle back in 20 years. The rage now is rentals, fix & flip (made popular by the DIY shows), and the endless “alts”. I guess alts (short for alternative, i.e. not mutual funds, stocks, bonds) is anything the weird bearded folks back in the day pursued. Run down houses, self-storage, or maybe factoring receivables.
True ‘alts’ are interesting to me. Finding the number cruncher (quants as they are called) who found some crease in the crude oil pricing or small cap stocks. My experience is that the gains from these secretes only lasts a short while until the broad market wipes out that inefficiency.
What Makes Balanced Financial a Market Leader?
We are boutique to the problem of income planning. So there’s a lot we don’t do. We are not here to replace the relationship folks have with their current growth or pie chart advisor. That’s a surprise to most when we explain this. They can continue to do the growth component we want to be a new member on the client’s team - of the Income Planner.
We lead by helping a large number of the technical set – engineers, research scientists, etc. make sense of the nest eggs they have been building for 30 years and really have little emotional connection to, or sense of direction. We feel we lead the market in what I call ‘twilight counseling.’ That’s my elevator pitch – I’m a twilight counselor.
We help folks navigate from the accumulation phase of life over to the distribution phase.
Once a person is mid 70’s and Social Security is rolling in the distribution phase of life is pretty well understood and old hat – but that twilight of being mostly done with accumulation but not yet into distribution can be really murky.
Don’t compete create is my life moto. Don’t try to do what others are doing better, rather find the thing that isn’t being done. Back in the day, that was income planning. The financial industry is oriented around some version of ‘we’re smart, our proprietary funds are better than your funds.’ All are focused on growth. Growth is great; but when you are nosing in on retirement you want preservation, income and a plan to transition your bananas on to the next generation. This is a different skill set. More human. More patient. Less transactional. This is not something the wire house set is ever going to be attracted to or trained to do well.
We want to be known as the village income planners. We take over the baton from the accumulation folks a few months prior to retiring.
How Does Leadership Play a Role in the Quality of Balanced Financial’s Products/Services?
Back in 1997 I started using an instrument called and ‘index annuity’. Brand new at the time – it had only been invented in 1996. We looked at it. Looked at it again. Tried to find answers to questions of how the mechanics of these were set up. And then took some baby steps. In the late 1990’s everyone was a financial genius; you’d land in a city and the cab driver would start conversations about internet stocks. Stocks for a short time were more fascinating than sports! We started to move some dollars into these Index Annuities (now called FIA’s sort for fixed indexed annuities). We’d move some dollars out of banks, for the CD set into these as a “hey here’s away to get into the stock market EVERYONE is talking about, but with no risk to principal.” That worked for some folks who just couldn’t figure a path out of their history of bank products. Second, I started putting 401k roller over dollars into them. The story being, “hey, the market is roaring. Can’t last forever. Let’s use these fancy annuities for the ‘nest egg’ dollars.” That also seemed to resonate.
This was a new technology. Entirely new way of handling money – untested frankly. But when 2000, 01 and 02 came to visit everyone’s 401k the wisdom of these principal safe strategies was made obvious.
That was leadership.
Share Two or Three Instances of You Showing Leadership in Your Professional Life.
Tagging off of the above. I share an example of ‘Rob’ an engineer moving jobs. He had a little over $62,000 in his 401k on October 1997. We moved that into the fancy new Index Annuity and the first year he earned 8.76%. Yawn! Everyone was making big returns in late 1990’s. Next year he did 19.81% - the S&P grew about 22%. Now its October 1999.
Well the next two cycles Rob made a zero return as the United States equity market tumbled year over year.
What I could never have expected was that the zero years were the one’s Rob and all the others are so impressed by. No loss! His next two years were 7.9% and 5.21% as the markets recovered. He finished that 7 year contract up 56% while most portfolios (and thus the people who owned them)were devastated, and wouldn’t recover for 10 more years.
Getting the RICP designation was a real effort. That’s a Retirement Income Certified Professional degree. Those were some serious tests that had to be at one of those proctoring facilities … and I use all 60 minutes of each test! But that training was state of the art in arguing different philosophies, showing obscure software, getting into the minutia of Military benefits, the deep water of Social Security and eyebrow-raising examples of where State’s will come after estates for Medicaid benefits paid long after a person has passed on.
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