Financial Planning for Women & Diverse Generations: SmartCEO’s Brava! Award Winner Anne McCabe Triana Interviewed by Anne Loehr
John Choudhary and Anne McCabe Triana created CAM Private Wealth Services to provide a unique, disciplined and consultative approach to investing that places an emphasis on teamwork.
Anne, a Managing Partner, has been recognized by DC Modern Luxury magazine as one of the metropolitan area’s most Dynamic Women in Business and was selected as one of SmartCEO’s Brava! award recipients for 2013. I have been following Anne’s company for several years and was excited to hear her insights into financial planning, specifically for diverse generations and women.
Introduction
Anne Loehr: Beside generational trends and dynamics in the workforce, the entrance and acceleration of women in the workforce is a hot topic right now. In the financial world, are there obstacles that women must overcome to succeed? What advice do you have for women looking to create a career path within this industry?
Anne McCabe Triana: Given that I think wealth management is such a great career for women, I am disappointed when I read statistics showing only about 30% of financial advisors are women; and that number hasn’t budged much over the past few years. The biggest challenge is one of the most over-used words of modern day: balance. When you are first starting off, you have to invest an incredible amount of time in building your book of business. Before you are able to hire staff, you are responsible for everything (finding clients, servicing clients, keeping up with the markets/economy, compliance, paperwork, etc). Once you have built a sizable practice, the huge benefit I see, especially important to women, is flexibility. You are then in a position where you control your time and schedule, and can delegate some of those tasks. Given that I now have a family, if I were a female trying to get into the wealth management industry today, I would absolutely try to find a great, established team with whom I could work and learn from.
Anne Loehr: I read in an article that you and your co-founder have based your business on multigenerational growth “The two intend to build the practice organically, through client referrals and by working with the second generation of families already in the practice.” How do you think that sets you apart from other companies?
Anne McCabe Triana and John Choudhary: I think what sets us apart is we have made it a focus and encouraged clients to involve their children regardless of how young they are. For example, we have helped clients’ children manage their minor accounts as early as high school, and have set up Roth IRAs for children and grandchildren when they get their first job. We recognized early on that there is a lack of education around managing personal finances in schools, and we wanted to make that a value-add service for our clients.
Anne Loehr: Have generational concerns/issues always been top of mind or has it only been recently that you and your business partner have focused on generational issues?
Anne McCabe Triana and John Choudhary: Even though most advisors are just now starting to focus on the demographics of their clients, building a relationship with the next generation has been part of our process for a very long time. When we speak with clients and develop an investment plan for them, we are not only focused on the numbers, but also talk extensively about what they want their legacy to be; not just regarding their assets, but also values they want to pass to the next generation and beyond.
Generational Financial issues
Anne Loehr: I heard you speak Spanish fluently, another trend we’re seeing is the population growth of minorities in the U.S. How can financial planners adjust to meet their needs? What are their needs?
Anne McCabe Triana: Understanding and appreciating cultural differences and values is just as important to minorities as speaking their language. Because our team members come from such diverse backgrounds and speak multiple languages, it allows us to cater to a diverse group of clients. Wealth accumulation among minorities is one of the fastest growing segments of the high-net worth market in the US. This group is most concerned with finding professionals with whom they feel comfortable and confident in managing their financial affairs, which in most cases includes not only their financial position, but also the financial security of multiple generations that they help to care for.
Anne Loehr: Does this new demographic dynamic also change the way the 2nd generation plans and uses their finances?
Anne McCabe Triana and John Choudhary: Historically, the 1st generation was more focused on working and providing a good education for their children. They were not, in general, concerned about their own retirement. In essence, getting their children established was the retirement plan. Because of the sacrifices the 1st generation made, the 2nd generation is now living the “American Dream”. They were educated in the U.S., are typically successful in their careers, and have the discretionary income to be able to save and invest for their futures.
Anne Loehr: How do the financial concerns of Gen Y differ from Gen X and Baby Boomers?
Anne McCabe Triana and John Choudhary: We used to think of retirement planning as the “three legged stool” with a pension, social security, and a personal retirement plan as the three legs of that stool. For the most part, this holds true for the Baby Boomer generation. For Gen X and Y, that retirement picture looks very different. In general, there is a lack of confidence in the future of the social security system and their retirement plan will mostly be funded by personal savings.
Anne Loehr: Who are your primary clients at the moment?
Anne McCabe Triana and John Choudhary: Currently, the majority of our clients are in retirement or will be retiring in the next 10 years. The fastest growing segment of our practice, however, is younger clients due to the fact that we are focusing on multi-generational planning.
The Macro 2.0 world
Anne Loehr: What does the financial future look like for Gen Y, Gen X and Baby Boomers?
Anne McCabe Triana and John Choudhary: Baby Boomers face a few challenges : (1) the risk of outliving their money due to longer life expectancies, (2) healthcare expenses taking a larger percentage of their income than they anticipated; and (3) having to be more diversified in their portfolios due to the low interest rate environment we face today. The unique and exciting aspect of this generation is they are redefining retirement : they are traveling, volunteering, and in some cases starting second careers in this new phase of their lives. We feel there is a very bright future ahead for Gen Y mainly due to the accumulation of wealth from the economic recovery, and also the massive transfer of wealth that will occur in the coming years. We believe Gen X also has a bright future, but that they need to aggressively save for retirement, being as they will most likely be fully responsible for funding.
Marketing
Anne Loehr: Is marketing a big part of your business model?
Anne McCabe Triana and John Choudhary: Yes, but not in the traditional way. We conduct intimate events for clients which gives us an opportunity to get to know their extended family and professionals with whom they work. While the focus of these events is to deepen relationships with clients, ultimately they end up leading to new relationships.
Anne Loehr: Give me an example of a way you’ve had to change the way you talk to clients as you’ve begun to deal with the second generation?
Anne McCabe Triana and John Choudhary: All generations are interested in our holistic approach to managing wealth. Baby boomers and gen Y prefer that we stay high level and not overload them with lots of information. On the other hand, Gen X, growing up in the age of information overload, is very interested in details, and appreciates extensive information.
Anne Loehr: Is there a particular financial issue that is difficult or hard for advisors to address with Gen Y (or any generation)?
Anne McCabe Triana and John Choudhary: For Baby Boomers, given the low interest-rate environment, it is sometimes challenging to balance the risk of their portfolio with the need to keep up with inflation. Gen Y, being the “sandwich generation”, presents a unique challenge in that as an advisor, we need to develop a plan not only for their retirement, but in some cases for multiple financial responsibilities for either their children or parents or both. For Gen X, our main focus is how to balance paying down debt such as school loans with saving and investing for their future given that retirement will depend mostly on personal savings.
Anne and John can be contacted at 703.956.2200 or atriana@CAMprivatewealth.com jchoudhary@CAMprivatewealth.
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