Hire a company first and a person second. You should absolutely be very comfortable with your financial planner as an individual. After all, you are forming a new relationship that will have a huge impact on your future quality of life. But how do you feel about the company that your financial planner works for? If you need assistance when your consultant is not available, you should feel comfortable with the rest of their team.
As part of our series about what one should look for when hiring a financial planner or adviser, I had the pleasure of interviewing Daniel Graff, CFP®, CEPA, Principal and Client Advisor at SBSB Financial Advisors.
As a financial advisor, Dan Graff helps his clients navigate financial challenges and achieve their goals. He asks pertinent questions and enjoys helping clients think about their money from a fresh perspective. He has developed an interest in entrepreneurship and especially enjoys working with business owners and young executives.
Dan is an avid Packers fan and the proud owner of a share of Green Bay Packers stock. He enjoys reading (especially Stephen Covey), eating, skiing, cycling, golfing, and spending time with his wife and children. He previously served as Treasurer and founding board member at Food for Hope, a meal program for hungry children, and was Chairman of the Young Life Resource Board for Broomfield/Adams County in Colorado. He has a passion for helping at-risk youth, especially in the areas of hunger and education.
Prior to joining SBSB in 2018, Dan was the Director of Financial Planning for Weatherstone Capital Management in Denver, CO. He earned a degree in Financial Management from Calhoun Honors College at Clemson University. He is a CERTIFIED FINANCIAL PLANNER™ professional and holds the CEPA (Certified Exit Planning Advisor) designation. As a CEPA, he is focused on helping business owners plan for and navigate business transitions and sales. He is also a member of the Financial Planning Association (FPA).
Thank you so much for doing this with us! Our readers would love to ‘get to know you’ a bit more. Can you tell us a story about what brought you to this specific career path?
My interest in financial planning really began in childhood. I had hard-working parents who made sure I never went without, but at the same time, my family never had extra money. I saw my parents making significant sacrifices to cover our expenses. This gave me a desire to learn everything possible about money, investing, and growing wealth, to help people like my parents achieve financial security.
Instead of starting out in financial planning right away after graduating from Clemson’s Calhoun Honors College, I had the opportunity to start a mortgage company with a mentor of mine. Within a year, the 2008–09 financial crisis hit. I found myself wanting to expand professionally beyond mortgage assistance into broader financial advice, and so I decided to pursue my CERTIFIED FINANCIAL PLANNER™ professional designation (CFP®). Joining the financial advisory business provided another way to serve clients. As a CFP®, I really enjoy the opportunity to learn about and understand the career paths of hundreds or even thousands of people and provide practical financial advice to business owners and executives.
Can you share a story about the most humorous mistake you made when you were first starting in the industry? Can you tell us what lesson or take away you learned from that?
Honestly, my most memorable mistake was attire-related. I had a meeting in downtown Charlotte, NC, and was focused on getting to the meeting in a timely manner with all of the materials that I needed. In the process of getting ready, I put on a pair of slacks and a button-down shirt without much thought. It was a cold day, so I also threw on a vest and went into work. When I arrived, my boss took a look at my casual (and somewhat thrown together) outfit and asked me if I was homeless. I remember thinking to myself, “You know what you pay me…I can’t afford your clothes.” I was really offended. But based on his reaction, I learned an important lesson about respect and perception. Starting out, I have seen many new associates make similar mistakes.
Like it or not, appearance and perception are vital to a successful career. The way you present yourself visually is part of your brand and can have a real impact on how much people trust you and how competent they think you are. Not only did my old boss teach me this important lesson with his reaction, I also distinctly remember receiving a gift card to a men’s clothing store from him that Christmas.
Are you working on any exciting new projects now? How do you think that will help people?
Currently, I am focused on two main business initiatives related to risk mitigation for entrepreneurs and executives. Business start-ups often have a large amount of capital tied up in business operations and assets, which is not ideal from a risk standpoint. I am looking at ways to diversify their exposure to both the business and other investments to spread out risk. Many entrepreneurs might have up to 70 percent of their assets tied up in their business, and, especially as we have seen with the pandemic, it is important to mitigate risks as markets fluctuate and business models change.
A similar concern is that of executives who have a significant portion of their compensation in company stock options. I am working in this area to help executives move their investments in appropriate ways to maintain compliance within rules and regulations for executive compensation, but in a way that minimizes their tax liability. When a large portion of an executive’s investments are tied up in one company, it’s especially important to be strategic in the manner that you create liquidity as they approach retirement.
Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Is there a takeaway or lesson that others can learn from that?
I think it takes time to build up momentum in any career, but especially as a trusted financial advisor. This business is not easy. It takes real knowledge of the markets and experience in a large variety of situations to be able to give sound advice that fits an individual’s unique situation. Additionally, once you have the confidence and talent to give great advice, you have to also have the track record and command of the business that makes others willing to listen. That piece takes time. There are no shortcuts.
I saw a real tipping point in my career after about seven years in the business. I had built up a strong track record and core group of clients. Once I reached about age 30, I realized that people were listening to me, and were comfortable referring their friends and family.
What three pieces of advice would you give to your colleagues in the finance field to thrive and avoid burnout? Can you give a story or example?
I have found over the years, the best way to take care of my clients has been to take care of myself — managing my workload and developing a good sense of priorities. In my first job, I didn’t understand the concept of managing up. I worked so hard, but was constantly frustrated and burned out because there was so much more work to do than I could ever get done. I learned that pace and communication are vital. I tell those just starting out not to say “yes” just because they feel like they have to. If you ask great questions when a task is handed to you and manage your priorities, you will achieve great results for yourself, your organization, and, most importantly, the clients who are trusting you with their financial futures.
In the same vein, don’t expect your superiors and co-workers to know what is on your plate. Make sure you are managing expectations for turnaround time on projects and communicating your priorities on a regular basis. Also, working within a larger organization, it is especially important to remember that you will win when everyone is winning. Rather than feeling competitive with your team, look for ways to make others look good and try to anticipate what will be needed next. Your ability to do this will have a significant impact on your success.
Ok. Thank you for all of that. Let’s now move to the core focus of our interview. As an “finance insider”, you know much more about the finance industry than most consumers. If your loved one wanted to hire a financial advisor (not you :-)), which 5 things would you advise them to find out about before committing? Can you give an example or story for each?
It’s a great question. So many people are confused about what makes a good financial planner and often will hire someone based on their “gut reaction,” without a real analysis of what they are getting from the relationship and what they should expect. I recommend they consider five vital components when evaluating a financial advisory relationship.
1.) Hire a company first and a person second. You should absolutely be very comfortable with your financial planner as an individual. After all, you are forming a new relationship that will have a huge impact on your future quality of life. But how do you feel about the company that your financial planner works for? If you need assistance when your consultant is not available, you should feel comfortable with the rest of their team.
Additionally, the company needs to be strong, stable, and have a philosophy of doing business that you can get behind. The policies and procedures in place at your financial advisor’s company will establish the parameters of how your portfolio is managed. Evaluate the companies you want to work with first, and then find a person within your preferred company that fits with your style and personality.
2.) Cost is important, but value is important, too. There are many ways to structure an advisory relationship. Some advisors work on commissions and some work for a flat rate. The scope of fees is in proportion to the amount of work and size of your portfolio in all cases, but it is difficult to estimate total cost in advance and compare apples to apples.
A better way to approach evaluation of cost is to look at value first. Which activities carry a cost and which are provided free as a perk of being a client? Is there a cap on fees? How are advisors compensated overall? It’s important that you feel comfortable that an advisor is providing good value in the relationship, rather than choosing on cost alone.
3.) Understand the type of advisor you are looking for and what would be most helpful for you. Your stage of life, investing goals, and profession are all variables that impact the type of advisor you might need. Some advisors specialize in liquidation of concentrated stock, executive compensation, and stock options, while others work primarily in the areas of retirement planning or tax liability mitigation. Not all advisors have the same level of expertise in specialized areas of investment planning.
Keep your specific needs in the forefront as you search for and interview candidates. I spend a lot of time working in cash flow and liquidity management related to executive compensation, but we have several experts in our firm that specialize in taxation, for example. A good financial advisor may be able to give solid advice in several areas of planning, and hopefully they also can tap into the resources of their firm to engage various specialties for clients.
4.) Don’t let location hold you back, find the firm and person that fits best for you. Especially in today’s virtual work world, hopping on a video or conference call with your advisor is just as easy as a trip down the street. So many people limit themselves to the advisors that have an office in their local community without looking out into the wider world to find the perfect fit. While location can be a benefit, especially if you have local investment needs related to pensions and state-specific investment accounts, geography isn’t always a top consideration. For example, I now find myself working with executives from around of the country as I continue to build my practice in executive compensation.
5.) Every financial decision is a tax decision, hire someone who can help with both. Clients are best served when their tax strategy is developed in concert with their overall financial and investment strategy. Having these capabilities within the same firm greatly increases the level of communication and seamless information sharing. While we also work with an external team of consultants and CPAs for some clients, others prefer to have all of their planning under one roof. This can be especially important when it comes to tax considerations.
I like to say that every financial decision is a tax decision on some level. It’s not just about how much money you make, but how much you keep. If a firm has expertise in taxation, their advisors are likely to help you ask the right questions, regardless of whether they’re preparing your return each year.
I think most people think that financial advisors are for very wealthy people. This is likely not actually true. Can you explain who would most benefit from hiring a financial advisor and why? Can you give an example?
Anyone with the means to invest and save for the future really should engage a financial advisor. Doing so can prevent mistakes and help maximize the return on any size investment. I especially believe that most people need a financial advisor due to a lack of time, expertise, and confidence to act.
The question really isn’t whether most people need a financial advisor, but rather what value they get from the relationship compared to the cost incurred. For wealthy people, the cost of a mistake could be much greater, hence the perception they have the greatest need for advice. However, any mistake can be damaging to your future plan, and there are certainly financial advisors who cater to younger people and those who are still finding their path to success.
A great example of who really should hire a financial advisor with urgency is a young couple participating in a start-up and wondering what to do with their options. Making good use of the opportunity with a substantial investment early in a career can have lasting effects and can set the trajectory of your wealth development over the course of an entire lifetime. It’s a circumstance which would require some specialized advice and may provide significant value.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
Wow, there are so many people that have helped me. It’s actually interesting to look back. I have two major influences on my career that come to mind. James Fleshman was my first business partner and gave me the opportunity out of school to get started in my career. He showed me that with enough hustle, talent, and hard work (and some decent brains) you can really go out there and make your mark.
The other is my uncle, Don Asselin. He was a business advisor who helped several brokerage firms convert into registered investment advisors following the fee-for-advice model. When I was looking at a career in financial planning, he directed me to a fee-based approach which I still believe is the right and most responsible way to structure client relationships. Because of his advice, I have always felt like I was sitting on the same side of the table with my clients, and that I succeed when they succeed. I have no incentive to sell them anything. I just want to put what makes the most sense for them in their investment portfolio. I can’t imagine how different things would feel for me if I were a commission-based advisor, and so I am thankful to Don that he steered me in this direction so early in my career.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
My mission ever since beginning in this industry has been to try and right the historical wrongs of stockbrokers. While there have always been honest and good people in financial planning, some in the past have tarnished the reputation of our industry with self-serving advice and a lack of transparency regarding costs to the consumer. Unfortunately, there are still a lot of salesmen in our industry that have sold something that is great for themselves and mediocre for their client. When you tell people what you do at a party, they sometimes run away for fear that you are one of “those guys.”
My hope is to provide great value, to help people make sound financial decisions, and continue to look for ways to help them win. If I do that for a long enough period and lead by example, I believe the reputation issues our industry faces have a chance to change.
How can our readers follow you on social media?
I can be found on LinkedIn (https://www.linkedin.com/in/daniel-graff-cfp%C2%AE/) and I use that platform to post most of my work-related content, including articles.
Thank you so much for joining us. This was very inspirational.
Thank you for having me!