Financial Literacy

BIG INVESTMENT FIRMS Leave Behind Smaller Investors

Investment advisors at big-name firms and the investors they serve often find themselves in a tug-of-war between the company’s recommendations, and the client’s own ideas. Clients might want to invest in a hot start-up like Tesla Motors, while corporate policies put the brakes on that plan.

Frustration with not being able to let clients breathe is one of the reasons Gene Sulzberger struck off on his own.

“They were getting so fearful of litigation that everything was just dumbed-down,” said Sulzberger, president of Sulzberger Capital Advisors, told Advisors Magazine during a recent interview. “They were fearful of officers not getting all the checks and balances in place if they were deviating from the portfolio a little bit.”

Sulzberger Capital Advisors is a Miami-based firm that offers wealth management services to clients looking for a customized solution to help them reach their financial goals. The firm also works with traditional investment managers who can assist clients with capital preservation, income creation, and capital growth. Sulzberger Capital Advisors requires “six figures” of investable assets to get started, but Sulzberger declines to set a hard minimum so that he can take on clients who fit well.

Sulzberger spent some time in finance’s top firms, and he found that average investors—and particularly clients with $1 million to $5 million portfolios—were being left behind. At one company, Sulzberger recalled only being allowed two annual client contacts if the investors’ portfolio totaled less than $5 million, something he described as “obscene.” Boosting those investors’ access to reliable, tailored financial services became one of Sulzberger Capital Advisors’ key offerings.

“I felt there needed to be more customization going on with client portfolios to really be helping them get satisfaction out of what they’re doing,” Sulzberger said.

Would-be investors often struggle to get started in tackling their finances. Sulzberger said that a number of prospects take an “out-of-sight, out-of-mind” approach to their finances, but that he remains open to their questions and continually keeps them in the loop to make sure that their expectations are in line with what the firm can achieve. And for clients who struggle with financial literacy—another barrier to getting started, Sulzberger noted—Sulzberger works to explain their finances in a way they can understand.

Industry watchers have claimed that automated tools and the so-called “robo-advising” platforms will increase financial literacy and improve clients’ ability to manage their own money. Sulzberger, however, believes those tools may be “too simplistic,” and that investors will eventually want to talk to an advisor who can provide personalized service.

“Seventy-five percent of this job is almost like being a therapist,” Sulzberger said. “It’s about listening to people, being there for people, communicating with them, and understanding their situation and their issues.”

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