Expertise scored 80 Financial Advisors in Riverside, CA – and Pacific Capital ranked in the Top 13
The following is adapted from FA Magazine by Karen Demasters – June 1, 2017
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Financial advisor Chad Willardson worked very hard recently to get elected to a job that had no financial training requirements whatsoever—treasurer of Corona, Calif.
In that position, he is in charge of investing the city’s $250 million bond portfolio. His predecessors were in charge of the same fund, but he says they didn’t have his financial or investment training. They came into the job cold.
More often than people realize, elected officials in the U.S. have no financial training when they are put in charge of public budgets and pension funds on the local, state and national levels. Even when an official is not directly in charge of a financial department, he or she is frequently expected to weigh in on the financial consequences of legislation.
Sometimes financial advisors or those with similar backgrounds decide to tackle the rigors of campaigning and accept public offices themselves, but it doesn’t happen enough, say industry people.
Willardson, the founder and president of Pacific Capital, a wealth management and financial advisory firm, never had any political ambitions himself. But he wanted to make things better in the community where he and his family work and live. Leaders in Corona, a growing city of about 162,000 residents, asked him to run for treasurer in a nonpartisan election, and he is now starting his first four-year term.
“A lot of cities are in financial trouble and there are many of us with financial expertise who can make a real difference,” he says. “Managing the city’s portfolio was like taking on a new client for me, but it is a very important client. It was easy to fold this in with what I already do as a business.
“I don’t think we can afford to place our investments in the hands of politicians,” he says.
Willardson is using the same resources for the city that he uses in his business, and he has brought in a third party analyst to help show the officials how the city can increase yield and reduce costs on its investments. “My goal by the end of four years is to show how much we have improved with our investments,” he says.
The ways advisors get into the public arena differ, but the goal of effectively influencing public policy so that financial consequences are taken into consideration is the same for most. Some advisors who have taken the public servant plunge are battling financial issues on the state level. Heather Bishoff, co-owner and chief financial officer of Bishoff Financial Group in Worthington, Ohio, an asset management and retirement planning firm, started with a seat on the local board of education when she saw teachers being let go and programs being cut. But she soon found that school funding is a state issue.
She is now a Democratic member of the Ohio House of Representatives in her third two-year term facing numerous challenges in a state ranked fifth worst in the United States for taxes. “It was extremely intimidating to run for office, but we need more people who are financially minded to be at the forefront of these issues. There are public policy issues on expenditures and taxes that affect people on a day-to-day basis,” she says. “We have to put our money where our mouth is, so to speak.”
“I’ve had my say, but, despite my pleas, Ohio has raised a lot of taxes,” she says. “What tends to happen when non-financial people make decisions about public policy is they trip over a dollar to save a penny. As financial advisors, we think long term and for taxpayers it should be the same. I am too passionate about this to see shortsighted public policy made. As financial advisors, we know you sometimes have to make investments up front to save money later on.”
As an added bonus, Bishoff says her children love her holding public office. “They feel special. They know I am good for a peanut butter sandwich for them, but I can also stand on a mountain with a sword and let my opinion be known if need be.”
Another bonus is that holding public office can give a financial advisor added exposure, says Doug Lyons, founder of Douglas J. Lyons Financial Group, a wealth management firm in Red Bank, N.J. Lyons was encouraged to run for office in his hometown of Bay Head, N.J., he says, but commuting to New York City every day left him with little extra time. After opening his own business in the suburbs, he had more time.
A Republican, he is now in his second three-year term as a Bay Head councilman in charge of the finance committee. Lyons encourages all financial advisors to serve in public office as a way of giving back to the community. Being in public office gives an advisor more attention but it also means taking the good with the bad, he notes.
“People will unload their complaints about local issues on you at parties, but as a financial advisor you deal with all kinds of individuals, so you can bring a unique skill to the table in knowing how to deal with people,” he says. “Absolutely, I would encourage other financial advisors to run for office.
“In Bay Head, there were issues in the finance department that needed to be dealt with and I think I brought a new perspective that would not have been there without me,” Lyons adds. Since he has been on the council, he has helped deal with full-time and part-time employee issues.
Advisors in general often show a high level of engagement in their communities, some by running for public office, others by taking different actions, says Blaine Aikin, chairman of the Certified Financial Planner Board of Standards Inc.’s board of directors.
“Financial advisors are highly engaged in people’s lives and understand behavior and they know how to bring reality into the picture,” Aikin says. “Sometimes what we want to do is not realistic: Advisors have to point this out all the time, so they know how to work with people to show them what the trade-offs of proposed legislation might be.”
But being in politics can be divisive, and some advisors may not be comfortable with that. “Many people may not realize a public official needs to be a fiduciary, just like a financial advisor needs to be one,” Aikin points out. “They need to act in a way that is best for their constituents” on decisions about whether to, say, pursue revenue growth or focus on other goals like land preservation. In this way, they are acting just as advisors need to act—in the best interests of their clients, he says.
Many advisors still hesitate to jump into the political arena, adding more work to what is probably an already busy life and potentially creating enemies along the way, says Paul H. Auslander, the former Financial Planning Association president and chair, who has held leadership positions in the financial community nationally and in Florida where he works and lives. Auslander is the director of financial planning at ProVise Management Group LLC, a fee-based financial planning and investment management firm in Clearwater.
He was selected in 2007 by Florida’s chief financial officer to serve on the state’s first Financial Literacy Council for a four-year term. The council, created by the Florida Legislature, was asked to study the financial issues that affect consumers without basic financial knowledge. The council made recommendations to the legislature on how to help consumers increase their knowledge of these issues.
Auslander is known for urging financial advisors to apply their skills to public policy issues by taking on elected and appointive offices. “Financial advisors in public offices are needed more now than ever, but many do not run because of the time-consuming complications of dealing with their own compliance issues for their firms, or because of a disdain for the political process,” he says.
“I would like to see them do it because they see it as a noble method of service, but most are not interested,” he says. “Some cataclysmic event may spur them to act, but they should not wait until something drastic happens.”
The U.S. Department of Labor’s fiduciary rule, which requires advisors who deal with retirement planning to act in the best interests of their clients, is a perfect example of a law that needed more financial experts weighing in on it, Auslander says. The rule is now set to go into effect in June. “The rule was a great idea in concept but then something went wrong and it is just bad legislation now, which is a shame,” he says.
The reward for those who accept the challenge of being in public office is that “you feel like a public piñata,” says Frank Astorino, a Republican councilman in his third term in North Caldwell, N.J. He heads the Astorino Financial Group, a wealth management and financial planning firm in Fairfield, N.J.
Astorino is chair of the borough council’s finance committee, which, he says, gives him “the privilege of overseeing the financial well-being of individual families and an entire town. But there always is an inherent conflict when you are in politics. Having a background in behavioral finance helps.”
He welcomes different viewpoints, which makes his job as councilman interesting, but he is a fiscal conservative. “We have to make sure the borough administrator and the chief financial officer do well with the money we give them, so being a councilman is a little like managing a portfolio.
“You can have more of an impact on a local level, so I would encourage anyone who wants to do that to run for local office,” he says. “I think the other council members appreciate my financial knowledge.”
Trying to wield that political influence sometimes can be frustrating. Steve Sweeney, president of the New Jersey Senate and co-chair of two private pension funds in his business life, says he has gotten verbally beaten up on more than one occasion because of his efforts to increase funding for the state employees’ pension fund, which has one of the worst funding rates in the nation.
“I’m always telling people things they do not want to hear,” he says. “Knowledge is everything in life, and when you know what you’re talking about it is a plus. If you understand what an assumption rate is and how it works, it is a real advantage in public finances. The legislature can’t allow a bond to go forward with the debt back-loaded without having real ramifications later, and they need to know this.”
Sweeney also tried to make New Jersey the first state in the nation to loan money to itself, and he says he took a tremendous amount of heat from those who did not understand the financing. He proposed having the state pension fund buy guaranteed bonds from the New Jersey Transportation Trust Fund Authority, which he described as a win for both sides. “This lack of understanding is a critical issue in state government,” he says.
Other states, like Missouri, are in as much trouble as New Jersey because of fiscal problems. The state public employees’ pension fund is in a financial hole and benefits may have to be cut. The pension fund for county workers also is underfunded, says Holmes Osborne, who ran unsuccessfully for the Missouri House of Representatives in 2010 and 2012 and who owns Osborne Global Investments, a money management firm that specializes in the management of stocks, bonds and corporate retirement plans in Odessa, Mo.
“The pension funds are well run, but the legislature underfunds them,” says Osborne. “The legislature is relying on increased stock market returns, which is not going to happen. There are a lot of ways Missouri is falling behind monetarily.
“I ran for office because I can bring a financial and economic background to the table,” says Osborne. A Democrat, he has decided to run again for the Missouri House.
Sometimes, revenue is not the end goal for a community, yet even its other goals have to be considered through a financial lens. Nags Head, N.C., for instance, was a town divided between those who wanted more development to bring in new business and revenue and those who wanted to preserve open space.
“Nags Head needed to hear that growth at all costs is not good,” says Will W. Woodard III, founder of local firm Dare Capital Management LLC, a fee-only investment planner. Woodard, who ran as an independent in a nonpartisan race for town commissioner, sponsored an ordinance to preserve open space and “others have realized that quality of development is better than quantity.”
“As financial advisors,” he adds, “we are often told to be politically correct and keep our heads down. But if your life is your body of work, like your portfolios are, then you have a responsibility to let your voice be heard. I applaud anyone who is willing to do that.”
Advisor Steven J. Stanganelli of Amesbury, Mass., agrees with that sentiment and decided to run as an independent for a seat on the nonpartisan city council, where he now serves on the finance committee. He’s already decided to run for re-election locally. He also made an unsuccessful run for state representative three years ago.
Stanganelli is also a sole practitioner at Clear View Wealth Advisors, a fee-only wealth management and advisory firm in the city. “I have a perspective that is useful to have on the council,” Stanganelli says. “I look at things like the budget from the bottom up. I bring my financial perspective to the discussion, even as frustrating as I sometimes find it.”
He says he has not been able to have much impact so far. “I don’t have enough WD-40 to have moved the wheels of the town very much yet, but if the council is going to talk about money, I want to be part of the discussion.”
Stanganelli and other advisors say they have lost little or no business over their political activities. “Advisors,” he says, “don’t run for office because they are busy, it doesn’t pay well and they risk ticking someone off and losing sleep and business.” But he adds he hasn’t lost any clients.
Others, like Osborne in Missouri, don’t care if they lose business. “There are people in the district who will not do business with me, but that’s just the way it goes,” he says. “There have not been enough of them to make me want to step out of the public spotlight.”
“Losing business was a fear I had,” adds Bishoff, “but it has not played out that way. We serve high-net-worth people and small business owners and I think my being in the Statehouse is exciting for everyone.”
For Willardson, the Corona treasurer, holding elected office has given him even better financial credentials in his private business. “I’ve made connections through my community work, and people feel even better about hiring me because I handle the city’s portfolio,” he says
Profiles of Success – Chad Willardson
I had the opportunity to sit down with Chad Willardson, who is the founder and senior wealth advisor for Pacific Capital. As you walk into Chad’s office you are immediately struck with a feeling of comfort. The entry way and hallways include an aquarium, bold pictures of the ocean, and a few pictures of some select golf courses perfectly dispersed on the walls. Upon entering his office you’ll notice that his desk is clean, credentials from major universities including Harvard hang neatly on the wall, and his family in frames arms length away give you the impression that this guy has his act together. When I left his office I knew one thing; Chad Willardson is a profile of success.
I asked Chad if there is anyone that has inspired him to become what he has become. His head sank down a little as if he was in deep though, almost as if it was hard to talk about. After a second or two of silence, the two words that came first were, “My Mom”. He said, “My Mom has always been driven and motivated. She always instilled courage in me.” He went on next to talk about his Dad. “My Dad has always been a ‘likable leader’ with impeccable trustworthiness.” It seemed like Chad was most impressed with one attribute of his Dad that escapes most of us; Humility. Most people don’t know how successful Craig Willardson is because he simply doesn’t tell them. When people ask him what he does, rather than boasting about being the CEO of a large egg corporation, he just says, “I’m in the egg business”.
Books seem to play one of the most important roles in the life of Chad Willardson. He lamented the fact that he never read books in High School or in college. He told a vivid story about his first experience at Merrill Lynch where he was asked a very basic question about observing stocks. He still remembers that day and the feeling that he got from not knowing the answer to that question. It seemed to me as he told this story that this day was one of those turning points in a persons life. From that day he resolved to gather as much information about the career that he was going to pursue so that he wouldn’t have to sit there in the dark while questions were asked. Now, Chad Willardson credits much of his success to diligently reading. From what I’ve heard from some of his peers at that same Merrill Lynch, Chad became that branches top producer within just a few years.
Here are some of the first books to come off his lips;
- Create Your Own Future – Brian Tracy
- The Magic of Thinking Big – David J. Schwartz
- Never Eat Alone – Keith Ferrazzi
- How to Win Friends and Influence People – Dale Carnegie
Chad Willardson watches the sunrise and starts his day anywhere between 5:45-6:15 every morning, probably a habit formed through serving a mission for the Church of Jesus Christ of Latter-Day Saints for two years. The things he learned on his mission is probably where his current company mission statement is derived from. His philosophy in life has carried over into the business that he owns and the clients that he services. From the time he started as an intern at a $10 Billion dollar mutual fund company to the current day, Chad Willardson finds joy first and foremost in serving others. You can tell that he genuinely wants to help others improve their lives by freeing them of the emotion and stress that can be caused by finances. His fee is a small price to pay for bringing clarity to a confusing financial situation.
For those of you trying to start a career as a financial advisor, Chad Willardson received some very important advice early on. He was told to “work very very hard for 5 consecutive years and not give up and not turn back”. He was told that it would be hard, exhausting, confusing, and that he would want to quit but if he persisted through for those 5 years, the result would be rewarding.
If you know Chad Willardson, you know that he is a profile of success, but what you might not know about him is that he loves to dance. Get invited to one of his dance parties and you’ll experience that first hand. You might be left scratching your head wondering how a 6’5” tall guy figures out how to dance, but somehow he does. He’s a lot better at basketball than he is at dancing, and he’s a lot better at reading than he is at basketball which is why he is who he is, and which is why I’m sitting in his office trying to get into his head.
Chad manages the stresses of life by implementing priority management principles. His innate desire is to please everyone, to be accessible, and helpful. However, being only one person, if you allow your accessibility to get out of control you are asking for overwhelming anxiety. Chad has set boundaries and attempts to make sure that his priorities are in order on a day to day basis so that his family doesn’t suffer the consequences of an imbalanced life.
I have heard reputable CPA’s in the region describe him as very “strategic”, but when all is said and done, anyone who knows Chad Willardson will describe him as a leader, and I would agree. According to Chad;
Lifting others to be even better than what they might think they can be is true leadership. Invest in others lives and see potential beyond what others might see in themselves. Leaving someone better than you found them, and ensuring that they will be even stronger when you’re gone…that is true leadership.
I have always believed that the most miserable people in the world are miserable only because they are continually studying other miserable people. They watch to much TV, endure too much negativity, and refuse to serve others. Conversely, the happiest and most successful people have come by way of dedicating their lives to a study of happy and successful people. For those looking for someone to study, I’d suggest Chad Willardson.
Every day you’re bombarded by ideas that could derail your financial feature. Bad advice, different expert opinions, and sales pitches are everywhere. Whether you personally have a hundred thousand dollars or a hundred million dollars, you feel the burden of stress of making the best moves for your future, despite a lot of uncertainty.
How do you decide what to do with your money? In his new book, Stress-Free Money, Chad Willardson shows you how to overcome the obstacles standing between you and financial freedom. He exposes the risks, biases, and major mistakes that keep so many people from reaching their goals. Financial security and peace of mind are within reach. Most of us just need to know where to start.