Be wary of advisors that are being pushy to sign up. It’s a process, and it’s meant to go slowly. You’re making a big decision. There’s an organic progression here, and nothing should be rushed. Most of my onboarding with new clients before they make their final commitment includes a multi-month process with several meetings. It’s all a matter of us feeling comfortable with one other.
As part of our series about what one should look for when hiring a financial planner or adviser, I had the pleasure of interviewing Matthew Schechner. Matthew Schechner began his financial planning career in New York City with Gruntal & Co. Following this, he spent several years at Oppenheimer & Co. as a Senior Vice President. Just prior to finding Essential Advisory Services, Matthew spent 10 years as a financial planner with National Holdings. In 2018, Matthew founded Essential Advisory Services with the intention to empower families and individuals through guidance, education and a warm sense of community. The judgment-free financial planning firm is located in Westbury, New York, offering services including goal-based planning, women and LGBTQ services. In 2019, Matthew received the honor as Envestnet’s Essential Advisor of the Year, being selected out of a pool of over 90,000 advisors. Most recently, he received the First-Class Service Award from National Holdings in 2019.
Thank you so much for doing this with us, Matthew! 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?
Following college, I began my career as an employment manager at a large hotel in South Florida where I was tasked with hiring hourly employees, and eventually, in charge of evaluating them. This experience really influenced my thinking and made me question what I was doing. I saw too many people working way too hard with little to no reward. I knew then and there I was meant to find a career that not only had financial incentives, but also great capacity for personal growth. I’ve always known I wanted to help people, and I’ve always had a passion for numbers. Marrying the two concepts made a lot of sense to me, and essentially, it’s what drove me to financial planning.
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 takeaway you learned from that?
Well, this isn’t a mistake that I made, but one that a client made years ago, probably somewhere around 1999. This was during the internet boom when stocks were moving up or down 20 percent in the course of a day. A client calls me up to buy another 1000 shares of JDS Uniphase. As many know JDS Uniphase did not have a very happy ending. I tried to talk the client out of it, and I remember clearly what the client said to me. “Matt, just buy the stock. Do you know what JDS stands for?” I said no, and he answered “Just Don’t Sell! Just Don’t Sell!”. At that moment I chuckled, but as time went on, I realized there was a lesson to be learned. Greed can consume someone to the point of making irrational emotional decisions. As years went on, I never forgot the story. In fact, it reminds me how important it is for me to be the investment behavior counselor for many of my clients.
Are you working on any exciting new projects now? How do you think that will help people?
We recently announced the launch of Essential Advisory Services, a judgment-free, financial planning firm. Our mission is targeting specific communities in society that are ignored and underserviced and are in desperate need for financial planning.
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?
From birth we’re all taught to be problem solvers. Our parents teach us, schools teach us, and eventually, colleagues and mentors teach us. As a financial advisor, we’re given products to be the solutions to all these problems. My a-ha moment came when I recognized that a financial product cannot be a solution to one’s life problems. We need to start with the end in mind. It is the essence of goal-based planning. Only when you know where you are going can you find the right mix of products to be the solution. This realization brought me on my current path and eventually led me from being a micro-advisor to a macro-advisor. In fact, the paradigm shift I experienced was the genesis of Essential Advisory Services.
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?
1. Make sure 50 percent of the books you read are away from the industry. I find a lot of my colleagues read everything they can get their hands on about becoming a better advisor, which of course has great value. It sharpens your tools and enhances your craft. However, there’s something to be said about reading books distant from your industry, as this acts as an escape mechanism for your mind. I think it’s just as important to exercise all parts of your mind. Pick a couple of genres’ that have nothing to do with your career and let your mind go.
2. Find a cause in life that’s important to you and dedicate a few hours a week to it. Philanthropy is a big part of my life. I’ve been on the Board of Directors for numerous organizations, and I’ve always felt it’s important to make sure a part of your week is to giving back. Altruism is one of the essential pillars of our household.
3. The world is 24/7 and there’s an expectation that we are as well. Find a communication strategy that works for you and your clients that will also ensure your sanity. I’m reminded a title of a story written on Thrive Global some time ago…” Be the architect of your time”.
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?
1. You have to ask for references. You also have to be careful with the references. You don’t want the advisor to give his brother-in-law as a referral, which inevitably might happen. The client needs to be diligent and do their own investigative research and screening.
2. Ask if they’re a fiduciary and what is their fee structure. This will provide more insight to who they are and how they run their business. This will also help mitigate the opportunity for conflict-of-interest.
3. Find out how the advisor communicates with his/her clients. Depending on the type of business the advisor runs, it might not be possible for them to see you as much as you need. The client might want to see the advisor quarterly or semi-annually. However, for some advisors, it might not be something they can commit to. Inquire if they use skype or zoom for a face to face. For some clients, especially within the older generation this might not fall within their comfort zone. However, as we move down the age chart this could be a more preferable and efficient use of everyone’s time.
4. Do a background check. You can access FINRA broker check, and make sure to verify any of their credentials. It really depends on how deep you’d like to go.
5. Be wary of advisors that are being pushy to sign up. It’s a process, and it’s meant to go slowly. You’re making a big decision. There’s an organic progression here, and nothing should be rushed. Most of my onboarding with new clients before they make their final commitment includes a multi-month process with several meetings. It’s all a matter of us feeling comfortable with one other.
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?
Financial advising isn’t just for the wealthy these days. Fifteen to twenty years ago, it was much more limited. Considering all of the recent advancements and augmentation within technology, advisors are typically able to handle much more clientele than they’ve been able to in the past. Every day, we’re able to do things a little bit quicker. Advisors can offer more sophisticated and elegant services to people who warrant it.
There’s a lot of people who benefit from hiring a financial advisor. The area I find most impactful, and where I have a lot of experience with, is small to medium size business owners. The average small to medium size business owner spends their entire day surviving. Typically, they’re consumed with success, failure, and managing risk. There’s a lot riding on it. These aren’t businesses with $50 million in the bank, these are businesses sometimes running month-to-month. I find that it’s more common that they have tunnel vision when it comes to their business. In fact, their personal finances are more at risk due to this myopia. It’s my experience these business owners usually leave themselves for last when it comes to retirement and financial planning. As opposed to someone working in corporate America where you’re given your 401(k), vacation days, pension plan, health insurance etc. The small to medium size business owners have to create their own magic every day, day in and day out. Most of them do not realize there’s many more opportunities for them than those in the corporate world. Not just 401(k) plans but being able to accelerate retirement planning through cash balance and profit-sharing plans.
Other groups that can benefit from financial planning include spouses who have been divorced whose partner may have handled the finances. Divorces can be tough, and it can be difficult to know how to handle finances if it’s not something you were used to doing in the past. Working with a goal-based planner can be a great way to create and implement a strategy.
Another group very underserviced is the LGBTQ community. Not only is this community underserviced by advisors, they are often ignored. There’s no reason why anyone should be ignored anymore. Essential Advisory Services is an organization dedicated to tearing down the walls built by others.
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?
Joshua Barg, a colleague and a friend that I’ve worked with for a long time. He really put me on the path to financial planning, and I’m grateful for him every day. He’s a colleague who understood the impact of planning years before I did, and he worked very hard to influence me. He taught me so much. I cannot emphasize enough how important it is to have a trusted mentor in your corner.
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. :-)
The most important trait or habit I would love to influence is saving. Our motto is work hard, play hard, but save harder. It’s such an under-rated habit. What’s strange is at some level most everyone has the capacity to save. Yet, so many refuse to put it into practice. I do believe the indoctrination, so to speak, should begin very early in our lives. Every day we see the dividends of what happens when we teach our youth at the early stages of development. I think we need more creative savings plans, perhaps government sponsored. Maybe some type of structured savings vehicle that mandates or at least highly incentivizes savings. To start a movement, we should begin educating how people can save at a younger age.
How can our readers follow you on social media?
Twitter — @essentialadvis2
Facebook — @essentialwealthwellness
LinkedIn — Essential Advisory Services
Thank you so much for joining us. This was very inspirational.