Protecting Wealth and Fulfilling Retirement Dreams and Goals
In 2008, I worked in an after-school program and one of my favorite “duties” was to lead “story time” for the elementary-aged children we served. One of my favorite books to read aloud was Flat Stanley, which follows the adventures of the titular character, Stanley, who had been accidentally flattened one day, but makes the most of his situation, and is soon unlocking locked doors by sliding underneath them, and traveling around the world in a postal envelope.
It was while working there that I first heard whispers of the massive financial crisis the U.S. was headed into --from a colleague who was in her late 50s and could no longer count on what she had saved for retirement to last her. In one short year the financial crisis of 2008 had wiped out $12.8 trillion dollars of investment assets in America. My friend decided she would have to continue working, well--indefinitely, and was devastated. In my early 30s at the time, I couldn’t really fathom the heartbreak, her retirement plan gone sideways faster than you could finish reading Flat Stanley.
In the eight years since, many fingers have been pointed: to regulators asleep at the financial wheel, at credit-default swaps and the Lehman Brothers bankruptcy, as well as the housing market. In the eight years since, many Americans have tried to crawl out of that devastating financial slump and recover what they lost (many up to 50-60% of their investment value). There are over 10,000 Baby Boomers that will be retiring EVERY DAY over the next decade. Many are wondering if they will have enough money to retire and whether or not they will have enough to last them during their lifetimes.
Many times people THINK they know what their goals are, but as you sit and discuss what they want out of retirement, they really haven’t crystallized what they want from retirement.
I had the opportunity of sitting down with Dan Ohlwiler, owner and CEO of Sterling Financial Advisors and discussing the challenges many people face when they begin to approach retirement. His experience as a retirement planner over the past 30+ years helping individuals and couples develop a safe and secure retirement income plan has helped hone his conservative philosophy in planning for retirement. He has seen the devastating impact the financial crisis of not only 2008, but the Dot-Com bubble of 2001-2002 has had on many people’s retirement plans. Through these experiences he has come to learn that “it’s not how much money you make that counts—it’s how much money you keep that matters.” Dan says that his (and his company’s) approach to retirement planning has helped his clients with what he calls S.W.A.N.—Sleep Well At Night.
Sorbet: So Dan, you have been helping people plan for their retirement a long time—for over 30 years. How have things changed over that period of time?
Dan: I started out in the life insurance business in 1981. Full financial planning as a profession was fairly young at the time and in 1984 I decided to get securities licensed and move my business into full financial planning and helping people plan for retirement. Everything was going great—I was in my early 30’s, my business was growing, and life was good. Then in 1987 there was a big stock market crash called “Black Monday.” The stock market dropped 25% in ONE DAY! That event had a great impact on me and my business. A lot of my client lost money and blamed me for it. I hadn’t done anything wrong or illegal, but it’s human nature to blame your brokers or advisors because they lost money. Needless to say, my business suffered and I struggled to keep my business going. To make a long story short, that experience (along with many others) helped me to step back and look at what I was doing and then making a decision that if I people were going to trust me with their life savings, then I can’t afford to lose their money.
What I see out there right now is there are a lot of young stock brokers, advisors, or other people who have never experienced a downturn in the economy during the time they’ve been in their profession. Many got into the business after the 2008 crash and the only thing they’ve experienced is a bull market. They are a lot like I was when I was starting. Business is great and life is good. They think that this market is going to go on forever. The philosophy of “buy and hold” is one philosophy the stock market. But that philosophy probably no longer applies as we get older. The time frame for investing is much shorter and in many circumstances we don’t have the time to recover what we’ve lost. The stock market today is not the same as it was when Baby Boomers were growing up. It’s much more volatile.
Sorbet: Tell me about your company Sterling Financial Advisors? How long has it been in business and explain how you might be different from others in your profession?
Dan: Well, as I mentioned earlier, I myself, have been doing this for over 30 years, but I was in a partnership for a portion of that time and decided to sell my half of the business around 10 years ago and go out on my own—so to speak. That’s when I formed Sterling Financial Advisors. Many people ask me—why the name Sterling? I just felt like I wanted a name that reflected a sense of quality and class, and sterling silver seems to reflect that.
A lot of companies talk about having a “family atmosphere” or that clients become part of their “extended family.” Well, we really are a family business. My wife and I have five children—four boys and one girl. Three of our boys along with my son-in-law work in the business make up our staff (along with my wife, Marilyn). So it actually is a family run business. So when we tell clients that they become part of the “Sterling Family,” it really is part of our extended family.
Sorbet: That is amazing. You really do have a family business then. How do all of you get along?
Dan: We have been lucky and we are a really close family. All five of our children live in south Orange County so we’re able to get together a lot. Keeping everyone happy is sometimes a challenge, just like it is in every family, but it seems to work so far. Overall we all get along very well and enjoy getting together—even outside of work.
Sorbet: So if someone comes to one of your retirement workshops or is referred to you from one of your clients, how would they go about working with you and your firm?
Dan: Well, the very first meeting is really just to get to know them and what their hopes and dreams are for retirement. Many times people THINK they know what their goals are, but as you sit and discuss what they want out of retirement, they really haven’t crystallized what they want from retirement. Most of the time they just want to make sure they have enough money to last them the rest of their lives and they haven’t thought much beyond that. That’s what we try and help them understand—what is it that they really want in retirement, as well as going forward? There is no pressure or commitment that they need to make in the first meeting—other than to decide whether or not they’d like to meet again. It’s simply a “get-to-know-you” meeting. There’s no cost or charge for the first meeting because we might not be able to even help them. We just want to find out if their retirement goals and dreams are consistent with our philosophy. This is as much of an interview on our side as it is for them.
Sorbet: Assuming they want to come back and see you, what happens then?
Dan: The purpose of the second meeting is to lay the foundation for our relationship going forward. That foundation is built around what we call our “Retirement Weather Report.” I wrote a book about retirement planning called “Protecting Your Retirement From The Financial Perfect Storm.”
How we invest our money at age 35 is significantly different than how we should invest it at age 65 or 70.
The basis of that book is that there are a number of factors that can affect our retirement (just like the movie) and so we have put together the Retirement Weather Report” that “forecasts,” so to speak, what people’s retirement income is projected to be for the next 30 years—based upon their current situation along with certain assumptions. We prepare these reports at no cost just to give both sides a foundation to base our further discussions. If at the end of the second meeting, they like what they’ve learned and seen, we then establish a working relationship based upon their individual needs.
Sorbet: Do you have specific investments or tools that you use with your clients?
Dan: One of the things we tell people in our first meeting is that we don’t have any monopoly on any of the investments or insurance products we use in the planning process. They can probably get the same types of things from any other broker or advisor. What we do have a monopoly on is the integrity we have and how we treat our clients. That’s what we have a monopoly on and sets us apart from other firms. We had client come in a few months ago for their annual review after being with us for a little over a year. As they were leaving, the wife said to me—“Dan, the thing we appreciate about you and your company is that you treat us the same AFTER we became clients as you did when we were first in the process of becoming clients.” They said that so many times in the past when they’ve dealt with other brokers, as soon as they became clients the broker almost seemed to forget about us and move on to the next prospect. Things like that just reconfirms to me that how we’re running our business and the culture we’ve established on how to treat clients is right.
Sorbet: So when you say “culture” of your firm, what do you mean by that and what can a client expect from you?
Dan: Well, as I mentioned earlier, we really do consider our clients part of our extended family of Sterling Financial Advisors. I’ve instilled in my sons and son-in-law that our clients come first and that helping our clients reach their retirement goals is our number one mission. I have found over the years that it is much easier to keep existing clients than it is to get new ones. We will sponsor anywhere from 4-6 client appreciation events per year along with another 3-4 educational events. The social events have been to Broadway plays, Angels baseball games, harbor cruises, golf tournaments and many more. We have a year-end Christmas event that all of our clients are invited to. We have live entertainment, raffles, door prizes, etc. We also sponsor a local charity and as a company match the funds raised at the event. Last year we donated over $11,000 to the Jessie Rees Foundation. We really do treat our clients like family. These are just some of the ways we treat our clients and it’s a way for us to just say thanks to for trusting us with their life savings.
Sorbet: Finally, what makes you continue doing what you do? What is it that keeps you going in this profession?
Dan: I would say that the thing that keeps me going and motivates me is helping people protect their money at this stage in their life. How we invest our money at age 35 is significantly different than how we should invest it at age 65 or 70. Helping people understand how just one bad year in the market can have a devastating effect on their retirement for years to come. It can take just one year—like 2008, to impact your life for a long, long time. It took only one year for the market to drop over 50%, and then another seven years just to get back to where they were. So helping people set up a secure and dependable foundation for their retirement has become a passion with me. Not everyone is a fit for us, but for those who are, we’re going to do everything we can to help them have the kind of life and retirement they’ve worked a lifetime for.