ENSURING WEALTH LIVES ON
One firm’s proprietary approach to generational financial planning
Proprietary approach to generational financial planning
Successful wealth preservation requires a crucial, sometimesunexpected ingredient – love.
“The first thing that’s important to us is whether or not the people that are looking to become our clients, or that we want to have as a client, actually love someone other than themselves,” said Debra L. Schatzki, CFP®, founder and principal of BPP Wealth Solutions, LLC. “We will only work with people that want to make sure that the people they love, or the charities they love, will be well taken care of when they’re gone – that’s a critical priority for us when working with our clients.”
BPP Wealth Solutions, with offices in New York and New Jersey, provides investment management, insurance, and estate planning services to clients seeking to build, protect, and preserve their hard-earned wealth for the next generation. The firm works with clients dedicated to ensuring their wealth lives on after they are gone and committed to BPP’s proprietary Security Income
Plan® model.
“The Security Income Plan provides people with enormous value and clarity of what they have, how it’s owned, and what it will do for future generations,” Schatzki said in a recent interview with “Advisors Magazine.” BPP also requires prospective clients to hold minimum assets of $10 million, she said.
The firm’s registered process, the Security Income Plan, differentiates BPP from its competitors and helps provide clients with added clarity.
Financial planning can feel opaque to investors, even highly educated and competent ones, given its complexity and the persistent legalese surrounding disclosures and materials in the industry.
“One of the biggest problems our industry has is the clients’ inability to understand most of the information that’s given out,” Schatzki said. “I have clients that send us their prospectuses and ask us to contact them if there’s anything they should know, but most clients don’t want to read them or don’t find that in reading them they actually understand what’s going on either.”
Financial products such as 401(k) plans often come complete with impenetrable disclosures that leave clients frustrated. Schatzki said that complex tools may have been acceptable in a bygone era when only the upper-crust could access financial services, but today’s investor needs a more reasonable, intuitive approach.
“When you look at the structure of investment management and even financial planning, it has evolved from something that was being done
Build, Protect, Preserve Your Wealth for Generations™ with our proprietary process, the Security Income Plan® (SIP)
for royalty and privilege, to now being available to everyone. The difference now is that, for clients today, the information should be simple,” she said. “The tools that we have today are so much easier to use, and if our industry decided to simplify the way that things are communicated so that clients, the end-user, could understand the costs and the benefits, it would be transformative.”
Advisors often play, unintentionally, into the overly complex nature of financial products and services. Many advisors work diligently to educate their clients, but are hidebound by the jargon or legal-speak they picked up during their first years in the industry. Clients, meanwhile, likely have never had an advisor who can breakdown complicated financial terms into simple language. The internet in recent years has allowed clear, concise information to proliferate to mainstream audiences, but understanding their own finances remains a problem for many, possibly most, investors, Schatzki said.
“It’s more accessible but it’s still not at the forefront of any advisors’ plan,” she said. “The end-user, the client, should be able to understand things. With the tools that we have, the comparison should be at the front of the presentation so that everyone knows what they’re buying, how much it costs, and how it works.”
BPP Wealth Solutions works to simplify concepts by understanding how their clients want to communicate. Every BPP client takes the Kolbe personality test, a tool that measures how people react when presented with information, allowing the firm to tailor outgoing messages to individual recipients.
“It allows us to see how our clients like their information – are they visual, do they want more facts,” Schatzki said. “The test really does provide that information and doing that allows us to actually have our clients feel confident that when they get the information, they’ll actually understand it, it’s not based on the way we think.”
If I live a long life, will I be able to continue living in the lifestyle I’ve become accustomed to? BUILD
If I become disabled, how do I want to be cared for and can I afford this level of care? PROTECT
If I had died last night, would my assets go to whom I want with tax efficiency? PRESERVE
BPP Wealth Solutions acts as a fiduciary, meaning that clients’ best-interests come before bottom-line considerations. That means that the care BPP takes in communicating with clients extends to other aspects of the firm’s services.
The firm develops customized financial plans for each client, never taking what Schatzki described as a “cookie-cutter” asset allocation approach. Instead, Schatzki works to understand clients’ individual financial goals and needs so that a tailored solution can be developed. That custom solution is why automated platforms and do-it-yourself investing can produce subpar results, and why a professional advisor still beats anything else on the market.
“Most investors don’t make money because they buy when the market’s up and sell when the market’s down. One of the key components of being a good planner is to keep people invested in their wealth,” Schatzki said, adding that automated tools such as the so-called “roboadvisors” can fall short if the economy takes an unexpected turn.
She then explained why a skilled advisor plays such an important role.
“Having options is always good but having professionals to keep people on track to know what they should or shouldn’t do is critical to people achieving their goals,” she said. “The problem comes in when things go bad and they don’t have that safety net. Professionals help to keep them on the right road while the markets are scary, or while they don’t have enough in their savings, or while a critical element comes into their lives and they don’t know how to deal with it.”
Just like how clients need to love someone beyond themselves, BPP takes its concern for clients farther than simply dropping money into different “buckets.” Part of being a fiduciary is “making sure, in any way we can, that all of their things are set up well,” Schatzki said. Without a skilled fiduciary, even the most informed client can be led into bad decisions or to inadequate products. Building a tailored solution also requires an advisor to make sure other professionals in a client’s orbit, such as their attorney, are kept informed.
“Fiduciaries, we all need to work together because the clients rely on us,” Schatzki said. “Even my most educated clients really didn’t understand most of their planning. They’ve had some of the best planners in the world, but there wasn’t any coordination of the plan with all of the different professionals, and in many cases, there wasn’t an illustration so that they could actually see how their plans operated.”
All of this work is essential to help clients reach the financial future they worked hard for, Schatzki said. Any prospective investor needs to ask their would-be advisor two questions: how will you help me fulfill my
Fiduciaries, we all need to work together because the clients rely on us." - Debra Schatzki
dreams, and what process will you use to do that? Many clients may naturally focus on investor qualifications or personal referrals, but those two questions will shed more light on the relationship’s potential than anything else.
A strong client-advisor relationship is key to longterm wealth management, and especially multigenerational financial planning. Investors may worry whether their loved ones will be taken care of after they are gone, and the hurdles to building a solid financial foundation for the next generation can seem hard to get over. A trusted, open advisor can help investors navigate the complex financial world and come through with a sense of security.
“What we can accomplish by planning and being conscious is amazing,” Schatzki said. “Working with a good team of advisors, accountants, attorneys can really help people fulfill their dreams and stay on track.”
For more information on BPP Wealth Solutions, visit: bppwealth. com