Diane Pearson hates to stereotype women clients and their communication styles. But she knows from years of experience that women often prefer to work with someone of their own gender — especially when they’re faced with wrenching situations such as a divorce or the death of a spouse.
Single-women clients, including divorcees and widows, make up 15% of the approximately $400 million of assets managed by Pittsburgh-based Legend Financial Advisors, where Pearson is one of five co-owners.
The advisors employ a team strategy to handle clients, as do some other high-profile advisors, including Meg Green. a Royal Alliance advisor with offices in Florida and California. See: What Meg Green was thinking when she purposefully shed $40 million of assets.
Name: Diane Pearson, Legend Financial Advisors
Location: Pittsburgh, Pa.
Years in the business: 22
Her firm’s assets under management: $400 million
Why did you become an advisor?
By default? (laughs) Lou Stanasolovich hired me in 1989 to assist him at another firm (Allegheny Financial Group). He said, “I plan on starting my own firm. What you think about that?” I wanted a job, so of course I said OK! (laughs) We worked through the process, building clientele and revenue over five years, and started Legend in January of ‘94.
At first I did accounting and administrative work and telemarketing. I was smiling and dialing. I took incremental steps along the way. I did not sit for my CFP exam until 2000. In 1992 I got married and started a family; in the interim I got my Series 7 license and insurance license just to try to enhance my knowledge in various aspects of the industry. Once the kids were out of diapers, I started studying for my CFP.
And now I’m acting as an advisor and handling the operations of the firm.
I have college degrees in management and accounting, and I guess that puts together the people and numbers aspects. Financial planning was definitely a natural progression, and it’s become a passion rather than a job.
How much do you personally manage?
I don’t have my own book of business; we work as a team.
*What’s the advantage of that? *
We have four advisors on the team: Lou, myself, Jim Holtzman and Ben Greenfeld. When a client calls in, they’re not sure if they will be sitting with me, or they might be sitting with Jim. After we meet with them, we leave messages for each other: “I met with Mark and Sue today; here are the issues and here’s how we’re addressing them.”
We learned this from the (Allegheny Financial Group), where we had everyone kind of doing their own thing. If we wanted to take a vacation, did our clients just have to sit for a week waiting for a return phone call? Also, Jim is a CPA; sometimes I’ll get a tax question thrown at me that I’m not 100% comfortable with.
We understand women clients are a niche at your firm?
I’d say that niche is more curving toward me. They don’t hesitate to talk to any of the men here, but somehow from a communications standpoint women like to talk to other women. (See: How to market to women: Don’t.)
When you’ve got a female going through a divorce, a male might be the last person they want to talk to. We are different genders; we do think differently. The other issue is widows. We frequently have potential clients come in and say, “I want someone to be here for my wife if something ever happens to me. There are still many couples in which one member does not deal with finances on a day-to-day basis. If the other passes away, many times we hear them say, “I don’t understand what I’m doing.” That’s where we step in.
*How do you cultivate this niche? *
I have the Certified Divorce Financial Analyst designation, and that’s a good direction to go. I primarily deal with attorneys as far as the divorce aspect. My role is primarily looking at assets and trying to come up with equitable distribution. That opens up doors. (See: Eavesdropping on the Women Advisors Forum: Rainmakers share their secrets. Hint: They revolve around finding a niche.)
We’re developing a web site dealing widows and specific financial situations. I’ve also aligned myself with other women’s organizations in the Pittsburgh area. I’ve been on the board of the National Association of Women Business Owners, and that’s been a good opening for me.
When you go through something like this, I’ve found that genders naturally want to be with genders. It is true that everyone may have the same problems—in figuring out cash flow or trying to save for retirement. But the way it’s communicated can be extremely different.
Your firm uses TD Ameritrade as custodian. Why?
We have $380 million in assets at TD, and they’re primary. But we use other brokerage houses. We had a client who came to us with $20 million. They wanted to use Schwab. Guess what? We stayed at Schwab. (See: Where TD Ameritrade has come since its 2006 merger and where it is headed in 2010).
As for TD, when we started Legend, we were using a much smaller firm, Jack White. Jack White was acquired by Waterhouse, and then came the merger with Ameritrade. Along the way on the adviser side, TD kept a number of their employees, and we’ve all kind of grown up together.
We’ve always kind of had their ear, and they’ve relied on us: Lou was on their first advisor panel, and I am now on that panel.
They allow us to feel like we’re part of the family; they trust us and listen to our input. When you’re dealing with a corporation that size, many times you feel like you are a really small piece of the puzzle. But they have always been very open and accepting of the ideas we’d offer to them.
What has been your best day as an advisor?
The best by far was: I had a client who’d just started with us a couple of months earlier. We had done all their data gathering and I’d completed all the illustrations. I sat down and wrote recommendations in regard to their situation and what their next steps would be. I met with them on a Wednesday afternoon and presented the recommendations.
On Thursday at about 8:15, my phone rings. It’s the husband of the couple, and he said, “I just walked into the office and there was a pink slip lying on my desk.” He said that because of what we’d done, he knew exactly where he was and what his options were. He ended up getting out of corporate America and becoming a photographer. I felt like I had really accomplished something and made a difference in someone’s life.”
What has been your worst day as an advisor?
The day any client dies. In financial planning, you have discussions with clients that are intimate. You do really get to know someone when they can talk you about their money.