Practice Management

One Family's Secret to Success and Succession

Meet the Rathwells: John Rathwell, Investment Advisor and Wealth Professional Top 50 recipient three years’ running; Jonathan Rathwell, Associate Investment Advisor, FPSC Level 1, RRC, PFP®, CIM® and Brianna Rathwell, Associate Investment Advisor and 2018 Wealth Professional Young Gun. The team behind Rathwell Financial, HollisWealth®, a division of Industrial Alliance Securities Inc., sat down with Insights to explain how they live their motto – “families helping families” – and to share the practices that set this thriving business apart.
July 2019

Brianna, John and Jonathan Rathwell

Rathwell Financial, HollisWealth®, a division of Industrial Alliance Securities Inc.

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Meet the Rathwells: John Rathwell, Investment Advisor and Wealth Professional Top 50 recipient three years’ running; Jonathan Rathwell, Associate Investment Advisor, FPSC Level 1, RRC, PFP®, CIM® and Brianna Rathwell, Associate Investment Advisor and 2018 Wealth Professional Young Gun. The team behind Rathwell Financial, HollisWealth®, a division of Industrial Alliance Securities Inc., sat down with Insights to explain how they live their motto – “families helping families” – and to share the practices that set this thriving business apart.

 

Different – and better

John: Before going out on my own 15 years ago, I spent nearly two decades at TD Bank and Investors Group. Having experienced various styles, models and approaches over the years, I knew I wanted to create something truly unique as an independent Advisor. One thing that makes us different – and better – is that we’re a family helping families. Because we span the generations, and yet provide absolute consistency, my kids and I attract grandparents who send us their grandchildren… and vice versa.

Jonathan: John often talks about people who become “raving fans”. Our aim is to have clients want to send us referrals – and for those friends and family members to feel like coming into our office is a special occasion.

John: It is a special occasion. We’re exclusively referral only. We don’t advertise. We don’t have a website. As a matter of fact, I even took our name out of the phone book.

Brianna: Another differentiator is that we continue to evolve. Last year we transitioned our business from embedded comp to a fee-based model. John and Jonathan also obtained their CIM® designations, and I’m following suit, working toward meeting the necessary requirements. Our goal is that by the end of 2019 – subject to approval by HollisWealth – we’ll all be able to provide discretionary portfolio management services to our clients.

John: Where we really shine is tax planning. While everyone talks about this offering, we’re able to demonstrate that the programs we’ve put in place save hundreds of thousands of dollars annually. For example, a while back we presented a prospective client with a plan showing potential tax savings of $1 million over a 10-year period. We then shared it with their accountant, who could see that we were really going to add value. We gained a client who became one of our biggest supporters – and their accountant subsequently sent some significant tax planning business our way.

We don’t “sell” to drive up AUM, we help – and that drives AUM.

John: We’re also bucking the system. While financial institutions are increasingly automated, we have a live person answering the phone who is familiar with our clients, recognizes their voices, and sets the tone for our high-end service.

Brianna: Every aspect of our business is personalized. We don’t “sell” to drive up AUM, we help – and that drives AUM. Our approach is win-win. When clients do well, we do well.

Jonathan: To Brianna’s point, in an industry concerned with mutual fund redemptions, we attract between $10 to $20 million in new assets each year – primarily with mutual funds.

John: Ultimately, clients who work with us come to understand three things. One: we’re there to help. Two: we’re independent, committed to seeking the best-of-the-best when it comes to investments. And three: we genuinely value their business and view it as a partnership.

We can’t control the markets, but we can control the ride.

Our secret weapon

John: As part of our focus on doing it better, we developed a Vision Statement and planning document that’s got a success rate of over 90% in terms of prospective clients coming on board. It’s the secret weapon we use at every meeting. In simple terms, it’s a checklist with 10 boxes. We go through it step by step, generally seeing agreement and surprise at each turn. It’s a business driver.

Brianna: It clearly demonstrates a holistic planning approach; that we put our clients in the centre of our services, investment processes, and professional networks, taking care of everything. Their entire lives are accounted for; needs, goals, wants – and a road map to get there.

Jonathan: The first section focuses on strategy, approach, and investment model. We explain that we lever SIA charts to help build superior portfolios, have unbiased access to all fund providers and banks, act solely in their best interests by choosing quality, and tailor holdings to reflect their unique desires and risk tolerance. We show them that while we can’t control the markets, we can control the ride. From there, the rest of the sections deal with life insurance, wills, estate planning, tax planning, etc.

Brianna: The process allows us to ask point-blank questions about all of those things, giving them an idea of what we’re all about. We recently met with people who paid $28,000 in tax last year. We pointed out that if nothing changes, that’s $280,000 over the next 10 years. It was an eye opener.

John: By the end of the meeting, many people who deal with two or three financial institutions want to move all of their money here, because of our completely unbiased, professionally managed approach.

Clients see consistency – and that provides peace of mind.

Built-in succession/guaranteed continuity for clients

John: I’m really proud that Jonathan and Brianna stepped into the business to help people. And my son Jordan, who’s completing his education, will be joining us soon. I didn’t force any of them into this industry, I merely presented an opportunity to work in a profession that provides freedom, flexibility and the ability to get paid to help. There’s no better job on the planet.

Jonathan: My dad had me right out of the gate. I wrote my last exam in the morning, grabbed a bite with my grad class, and was working at Rathwell Financial by 1:00 p.m. That was nearly 10 years ago.

Brianna: For Advisors starting out, age is obviously the biggest challenge. You have your credentials, but there’s no substitute for hands-on experience. Clearly our greatest advantage is John’s mentorship.

Jonathan: He’s our best asset. As for style, he likes the sink or swim method, so he threw us into the deep end…

John: But I stood right there – with a life raft.

Brianna: We’re a team. Initially, we observed John in action, and over time it transitioned to us running joint meetings. Clients see consistency – and that provides peace of mind. This is critical as we look ahead toward eventual succession. It’s not just about us, it’s got to work for existing clients, and for generations to come.

Our model is strong, and we’re in a position to buy the right books of business.

The next 10 years

Jonathan: When John is ready to step back, we’ll be there to assume greater roles and responsibilities. Our aspiration is to move forward as a team, maintain a boutique approach, and continue to be recognized on a local level as a heavy hitter in the central Alberta market – and also on a national level. We’re proud that with less than five years in the industry, my sister was among Wealth Professional’s Young Guns for 2018.

John: Brianna is a differentiator for us. She works with many recently widowed and divorced clients. Women feel more comfortable with her because she listens. In fact, we’ve got great female clients I’ve been dealing with for 25-30 years who now ask for Brianna. Jonathan works with many of my 55 + clients, but he does really well with a 20 to 50-year-old demographic because he can relate to them.

Brianna: I also work at a second HollisWealth office here in Red Deer with an Advisor nearing retirement. The plan for me, as successor, is to eventually bring that book here. It’s a win-win as the seller is well-aware of our strengths.

John: Our growth has been organic, so we haven’t been actively looking to buy, but our portfolio platform, approach and service offering would allow for scalability. Our model is strong, and we’re in a position to buy the right books of business.

When I started out over 30 years ago the model was to work days, evenings and weekends to continually bring in new clients. That’s not the case here; Jonathan and Brianna don’t have to go out and find new clients – they have to maintain a focus on adding value and providing genuine care for our clients through highly personalized service. That’s why we’re successful and that’s how we’ll grow.

The Rathwells on BMO Global Asset Management

Confident it would complement our existing holdings and portfolio approach, Allan Henderson – our BMO Global Asset Management Regional Sales Rep – brought BMO Concentrated Global Equity Fund to our attention. It takes a lot for a fund to make it to our short list, but with global exposure, relatively low volatility and good performance, it’s proven to be a great addition. In fact, we’ve invested between $6 million to $10 million on our clients’ behalf in the last six months.

HollisWealth®, a division of Industrial Alliance Securities Inc. Disclosures:

This information has been prepared by John Rathwell who is an Investment Advisor for HollisWealth®. Opinions expressed in this article are those of the John Rathwell, Investment Advisor only and do not necessarily reflect those of HollisWealth. The opinions expressed are based on an analysis and interpretation dating from the date of publication and are subject to change without notice. Furthermore, they do not constitute an offer or solicitation to buy or sell any of the securities mentioned. The information contained herein may not apply to all types of investors.

HollisWealth® is a division of Industrial Alliance Securities Inc., a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.

BMO Global Asset Management Disclosures:

This article is for information purposes. The information contained herein is not, and should not be construed as, investment advice to any party. Investments should be evaluated relative to the individual’s investment objectives and professional advice should be obtained with respect to any circumstance.

BMO Global Asset Management is a brand name that comprises BMO Asset Management Inc., BMO Investments Inc., BMO Asset Management Corp., BMO Asset Management Limited and BMO’s specialized investment management firms.

Commissions, management fees and expenses (if applicable) all may be associated with investments in mutual funds and exchange traded funds (ETFs). Trailing commissions may be associated with investments in mutual funds. Please read the fund facts, ETF Facts or prospectus before investing. Mutual funds and ETFs are not guaranteed, their values change frequently and past performance may not be repeated.

For a summary of the risks of an investment in the BMO ETFs, please see the specific risks set out in the prospectus. BMO ETFs trade like stocks, fluctuate in market value and may trade at a discount to their net asset value, which may increase the risk of loss.

BMO Mutual Funds are offered by BMO Investments Inc., a financial services firm and separate entity from Bank of Montreal. BMO ETFs are managed and administered by BMO Asset Management Inc., an investment fund manager and portfolio manager and separate legal entity from Bank of Montreal.

®/™ Registered trade-marks/trade-mark of Bank of Montreal, used under licence.

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