John Salter is bringing the classroom into the client meeting room, and vice versa.
He not only sees what's going on in the trenches with clients, he also teaches in Texas Tech University's personal financial planning department.
His research is currently focused on the use of reverse mortgages in retirement distribution management. He published a notable academic piece, "Standby Reverse Mortgages: A Risk Management Tool for Retirement Distributions," in the Journal of Financial Planning in 2012.
The paper, co-authored by Shaun Pfeiffer, associate professor at Edinboro University, and Harold Evensky, president of Evensky & Katz, looked at using a Home Equity Conversion Mortgage Saver reverse mortgage to help sustain retirement income. The line of credit tied to the HECM Saver acts as a risk management tool: It hedges the risk of the client having to draw income from his or her portfolio in a down year.
"It's there in the future if you need it, but in an ideal situation, you never use it," Mr. Salter said of the reverse mortgage strategy.
He was also a co-author with Mr. Pfeiffer and Mr. Evensky on a 2013 paper, "The Benefits of a Cash Reserve Strategy in Retirement Distribution Planning."
Unlike many academics though, Mr. Salter's findings can be put to work in real-life situations. He's now working with a client whose situation fit the mold for the HECM Saver strategy.
"That's the fun part of thinking about problems at the firm — taking them to school and finding the solution," he said. "I try to keep the research fairly practical, hopefully for everyone and not just for us."
For others looking to make a go at both being a practitioner and an academic, Mr. Salter recommends taking advantage of luck, which he defines as the nexus where preparation meets opportunity.
"I try to be prepared through working hard, and I have acted on the opportunities that have presented themselves as being useful for moving forward in my career," he noted in the InvestmentNews 40 Under 40 survey. "Maybe just as important, recognizing those opportunities that should be avoided."
— Darla Mercado
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Robert Schein
Managing director and partner, HighTower
