Advisers' holiday spirits — and parties — are up

Such events show clients how much advisers value their business

Dec 5, 2010 @ 12:01 am

By Nancy R. Mandell

The market's up, the economy is recovering (even if tepidly) and the financial advice business has regained a measure of health — so it is time to celebrate.

“Although many advisers are still a bit shellshocked by the 2008 market performance, they seem to be back to almost normal with their holiday events,” said Michael W. Byrnes Jr., president of Byrnes Consulting LLC, an adviser consulting firm.

In “a referral-driven industry” such as personal financial services, these events “serve an important client appreciation role,” he said.

At the Westport, Conn., headquarters of RDM Financial Group, founder, president and chief executive Ron Weiner was busy last week planning the four annual holiday parties he hosts for about half his 300 client families, who are spread out over 30 states. (He reaches the rest with 2,500 Thanksgiving and holiday cards hand-signed by all 18 members of the firm — an exercise that began several weeks ago.)

RDM's holiday party tradition kicks off in Westport with cocktails in the office and dinner at an area restaurant. Business is limited to a brief update about the firm and the markets.

A similar event follows on Long Island, where many of the clients responsible for the firm's $600 million in assets under management reside. There is a luncheon at a Manhattan restaurant and a round of cocktails and dinner in Boca Raton, Fla., where a satellite office serves the 20% to 25% of clients who either live or spend the winter in South Florida.

The entire staff attends the three parties in the Northeast and 10 to 12 will fly down for the Florida party and some extra R&R.

Mr. Weiner, the sole adviser in the firm, estimated that this year's bashes will cost about $40,000 but generate far more in good will.

“The important thing in our business is the client relationship, and I believe these parties create a strong, high-touch link,” he said.

“We've done this for 15 years; our holiday plans stay the same whether the economy is up or down. It's a tradition people enjoy, and it's as good for our staff as it is for our clients,” not to mention that “a room full of happy people is good advertising” for the guests his clients bring, Mr. Weiner said.

At Retirement Planning Services Inc. in Millersville, Md., this year's festivities will be a bit more restrained. For the first time, founder and chief executive Mike Steranka will host a brunch at a local country club rather than an evening of dinner, drinks and dancing.

“We always have a big holiday event to show our clients how much we appreciate their business,” said Mr. Steranka, whose registered investment adviser firm manages more than $200 million in assets in Maryland's Anne Arundel County.

To his surprise, invitations to the Dec. 12 brunch drew close to 350 positive responses from among his 750 active clients, whose average net worth is $2 million.

“Certainly, the [brunch] price is good — less expensive than a plated dinner and not as much drinking, but it will still pack a punch,” Mr. Steranka said.

Although the timing may be a cost-efficient move for the company, he conceded that there might be a completely different reason for its popularity among his clients, whose average age is about 70: It is being held during daylight hours, eliminating the need for them to drive at night.

“I think we might be onto something,” Mr. Steranka said.

The firm holds a separate celebration for its five advisers and six staff members, who are invited to bring their spouses or significant others to lunch at a pricey steakhouse, where bonuses are given out.

The mix of parties-as-usual and modest celebrations among advisory firms mirrors the celebration pattern throughout the economy.

The global outsourcing and business coaching firm Challenger Gray & Christmas reported recently that 68% of companies are planning holiday parties this year, up slightly from 62% a year ago when lowered profits and recent or potential layoffs meant that there was little to celebrate or little to celebrate with.

“We are at a precarious stage in the recovery, where some companies are feeling it more than others,” said John A. Challenger, chief executive of Challenger Gray & Christmas, which conducted the non-scientific survey of about 100 human re-sources professionals.

One advisory firm celebrating with a party this season — for staff members only — is Altfest Personal Wealth Management.


Clients of the New York firm, which manages $558 million in assets, are invited to an annual event in June and receive “an upbeat year-end letter telling them about our successes and profiling staff members,” said Karen C. Altfest, principal adviser and vice president for client relations.

“We've had a very strong year; we've been able to report good things to our clients,” she said.

“Our staff has worked very hard. We have some new people developing new ideas, so we want to celebrate a good year,” Ms. Altfest said.

The firm's goal is to surprise its staff with a creative theme or idea for the annual holiday lunch.

Ms. Altfest declined to reveal this year's plans for the 20 staff members, six interns and several consultants. But past celebrations have included a customized meal catered by a client's daughter, entertainment by subway musicians and a caricaturist.

“We want to be creative, and we try to make things warm and special, which is very much our style,” Ms. Altfest said.

Like many in the industry, the firm forgoes client gifts. Instead, it makes a donation to the Yorkville Common Pantry, an organization that serves the hungry in New York, which also receives a donation whenever a client brings in a referral.

“There is a trend where some advisers are giving back to local charities, from making donations in clients' names replacing traditional gifts, to ramping up their volunteer efforts, and in some cases inviting clients to join in,” Mr. Byrnes said.

“It is a great time to give, as charities often get hit the hardest by a recession. As a whole, the industry's brand image is tarnished, and charity support is a tactic to help repair the damage,” Mr. Byrnes said.

“There seems to be a sense that one can truly survive without buying gifts and throwing parties,” said Lawrence J. Botzman, an independent certified financial planner in Somerset, Ky., with 140 clients. “Charitable groups with whom we are affiliated are having more support from funds and volunteers as the focus has been changed by the past couple of years.”

Mr. Botzman has always made gifts to charitable organizations on behalf of his clients, who have assured him that they really don't want trinkets or fruit baskets.

“Instead, we notify them that their Christmas gift has been delivered to a child somewhere in the world in a Christmas box. We also tell them that we are sponsoring a community Christmas dinner in their honor, and they are welcome to attend,” said Mr. Botzman, whose firm has $95 million under advisement.

That jibes with the Challenger Gray survey, which found that employees prefer scaled-back affairs. According to the survey, 53% of companies planning parties are holding them on-site, up from 29% last year.

“There is a common perception that corporate holiday parties are raucous affairs where managers and their workers can cut loose. In reality, corporate parties can merely add another layer of stress to workers who have to worry about getting too relaxed and saying or doing something that might offend a supervisor,” Mr. Challenger said.


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