Two Advisors, One Winning Prescription

Advisors Kyle Richie and Andrew Feindel have teamed to successfully serve an affluent, sophisticated niche with unique challenges. In this article, they reveal the strategy, tactics and continuous learning required to provide optimal financial planning for Canada’s medical professionals.

Specialists who are still learning

When we started our practice together 16 years ago, we had the benefit of Kyle’s experience running a prior book of business (he had just moved from Vancouver). We decided to implement a few rules right off the bat. The first was to create a minimum investment criteria and aligned philosophy to meet, so we could dedicate the necessary time to each and every client. And the second was to specialize in a niche. Marketing to doctors made sense for us since we both had extensive connections (to start, our fathers are surgeons, while our wives are nurses).

With two decades of collective experience, and a $475 million book, it’s fair to say that we’ve cultivated an in-depth understanding of our clientele and their unique needs. We deal constantly with a range of specialities from incorporation and dividend/salary mix to corporate insurance and tax planning strategies. Yet we still view ourselves as students in the industry. We’re constant learners, immersing ourselves like sponges, and we think that’s driven our success in no small part. We get excited every year when the Federal Budget is released because we read and discuss it together, and think – what are the tax-saving opportunities that we can apply here for our clients?

Controlling the controllable is key

Currently, we manage approximately 250 families, 97% of which are physicians and dentists, while the rest consist of ultra-high-net-worth business owners. With every one of them, we aim to “control the controllable.” What we mean by that is it’s important to excel beyond investment management to provide a holistic wealth strategy. Instead of offering piecemeal advice or trying to predict the next stock trend, we want to understand all the “controllable” aspects and learn every tax, estate and insurance strategy out there. We don’t spend our time trying to be the next Warren Buffett.

It’s not just lip service for us. Typically, in our industry, investments are dealt with by investment managers, accountants will deal with tax planning, an insurance broker will decide on the insurance, while the lawyer will address the estate. That’s the wrong way to do it in our opinion. We’re a one-stop shop in the sense that the accountability – and responsibility – for the implementation of our recommendations rest on us as a team.

We make it easy by doing our best to connect it all, which is something that is greatly appreciated by our client base. For example, if they’re donating to charity, how can we do it more efficiently and factor in their investments at the same time? What are the incentives of this accounting strategy, and how does it mix in with their financial plan? How does their dividend/salary mix relate to their investments? We assess from all angles, as all of these decisions interact together.

Sharing is caring

We’re so passionate about the integration of planning that Andrew even wrote a book on the subject to help Advisors – and their clients – gain control. The new book, titled Kickstart Your Corporation: The Incorporated Professional’s Financial Planning Coach, offers targeted, ear-to-the-ground advice that we both use everyday in our own practice.

The first chapter starts off by delving into a personal anecdote about how we helped a family doctor save a significant amount of money by incorporating early on. A huge misconception in the healthcare industry is when to incorporate as many people believe it’s when you hit a certain amount of income, or when you have zero debt. But taking this step at the outset could allow a client to purchase their home much quicker, for example.

The book (for which proceeds are donated to charity) is written to help investors have better (and more knowledgeable) conversations – and ask the right questions, from fee structure to evaluating the merits of each underlying investment. It also serves to provide Advisors starting in the business with a practical and accessible guide to prevent course-correcting down the line.

Our industry has evolved

After our first meeting with new clients, we compare two different scenarios: one is if they continued on their current path, and the other is if we engage with them. We don’t just say now you’re achieving a 2% return, and our way will yield 8%, because that’s just typing in a larger number on a computer, and it’s not realistic. To be truly comparable, we complete a pure strategy analysis; assume identical spending; and isolate for returns. We look at their situations 5-10 years down the line, from tax to asset composition to the amount registered in their corporation. That’s the only way you can see if/how an Advisor will add true value.

We recently celebrated our one-year anniversary at Richardson Wealth, a move we made in large part due to its truly independent, non-biased platform, and our desire to have full fee discretion – and evolve with the times. The way we see it, transparent Advisors who present holistic planning with an unlimited product shelf are the ones who resonate with clients now – and into the future.

Ensure it runs in the family

To maintain relationships long term, we run our practice like a family bank. Our client base extends from early 30s (and fresh out of residency) to mid-80-year-olds. For those with adult children, we hold meetings that include their multiple generations to discuss estate plans, and strategies that have been implemented to ensure wealth is transitioned smoothly – and that there is an appreciation for building a long-term legacy.

Another topic discussed in Andrew’s book is how to help parents instill financial discipline within their children. One example: people often think about insurance in black or white: do I need it or not? But many of our clients’ kids are now paying a part or the entire premium on the parents’ life insurance as a means of forced savings, ultimately providing a tax-free return on those premium payments down the road. It’s about thinking outside the box on how to involve the next generation.

Striving for top two in Canada

Our main objective for our clients is to deliver superior advice, service and risk-adjusted returns, at the most reasonable fees, ultimately providing the best value for high-net-worth Canadians. In terms of our business, we want to reach top two in Canada, bringing in $100 million in assets under management annually, with the intent to reach $1 billion by year-end 2025.

Without a doubt, much of our success so far has been based on our drive to work long days – educating ourselves, bringing tax books with us on vacation, doing whatever it takes to further develop our niche. It’s about focusing your energy and excitement on what you can control, beyond just product shelf. If we’re meeting a prospect, and they’re incorporated, and have an all-Canadian bank portfolio, it’s easy for us to win that business since we know exactly how to make it more tax-efficient. In a corporation, a 4% capital gain is better than 8% interest, and that’s where we really excel – in knowing how we can structure investments so they get paid out at lower tax rates, and making sense of that for our clients.

While our business is largely referral-driven, we also market ourselves as frequent speakers at Ontario Medical Association (OMA) conferences, several universities and at Mt. Sinai Hospital to their last year of residents. With most in-person networking on hold during the pandemic, we’ve “gone to school” this year on virtual presentations and how best to connect with clients and prospects virtually. Just another example of continuous learning, adapting and striving to do the best for our clients and our practice.

For more ideas to enhance your practice, and build a resilient portfolio, contact your BMO Global Asset Management Regional Sales Representative.