A Spiritual Journey

As a student of both spirituality and history, Felipe seeks balance in every aspect of life. He believes that if you understand why something happens or why it is done the way it is, you can learn from it. These trends often times repeat and, if you can identify these trends, it can help you in your predictions and investment allocations.

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    A Spiritual Journey

    A Spiritual Journey

    As a student of both spirituality and history, Felipe seeks balance in every aspect of life. He believes that if you understand why something happens or why it is done the way it is, you can learn from it. These trends often times repeat and, if you can identify these trends, it can help you in your predictions and investment allocations.

    When it comes to client expectations, Felipe tends to ask different questions. He tries to get to the essence of what the client is pursuing, not just to beat an index. Ask different questions, and you will be surprised to get different answers.

    Like many college students, Felipe did not pursue what he originally started studying. With an innate interest in history, it was logical for him to become a history teacher. After a stint as a temp associate at Macy’s in Herald Square, Felipe started as a sales assistant at Kidder, Peabody & Co. while he was attending school. Discovering that he could combine his love of history with the skills he was learning at his job, he pursued a major in finance at Baruch College.

    After graduation, Felipe ventured deeper into the financial services industry, becoming a stockbroker; he credits his knowledge on the basics of investing to that role, where his peers taught him portfolio management and his on-the-job training gave him the skills of portfolio construction using stocks, bonds and mutual funds to solve financial issues.

    The volatile nature of stock trading in the early 1990s caused Felipe to examine his career. “I didn’t know how much longer I could do this,” Felipe divulges, “because if you pick the wrong stock, you have a problem. I started to look at what other advisors were doing, and that’s when the transition happened—I became a CFP.”

    During the next decade, a multitude of economic crises—the boom and bust of the dot com era, Y2K and 9/11, to name a few—changed the landscape of the financial services industry. Solo practitioners at wirehouses were being pushed into two categories: 1) pull in tremendous business on your own, or 2) join a team. “I wasn’t grossing over a million at that time and I knew joining a team would be the nail in the coffin for me. I decided to go independent.

    Tom Finnegan [an affiliated investment professional with AP in Manhattan, New York] and I met at an outing in Colorado and he told me I should consider coming to AP. I was sold.”

    AP has provided Felipe with a larger network of like-minded advisors. It was through this network that he was introduced to Brian Farkas, AP-affiliated advisor and owner of Barons Financial Strategies, Inc. “I’ve always admired Brian; he is a great businessman. He’s always thinking and trying to develop new ideas, and he has tremendous loyalty. When he approached me about being in his succession plan, I knew it would be a great partnership.”

    Felipe affiliated with AP in 2006 and not only went all in on the independent business model, but also the firm’s commitment to social responsibility, becoming involved with World T.E.A.M. (WT) and participating in one of the first rides when Team American Portfolios consisted of only six members. When asked how his involvement started, Felipe answers with a laugh. “[CEO] Lon [Dolber] is a great salesman and he didn’t give me many options, so I did it. I’ve done it whenever I can since then.”

    The charity bug had bitten and left its mark, inspiring Barons Financial Strategies, Inc. to host their own charitable events. Breast cancer awareness and Movember (for prostate cancer awareness in honor of Felipe’s father and grandfather) are two charities the practice supports annually. “I want to donate in the most genuine way possible. I’m not checking a box; I’m involved and I’m trying to get my clients involved. And that’s something I love about AP is how charitable the company is.”

    The AP network continues to run deep, giving Felipe the opportunity to serve on the AP Advisor Council (APAC) through affiliated colleague Carlos Benedeti of Passport Wealth in Davie, Florida, who served on APAC for three years and suggested Felipe take his place. Both men have worked together over the years and, despite taking different approaches to solve problems, have a shared interest in contributing to the firm and industry.

    The goal Felipe has set for himself as a newly-appointed APAC member is to take what he does well, coupled with a back-to-basics approach, and help solve one universal problem. Learning from his experience working with groups in the past, he brings a unique outlook on the tasks at hand. “People go into this thinking they can solve every problem, that they are going to be the answer. But they learn that the issues are complicated and have more angles to them. I’d rather take one issue and solve that than try to solve six and not solve anything.”

    Felipe is looking forward to exploring all the subcommittees to see where he will best fit. One topic of interest he would like to focus on is risk management. Through his years in the industry, he has seen the turbulent nature of the stock market. Watching the trends through his eyes as a history buff, Felipe believes that a few good years does not ensure they will remain good. “Markets are all cycles; if you learn the cycles, you can foresee and prepare for risks. Historically, cycles do not play out where they remain good for an extended period.”

    His interest in risk management stems from his outlook on life and investing. “Do not get too optimistic or too pessimistic,” he advises. “This business tends to make people emotionally high and low. Just realize that when you’re at those peaks, it’s not going to be there forever; you’re going to come back to the middle.” Pausing, he collects his thoughts and continues. “People don’t tend to make the best decisions when they are at those extremes. It’s a good trait to not be reactive to volatility.”

    Felipe handles his business with the same mindset. About his business mix, he says, “I like taking a very back-to-basics approach, because that is how I was schooled in the beginning. When things get crazy, I find that going back to stocks, bonds and mutual funds always helps.”

    Felipe believes that the industry must learn from the past to prepare for the future. “Our business is going to get more complicated,” Felipe states. “There has been a set-it-and-forget-it approach to passive investing. If 90% of money nowadays is passively invested and there is a big trend that could change, it could be a threat.”

    Although he believes these trends are glacial, taking many years to manifest, it can become a detriment if ignored. “The world is getting more complicated, and it is a good thing because there are investing opportunities in many places that we do not see. Just buying S&P 500 is not going to address these advancements.”

    Many people worry about the future of the financial services industry, but Felipe considers that by staying innovative and addressing new opportunities in a compliant way, financial advisors will remain relevant. He is optimistic about younger generations, seeing them as more open-minded, motivated and willing to invest in different ways. Felipe contends that, while people in their 20s and 30s may not be looking for an advisor and are investing on platforms like Robinhood, when they get to their 40s and 50s with a substantial amount of money to invest, they are likely to seek out a seasoned financial professional to help them with their more complex investing needs.

    Many times, the subject of fees and the costs of having a financial advisor is a point of contention for younger generations. “I always ask my clients, if Warren Buffet sat in front of you and said, ‘I’m going to charge you 5%, but I’ll manage your money,’ would you take it? And they say yes, of course they would … it’s Warren Buffet. So, it’s not a question of price, it’s a question of value and what an advisor is doing for you. I think we need to do a better job at explaining our value.”

    In his philosophical and spiritual studies, Felipe has read that as you age, something inside you dies; the openness we had as children becomes a closed door, no longer receptive to suggestion. He believes the financial services industry has done that with investing. If the industry wants to engage a younger generation earlier in their lives, then the industry itself must be more open-minded.

    Looking back on mistakes made and lessons learned from his personal investing, Felipe shares one instance that still troubles him. “Back in the old days, we started the IPO of eBay and Google. I made money on them, but I sold them; it was an instinctive reaction. It was ridiculous to think selling PEZ dispensers on eBay would become a monster stock. It still haunts me knowing I had the opportunity to make a lot of money, but I’ve trained myself since to not react to a new idea in a negative way.”

    Although cryptocurrency and NFTs may be the latest in investment trends, Felipe understands there are two sides to the proverbial coin. “There is a risk involving this sector by including it in a product mix. It could go through a boom and bust, and we cannot afford to lose someone’s retirement money because you think it will hit a home run. AP oversees many advisors and we live in a litigious society. Investors do not always take the proper approach with these new sectors and AP needs to regulate to the best of its ability. It’s a complication; I understand AP’s position, and I believe they are taking the right approach.”

    As controversial as it is, Felipe foresees cryptocurrency and NFTs as here to stay. The 30-and-under crowd is flocking to cryptocurrency, but the negative approach and lack of willingness to understand the new sector could prove detrimental to the future of investing. “People think the version you see today is what you are going to see in 20 years; I don’t believe that is the case. Look at when the internet started and Pets.com went out the window, but look at what it did after and how it has changed our lives. I think crypto and blockchain have a similar trajectory.”

    Another subject in the financial industry that is becoming more top-of-mind is that of succession planning—a topic Felipe doesn’t think people are talking about enough, though he believes the reason runs deeper than it simply being a nuisance. “There are things that need to be addressed and the right questions need to be asked. Is it an issue that you don’t think your clients will be taken care of properly? Is there some way you’re going to live forever? Is it because you don’t want to retire and lose control? If the reasons are addressed properly, succession will go smoother.”

    Outside involvement to provide solutions for these issues may help with participation in succession planning. Felipe believes taking the personal concerns out of it—perhaps feeling outdated or replaced by a younger model—and working with partners of the firm to ensure assets stay within one’s practice and client service may continue will allow a calmer aura surrounding the topic to prevail.

    “One technique I use was learned from a podcast. Think of your future self as a separate person. What or who are you in 10 years? That future self must think about succession. I think that is one thing we as advisors could do better.”

    In thinking of succession planning, Felipe believes current advisors should be helping the younger generation get into the field of financial services. Felipe wants to extend job opportunities to people who would benefit from it. “I want to hire me 30 or 40 years ago. I want to hire the kids who are going to commcommunity college, who are struggling, who are working during the day and taking classes at night. Those are the people I can relate to. It’s not a bad thing if you went to an Ivy League school, but to really help someone, I’d like to give the underdogs a shot.”

    Barons Financial Strategies, Inc. will hire an intern in the near future. Ideally, the candidate would fit the criteria Felipe is looking for—a hungry go-getter who will work hard to secure their future. The opportunity to help those who need it is arising, and they are accepting the challenge with open arms. Says Felipe, “One of the things I love about this job is I get to work with people that I want to work with—peers and clients. I get to help people who want my help and understand what I can do for them.”

    So, what does the spiritual guru with a penchant to help the less fortunate do on his off time? Aside from listening to a wide array of music, he studies the Kabbalah and Buddhism, which ties in with his love of history. He’s also into fitness and isn’t shy about trying new things. “I do bootcamp classes, cycle and play tennis. I just ended a year-and-a-half stint doing Olympic lifting. When it comes to fitness, I’m not really good at anything, but I do everything.”

    An old adage sums up his feelings in that, “If you’re going to say something nice, say it right away; if you’re going to say something nasty, wait 24 hours.” It is a philosophy that has stayed with Felipe, in life and business. “People are reactive by nature; if you want to say something nice to someone and you wait too long, you just let it go. Alternatively, if you want to say something nasty to someone and you wait to say it, you also let it go.” Felipe applies the same attitude to investing, whereby resisting the temptation in making knee-jerk reactions will spare you any pain of regret down the road.

    Without knowing or seeing him, this 30-year financial veteran might seem like a wise old man teaching academia. Thankfully, for AP and the profession, Felipe is far from done, paving the way for others with his life lessons and taking the future head on.

    About The Author

     

    Financial Advisor 

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