LEADERSHIP CORNER
Being financial adviser is 'natural job for women,' manager says
Interviewed by David Butts
Advertiser Staff Writer
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Age: 61
Company: Merrill Lynch
Title: Managing director, Advisory Division; manages 75 financial advisors and about 50 support staff
High school: Raymond High School, Raymond, Wash.
College: Pacific Lutheran University; State University of New York, Albany
Little known fact: As a child in Washington state, my father would take me with him in the car to go watch forest fires.
Breakthrough job: I began my career as a high school teacher of foreign languages, took a break to have two children, came back to work in the state mental hospital ... then taught art in the state penitentiary ... then went back to graduate school (for a master's degree in educational administration).
I answered an ad in MS magazine (27 years ago). It said we need a few good women. They called me a couple of weeks later ... made me an offer and I took it.
They had been through a lawsuit. A woman named Helen O'Bannon had sued Merrill Lynch for discrimination against women. It was a major change in the industry. I was the only female in the office for four years.
Major challenge: "The shocks of the hot market and the comedown were so hard that many people are scared to death. Timing is something they need to look at realistically rather than emotionally. People deal with the market at a very emotional level. I think it is a big challenge for our industry to help people deal with the emotions that are in the marketplace.
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Q. Have the scandals of recent years — including the one that questioned the independence of Merrill Lynch analysts — scared people away from financial advisers?
A. No, because ... when you get to the personal level of dealing face-to-face with somebody and you are in a local community, those people are outside that scandal group.
The thing is not whether they trust the person. The trust is there. It is whether they trust the marketplace. So they (investors) are sitting on cash.
Q. How do you rebuild trust in investing?
A. Knowing that there is more structure, more scrutiny, people will come to realize just through public education that this is America. This is what capitalism is about. This is investing in the growth of the country, and where else would one go with their money.
There is no absolutely safe place for your money. There is economic risk if you do nothing and there is market risk if you are in the market. That's life.
Q. Have you lost clients with the recent drop in the market?
A. If you look in the top 250 ranking, we dropped one rank, but we are far ahead of any of the competitors as far as assets under management. The last 4 1/2 years since I've been here, the office has grown in staff considerably. We are having a fairly good year. We should at least by year end be flat with the year before. We are not going backward.
We have about 75 financial advisers in my complex, that includes Guam, Hilo, Kona and here. Total staff is probably 125 people. We had about 55 financial advisers when I came four years ago.
Q. Are discount Internet brokers, such as Scottrade with its $7 trades, a threat to your business?
A. Heavens, no. There's no company that can make money on a $7 trade, so what they make their money on is the person who is an addictive trader and is on margin. They'll make their money off the interest that person is paying on the margin debt. The transaction itself, they are losing money on. That is their loss leader.
Q. When you hire new advisers, do they mostly come from the Mainland?
A. No, we don't tend to hire from the Mainland. Often if you hire from the Mainland, they will stay for a short period and go back. That's not a good investment for me. So we hire from here, but we have had recently a rash of applicants who grew up here, went to high school here, went to the Mainland to college and now they want to come back home. We like to hire them.
Q. Are you seeing a shift toward more clients who are retirees from the Mainland?
A. We see more of that in our Kona office. We have some here, but it is not the majority of our client base. Our client base tends to be business owners. And then we have our other mix, the retirees, the military, the professionals.
Q. There is an image of brokerage houses catering to their larger clients at the detriment of their smaller clients, unloading the poorly performing stocks on the little guys. How do you deal with small investors?
A. If it is a small client and they have maybe $20,000 total, they are not going to be buying stocks. They are going to be in a managed portfolio of mutual funds. You don't need daily contact, weekly contact or even monthly. But quarterly or twice a year, they need contact or review. That's an appropriate experience.
If somebody has a very complex situation where they need estate planning, tax planning, a complete financial plan. They own a business. They've got retirement plans. They are going to get more attention and they deserve more attention.
Q. You've been 27 years in what is often considered a man's industry. How difficult has that been?
A. It's been interesting. I think along the way there have been a lot of men that have learned a lot. The key thing for any woman in a man's industry is you have to keep your sense of humor.
It has not broadened much for women. Probably less than 10 percent of the managers in the industry are female and about 15 percent of the financial advisers are female. That has not changed in 27 years.
Q. Why aren't more women entering the financial industry?
A. I really think it's a perception that occurs in college. Business departments have way more women in accounting than they do in marketing. The men know there is money to be made in marketing. A lot of women want the stability of a fixed income, and the men don't mind taking the risk of the instability.
I find the women who are financial advisers are outstanding when it comes to the relationship with the client and caring about the client at a very personal level. They just don't know that this is a natural job for women.
Q. You've been in Hawai'i four years. Have you noticed differences in the work culture?
A. Work here is something you do to support the way you live. It isn't your life. I think it's a very healthy philosophy. I think the way we work is less driven here, less high energy and numbers oriented. It's more people-oriented.
