Family First

And for Kathy Daly, all of her clients are family

Kathy Daly was running late for our 12 p.m. interview. It was the day after J.P. Morgan Chase acquired Bear Stearns at the fire-sale price of $2 a share, and she'd been calling clients since 6 a.m., soothing nerves already rubbed raw by the previous week's market plunge. Her aim: calming her clients before their concerns could turn to panic.

"I'd rather have them holding my hand than someone else's," says Kathy Daly, an advisor with City Securities in Muncie, Indiana.

Terms like mothering and hand-holding slip easily into the conversation when Daly talks about her clients. This nurturing bent represents the philosophy of one of her early mentors, and reflects the personal passion that drew Daly toward the advisory business in the first place.

In the early 1980s she was a commodities trader, specializing in precious metals. It was a lucrative sector to be in, but the business never sat well with Daly.

"Fear and greed fueled that market," she remembers. Her job was to convince people to buy silver and gold. Without knowing anything about the clients, though, such as their overall financial situation or long-term goals, she was uncomfortable making specific investment recommendations.

"I didn't feel good talking to people about just one element of investing," Daly says.

So she enrolled in night school, studying economics and psychology. She wanted a better understanding of the entire market structure and a better way of communicating with clients about their finances.

"I called it, 'How to play the market and keep your mind,'" she laughs.

Once armed with a more comprehensive knowledge of the investment markets, Daly considered two career paths--banking and brokerage. Back then banks could only talk to clients about banking products, and she wanted to offer clients a more inclusive investment plan, so she interviewed with two area brokerage firms.

The bigger firm wasn't interested in Daly because she didn't have a book to bring with her, but a small regional brokerage, K.J. Brown and Co., was willing to gamble on a woman broker in 1985--primarily because the owner's daughter was already working there.

"That was a time when there weren't a lot of women in this business, but [Kenneth J. Brown Jr.] believed that I could do it," she says. Under Brown's tutelage, she learned the importance of understanding every aspect of each investment product so that she could tailor portfolios to clients' individual needs. It was Brown's daughter Kim, who set the standard for a nurturing client relationship--a standard that Daly still follows today.

"She mothered her clients to death, and I loved that philosophy," she says. "The more you take care of people, the better you can service them."

That pretty much sums up Daly's entire business plan. For more than 20 years, Daly has comfortably assumed the role of friend, teacher, mentor, and advisor for all of her clients. She goes to birthday parties and graduations. When clients are too old to come to her, she goes to them. And when their children or grandchildren need advice, she's there for them as well.

When kids she watched grow up land their first jobs, she encourages them to bring their 401(k) package to her. She'll go over the entire plan with them, researching the investment options and offering advice. If a client's son or granddaughter gets married, she sits down with the new couple to talk about budgeting and financial planning. But she won't get paid on the 401(k) assets, and she'll probably recommend that the young couple start their savings program with a bank account instead of investing with her. She's not worried about commissions.

"I was paid in the past," she says. "And I promised Johnny's great-grandma that I would watch over him."

More importantly, she can start at the beginning with the new generation and help them build their wealth and achieve their personal successes.

"It's great to have the big accounts, but teaching people how to save and how to invest is why I do my job," she says.
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