From the February 2014 issue of Research Magazine • Subscribe!

January 27, 2014

God and the Advisor: Navigating Faith and Finance

Matters of faith play a large role in some advisory practices

Illustration by Chris Gash Illustration by Chris Gash

Like politics, religion is a hot-button, emotion-fraught subject financial advisors typically steer clear of. They figure: Better avoid such a touchy, indeed controversial, area within the client-FA relationship.

Yet many advisors have integrated religion—their own beliefs, those of their clients or both—into their practices to varying degrees. For some, religion is in fact a major focus.

Advisors are generally in one of three camps: They never mention religion unless clients do; they address religion indirectly; or they openly position religion at the forefront—vigorously, in some cases.

“A lot of people are scared to talk about religion. So advisors might not bring it up at all,” says Hil Bowman, portfolio manager-advisor with Morgan Stanley in Dallas, who invests client funds chiefly in accord with biblical teachings.

Some FAs insist that the financial services industry is paying closer attention to faith-based investing.

“There are advisors who are very committed to applying biblical principles to the way they manage money; and wirehouses are recognizing the Christian audience as a market,” says John Moore, president of John Moore & Associates, in Albuquerque, N.M., whose broker-dealer is Raymond James.

The Bible, says Moore—author of a study guide, The Almighty and the Dollar—teaches “not to spend more than you earn, to be careful about borrowing and owing money, and to give generously, such as with charitable planning.”

Bowman’s Christian faith is interwoven with his practice: “It’s part of who I am. It isn’t that I’m religious on Sunday and not on Monday to Saturday.”

Bowman uses biblical principles to help determine how clients view risk. “If you’re scared to death of losing money, you’re not going to take the same risk as someone who sees it as a vehicle to help the world or help God and pay for His bills, and try to grow it so He can give more money away,” the FA says.

On the other end of the spectrum, Angela Thomson, president of Coastal Financial Planning and practicing in Lincoln, R.I. —the state with the nation’s heaviest Catholic population—makes no effort to broach the subject of religion in speaking with prospects and clients.

“It’s a Pandora’s Box—and I do not open it. Unless they bring it up, I don’t ask,” the CFP says. “People either are extremely religious and opinionated or couldn’t care less. If it’s important to them, they’ll speak up. So you tell me what you want, and I’ll try to meet your expectations.”

Such was the case when a devout Catholic client directed that Thomson deploy none of her money in companies manufacturing or connected with birth control products.

Says Thomson: “That woman got me thinking about the whole concept of socially conscious investing. ‘Socially conscious’ and ‘religious’ are synonymous with a lot of people. But everyone has a different perception of what that means; so you need to get clients to be specific. For example, from a religious perspective, some don’t approve of same-sex marriage.”

Meanwhile, in San Diego, Sheryl Rowling, founder of Rowling & Associates, does not hesitate to bring up her own Jewish beliefs in client conversations.

“We talk about all kinds of things,” says the RIA. “The basic values of Judaism go nicely with community-minded people of any religion.”

At Chanukah and Christmastime, instead of giving clients trinkets, Rowling makes donations in their names to charities such as Jewish Family Services’ local food pantry program, which serves all faiths.

Rowling isn’t an observant Jew who attends synagogue regularly or keeps kosher; but she adheres to Jewish principles of morality, conducting her practice based on a central tenet of Judaism called, in Hebrew, “tikkun olam,” which means it is people’s responsibility to repair the world.

“I take that seriously,” says Rowling, “because I want to help enable clients to live the life they want and have the capacity to help others through charity.”

Multiple Perspectives

The depth of advisors’ own faith typically dictates how big a role, if any, religion plays in their business.

In 1987, seven years after kicking off his career with EF Hutton, Moore felt he was “called or led” to apply biblical principles to managing money, he says.

“The Bible has over 2,000 verses that address money, more so than other [issues], like prayer and heaven,” says Moore, a member of Kingdom Advisors, a ministry of Christian FAs.

Prospective clients of Jeffrey Rogers, founder-chair of Stewardship Advisory Group, know prior to their first meeting with the Orlando, Fla., advisor that he’s guided by a faith perspective. Such information comes via a referring client or colleague, or by checking out the FA’s website, which states his firm’s primary goal: “To honor God in all that we do.”

“We’re upfront and honest about our faith,” says Rogers, a born-again Christian. “I have a personal relationship with Jesus Christ, and I want the whole world to know about His love for them. As Jesus [counseled], we don’t hide our [light] under a bushel; but we don’t shove it down people’s throats either.”

Other advisors use a somewhat subtle means to communicate their religious emphasis. CFP Larry Mathis, founder of Mathis Financial, in Phoenix, and a member of United Planners Financial Services of America, prominently displays on his office bookshelf a large tome whose dust jacket states: “To God Be the Glory.”

“It’s a way of making clients realize when they come in that I’m not just accountable to them or to myself, but I’m accountable to the God that I believe in,” says Mathis, himself author of Tools of the Cross: Walking with the Master Carpenter (Morgan James, 2011).

Even if the topic of religion isn’t deliberately brought out, an advisor and client simply sharing the same faith can deepen the relationship.

Harris Konter, a wealth management specialist with Vidal Whitley & Konter Wealth Advisors of Raymond James Associates, in Atlanta, does lots of non-profit work in the city’s Jewish community; in addition, his sister is executive director of a synagogue there. Not surprisingly, Judaism crops up in the FA’s conversations with prospects and clients—for instance, experiences at a Jewish summer camp or membership in a Jewish college fraternity.

Though Konter refrains from elaborating his personal beliefs when relating with clients, in the interview, he says: “Judaism puts a big focus on morality and ethics. We’re certainly in a business where morality and ethics play a key role in what you do and how you do it. I have a strong moral compass.”

Fatima Iqbal, financial planner with Azzad Asset Management, based in Falls Church, Va., actively pursues the Islamic investor market by holding educational seminars at schools, Islamic centers and Muslim-sponsored conventions and conferences nationwide. Last December, for example, she rented a booth at an Islamic Circle of North America conference.

“The demand is growing: We have a lot of professionals who want to do good with their money and also want to stick with halal values and principles,” says Iqbal, a Muslim who, starting as an advisor five years ago, opted to work only with products aligned with Islamic values.

Halal guidelines prohibit investing in products that obtain more than 5% of their income from the sale of alcohol, tobacco, pork, weapons, gambling or pornography and forbid investing in companies that derive significant revenue from interest.

Thus, with conventional bonds off-limits, creation of a diversified portfolio including fixed income is a challenge. Consequently, in 2010, Iqbal’s firm launched the Azzad Wise Capital Fund. It invests in the deposit programs of banks offering interest-free transactions. It also invests in sukuk, also called Islamic bonds, which are certificates based on lease-type agreements.

Managing client investments in sync with the Christian faith, Rogers, with United Planners Financial Services, uses “positive” and “negative” screens, the former supporting patriotism and capitalism, among other values. Those, he says, “see stewardship of God’s creation as important.” “Negative” screens eliminate companies involved in, for instance, gambling or pornography, or in abortion, such as certain drug-makers.

Moore applies socially responsible screens with “a Christian dynamic,” he says, restricting companies engaged in the production of tobacco or alcohol, among others.

For religious clients, Mathis avoids firms that publish adult magazines. And some “ultra-conservative Christians,” he notes, shun investing in companies that support gay, lesbian and transgender rights.

Rowling expresses her Judaic beliefs by doing business with fund companies like American Century Investments, whose foundation established the Stowers Institute for Medical Research.

“The Judaism part is that it’s not all about making money—it’s about making the world a better place,” Rowling says. “A huge amount of profits produced by this company goes into cancer research, and my clients know that.”

Organized Work

Carving out a specialized sub-niche during the past six years, Jim Ryan, a private wealth advisor and vice president of global institutional consulting at Merrill Lynch, serves Roman Catholic non-profits including dioceses, parishes, hospitals and schools.

Trustees of these organizations, notes the New York City-based head of The Ryan Group, are “becoming increasingly sensitive to whether their portfolios reflect their faith—in addition to getting a good rate of return with minimizing risk.”

In drawing up a list of suitable investments, Ryan first references suggested guidelines of the U.S. Conference of Catholic Bishops, which support companies promoting “the Common Good” and avoiding those participating in “harmful activities,” such as production of contraception and nuclear weapons.

On the issue of pornography—“counter to the values of Catholic moral teaching,” say the guidelines—Ryan often suggests investing in companies that obtain no more than 5% in revenue from such enterprise.

“That allows trustees to buy hotel chains and cable television companies” showing adult entertainment, he notes.

Even those FAs representing a specific religious viewpoint count among their clientele folks of many other beliefs.

Moore, a Christian who espouses that “what the Bible says about money is good financial practice,” has a rabbi client. With Raymond James in another city before moving to Albuquerque, she searched the BD’s website for a local advisor and found Moore.

Recalls the FA: “When she came in and we talked about what we do here, she said, ‘It’s about time my portfolio had some biblical wisdom applied to it’.”

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