The morning mists have just begun to lift from the tiny Chinese village when Lesley Brey hops on her mountain bike and begins pedaling toward the edge of town, dodging chickens amid the aroma of steamed food emanating from nearby shops. Her brightly colored athletic clothing–or perhaps it’s her fair skin, so rare in this remote region–elicits some stares, and a few villagers wave, recognizing her from the morning’s Tai Chi exercises in the village square. Her three-week mountain-biking trek across parts of southern China is a guided tour, but only sort of: Every morning, the organizers hand out directions explaining how to reach that night’s lodgings, and then everyone is set loose to find their way. “It was the most incredible thing,” says Brey cheerfully, recalling the side trips she and her husband made from the designated route, only sometimes on purpose. “You’d come to a place where the directions said go straight, but the road was totally torn up, so you’d have to make your own detour and figure your way out.” Of course, if you figured incorrectly, it could be a very long time before you were ever heard from again–but hey, that’s part of the fun, right?
Okay, so getting lost in the hinterlands of China with only a bike and a knapsack might not be everyone’s idea of R&R. But Brey, 43, seems to enjoy blazing her own trail: She recently declined an offer to become president of a large planning firm, preferring to continue running her own one-woman planning shop in Honolulu, and on another recent vacation, she took her family to, of all places, Tibet.
Yet many of her clients are on the opposite end of the risk spectrum, at least when it comes to their finances. A significant number of her clients are widows, many of whom rarely touched the checkbook while their husbands were alive, let alone the investment statements. When it comes to money, these clients want a guide to hold their hands every step of the way, helping them find their way around obstacles, warning them about potholes, and making sure they’re staying on the road toward financial independence. “Many women have not handled money throughout their lives, so when their husbands die, they find themselves on this scary edge of a cliff,” peering down at a subject area that’s entirely foreign to them, says Brey. “But in many cases, it’s not that they were disinterested, or that they can’t do it; the opportunity just never came up. When you give them a little bit of knowledge, they’re just voracious.”
Brey’s mission is to educate her clients about their finances, tease out their goals–which can be especially tough for the recently widowed, since it means imagining a changed future at a time when it’s hard even to think about the present–and help them build a plan to achieve those goals. “I won’t work with the ones who say, ‘Here, just take care of this.’ I want to get them to a point where they understand enough to be able to do this on their own if they had to,” she says. “Then, once they understand it, most of them say, ‘Great. I get it; that’s wonderful. But I’m glad you’re here, because I’m going to go play bridge,’ or go hiking, or whatever it is they like to do.”
A Guiding Hand
Seventy-six-year-old jazz and blues singer Vera Forbes could be a poster child for the kind of client Brey especially likes to work with. Forbes is not the timid, little-old-lady type who sits around knitting booties and baking cakes; she’s much more likely to be dining out, planning a cruise, or organizing her friends into singing groups and auditioning for performances. But even the feisty and independent Forbes was thrown for a loop four years ago, when her husband passed away after bouts with Parkinson’s disease and recurring cancer.
The emotional turmoil was bad enough. Throw in a confusing swirl of financial matters, which Forbes had never dealt with during the 25 years of her marriage, and things began to look pretty bleak. As her husband’s condition worsened, he had become less able to keep the couple’s financial records in order. It was only by chance that she ran across a document detailing what turned out to be the couple’s largest investment holding. And every time she’d call a financial institution to procure records or resolve a question, she’d get a different representative on the phone and have to start over at square one. “It was confusing for me, and it was so complicated because things were just all over the place,” Forbes recalls. “I really needed an advisor.”
Forbes hired an advisor for a short-term engagement, and when she asked him to recommend someone to handle her finances long term, he suggested Brey. “So I called her and we had an interview, and I liked her on sight,” says Forbes. Brey helped her establish long-term goals, diversify her portfolio (“my pie,” as Forbes calls it), and sell off a portion of her largest holding. “I was blessed to find Lesley, because she really took care of advising me,” says Forbes. “She really helped me deal with the insecurity I felt after my husband’s death, and she’s not one of these people who just says, ‘Here’s what you have to do.’ Instead, she suggests things and explains why we should do this instead of that. She’s a great teacher. I don’t like to deal with all this stuff”–she laughs–”but she makes it pleasant, she really does.”
The Survivor’s List
One of the cornerstones of Brey’s work with widows is what she calls the “Survivor’s File,” a four-page document that helps a widow determine what actions she needs to take in the months following her spouse’s death (e.g., file estate tax returns, contact company benefits administrators, revise beneficiaries, etc.), and provides a template to help her organize the information she’ll need to take those actions (e.g., the deceased person’s Social Security number, life insurance policy numbers and carriers, and so forth (see sidebar on page 84). Ideally, it should be filled out with up-to-date information while both spouses are still living, but Brey says it’s also a useful tool to help the recently widowed get their affairs organized.
Sadly, Brey’s “Survivor’s File” had reason to become a well-traveled document last year, when September 11 sent planners scurrying for resources to help them serve clients who had lost loved ones in the attacks. Planner Rosanne Grande of Bohemia, New York, read about the list in an online version of a summer 2001 Investment Advisor series on women and money, and was among several advisors to contact Brey to request a copy. Brey sent it almost immediately, says Grande. “Lesley’s list was particularly useful for 9/11 because these were people who needed to find things really fast,” she says, noting that the list makes a great complement to two other print resources she uses frequently, After He’s Gone by Barbara Tom Jowell and Donnette Schwisow (Birch Lane Printing, 1997), and Suddenly Single by Kerry Hannon (John Wiley & Sons, 1998). “You really hated to bother them with paperwork at a time like that, but it was important to get everything settled,” Grande says.
Grande points out she completed the form herself for her own family to keep on file, and passed the form along to her sister-in-law, who was recently widowed.
First, Do Nothing
One of the main points the “Survivor’s File” makes clear is that there are very few actions the survivor absolutely, positively has to take immediately following her spouse’s death. Under the heading “Absolute Must-Do’s Within 9 Months,” there are only two items listed, and at the bottom of the first page, Brey reinforces the point in black and white: “Go Slow–Be cautious about rushing big decisions. (They will all feel big.)”
“The first thing I tell a widow is: Don’ t make any big decisions,” says Brey. “When you’ve lost someone close to you, suddenly you’re in a fog, and making decisions is extraordinarily difficult. Even simple things, like ‘What should I eat for breakfast?,’ are suddenly hard. So this form gives them something tangible [that says]: ‘Okay. Don’t make any big decisions.’ ‘Call the people you love.’ It’s really simple.”
And even once the surviving spouse reaches a point where she is ready to start making decisions, says Brey, it’s important to take only baby steps at first. “Invariably there’s some concentration [in the portfolio] that the husband really liked that I want to get them out of, but what I’ve learned is that it can take years–it’s an educational process,” she says. “If you recommend right off the bat that she sell whatever John had in the portfolio so you can diversify the holdings, you’ll get, ‘Oh, no, no! He believed in that stock!’”
Rather than try to cajole the client out of an inappropriate investment quickly, Brey steers the conversation toward a more general chat about the client’s visions and goals. “I’ll start with, ‘What do you want for your kids? Would he have wanted you to travel? Do you have dreams you want to keep chasing? Do you want to volunteer?’ Once you get the survivor to envision a future, as opposed to the darkness that they’re in at the moment, then and only then can you move forward,” she says. Once the goals are clarified, she introduces the idea of diversification, and “it becomes evident relatively quickly that a concentration of 20% in one stock just doesn’t fit into that philosophy,” she says. When the light bulb goes on, some women are eager to diversify right away; others have more trouble letting go, and prefer diversifying only a portion of the holding, or doing so in stages. “I had one client that sold it off over five years, because that’s what she was comfortable with,” says Brey.
While it’s important to be sensitive to a client’s emotions, that doesn’t mean being a pushover, especially once the first year or so has passed and the client relationship is well established. All items on a client’s “to-do list” (say, getting a trust drawn up) have timeframes, and Brey says she’ll “play project manager–or nag” to make sure things get done. If they don’t do it, step one is to ask the client how the task is coming along; step two is to offer to go with the client (if, for instance, the task involves consulting a trust attorney).
As for step three: “If we get to a year and they haven’t done something they had committed to, we’ll go back and revisit what they really feel is important, and find out what is keeping them from completing the task. Frequently we’ll find some value that either was more important, or, more frequently, just louder.” For example, one of Brey’s clients had vowed to stop contributing to her adult daughter’s financial irresponsibility, and had decided to give the daughter only $500 per month. The daughter kept racking up expenses, however, and soon the client was back to doling out $1,000 or $1,500 each month. “In a case like that, you go back to the drawing board, and say, ‘Okay, if that’s what you want to do, let’s put $1,500 in her as a monthly expense,’” says Brey. “‘That means that all that money we put away for traveling isn’t there anymore. Is that the tradeoff you want? Are you okay with this?’”
Brey says she owes much of her knowledge about widows to a good friend who was widowed 12 years ago at the age of 30. “She taught me nearly everything I know about working with people who have experienced a tragedy of some sort,” she says. “She was so candid about everything.” The frankness was edifying, but that’s not to say it didn’t sometimes hurt. For instance, a few months after her friend’s husband died, her friend asked her, “How come you haven’t called?” Brey gulped, and responded faintly that she hadn’t known what to say. To which her friend said, “‘You know what? Everybody says the wrong thing. But it’s better to say the wrong thing than not to say anything at all, not to even call.’” Needless to say, Brey now always calls her widowed clients on a regular basis–even when she doesn’t quite know what to say.
The Next Generation
When she isn’t working with widows and retirees, Brey enjoys talking finance with an entirely different demographic group–kids. On the 18-inch-thick coral-block walls of her high-ceilinged office in downtown Honolulu, there are a bunch of the obligatory diplomas, plus a painted fan, several scrolls, and a watercolor of an old man teaching two children to play go, the Chinese version of checkers. The watercolor, she explains, is meant to show the wisdom of the ages being passed from one generation to the next–something she hopes to do by teaching her clients’ children about money, and training other advisors to do so, too. She’s working on a presentation about kids and money for an upcoming NAPFA meeting. She’s already tried several of the strategies out on some handy guinea pigs–her 16-year-old daughter and 12-year-old son.
When her children enter seventh grade, as her son did this fall, they begin receiving not a weekly allowance, but an annual one. “The summer before seventh grade, they get a checkbook, and in August they get a lump sum, which has to last them for the year, for clothing, gifts, recreation, and entertainment,” says Brey, who notes that this strategy has made her daughter “very aware” of the cost of things, and impressed upon her the value of saving. To encourage the habit of charitable giving, Brey also started giving each of her children $100 annually to donate to the charity of their choice, beginning when each child was eight or nine years old. “They’re not allowed to pick their own school, or use it for their team’s fundraiser–that’s too easy,” she says with a laugh. “But I think it helps in getting the values across to them.”
Brey also makes a strong argument that children, at least those from wealthy families, should receive custody of their UTMA or UGMA account assets at age 18, and be required to pay their own bills for tuition, rent, food, clothes, and travel from the account. “My logic is that it’s far better to have these kids, as they’re growing up and learning how to handle money, blow $10,000, $20,000, or $30,000, than it is to have them come into family money further down the road and blow the whole family fortune,” she says. They need to develop earlier in life “a sense of scarcity”–the realization that money doesn’t grow on trees.
The Trail Ahead
Brey says the goal of her practice is to help clients achieve a healthy balance in their financial and personal lives. She’s following her own advice this fall: Contractors are presently hammering away at the Brey residence in Honolulu, constructing a new garage and transforming the current garage into a self-contained home office, complete with its own entrance, alarm system, bathroom, and closet space. She plans to transfer her business into the home office by the end of the year. “I’m really looking forward to it. I’ve talked to so many people who work out of their homes and say they really like the flexibility and freedom,” she says. “When I work at home now, which I do occasionally, it works well, and I realized how nice it would be to be able to go running first thing in the morning instead of commuting.”
The move to the home office is actually part of a larger plan to make her practice entirely mobile by the time her kids graduate high school, so that she and her husband can follow their dream of traveling together while continuing to work. “My husband’s goal since dental school has always been to be ‘paid in chickens,’” she says with a laugh. “We’re talking about outfitting a sailboat for dentistry and then cruising up and down between Washington State and Alaska and treating all the villagers along the coast who can’t afford dental treatment. We’ll go hunting with them, I can work remotely [as a planner], he’ll treat their teeth, and we’ll get paid in chickens.” Brey has purchased PaperPort software and a scanner, which she plans to use to convert to a “paperless” office, and her laptop is configured so that she can have wireless access to the Internet. “If you have all your files on your computer, and you can hook up wirelessly and you have a phone, you can do 90% of this job from anywhere. I could be working in Machu Picchu if there were [an available] satellite.”
While she admits that face-to-face contact with clients is irreplaceable, it’s also true that “clients don’t want to see you every month; they’ve got lives to lead,” she says. And she has a life to lead, too–so why not lead some of it in Machu Picchu?