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At 34, and Top-Rated by Forbes, Merrill Advisor Forms His Own Wealth Firm

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As a young Bank of America mortgage underwriter, Michael Henley hated to constantly deliver bad news to people. So shortly after Merrill Lynch was acquired by BofA in 2009, he quickly answered a job post by Merrill that pushed his future in a sharply different direction.

And it was indeed the right move. After nine years with Merrill, Henley, with $930 million in AUM, just launched an independent advisory practice with his team of eight intact.

Henley is only 34. Six of Wyeth Private Wealth’s eight partners are in their early-to-mid-30s. In a realm where the average financial advisor is 50.1 years old, according to Cerulli Associates, Henley is a rare standout just by age alone.

Forbes ranks him #1 in Delaware in its “America’s Top Next-Generation Wealth Advisors” for 2018 and #42 nationwide.

In 2012, he took over leadership of an established team in Wilmington and grew it to “almost a franchise” within the wirehouse, he says.

Now the RIA, focused on affluent families, is helping to minimize the tax burden of chiefly active and retired DuPont management, a clientele built at Merrill. Dynasty Financial Partners provides back office and marketing support, and Fidelity is custodian.

(Related: Why Douglas Boneparth, 33, Is Crushing It With Wealthy Millennials)

Come December, Wyeth will be headquartered in Kennett Square, Pennsylvania. Temporary offices are in nearby Chadds Ford.

A native of Virginia, who started out in the audit and control department of JP Morgan Chase before moving to BofA, Henley  comments about his move to independence: “It’s overwhelming and exciting. But I’d rather be stressed doing this than anything else.”

THINKADVISOR: Has your youth helped you as an advisor?

MICHAEL HENLEY: It’s been a big differentiator. We tell families we have 20 to 30 years to go and that we continue to build our team by hiring younger and younger professionals. We want to add rock stars in their late 20s when we’re in our late 30s.

What’s the secret to your personal success?

I became a student of the business right from the beginning. I listen to [financial] podcasts in the car, the gym, walking the dogs. Even when my wife Amanda and I are vacationing, I’m on the beach reading about complex gifting strategies.

You listen to podcasts while walking your three dogs!

Yes. I’ve been following the independent space with Michael Kitces’s and Mindy Diamond’s podcasts about advisors who have gone independent and what it’s like.

Describe Merrill Lynch’s reaction when you told them you were leaving?

Merrill was shocked. I think they assumed I’d stay there for the rest of my career because I was legacy Bank of America. But if you’d ask the other advisors [former colleagues], they’d say, “Did you really think he was going to stay forever?” I’ve been such an advocate of the fiduciary model for years.

Why do you focus on tax-reduction strategies?

I’m a kind of tax geek. Looking out five to 10 years: What can we do proactively to help minimize wealthy families’ lifetime tax burden? I found that one of the biggest gaps in financial planning was tax advice. So at Merrill, I thought: What if I married tax planning and financial planning?

What was the firm’s reaction?

Merrill said they don’t allow advisors to give tax advice: If clients want that, they should be told to a go to a CPA. It’s the same with any [wirehouse because of liability]. It was very limiting. I wanted to have access to tax-planning software, but that was a huge no-no.

What, for instance, are you doing for clients tax-wise now?

If someone has a significant amount of their wealth in a pre-tax retirement plan, before they’re 70-1/2 we can minimize their future required distributions. If they’re charitably inclined, we can use donor-advised funds [which allow] five or 10 years of gifting upfront, and then the client doles out that money over the succeeding years. Also, the funds can be used as a tax-planning tool for clients who may not be able to itemize under the new tax law.

What’s the story behind you and Steve Maconi’s teaming up in 2012? He’s now chairman of your firm.

It was our mutual idea — not Merrill’s. Steve said, “We’ll still be involved in key decisions, but we want you to come in and drive [the practice].”

Most of your clients are DuPont executives, right?

We work fairly exclusively with DuPont management-level and higher-level [executives]. Many clients are engineers.

How did you happen to build that particular clientele?

As the advisor of record on DuPont’s 401(k) plan, Steve had a significant presence with the company when I joined him. But even before [we partnered], 80%-90% of my clients were from DuPont. Their headquarters are in downtown Wilmington, Delaware, where Steve and I worked at Merrill. [Dow Chemical and DuPont merged in 2018. DowDuPont will be split into three companies next year.]

So why did you become a financial advisor?

I started at Bank of America’s card services department helping the bank’s wealthiest customers. My boss said, “You’re so good working with wealthy people, you should be a financial advisor.” I blew it off for a while. But when a job posting came up after [BofA] acquired Merrill, I thought: “What the heck!”

Were you still in card services?

By then, I was a [BofA] mortgage underwriter calling people and saying: “We’re unable to give loans at this time.” I didn’t want my only interaction with people to be negative news, so I transitioned to advisor in 2009. It was an opportunity: The industry was shifting from commission-based business to, kind of, financial planning.

Did you cold-call?

Yes, and I absolutely loved it! My goal was to see if I could get strangers to have a conversation about their personal finance. I never tried to push for an appointment or for them to buy anything. Yesterday my first client, who’s stayed with me this whole time, came into the office. She was so [happy] she was almost doing cartwheels!

When you decided to go independent, why did you choose  Dynasty Financial Partners’ platform?

No. 1: Shirl Penney [president-CEO] is younger – he’s 41. And a lot of Dynasty’s management is younger too. That was very important to us. I’m 34; six of our firm’s eight partners are in their early to mid-30s. Also, we wanted to go all the way: We didn’t want to brand ourselves under HighTower, and we had no interest in completely selling our upside to Focus Financial. With 20 or 30 years of runway ahead, Dynasty was the best fit by far.

Your website says you help clients “avoid making investment mistakes.” Please elaborate.

When the market is free-falling, we coach clients not to react to headlines. I really lean on Steve that way because he’s been through every market cycle and crash. To take the emotion out of investing, we focus on the long term. And I always remind clients that hating Donald Trump – some do – is not an investment strategy!

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