Many financial advisors search hard for a client niche to target. For Charles Massimo, the niche found him.
Father of two sons who are autistic, and a daughter who is not, the FA’s personal experience rearing his now 19-year-old triplets indeed informed CJM Wealth Management, his independent advisory practice.
A member of New York Gov. Andrew Cuomo’s Autism Spectrum Advisory Board, Massimo, 56, focuses on helping parents of autistic children plan for the future. He takes the long view, looking ahead to their care after both parents are deceased.
His other specialty is helping affluent physicians manage their wealth. That grew from a friendship with one surgeon to his becoming part of the doctor’s trusted circle of colleagues.
Before founding his own shop in 2003, Massimo spent 20 years working at Shearson Lehman as a compliance officer, New York Life Insurance Co. as an agent and Merrill Lynch and Smith Barney as a financial advisor.
He experienced wirehouse life as deeply frustrating: The FA wanted to invest based on his clients’ best interests; the two firms only wanted to sell products, he says.
The resulting internal conflict finally caused him to break away from Smith Barney and launch his own firm. Later, he wrote an expose-like bestseller: “Getting Off the Street: Sane Investment Advice from One of the Nation’s Leading Wealth Managers” (Offstreet Press 2014).
With about $480 million in assets under management, Massimo, who initially built his practice conducting two seminars monthly, is located in the hamlet of Deer Park, on New York’s Long Island. According to the advisor, the Island has the country’s largest cluster of children with the neuro-developmental condition of autism.
Massimo’s not-for-profit, Autism Communities, addresses the pressing problem of housing for adults with autism.
The advisor’s sons now live and work at a residential school; their sister is a college sophomore, likely to become a special education teacher.
ThinkAdvisor recently held a phone interview with the enterprising advisor, who is supported by the Dynasty Financial Partners platform.
THINKADVISOR: Tell me about your niche of families impacted by autism.
CHARLES MASSIMO: I have two boys with autism, and all the challenges of planning for their care and future, their sister’s future and my own future are a lot of balls to juggle. I wanted to bring my expertise both professionally and personally to [similar] families so they don’t have issues later in life. I’m trying to find ways to improve these children’s lives.
How do you prospect for such a specialized clientele?
I’m an advocate for children with autism. I have my own not-for-profit. I network at events and meet many families much the same as mine [etc.].
At events, do families ask for your financial advice?
Yes. At first, I’d just give it away and never looked to build a business around it. Then I realized I could add a lot of value.
Did you start developing this niche while you were at Merrill Lynch or Smith Barney?
No, because you can’t hold a niche at those [large firms]. You’re forced, in a way, to bring in as many [clients] as you can since that’s the only way you’re going to get paid.
I understand that Long Island, New York, where you practice, is a hub for families with autism. Why is that?
Long Island has the largest population of children with autism. The services, schools and support agencies are probably some of the best in the country. So a lot of people move here for those. Also, because it’s in [one of] the most affluent parts of the country, we tend to get our children diagnosed sooner.
Your other focus is physicians. How did you begin advising them?
Many years ago I became very good friends with a surgeon, met lots of his friends, got accepted into their trusted circle; and they started coming to me to look at their investing. Physicians are probably the greatest referral source.
What do you advise families with autism about that’s different from helping other clients?
Parents have to think about what’s going to happen when they’re no longer here because their children can’t care for or advocate for themselves. It’s not easy for families to focus on that, but we have to. I make sure all my clients fill out a Letter of Intention that spells out how they want their child to be cared for, including what their likes and dislikes are, what their strengths and weaknesses are.
What other financial concerns do these parents have?
There aren’t a lot of dual-income families because one spouse has to stay home with the child. So that creates a whole other planning challenge. Also, the divorce rate in families with autism is much higher than the norm — another challenge.
Why did you want to become a financial advisor?
I watched my father lose a lot of money in the market mainly because a broker put him in things that he shouldn’t have been in by taking advantage of his wanting to make a quick hit. When I came into the industry, I learned that, unfortunately, there were a a lot of unscrupulous advisors looking to take [clients’] money by not putting [their] interests first.
How did you position your practice while at Merrill Lynch and Smith Barney?
I wanted to do things in a very different way. But the large firms pretty much dictate to you how to grow your business. It’s all about bringing in assets, not about how you build portfolios and manage clients’ expectations. It’s just: Let’s see how much profit you can make pushing stocks and funds that are making the firm a lot of money. That’s what I did.
What ultimately happened?
Unfortunately, when the technology bubble burst in 2000, you realized you had 40%-50% of your clients’ portfolios in tech stocks because you did what the firm told you to do. Most of those people lost a significant amount of their net worth, and some were never able to make it back.
What was your response to all that?
I said: “I love doing what I’m doing, but I don’t like doing it this way. I want to build a company that always puts clients first.”
Your book, “Getting Off the Street,” revealed some the less-talked-about aspects of financial advisory. What are examples?
A lot of what I wrote about had to do with the fact that the interests of Wall Street are their own, and you [investors] come second. If you make money, it’s purely coincidental. And I covered a lot about hidden fees.
Since you’ve been on your own, your approach is “structured investing.” Please explain?
We follow the Fama-French three-factor model exactly. Our portfolios are [composed of] 14,000 stocks in 44 countries. There’s not one stock that makes up more than 1% of the entire portfolio. That’s how we manage risk.
When you became the father of triplets, you must have been excited.
Yes. You don’t really know what you’re in for! But I couldn’t be happier to watch their remarkable growth from the time they were born to where they are today. Investing is the same: If you can be patient, ignore the noise and stay disciplined, the returns [can be] phenomenal.
How old were Christopher and Steven when they were diagnosed with autism?
Fortunately, 18 months. So we were able to get therapy very early on, which certainly helped with their development.
Unlike her brothers, Elaina doesn’t have autism. The incidence is higher in males than females, correct?
Much higher in males, but in females, autism is more severe. Also, autism is much higher in multiples. The latest research has identified more and more genes [associated with autism]; so they believe it’s genetic. But there’s is still no conclusive evidence or reasoning.
Do your boys live at home?
For three years, they’ve been in a residential program at a school in Monticello, New York. We wanted to teach them independence — because, again, [my now ex-wife and I] aren’t going to be here for their entire lives. The reality is that the vast majority of children with autism live with their parents until the parents die — and then it’s a crisis situation.
Do your sons have jobs, or are they in an educational program only?
It’s still school-based, but Christopher works at the school’s restaurant. Steven works in the field on a farm selling eggs into the community. Children on the autism spectrum like to be outside. They like the freedom and openness.
Do the boys interact with customers in their jobs?
Yes. Christopher, especially. He has a script he follows: “Hello. My name is Christopher. Welcome to the restaurant. Let me seat you.”
Dynasty Financial Partners provides you with back-office and marketing support, and your CJM team helps you, of course. How much does that mean to you in terms of practice growth?
Because so much of my time is spent advocating for my own children, were it not for my colleagues, [building the business] would be really difficult. They’ve given me the ability to grow.
What are some specific ways that you advocate for Steven and Christopher?
At school, and with physicians on what medicines they take and don’t take [etc.]. We’re their legal guardians because they don’t have a voice for themselves. So we have to be their voice.
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