Leading financial advisor helps successful individuals
move away from being just wealth consumers
By Thomas A. McCoy
Joseph Janiczek, MSFS, ChFC, is chairman of Janiczek & Company, Ltd., in Greenwood Village, Colorado, and author of How to Achieve Absolute Financial Freedom.
For independent agents, delivering renewals in a hard market is tough. But how would you like to be a personal financial advisor today? You'd be fielding phone calls from clients right after they receive their shrunken 401(k) and IRA account statements. Or when they sit down to add up the college tab for their son or daughter.
The financial advisor's performance isn't subject to client scrutiny only when those quarterly account statements or tuition bills arrive in the mail. An advisor is like a baseball player whose hits and errors are recorded in the newspaper after every game. When the stock and bond markets close each day, the advisor's clients are filling in their scorecards on the spot. All that's needed is Internet access, or an 800 phone number for their mutual fund companies.
Of course, the advisor can try to persuade clients to take a long-term view of their investments. But after two and a half years of a severe bear market, many investors' patience is wearing a little thin.
Joseph Janiczek, chairman of Janiczek & Company, Ltd., a Greenwood Village, Colorado, financial planning firm, believes the heart of investors' difficulties has nothing to do with bear markets or any other kind of markets. The real problem, he believes, is that, "Many people have orchestrated their relationship with money in a way that is not in their favor." He believes that poor habits relating to money management--often formed early in life--are to blame.
Janiczek serves as a financial advisor to about 150 people and has built his practice to where he now accepts only clients with at least $1 million of investable assets. In October 2001 he was named one of the 100 top financial advisors in the nation by Mutual Funds magazine, and in June of this year, he was named one of the 250 best financial advisors in the nation by Worth magazine.
Although Janiczek's clients obviously have achieved a good measure of success, he believes that everyone is susceptible to serious errors in money management. He has written a book titled How to Achieve Absolute Financial Freedom, in which he makes it clear that financial folly is no stranger to the gated community. The good news, he says, is that it is correctable. From the book's Introduction:
I've watched people who make a million dollars a year become broke and people who make a modest amount become financially independent ... There is no such thing as "successful" and "unsuccessful" people. Rather, there are people with successful habits and unsuccessful habits ...
How long does it take to master a new habit? ... (for a) simple habit ... 40 days; (for a) complex/multiple habit ... 40 months. This belief comes from the Bible and from practical experience.
The book is written with the conviction and passion of a parent who is trying to drum values into his children. He urges readers to adopt sound savings, borrowing and spending habits. Then, he goes one step further. He says that an important habit to develop is "the giving habit." (Remember this is a book about achieving financial freedom.)
To give without expecting anything in return demonstrates the ultimate act of financial control ... It provides an unlimited source of confidence about your life because it expresses complete control over your money ... It changes your life from a "have to" stance to a "choose to" one.
Janiczek suggests that the giving habit, like all other habits of financial control, is not something that can be easily deferred until later in life. People who wait until they're wealthy to try to develop this important habit of financial control may have waited too long. The key, he says, is developing gratitude for whatever you have.
Those who wait to be happy until they "hit it big" often experience a major letdown when they hit it big because they never learned to appreciate what they have in the first place.
Janiczek's practice is entirely fee-based. He accepts no commissions from mutual fund companies or others whose products he may recommend. For his core program, titled Wealth with EaseTM, he charges $5,000 to $9,000 (depending on the client's net worth), for the initial series of four consultations that sets his program in motion. Then, he meets or has a telephone "value plus" call with the client quarterly to review progress and is paid 1% per year of the balance of the client's portfolio (or less for larger portfolios). "That way we are compensated based on the success of the client's investments," he explains.
Janiczek, like successful property/casualty agents, is careful to define the type of people he wants as clients and what the long-term results of their relationship should be. In his promotional material he explains that the Wealth with Ease program is designed for "semi-affluent individuals who have outgrown their original support system." Its aim is to change "wealth consumers," into "wealth benefactors"; then to convert the latter into "wealth transformers."
Joseph Janiczek includes P-C agents on his team of advisors which counsels clients regarding their entire financial picture.
He describes Wealth Consumers as semi-affluent individuals "who lack the critical mass of capital, mangement systems, prudence and/or balance to completely tame money in their lives ... (they are) susceptible to consume wealth or be consumed by wealth."
Wealth Benefactors are also semi-affluent, but they have "tamed money" in their lives. They are "served by wealth (and not vice versa) and they utilize this advantageous position to make greater contributions and accomplishments, develop more meaningful relationships, and enjoy greater and greater leisure and freedom."
Finally, "A Wealth Transformer is a Wealth Benefactor with a vibrant legacy ..." This last category of individual works to enhance the lives of generations beyond his or her own.
Janiczek has property/casualty agency owners as clients and has found them to be them to be open to change. "I've worked with them on transition planning for their business and helped them build wealth outside of their business. This is the process of creating critical mass, which enables them to become Wealth Benefactors instead of Wealth Consumers."
He also has worked with P-C agents as part of a team of advisors that he assembles (also including accountants and attorneys) to serve some clients. This requires having these P-C agents or other professionals available in various regions of the United States to match up with Janiczek's national clientele.
"Many times when we're looking at the client's entire financial picture, it becomes obvious that he doesn't have the proper insurance limits in place. The client may own various real estate properties in different locations and have his insurance provided by different agents, and we can do a much better job by combining them. There also are opportunities for life insurance sales that come up during our discussions with a client."
Janiczek does not receive commissions from any financial services or insurance product providers, but his relationships with agents can result in cross-referral opportunities.
As a financial advisor, Janiczek wants clients to think "long term" but not just in the simplistic way that most people say, "I'm in the stock market for the long term, so maybe my stocks will come back in value some day." He wants people to take a serious look at where they are financially and what they can do, by establishing good long-term habits, to order their lives so that money will be their servant and not their master.
With Joseph Janiczek, financial advice will always be personal. Once again from his book:
I've witnessed the consequences and rewards of personal financial activities of hundreds of individuals. I've helped people make their first investments, their last investments and countless ones in between. I've had clients bring in Dom Perignon champagne to celebrate the day they became multi-millionaires and clients weep in my arms during a tragedy.
"What I do," Janiczek emphasizes, "is try to help people out of a sabotaged relationship with money. I dream of the time in the future when money isn't such a negative influence in the world as it is now." *
For more information:
Janiczek & Company, Ltd.
Web site: www.janiczek.com