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Tune in to "What Works" hosted by Don Patrick where we tap into 2,500+ years of experience in running financial advisory practices. In each episode, Don sits down with an experienced financial planner, uncovering the unique insights and experiences that have shaped their careers. From navigating market fluctuations to building successful client relationships, Don and his guests share invaluable business tips and strategies for financial planners looking to thrive in the industry.
Join us every other Thursday, as we explore the wealth of knowledge accumulated from over 2500+ years of combined experience in financial planning.
Hi, everyone. Welcome to What Works. This is a show for consortium advisors that taps into over 1,000 years of experience shared by our consortium advisors.
I'm your host, Don Patrick, and I'm here to guide the conversation with guest advisors and lift the hood on what works for them in business and life. It's all about learning and growing.
So let's go.
Don Patrick: Welcome, everybody, to the IFG, 31st episode of What Works podcast. And today our special guest is Alan Bratic. He's president of Thompson Baker in Florida. So Alan, welcome.
Alan Bratic: Well, thanks for having me, Don.
Don Patrick: This is gonna be great. Let's kind of start with your journey a little bit, your personal professional background, and just tell us a little bit about your background and your family, because that's pretty interesting.
Alan Bratic: Sure. Well, I grew up, was born and raised in Croatia in Europe, when I was a little kid, used to play a lot of soccer and then kind of realized that soccer was not gonna be it for me. And I started playing tennis, which led me to getting a college scholarship here in United States. And originally spent a couple of years in Augusta, Georgia, and then transferred to school in St. Augustine, Florida. And just absolutely loved it down here. Ended up majoring in business and economics, took a ton of investment classes my junior and senior years, did my internship at Prudential Securities here in town. And of course, Prudential Securities I think has changed their names a few times. I met my wife also here my junior year of college.
So, basically after graduating, I had to stay for about a month and a half longer 'cause our tennis team qualified for National Championship, which was held in Tulsa, Oklahoma. So I had to stay through end of May. And during that time we were training, I had few different interviews and I got offered a position on a, being an equity trader on a trading desk for Barnett Bank.
And Barnett Bank was one of the oldest Florida banks. So, literally right after National Championships, took about two or three weeks off and then started working for them. And then, as destiny would have it, six months later, Nations Bank bought Barnett Bank. So literally my whole department was gone, not because Nations Bank wanted it, but just because they were what we call lifers at Barnett.
They were there 20, 30, 40 years. So all their stock options vested, and of course, stock went up like 30% through the buyout. So, Nations Bank offered me a position in Charlotte, North Carolina. So we moved to Charlotte and then six months later, Nations Bank merged with Bank America to become Bank of America.
So I stayed with them for about a couple years and then I realized, hey, I really wanna work one-on-one with clients. And the bank really wanted me to move to big city like LA, Chicago, and New York. And we had our first child and my wife said, “I really don't wanna live in a big city.”
Charlotte was big enough for her. And so we moved back to St. Augustine and joined and started really the financial services department of a insurance agency here and been here ever since. So that was back in 2000 and here we're 25 years later, still going.
Don Patrick: That's amazing. Your office is almost across the street from the school you went to, isn't it?
Alan Bratic: Oh, absolutely. It's about 40 yards. Yeah. It's literally across the street. The next door to us is their admissions building that they built not too long ago. So it's really a dream come true. It's a beautiful town. It's just a wonderful community. Just love it.
Don Patrick: Well, first of all, you had how many children?
Alan Bratic: So, yeah, so we have three kids. We have two grown ones. My daughter, Ava, who's the oldest, graduated from FSU School of Music back in ‘22 and she's now a middle school music teacher. And then my middle child, Noah, just a few months ago, graduated also from FSU and literally on Wednesday, got his real estate license.
He passed his real estate exam, so he wants to be a realtor. And then we have Brady, who is a freshman in high school.
Don Patrick: That's great. So how did you hook up with Thompson Baker, the insurance agency? How did that come about and starting that whole investment slash management financial planning...for them?
Alan Bratic: Sure. The Thompson Baker Agency was founded in 1925. So we're actually celebrating a hundred years this year in business. And back in 1925, it was all about real estate and insurance.
So it was started by a Georgia Tech graduate who came down here on a visit, to visit a friend that was Mr. Ryman. And then Mr. Thompson was locals in Augustine guy, who was in the middle of the real estate boom. If you recall the mid-20s, from the history lessons, Don, I'm not saying you recall it for personal experience, but Florida was just booming in real estate.
Don Patrick: They were selling a lot of swamp land, if I recall.
Alan Bratic: Yep, absolutely. People were, they're putting sand and whatnot to make swamp plants livable. And of course, Henry Flagler's Florida East Coast Railroad, from the 1890s or whatever that was built all the way down to Key West, really started that real estate boom in Florida.
So what happened was Mr. Thompson, Mr. Ryman started the agency and then in the 70s, my father-in-law, my wife's dad joined the agency. So it was called Thompson Bailey Baker at the time. And Mr. Bailey, his son, came on board somewhere in the eighties and he was doing a lot of life and health insurance.
Well, he decided somewhere in the late nineties to kind of go on his own and started his own firm. So he bought the entire book of business for the life and health side. And I kind of came at the right time where they're non-compete expired that said, “Hey, we really,” I approached them and said, “You need to restart this because it's just a natural marriage between insurance and then investments and planning.”
So that's how that come about.
Don Patrick: So you actually approached them and with the idea and a kind of a restructuring and creating this department and they said yes.
Alan Bratic: Yeah, it makes sense because we wanted to move back to St. Augustine and, they were doing this and really we rented office space for about a year and a half at a CPA's office when this first started because the tenant here upstairs where I am, we're still here building their new building and it was kind of taking longer as usually the building does.
So we actually rented a space for about a year and a half or so before actually moving here into the building. But yeah, that, that's how it came about.
Don Patrick: So this was, I’m gathering, your first foray into being a financial advisor?
Alan Bratic: Yes, absolutely. I was–
Don Patrick: So you were like green?
Alan Bratic: I was green, I was, but you know, one thing, one huge advantage that I had was I was, I started at a, on a mutual fund, an equity trading desk.
So dealt with a lot of that stuff. Then I got promoted at Nations Bank to executive services area, which was basically, we were almost like 911 department where people that didn't know what to do called us and had us research things and do things. So I learned about margins because sharing, transfer of assets, registering securities, I mean, everything you can think of. So it was almost like a comparative, being mechanic first before being a car salesman.
Don Patrick: Well, you know more than most of us.
Alan Bratic: Well, it really helped me because I knew how things worked. So when I would meet, and I had economics and investments background from school, but, so I would meet with people and explain them, hey, how these things actually work and what to expect.
And I learned never to overpromise and underdeliver that. That was one thing that I was very honest with folks and told them what they can expect, what's doable, what's not, and help them differentiate between what people were selling them versus who was really trying to help them, if that makes sense.
Don Patrick: Absolutely. What a concept, being…and setting expectations. Amazing. So, all right, so now you've got that incredible background. Now you're dealing specifically, you're building this from scratch. Were you cross-selling network? How did you build this and how'd you get going?
Alan Bratic: Well, renting the space from the CPA's office, it gave us a little bit of an insight how the tax side works. And I just started going from one client to the next and just using the history of the agency, but then also some CPA connections to get few clients. And then it was just a matter of doing the right things for them and making sure they're happy with every aspect.
Because luckily, most of my clients were fairly known in a community. So when a community leader tells somebody or refers somebody or kind of gives you that introduction, you're already 80% there.
Don Patrick: Yep, that's correct.
Alan Bratic: Because most folks know that somebody that's a leader in community is not gonna necessarily tell 'em something that's not true.
So it was just a lot of hard work and doing the right things. and also, I started, right away I started studying for my CFP, Certified Financial Planner, probably a year into it. So that took me a couple years to finish all the classes and get my designation. And that really helped me kind of show people that I have some kind of knowledge, some kind of credential that I'm not just off the street. And back then, not as many people had CFP, so it was a differentiator for me for sure.
Don Patrick: So let me under, so you're doing some cross-selling with clients of Thompson Baker. You had some centers of influence with CPAs and then started getting referrals in the community. Is that what I'm understanding?
Alan Bratic: Yeah. And also joined, I was very active with my alumni association here locally and joined Kiwanis.
And I didn't just join Kiwanis, I was volunteering, I was doing things, I got fairly quickly on the board of directors. So, really just trying to expand my sphere of influence in a sense, because I always believed in financial planning investments. It's about being the first thought when somebody says, “Hey…,” Or, “I'm retiring, who can help me?” Because I always felt like every single piece of marketing I did was not to get a client from that marketing piece. It was to raise awareness. This is what I do, and I'm here when you need me. And that really worked for me.
Don Patrick: Brand awareness. So you get deeply involved in the community, involved in organizations, networking. So you really did, were doing it all. Cross-selling, referrals. involved in community, networking, the whole thing. And being in a community like St. Augustine is powerful. It's, you can do it in Atlanta, you gotta kind of create a little niche in the community.
But St. Augustine is, that's fantastic. And everybody knows everybody down there, right? Maybe not today, but when you got started.
Alan Bratic: Yeah. Absolutely. They do. And it's very important because when you're in a business for so many years, for so many decades, it's almost like how when you're in a popular community and people ask what's a good restaurant?
Well, it's the one that's still open because people will tell you real quick if it's a bad restaurant. It's not gonna last unless it's like Applebee's or one of those chains. But a real local restaurants, if you see a restaurant's been open 20, 30 years, the odds are it's probably pretty decent.
So, I kind of went the same way. If we're still in business, we're still having clients, we're still expanding, we've gotta be doing something right.
Don Patrick: So how were you compensated? You're starting with no clients. Did they set you up on a salary, a draw, or you just have to actually go?
Alan Bratic: Yeah, so the first year I had a salary and that was it. From then on it was, “Hey, you gotta go out there and make it happen.” So I was very cognizant of trying to do a lot of things my first year, set up a lot of different revenue streams and at that time, I didn't care if somebody wanted to buy a $50,000 term or somebody wanted to invest $5,000. I would take them. We've all been there. Remember when IRA contribution used to be $2,000? That was the max. I did a few of those.
Don Patrick: Now they're worth a lot, aren't they?
Alan Bratic: Yeah. Some of them are. Yeah, for sure. So you did everything.
Don Patrick: You did life and health and disability and insurance. Everything, investments, the whole, so you have a real financial planner.
Alan Bratic: Yeah. And it really helped me because I was always very curious about how things worked, and sometimes I would over-research certain things, but what it helped me was, in the long run, if we did a disability policy, we did the correct policy for the client, not the cheapest, necessarily, but the right one.
And some of those are still in effect from 25 years ago. And same thing with investments. I learned how to, from my operational experience, how to evaluate a mutual fund, how to look at expense ratios, fees. And back in 2000, that wasn't as big of a deal. Didn't start until, was it Elliot Spitzer, whoever the guy was from New York, when he started all the, remember when all the banks got in trouble for paying their, investment guys more because they were selling their own funds and stuff like that.
Don Patrick: I do.
Alan Bratic: So that the fee conscientious society really started back, somewhere in the mid-2000s. But I was fee conscientious back when I first started, just 'cause I've seen things and I've seen how some of the advisors that were with banks were doing, they were selling proprietary funds because they got their little extra commission.
They got their trips, they got all sorts of different things happening for them, and then to me just didn't seem right. I always felt like, “Hey, you just gotta do what's best for the client, not just what's gonna pay you the most.”
Don Patrick: How do you run your investments today? Do you use models? What kind of vehicles do you use? What does that look like?
Alan Bratic: So, so we use some models. I use mostly ETFs, here and there mutual funds on the fixed income side, we use some ETFs, some structure notes. But overall, I try to customize everybody's portfolio, which is a little different from most, I think. A lot of folks would just use a model and just bring in the assets, put 'em in a model, and let somebody else manage it.
And I've started to do that with some smaller clients, for folks that have, under certain amount of investible assets. But I still enjoy looking at different investments, different options. That allows me to use if I wanna use a preferred stock for the income side of fixed income side, I can. If I wanna use your mutual fund, that may, that beats a benchmark, I can. If I wanna buy individual stock, I can, but it's mostly, it's gonna be ETFs across the board that I use.
Don Patrick: So how do you do your research and analysis on ETFs and funds.
Alan Bratic: Well, some of it I do use LPL's capabilities, also have subscription to like Zacks, Morningstar. So that's how I look at it and nowadays it's incredible amount available on web.
You can search for certain things, you get so much information. But that's mostly how I do it. I take a look at which ones are higher rated and which ones, and I look at also performance and fees. For instance, in a large cap space, right? Large-cap growth, it's tough to beat S&P500.
So why fight that, right? My opportunity might be in small caps or emerging markets or fixed income. So once I understood that I kind of tailored the portfolios and but one thing that's very important for me, I never sell performance. As soon as you tell client, “Oh gosh, I'm gonna do 15% versus, this guy's gonna do 12,” or, “I'm gonna do 2% better than the market.” You're gonna start losing clients.
We talk about their goals, their needs, their income, how this is gonna work for them. And that's what we talk about in our meetings. Performance is what it is. The market does what the market does. We can't predict it, we can't time it. And as soon as folks realize that and realize, “Hey, I need somebody that's gonna be there,” and Don, you're gonna understand that.
I always tell them, “I'm like an airplane pilot.” And they're looking at me like, “What does that mean?” And I said, “I'm here for takeoffs, landings, and in-flight emergencies,” right? So when the turbulence happen and everybody's panicking and screaming, I'm here to get on Intercom and say, “Hey folks, we just experienced a little turbulence. Everything's gonna be okay. Just sit back, put your seatbelts on and we'll be back with you shortly.” That's what we do. That's what we do. Because most folks, there was a study done, I forget who did the study, but they've looked at returns over the last 50 or 60 years, and they've looked at S&P500 and they've looked at average investor and S&P 500 was, let's call it 9, 9.5, 10%, right?
Somewhere around that range. Average investor was like 4%, and folks were saying, “Well, wait a minute, why?” Right? Why is it such huge disparity? It was one answer. Emotions. Right? People are either exuberant and they just wanna buy everything under the sun, or they're so scared they just wanna sell everything.
And that's when they manage their own money. Or even when they have an advisor, they'll call in and say, “Listen, I can't stand this anymore. Please, let's sell everything.” And a lot of advisors will just be like, “Okay, fine, I'll do it because I don't wanna make you unhappy and I don't wanna be wrong.”
Right? And on the other hand, when things are going fantastic, let's say now, and everybody's like, “Hey, listen, I got $300,000 sitting in a CD. Let me put it all in the market.” My first question is gonna be, “Why is that in a CD, first of all?” It's probably emergency funds. And probably right now, maybe it's not the time to just put a large chunk in.
So those are kind of the things, because with the advisors, it's not about being right, it's about not being wrong. That's the most important part in my opinion. Because when you have wind in your sails, anybody can be a sailor. But when the win switches or there's no win, what do you do? That's what distinguishes good advisors from great ones.
Don Patrick: That's another great analogy. I love it. So what do you love about the profession besides your analytical, wanna research things, put things together?
Alan Bratic: I love working with people. I love when I get invited to a retirement party and the person says, this is, “Alan had a huge part in this.”
I love seeing them being able to do what they wanna do. I love them being able to support their kids' grandkids, travel, support charities, buy a mountain home in North Carolina, buy a boat, whatever it might be. That's the biggest difference because when a sit down with a client for review, we probably spend 90% of time talking about them, how they're doing, what would've been up to, what's happening with kids, grandkids. We talk a lot of different things, but it's about them and I really enjoy that, and we've been blessed to have really good market for a long time that has enabled people to really accumulate some assets and be able to do what they wanna. I just absolutely love talking to people. That’s what I love the most.
Don Patrick: I love it. It’s a great profession, so rewarding. So let's kind of turn to practice a little bit and can you give us a high-level overview of your practice and your base, what that looks like?
Alan Bratic: So we have another advisor here with me that came on board about a year ago from Northwestern Mutual, and then we have an assistant receptionist and so forth. But my client base is really wealthy families.
Earlier in my career, I catered to some medical professionals and I found real quick that they're a very challenging demographic to work with. So I kind of pivoted in a sense and really started looking at families, and of course executives, working individuals and so forth that are close to retirement.
But a big part of my practice was also focused on not just talking to, you know, when you have a couple, most of the times a husband will come in and talk about it and kind of, do most of the talking on investing so forth. One of the things I always said, “If you are married, I want both of you to be here and to hear this.”
And I tell you, I had some spouses sit there on their phones, just, not really listen to what I was saying, but they were still there and down the road when the, when something would happen to the breadwinner spouse, I think they really appreciated us being there for them and me having a relationship with them. But that's kind of probably the big view of the practice.
Don Patrick: I like how you call them medical professionals, you know what you mean.They know everything. You're so diplomatic. So let's talk about technology, tech stack, things of that nature. You already mentioned some of the things you subscribed to. Zacks, Morningstar, LPL Research.
Alan Bratic: Yeah, so we have Zacks, we have Morningstar, I use Right Capital for my quick planning kind of things, putting things together. We also subscribed to eMoney 360. That was one thing that I learned. So let me just give you quick synopsis. When I first started in the business, the agency was appointed, they had a relationship with Equitable. Because Equitable, they wrote Equitable policies in 1925. So Equitable was AXA Advisors back then. So we cleared through them first couple years, and that was just not really working for us, 'cause AXA Advisors or Equitable is really an insurance company, right? So they wanted to selling life insurance, annuities and stuff like that.
So we moved over from them to LPL. Well, LPL back in early 2000s was not what LPL is today. It was better than Pershing in my opinion. But the old Branch Net was just clunky, just wasn't working that great. And back when we first started, we subscribed to WealthVision, which is eMoney 360 tailored for LPL.
So when we left LPL, because the tech was just bad, this wasn't working, it was cumbersome, wasn't good and moved to a different broker-dealer and we found out that WealthVision was proprietary to LPL. So all that stuff that we had on Wealth Vision was poof, gone. So after a few years, the broker-dealer we were with was bought by a private capital firm and I was looking for a new broker-dealer and we got a call from LPL and I was like, “No, no way. I'm not going back to LPL.”
However, the person was, listen, “Alan, just hear me out. It's completely different. Technology is web-based. It's fantastic.” I said, “Okay, fine, I'll listen.” And sure enough, when I looked at what LPL L had available, it was completely different. So we went back, but one of the things that we changed.
We now went to eMoney 360. So we use that to really show clients' capabilities on a high-end level so they can put all sorts of different accounts there. They can have planning done, all sorts of different things. but to be honest with you, I use mostly Right Capital because it's, one thing I've learned is when you show up to a client with a 55-page financial plan, you're lost right there.
Don Patrick: Oh yeah.
Alan Bratic: You're done. You might as well walk out. It's pointless. Unless you have a Georgia Tech engineer as a client, that's a different story, but I don't…so, so write capital. What's nice about them? It's about, you can choose which pages to use, but you can create a 5, 6, 7 page plan with graphs and pictures that people really understand. So, and then also we use Redtail for our CRM, and I think that's about it, Don, that I can think of.
Don Patrick: So with the planning, do you use the vault with your clients, eMoney?
Alan Bratic: Yes. Some clients have used that.
Don Patrick: Not many, though, right?
Alan Bratic: Not as many because nowadays, people can save things just about anywhere. But I used it, I gave them a real-life example of me being 16 or 17, going to Rome with three or four other folks that I knew and basically, we went to Vatican to visit Vatican. And back then, this was a long time ago, when you went to Vatican, you had to show your passport, right? It was a different country.
So you went from Italy to Vatican. You had to show your passport. So one guy had all our passports. So, and back then the buses would pull up right next to St. Peters Square. It's not the same anymore, but it used to be right there. So we were waiting on a bus to get back to the place where we're staying.
And this little gypsy kid started asking us, “What number of bus is that?” And I'm like, are you seriously asking me that number's right there? But of course, the guy, the person that has the passport was a super friendly, like, “Oh yeah, this bus is…this is the number. This is where it takes you,” da, da, da.
So we all get on the bus. Little kid jumps off the bus and I'm like, “Well, that's not good.” So I'm checking my wallet, it’s still there, I got my stuff. So the bus starts going, a couple minutes into it I'm like, “Okay, give me my passport back.” So this gentleman starts fumbling through his little fanny pack, whatever.
He had the passport and he was like, “Do you have it? I don't have it.” So we finally figured little kid got the passports. So long story short, we take off at next stop and we're all in a…neighborhood of Rome and we go to the nearest station. It's probably 15 other people, same thing happened.
So, and back then, Croatia was a brand new country. So I had no copy of my passport, a picture of anything. I just had the old ID. So we had to go to consulate. It was a pain in the neck to get a, not a passport, but a traveling document. So I used that example for my clients to say, “Hey, listen, download a picture of your passport. Download a picture of your power attorney or healthcare surrogate, whatever else you need, just in case somebody needs to access it or you need to access it from Rome, you can have it.”
So that's how we originally used vault, but nowadays there's so many different systems that people just take pictures and save it on their phone and, but you know, some people still use that vault.
Don Patrick: Yeah. If you get 20% or more, 20, 25%. That's pretty much the norm. So you've got a prospective client. What does, how does this look? Do you have a phone call? Do you have a, I mean, just walk us through what it's like from perspective. It's a referral, let's say. So what happens next?
Alan Bratic: So, of course, I mean, it's usually a phone call. I'll give them a call and just, I'll briefly kind of try to figure out what they need, where they're about, and just kind of try to ascertain are they even gonna be a possibility for us. And one of the things that I tell them is, send them an email with basically, “Hey, just bring X, Y, and Z. Here's their address, here's the parking,” and so forth. But one of the things I tell them is like, “Listen, This is gonna be like a first date. I want you to know everything about me. I wanna know everything about you. And then we both gonna mutually decide if this makes sense going forward.” Because at first, when you first start in this business, you take a lot of folks that you probably shouldn't take as clients.
And I'm to the point where I'm getting closer to capacity and I don't wanna just take somebody to take somebody as a client and it doesn't matter who refers them and so forth. So we'll go through, investable assets, their goals. And I really try to, that first meeting, and it's almost always in person.
I just wanna see their demeanor, how easy they're talked to, do they converse? Do they give you information, are they standoffish? And those are some of the things that make big difference for me. But that's kind of the first step. After that, we send them out. Usually, “Hey, we might need X, Y, and Z.” And more than likely, after that standpoint, after that first meeting, we try to decide, okay, if there's a next meeting, when, what do we need to present? What do we need to put together? And so forth.
Don Patrick: So how do, well, I'm gonna back up just a second, because this is always a challenge. So this is a referral from a really good client of yours. You have this first date meeting, and you decide they're not a fit. How do you handle that?
Alan Bratic: Well, a couple different ways. If they're not a fit because they're assets and are up to par, if they have at least a hundred thousand, I will get my other advisor involved, right? However, if they're just not a fit, what I usually say is like, “Gosh. What you are trying to accomplish, we're just not the right firm to accomplish that for you. Somebody at Merrill Lynch might be better suited for you.” So we try to do it from that standpoint. But usually it's something like that. “Gosh, we're just not gonna be able to produce what you need us to produce. I really appreciate you coming in. It's fantastic meeting you. Tell, Don, thank you for referring.” And I'll usually tell him, “Hey, take a look at either,” if they're really do-it-yourself or maybe a Schwab E-Trade, something like that.
If they're appear to be super difficult, “We'll try to say, gosh, might wanna look at like UBS or Merrill Lynch or Fidelity or something like that.”
Don Patrick:. Nice. Alright, so you've had the first date meeting. How do you gather their information, do electronically? Do you have them fill out a form, just have them bring a box of stuff in. What does that look like?
Alan Bratic: So most of the times when I first call them, I'll ask them to bring stuff in or email me their information. Sometimes I'll send them a secure email and say, “Hey, just reply to this.” Sometimes they'll just PDF it, but most of the times I'll just print it out and bring it with them. So far, I've never had anybody bring a box. People have, thank God, people have had folders, three or four folders. But for most folks, occasionally, we have folks even log in.
Some of them say, “Gosh, I forgot to bring it.” But in a conference room, we have a big screen TV that's connected to a PC. Some of, they'll log in and just pull up their information. We'll print a statement or something like that. I don't have a, I know a lot of people have form that they send out to their clients.
Say, “Hey, bring this, this, and this.” I kind of tend to save it if I need it for down the road. I want the first meeting to be, “Hey, bring me the information.” But I don’t wanna overwhelm you. Because when somebody overwhelms you or just throw stuff at you from the get-go, you're gonna like, “I don't wanna go there.”
It's like filling up medical forms when you switch doctors and it's like 75 questions. And you going like, “My gosh, can I just establish a relationship with you? You can ask me if I'm allergic to something and you can look in my history.” But so always felt like kind of keep it simple. And then your next meetings and during your first meeting in person, you can ask more detailed questions.
Don Patrick: So, I guess the next step is you do your analysis and put together a plan. So then that meeting is the presentation of your findings. Do you still print hard copy or do you do it on that big screen?
Alan Bratic: I print hard copies. Sometimes I will pull it up on a screen so we can all look at it together. And my clients are not 25-year-olds. For 25-year-olds, maybe they don't want it, but most people kind of wanna touch and feel and be able to look through and make little notes as you go along. One of the things that always felt that was important when somebody's working on advisor or somebody else is managing money, they bring their portfolios in and it's so easy for anyone, including my competitors, to look at my portfolio to start tearing it apart, saying, “Oh, this is horrendous. This is horrible.”
One thing I've learned is when you own a home or an apartment or something and you ask somebody to come in to fix something, and what really bothers me when they come in and start saying, “Well, who did that flooring for you? Well, that's completely wrong. Who did this and why did they do it this way?”
And you're just going like you, first of all, you look, you feel like a fool. You feel stupid for even hiring the other person. But the matter of fact is it's not necessarily done wrong. It's just done differently. So that's one really important factor that I always mention to clients whenever they ask me, “What do you think about our portfolio?”
I might say, well, there's some room for improvement. It's not bad. I never wanna tear it down, even though sometimes, I mean, I found municipal bond funds in IRAs before. And I'll ask just a question, “Do you know why is that in here?” And they're like, “I dunno, I have no idea why it's in there.”
I said, “Well, usually we don't put that in the IRA, so you know, if you need some municipal bonds or stuff like that, we'll put it in your taxable account.” And I said, “That's just a little bit of efficiency that we can fix for you and make it more efficient.” Then we'll just do comparison of, “Oh, well, here's your expected returns, here's your risk profile with this portfolio versus this one.”
And we try to say, “Hey, you see you're getting 1% extra return, but only 0.25% extra risk.” People get that. People understand that. And sometimes, Don, there's nothing wrong with the outer portfolio. There's something wrong with an advisor and how the advisors communicate with the clients, so it's more about service versus completely destroying the portfolio.
Don Patrick: So, how do you compare the performance or look at the portfolios? Are you using Morningstar for that?
Alan Bratic: So Right Capital does that for us. You can actually input an actual portfolio in, and it will tell you how it is based on the model, right? If you choose, I don't know, a growth profile with whatever allocation and account tells you, okay, your current portfolio, you're like, you have too much international equities, or you have too much this, or too much data, or too little of something, and we'll kind of compare it, and this is a starting point.
Don Patrick: Correct. So you've had the, “Here's our findings…” You've walked through the plan, how do you get to the implementation stage?
Alan Bratic: So, usually, give people a couple of different options sometimes, right? If it's, and some people will come in there and say, “Listen, I don't want to touch X, Y, or Z because this other person was pushing X, Y, and Z.”
So I'll make a note of that and say, “Well, X, Y, and Z might not necessarily be bad, but if you hate it, you don't like it for whatever reason, I'm not gonna push into it for sure.” So somebody, I'll show them basically advisory account. I'll show maybe some different options, go through the fees and just say, “Hey, all we gotta do is just do a transfer of assets.”
And a lot of, I'll explain to people, it's like, “Well, in a lot of cases, it's just basically, you have your furniture in one room. All we’re doing is taking that furniture and put in a different room.” We're not gonna sell everything because lot people ask them, “Well, gosh, do you have to sell everything? How does this work?” So I'll explain to them basically in that way. So we're just moving your same chairs and then we'll figure it out if we need to paint that chair or change it up or put something more modern in it and so forth. I'll always talk to them about any cost and I'll also explain my fees.
And to be honest, Fisher Investments, it's probably my best advertising out there because literally every single good advisor does the same thing, what they claim to do. So I'll say, “Have you seen that Fisher Investments commercial?” “Oh yeah. I've seen the guy talk about something.” I said, and I say, “Listen, our fees are structured same way.”
So it's very, you can see the fee, it's done quarterly. It's a line item on your statement. But also, the better you do, the better we do. 'Cause the fee is annualized, it's based on asset center management. People understand that. I'm very conscientious about talking about fees and also talk to them about how we're gonna create portfolios that–the management fee is not only thing that you pay. Every single investment, just about every single investment has an expense ratio. Obviously. Apple stock doesn't, but an ETF does. And I said if we can find an ETF with five basis points versus 20 basis points, I just saved you 15 basis points if it's the same ETF.
So we go over those factors and go over the fees. And then, sometimes if we need to show a structured note or annuity or something like that, if somebody needs some guaranteed income or a life insurance policy, we'll go through that and we'll give 'em different options and always tell people, “Whatever I show you, I want you to love it or hate it.”
And people are, “Wait a minute, what?” I said, “Why hate it?” I said, “Because then I know we're not gonna do that.” Always felt like the worst feeling is being the lukewarm, “That's good. It's fine. It's okay.” It's like, “No.” It's like, “I want you to love it or hate it.”
Don Patrick: I love that. So is your asset management fee, that includes the financial planning or is there a separate fee for planning?
Alan Bratic: Most of the time, it includes it, yes. We kind of say, “Hey, listen.” And it also, Don, depends on how much financial planning really needs to be done, right? For some people it could be just a simple quick analysis of, “Hey, I wanna retire in seven years and I wanna have $10,000 a month. How do I get there?”
And some of people really need some advanced things. And in that case, we might do a fee, and honestly, I had some clients that came in and said, “Listen, I don't want you to manage my money. I'm doing my own,” or, “I have my brother-in-law doing it. All I wanna do is for you to really look at everything, giving honest opinion, we'll pay you a fee for that.”
I had probably three or four clients ask that and I said, “No problem.” And that case, it's probably, we take a look at somewhere around $300 an hour is what we charge with about $1500 minimum. And we said, “Hey, it's gonna cost you X, Y, and Z.” I just had a CPA, actually, a retired CPA, come to me that's working with a LPL guy in Jacksonville of all places.
And she just said, “Listen, I can't switch,” for whatever reasons, there's some relationship there with some family, but she's like, “I really want you to look at it because he's suggesting some things that don't make sense to me. Can you just look at it and lemme know what you think?” Well, sure enough, it doesn't make sense.
If it doesn't feel right, it probably isn't. So I said, “Yeah, that doesn't make sense to me.” But I charged her, I think it was like $1,200. It took me a few hours. And she was very thankful for that and said, “Thank you so much.” And I said, “Well, if you get a lot of these things that don't make sense, come see me because maybe you shouldn't be working with this person.” Right?
Don Patrick: So, with your existing clients, what does, I call them progress review meetings, but what does the cadence and…like? And what do you call it, actually?
Alan Bratic: So I have quarterly reviews.
Don Patrick: Quarterly. Do they all want that or do they all–
Alan Bratic: There’s probably three or four that are like, but one of the things when I meet with them first time is like, “This is, well, this is what we do.”
And I said, “I'm gonna need you to commit to certain things.” And I said, “I need you to commit to quarterly reviews.” And I said, there's gonna be some quarters where we're like, “Hey, everything is good.” Or, “I'm traveling, I'm doing this.” but I wanna be able to, what I call, touch a client. And I don't mean that literally, right?
But I wanna touch a client about 12 to 15 times a year. So what does that mean? Obviously, reviews are some of it. Sending a quarterly newsletter is one. Sending a birthday card is one. Sending a holiday card. Used to be Christmas cards, now it's all holiday cards. And then a call here and there, right? In April, where all this tariff were rolling around and everybody was panicking.
A lot of my folks got a call just to say, “Hey, listen, it's okay. We're gonna meet soon. We'll figure out the strategy for that.” But that's one thing that I always ask people to do. Now, I have some clients in California, in Colorado, in North Carolina and Virginia and Pennsylvania. Obviously, I'm not gonna meet with them quarterly in person, but we talk on the phone. Also for the folks who, you know, who don't wanna brave the traffic and all these different things.
We might do that quarterly meeting over the phone as well. But I try to get them all in beginning of the year, so I can give them a year-end report, summarize the year, what do we expect from this year? How's everything going? How are our holidays and so forth? I try to do it in person and it's been really good for me because you can tell if somebody's unhappy about something or somebody's looking elsewhere, or if somebody's not really feeling you anymore.
And you can maybe either say, “Hey, is everything okay?” And it could be something like, “Yeah, my dog died and I'm just in a dumps.” Or it could be something, “Well, Alan, kind of, you told us this and this is not happening, and gosh, can we get a little bit more of this?” So I have an opportunity to write whatever might be the issue, before they just leave me.
Don Patrick: So on these quarterly calls, what are the topics? What's the agenda like, just checking in, or is there specific agenda items? What does that look like?
Alan Bratic: Yeah. We talk about their accounts, their portfolios and performance. So I'll talk about, I'll take a look at what the indexes are doing, but more than that, I'll just talk about, “Hey, year to date your account's up 7%,” up five, down five, whatever it might be. And then I'll talk about the portfolio and say, “Here's why you outperformed, here's why you underperformed.” And then I kind of give them, “This is what's going on right now in the world.” Mostly United States, but this is what's going on.
We've got tariffs, we've got this, we got Russia, we've got X, Y, and Z. So how do we position the portfolio? Do we need to make any changes? Is everything okay the way it is? Anything going on with you? Are you guys going on any trips? I've had clients several over last year go on these 50, $60,000 trips.
And it seems like, “What are you doing?” But you know, some of those nicer cruises or with excursions here or there with first class tickets, you easily 50, $60,000 in. Now they're able to do this because their portfolios have done really well and they've done great job saving. But this allows us to kind of account for that.
So if they tell me, “Hey Alan, I'm gonna have to do three $20,000 withdrawals over the next three months.” I can position portfolios so I don't have to sell Apple stock that I don't wanna sell, as an example, right? So I can kind of plan ahead for that. And I'll tell you, the response has been really, really positive from these meetings.
People enjoy that. And when you're retired, what are you gonna do every day, right? So them coming in here and talking to me, they actually enjoy that. They get to dress up a little bit. Maybe they grab dinner or lunch afterwards. It's something to do, versus playing golf every single day.
Don Patrick: I love it. Yeah. That's great. So let's pivot to growth and obstacles in your business. What are some of your biggest challenges you've been facing recently?
Alan Bratic: Enjoying the fruits of my labor has probably biggest challenge because I'm at a point where I've done really well. I am really happy where my practice is, but as soon as you started thinking that, started to be complacent, now trying to prove yourself, things happen, things go south.
So for me it's really bringing on, just a few clients for myself, but more than anything, is helping Patrick improve his practice and get him up and running, because eventually I wanna be able to take maybe Friday off every single Friday or something like that, or go play golf with a client or do whatever.
And I want him to be in a position that he can take care of the ship, so to speak, right? So my focus is now doing the growth, doing the right way, creating good marketing opportunities, continuing the brand awareness, because even though we're successful, still trying to advertise, still trying to sponsor things, be visible in community, because momentum is a funny, being a sports guy, playing sports, any sport you play, the momentum is so huge and so important.
I mean, it doesn't matter. You look at FSU playing Alabama, right? I mean, Alabama lost its momentum and all of a sudden it got punched in the mouth and it was over. And Alabama probably should win that game, but it didn't. And there's so many examples like that. As soon as you lose that momentum, your confidence starts to go down, you start to self-doubt.
Your body language is bad. The same thing in business. It's absolutely same thing in business, So really that's for me is most important. That's my challenge as well, because how do you keep yourself motivated every single day? What do you do? How do you do that? Even your end goal, even when you retired, right?
And you, Don, are kind of towards retirement, but you're still doing things right, you're still keeping yourself motivated, you're still doing podcasts, you're still helping advisors. So those are crucial things, in my opinion. To be able to be a self-motivating person is huge for an advisor. And whatever it takes, you gotta do it.
If you gotta talk to yourself, you gotta leave notes. If you gotta listen to podcasts, if you listen to Tony Robbins, whoever, it doesn't matter. If you need to listen to AC DC every morning before you make call, it doesn't matter. You just gotta do it. That's the most important part for an advisor.
I always say, if you're just sitting here doing nothing in your office, go out to the park and start feeding the pigeons. You have a better chance of getting a client that way than just sitting in your office doing nothing.
Don Patrick: This is great advice, Alan. I love it. So right. Great observations,
Alan Bratic: Right.
Don Patrick: So on your, you're part of the IFG Consortium. Can you tell us when you joined IFG?
Alan Bratic: Yeah. So it was about four years ago, or five, sorry, five years ago. Time flies. Really, what I was looking for, Don, is ability to have a community, but also ability to have a different custodian. That's really started my journey because originally I was gonna partner up with an advisor in…which is near St. Augustine. That's where the TPC, The Players Championship, is. It's a very affluent, beautiful area of our county. And we were gonna bring a good friend of mine, who I went to college with, was a huge 401k producer, and he said, “I got this huge amount of 401k business, but it's like, we're not really taking advantage of it. I don't know how to do it. I don't wanna be the one.”
So we were gonna partner with him. So we started looking at IRAs, so we looked at, and I called my LPL recruiter and I said, “Hey, how do we accomplish this?” Right? So he told us, “Hey, you need to talk to Don and Land.” And he also sent me to, I think it's PAG, Private Advisor Group, or something like that.
Don Patrick: Yes, uh-huh. That's correct.
Alan Bratic: So we start talking to both and, Private Advisor Group was more like, “Yeah, we'd love to have you. This is what we got, this is what it is. You want to come on board or not, just tell us. We're good, ready to roll.” And when I started talking to you, I really enjoyed talking to you and Land, like, it was different, it was more personal and I just felt more sense of a community.
And even though I had to like talk to seven different people through the process, it was just like at a certain point in time I'm like, “Okay.”
Don Patrick: We have a culture we're trying to protect.
Alan Bratic: Right. No, I totally get it. Because one of the broker-dealers I looked at originally, before settling on LPL, was Commonwealth.
Which is now part of LPL. But Commonwealth was very, very, very selective with their advisors. Right? So when Commonwealth meant an offer to an advisor, that was like going into Yale Club or something. So when I said no to Commonwealth, they went with LPL. They were just like, “What?” But I still am very good friends with Wayne and people up there.
They're just wonderful people. I love it. Yeah. Becca and Wayne. They're fantastic. So I had the same feeling with you guys, even though I can tell you, we're not gonna mention names, but the person I had to interview, an advisor that I interviewed with, I was just like, “We're just not jelling at all, not happening.”
And I was like, “Why did they put me with that person to talk to?” You know what I mean? But, but anyway, I thought, I believe what you guys were doing and I believed in Land and you, and when you said, “Hey, we're gonna bring another custodian and we're totally on board,” and you guys did it. That was it.
And then meeting a lot of folks were just lovely. Everybody I talked to, they were so nice. From Carmen to Laura, to everybody, Karen, it's just good people. Like they're people that I would go have dinner with, you know what I mean? Not just do business with.
Don Patrick: No, I do. Everybody's great. No, they're all good people. That's why we have vetting process.
Alan Bratic: Right.
Don Patrick: Not always a guarantee, but then we fix that quick. So has you had much of an impact on your practice and your peers and such?
Alan Bratic: Yeah. Absolutely. Absolutely. I mean, and just the other day I talked to Crystal Epstein about a client that was kind of, not a client, but somebody else asking for some stuff.
And I was like, “Hey, Crystal, can you chat with me about this?” And she was, she called me and we just, we were able to have a normal conversation without worrying about am I gonna say something to compliance, gonna come after me afterwards. You know what I mean?
Don Patrick: She loves her advisors. She certainly does. Always has a smile.
Alright, so let's go through a few quick fun questions before we wrap up. So use three words to describe your talents and strengths.
Alan Bratic: Oh gosh. I would say persistent, honest, and probably trustworthy.
Don Patrick: I would agree with all three. Absolutely.
Alan Bratic: You know my wife sometimes says when I get ahold of something, I'm like pitbull.
Don Patrick: Grab ahold of that ankle and don't let go.
Alan Bratic: Yeah. I'm just like, this is just not right. This is just right. Just not right. And my wife's like, “Just let it go. Let go.” I just can't.
Don Patrick: So tell us something about yourself that most people don’t know.
Alan Bratic: There's not much. I'm probably a crappy golfer, probably most people know that. I just love sports. Obviously, people know that I'm from Croatia, so I don’t know if there's much, to be honest. Thinking here, I probably like EDM music more than most people would think, like techno, stuff like that.
Don Patrick: That's something.
Alan Bratic: I don't like country music and I'm sorry, I just don't get it. It's too whiny for me. But, maybe that.
Don Patrick: It's broken lovers and–
Alan Bratic: Yeah, I don't know. It just, obviously, growing up in Europe, right, in Croatia, country music is not really a thing there.
Don Patrick: I'm surprised. So do you have a favorite book?
Alan Bratic: Two. Atomic Habits. Probably that's what it is. I would say probably that's my favorite. And also The Great Gatsby. I’m doing business, but I love that book.
Don Patrick: That’s great. And last question. What’s the best piece of advice you’ve ever received?
Alan Bratic: Politically correct, I assume.
Don Patrick: Well, doesn’t bother me. We can always edit this…you know that.
Alan Bratic: No, this is a high-end podcast. Really, one of the piece of advice is be where your feet are, right? That meaning like, be where you are. Be focused on the person, what you're doing. Don't think about other things. Be where your feet are. It's probably crucial to me, and then also just under promise, over deliver.
Don Patrick: I agree. Absolutely. Well, Alan, this has been fantastic. I wanna thank you for the time and effort for this. We're finding, I mean, I learned so many things, conversations are great. I just wanna say thank you.
Alan Bratic: Well, I appreciate you having me on, Don. I mean, you're an icon in this industry and you have a fantastic podcast voice. You should be on radio or something.
Don Patrick: I'm an amateur, but I'm getting better. Anyway, I wanna thank you. I wanna thank all of you who are listening and thanks for tuning in and we'll talk to you next time. See you, Alan.
Alan Bratic: Will do. Thanks, Don.
Don Patrick: Take care.
Well, that's it for today's show. Thanks for listening.
If you've got something to share, send an email to dpatrick@thebraintrust.net. We want to know what works.
Until next time. See ya.