SMALL BUSINESS | March 28 – April 3, 2014
By Stephen Nellis
After a quarter century in an industry that’s changed tremendously, AmeriFlex Financial Services is gearing up for its biggest year.
The Santa Barbara-based independent financial services and wealth management firm has successfully weathered two massive market crashes since its founding in 1988. It’s now gearing up to offer services to teach and train other financial advisers, a push which it expects will double its revenue and staff and has already spurred it to expand its office space by 40 percent.
“The year of our 25th anniversary, we doubled our revenue, which is a feat for a financial services company that’s mature,” said Thomas Goodson, founding principal at AmeriFlex. “We expect to double revenue again this year.”
AmeriFlex got its start out of Goodson’s house. He was working for a prominent statewide insurance firm when it reorganized its offices. “They gave me a choice of moving to Glendale or a severance check. I was sitting at [longtime Santa Barbara watering hole] Harry’s having a gin and tonic and said, ‘I’ll take the check.’ ”
Goodson leveraged relationships with human resources executives at some large companies in Santa Barbara who needed 401(k) plans set up. Twenty-five years later, AmeriFlex offers a range of services, from retirement accounts to tax planning, in addition to working with high-net-worth clients.
To draw in clients, AmeriFlex has started offering tailored products to specific groups. It’s most recent is called the Woman Investor Program, which offers a “Fun and Finance” series of events to make investing more approachable.
Women face specific challenges when planning their finances: They live longer, they tend to move in and out of the workforce as they juggle family responsibilities, and they still earn 81 cents to the dollar compared with men, said Bibi Taylor, a wealth manager with the firm. Women tend to outperform men when they do invest because they take fewer unwarranted risks, but that tendency toward conservatism can make it tough to persuade women to invest rather than save. “It’s the challenge of getting them to see the value in having their dollars work for them,” Taylor said.
AmeriFlex has also designed programs targeted at business owners looking to sell a company and doctors. But the genesis of it all was a program called “Honey I Got Hit by a Bus.” Goodson said that clients for the program are “usually a couple, one of them knowing where everything is at and the other doesn’t.”
The idea is to put everything — 401(k) accounts, stocks and bonds, and any other financial assets or important information — in one place. Goodson said the idea started at home. His wife, he said, “does a great job of holding our family together, but if I died, she wouldn’t know where anything is. It started with what would happen if I got hit by a bus.”
Cataloging everything, from munis to passports, is the first step in what Goodson sees as the biggest trend in financial planning, something he calls “decumulation.” That’s the process of building a balance sheet of the client’s wealth, forecasting for the future and building what Goodson calls “a durable income strategy.”
“What we’ve found with folks as they get closer to retirement is they’ve done a great job of accumulating,” he said. “They are going to trade in a paycheck or sell a business and decumulate. The No. 1 concern they have is, Am I going to run out of money? You see that up and down the socioeconomic spectrum. They could have three jets and worry about running out of fuel or have a lovely condo overlooking the harbor and be worried about the same kind of thing.”
Once everything in a client’s financial life is digitized, AmeriFlex largely turns over the reins through its website, where clients can see and manage it on their own. Goodson doesn’t worry one bit about handing the client that power because it allows to AmeriFlex to focus on its clients’ thorny questions about inter-generational wealth transfers, deaths, business sales or divorces.
“The more you empower people, the more they trust you. And if they trust you, you’re the first point of contact for events,” Goodson said.
Justin Anderson, the firm’s other principal, said AmeriFlex decided to become an early adopter of the technology that put clients in control because it sees the industry heading toward a future where a premium will be put on human interaction for questions that only an adviser can solve. “Managing investments itself is becoming commercialized. You have to look at how to add value. It’s more complex than just managing an account,” he said.
AmeriFlex is getting in the business of training other advisers from around the country with its approach. Goodson said it’s the perfect way to stay rooted on the South Coast and increase the top line.
“We’re really community-based. Last year, we gave away $87,000 to not-for-profits. But we have ambitions grow. We can enable other advisers to grow their business,” he said. “At 25 years, we’re more excited now than we were 25 years ago. I wake up pumped up because there’s so much opportunity out there it’s unbelievable.”