Financial advisor 9781422290514, 1422290514

Table of contents :
Title Page
Contents
Introduction
Chapter 1: Job Requirements
Chapter 2: Integrity and Trustworthiness
Chapter 3: Respect and Compassion
Chapter 4: Justice and Fairness
Chapter 5: Responsibility
Chapter 6: Courage
Chapter 7: Self-Discipline and Courage
Chapter 8: Citizenship
Chapter 9: Career Opportunities
Further Reading
For More Information
Glossary
Index
About the Author & Consultants
Blank Page

Citation preview

NHMC13_CareersChrctr_NatPress_18HBK_NHMC13_CareersChrctr_18HBKjackets 4/15/13 6:14 PM Page 5

Find out what it takes to be a financial advisor with character… Financial advisors show people better ways to manage their money. They help their clients: • • • • •

Invest in stocks and bonds; Save for the future; Plan for home ownership; Set aside funds for their children’s college education; and Look ahead toward retirement.

Find out what you’ll need if you pursue a career in this field: the education… the experience…the integrity…and the respect for others. Financial Advisor will tell you what you’ll need.

BE SURE TO READ OTHER BOOKS IN THIS SERIES

Cover photos: Shutterstock.com

EAN

ISBN 978-1-4222-2755-8

9 781422 227558

90000

Financial Advisor

C AREERS

WITH

C HARACTER

Career Assessments & Their Meaning Childcare Worker Clergy Computer Programmer Financial Advisor Firefighter Homeland Security Officer Journalist Manager Military & Elite Forces Officer Nurse Politician Professional Athlete & Sports Official Psychologist Research Scientist Social Worker Special Education Teacher Veterinarian

Careers with Character

Financial Advisor Sherry Bonnice

Mason Crest

Mason Crest 450 Parkway Drive, Suite D Broomall, PA 19008 www.masoncrest.com Copyright © 2014 by Mason Crest, an imprint of National Highlights, Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, taping or any information storage and retrieval system, without permission from the publisher. Printed in the Hashemite Kingdom of Jordan. First printing 987654321 Series ISBN: 978-1-4222-2750-3 ISBN: 978-1-4222-2755-8 ebook ISBN: 978-1-4222-9051-4 The Library of Congress has cataloged the hardcopy format(s) as follows: Library of Congress Cataloging-in-Publication Data Bonnice, Sherry, 1956Financial advisor / Sherry Bonnice. pages cm. – (Careers with character) Includes index. Audience: Age 12. Audience: Grade 7 to 8. ISBN 978-1-4222-2755-8 (hardcover) – ISBN 978-1-4222-2750-3 (series) – ISBN 978-1-4222-9051-4 (ebook) 1. Financial planners–Vocational guidance–Juvenile literature. 2. Financial planning industry– Vocational guidance–Juvenile literature. 3. Investment advisors–Juvenile literature. I. Title. HG179.5.B66 2014 332.0240023–dc23 2013007176

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CONTENTS 1. 2. 3. 4. 5. 6. 7. 8. 9.

Introduction 7 Job Requirements 11 Integrity and Trustworthiness 23 Respect and Compassion 33 Justice and Fairness 41 Responsibility 51 Courage 59 Self-Discipline and Diligence 69 Citizenship 77 Career Opportunities 85 Further Reading 92 For More Information 93 Glossary 94 Index 95 About the Author & Consultants 96

We each leave a fingerprint on the world. Our careers are the work we do in life. Our characters are shaped by the choices we make to do good. When we combine careers with character, we touch the world with power.

INTRODUCTION by Dr. Cheryl Gholar and Dr. Ernestine G. Riggs In today’s world, the awesome task of choosing or staying in a career has become more involved than one would ever have imagined in past decades. Whether the job market is robust or the demand for workers is sluggish, the need for top-performing employees with good character remains a priority on most employers’ lists of “must have” or “must keep.” When critical decisions are being made regarding a company or organization’s growth or future, job performance and work ethic are often the determining factors as to who will remain employed and who will not. How does one achieve success in one’s career and in life? Victor Frankl, the Austrian psychologist, summarized the concept of success in the preface to his book Man’s Search for Meaning as: “The unintended side-effect of one’s personal dedication to a course greater than oneself.” Achieving value by responding to life and careers from higher levels of knowing and being is a specific goal of teaching and learning in “Careers with Character.” What constitutes success for us as individuals can be found deep within our belief system. Seeking, preparing, and attaining an excellent career that aligns with our personality is an outstanding goal. However, an excellent career augmented by exemplary character is a visible ex-

pression of the human need to bring meaning, purpose, and value to our work. Career education informs us of employment opportunities, occupational outlooks, earnings, and preparation needed to perform certain tasks. Character education provides insight into how a person of good character might choose to respond, initiate an action, or perform specific tasks in the presence of an ethical dilemma. “Careers with Character” combines the two and teaches students that careers are more than just jobs. Career development is incomplete without character development. What better way to explore careers and character than to make them a single package to be opened, examined, and reflected upon as a means of understanding the greater whole of who we are and what work can mean when one chooses to become an employee of character? Character can be defined simply as “who you are even when no one else is around.” Your character is revealed by your choices and actions. These bear your personal signature, validating the story of who you are. They are the fingerprints you leave behind on the people you meet and know; they are the ideas you bring into reality. Your choices tell the world what you truly believe. Character, when viewed as a standard of excellence, reminds us to ask ourselves when choosing a career: “Why this particular career, for what purpose, and to what end?” The authors of “Careers with Character” knowledgeably and passionately, through their various vignettes, enable one to experience an inner journey that is both intellectual and moral. Students will find themselves, when confronting decisions in real life, more prepared, having had experiential learning opportunities through this series. The books, however, do not separate or negate the individual good from the academic skills or intellect needed to perform the required tasks that lead to productive career development and personal fulfillment. Each book is replete with exemplary role models, practical strategies, instructional tools, and applications. In each volume, individuals of character work toward ethical leadership, learning how to respond appropriately to issues of not only right versus wrong, but issues of right versus right, understanding the possible benefits and consequences of their decisions. A wealth of examples is provided.

What is it about a career that moves our hearts and minds toward fulfilling a dream? It is our character. The truest approach to finding out who we are and what illuminates our lives is to look within. At the very heart of career development is good character. At the heart of good character is an individual who knows and loves the good, and seeks to share the good with others. By exploring careers and character together, we create internal and external environments that support and enhance each other, challenging students to lead conscious lives of personal quality and true richness every day. Is there a difference between doing the right thing, and doing things right? Career questions ask, “What do you know about a specific career?” Character questions ask, “Now that you know about a specific career, what will you choose to do with what you know?” “How will you perform certain tasks and services for others, even when no one else is around?” “Will all individuals be given your best regardless of their socioeconomic background, physical condition, ethnicity, or religious beliefs?” Character questions often challenge the authenticity of what we say we believe and value in the workplace and in our personal lives. Character and career questions together challenge us to pay attention to our lives and not fall asleep on the job. Career knowledge, self-knowledge, and ethical wisdom help us answer deeper questions about the meaning of work; they give us permission to transform our lives. Personal integrity is the price of admission. The insight of one “ordinary” individual can make a difference in the world—if that one individual believes that character is an amazing gift to uncap knowledge and talents to empower the human community. Our world needs everyday heroes in the workplace—and “Careers with Character” challenges students to become those heroes.

Financial advisors help people handle their money—through investment, savings, and budgeting.

Job Chapter Title Requirements Chapter Title Education and life lessons blend to prepare us for our careers.

Chapter One

S

uze Orman learned at an early age what money management means to an individual and to a family. When she was 13, her father’s take-out chicken restaurant burned to the ground. Although her mother worked full-time as a legal secretary, her father had no fire insurance and was left without an income. He later borrowed the money to open a deli in downtown Chicago while the family struggled to keep afloat. Suze remembers her father going to work every day, even as his emphysema worsened. She decided then that if he had the courage to keep going against the odds, she would make her life work, too.

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12 Certified Financial Planner Code of Ethics and Professional Responsibility Principle 1: Integrity A CFP designee shall offer and provide professional services with integrity. Principle 2: Objectivity A CFP designee shall be objective in providing professional services to clients. Principle 3: Competence A CFP designee shall provide services to clients competently and maintain the necessary knowledge and skill to continue to do so in those areas in which the planner is engaged. Principle 4: Fairness A CFP designee shall perform professional services in a manner that is fair and just to clients, principals, partners, and employers; and, shall disclose conflict(s) of interest(s) in providing such services. Principle 5: Confidentiality A CFP designee shall not disclose any confidential client information without the specific consent of the client unless in response to proper legal process, to defend against charges of wrongdoing by the CFP, or in connection with a civil dispute between the CFP and a client. Principle 6: Professionalism A CFP designee’s conduct in all matters shall reflect credit upon the profession. Principle 7: Diligence A CFP designee shall act diligently in providing professional services.

Job Requirements

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A financial advisor can help people make decisions about their lives and their money. After a few financial disasters of her own, Suze realized something: everyone has to deal with money and yet most people never think much about how it relates to their lives as a whole. With a new philosophy on finances, her experience as the owner of a financial planning firm, and an attitude of compassion and empathy for those in the midst of financial troubles, she wrote her first book, You’ve Earned It, Don’t Lose It, in 1995. Only two years later she wrote her first best-seller, The 9 Steps to Financial Freedom. Suze’s financial planning advice begins with simple things like cutting down on senseless purchases, keeping an eye on interest rates, and being honest about your financial standing. She teaches that being able to admit you can’t afford something you want is a giant step toward recognizing how you think about money. Too many people relate what they own and how much they

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Handling money more wisely helps people reach financial goals—like purchasing a home.

Job Requirements

15 can spend to who they are. On an Oprah Winfrey show, Suze Certified Financial Planner said, “The time has come for each and every one of us when The Certified Financial Planner our self-worth has to mean Board of Standards is a promore than our net worth.” fessional regulatory organizaSuze also encourages intion that fosters professional dividuals to draw up a will or standards in personal financial trust, enroll in long-term care planning. It was founded in insurance, and start children’s 1985 as a nonprofit profescollege funds. Getting ready sional regulatory organization. for retirement while you are The CFP designation has bestill working and being precome a widely recognized fipared for life’s expected and nancial planning credential and unexpected things are basics therefore it reassures the pubof her financial advice. lic that those financial planners Helping individuals make who earn CFP certificates have investment decisions is one of voluntarily agreed to adhere to the major responsibilities of a high standards of competence financial advisor or planner. and ethical practice established Like Suze Orman, whose sucby the CFP board. cess revolves around her compassionate attitude toward her clients and readers, a financial planner needs to learn as much as she can about her clients. Determining a person’s objectives, life stage, and responsibilities to dependents are some of the facts an advisor must obtain. But these are only a few; a person’s age, their work status, marital status, and accumulated savings all help the advisor understand a client’s specific needs. In order to prepare for such a responsibility, consultants must have knowledge of investments, tax laws, insurance, and real estate. Financial advisors require at least a bachelor’s degree in finance, economics, business, mathematics, or law. Courses in investments, taxes, and estate planning provide an edge when searching for a

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16 America’s First Financial Advisor George Washington considered Alexander Hamilton to be “of that laudable kind which prompts a man to excel in whatever he takes in hand. He is enterprising, quick in his perceptions, and his judgment (is) intuitively great.” At only 13, Hamilton had become a clerk in a local firm on St. Croix Island. Because of his responsibility and trustworthiness, he eventually ran the business when the owner was absent. His chance to move to North America came when some leading citizens saw his potential.They financed his education, giving Hamilton the opportunity to later affect the finances of the new country. Once in America, Hamilton became involved in intense study and embroiled controversy. By the time he was 19, he had achieved a bachelor of arts degree and made his first patriotic speech defending the Boston Tea Party, wrote articles for colonial union and American rights, and became one of the leading advocates of the patriotic movement. Following the war, Hamilton witnessed the squabbling between the states, lack of uniform currencies, and lack of financial cooperation with the Continental Congress. When he became the first Secretary of the United States Treasury in 1789, he was ready to address these problems. He devised plans for funding the national debt, encouraged growth of business and manufacturing, and organized a federal bank. In many ways Alexander Hamilton was the United States’ first financial advisor.

Job Requirements

17 position as a financial planCFP Licensing Requirements ner. Computer, analytical, and problem-solving skills are all 1. Fulfill a biennial continuing beneficial. education requirement. Obtaining certification is 2. Abide by a strict standard optional for advisors, but the of professional conduct, as training involved in such acoutlined in the CFP creditation influences potenBoard’s Code of Ethics. tial employers and clients. To become a certified financial planner (CFP), the recruit must have relevant experience, completion of specific educational requirements, a passing grade in a comprehensive examination, and adherence to an enforceable code of ethics. Those who want to sell stocks, bonds, mutual funds, insurance, or real estate may need a license to perform

Alexander Hamilton, America’s first Secretary of the Treasury, was also one of the earliest financial advisors.

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Clients need to respect and trust their financial advisors. these services. If legal advice is a part of the consultant’s assistance, he may need to acquire a license to practice law in his state. However, many financial planners refer clients to other professionals to help in these areas. As important as education is to any profession, financial planners also need to practice good communication skills, since helping clients understand complicated financial concepts is essential. Many individuals who are planning for their futures depend on the advice of financial advisors. Helping young couples plan for home ownership, invest in stocks and bonds, and set aside for their children’s college educations are some of the ways these financial planners assist their clients. Guiding an investor as she distributes her assets appropriately may allow that client to retire comfortably, since many retirees have to return to the work force in a lesser capacity because they have run out of savings. The comprehensive strategy mapped out by a planner helps to identify any problem

Job Requirements

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Keeping track of money can be frustrating and overwhelming for many people. Financial advisors help people make sense out of the figures. The Canadian Institute of Financial Planning offers a program called the Certified Financial Planner in order to provide expertise in handling financial management. Six comprehensive courses cover the full spectrum of financial products, services, and strategies. The courses include: An Introduction to Personal Financial Planning Creating Financial Security Acquiring and Preserving Financial Wealth Understanding Investment Products and Investment Strategies The Role of Insurance and Estate Planning in Personal Financial Management Comprehensive Financial Practice and Professional Ethics

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20 areas and makes recommendations for improvement. Avoiding potential problems sometimes helps a client as much as making a good investment. Financial planners also advise people when money problems can’t be avoided. Studies have shown that when disaster strikes, people reexamine their own financial situation. They ask questions like: • How should I get my financial affairs in order? What about wills, insurance policies, and personal records? • How do I make long-range investment plans that gain enough interest to keep me during the low times? • Is my retirement on target? Or have things changed in the last 20 years? • What about income taxes? Do I need to plan ahead? • If I have an unexpected financial crisis, do I have access to my assets without penalty? To answer questions like these, clients must respect and trust the person who advises them. Many financial advisors earn clientele because of recommendations from others they have helped. These clients look for a person of character as well as one with financial expertise. Practicing ethics will allow the financial counselor to build a reputation of integrity. In fact, when financial planners consistently make moral choices, they earn a name that embodies the principles below: • integrity and trustworthiness • respect and compassion • justice and fairness • responsibility • courage • self-discipline and diligence • citizenship

Job Requirements

21 Financial planners have much to offer their clients in terms of monetary security and advice—but they also have wonderful opportunities to touch their clients’ lives by projecting these core character values. People who base their decisions on these important character traits will make better decisions and ultimately will be more successful. And as Suze Orman has found, financial advisors’ success directly affects the success of their clients. Financial counselors’ commitment to excellence benefits those they serve.

Character is built into the spiritual fabric of personality hour by hour, day by day, year by year in much the same deliberate way that physical health is built into the body. —E. Lamar Kincaid

Since a financial advisor is involved with confidential discussions about investments and insurance, he needs to be a person of utmost integrity and trustworthiness.

Integrit y and Chapter Title trustworthIness

Chapter Title Making the right decision sometimes has financial repercussions.

Chapter Two

R

amón Díaz was proud of the financial planning office he ran in a small Southwestern town. He treated each of his clients with respect and was a trusted businessman in the community. Advising his clients based on their needs—rather than his own— made him a man of integrity. Ramón wasn’t oblivious to making a profit, of course. Like anyone, he wanted to get ahead in the world. He had one particular dream: he hoped to be able to add on an addition to his home one day so that his elderly parents could live out the rest of their lives with him and his wife—safe, happy, and close to their children and

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24 People who value integrity and trustworthiness: • tell the truth. • don’t withhold important information. • are sincere; they don’t deceive, mislead, try to trick others. • don’t betray a trust. • don’t steal. • don’t cheat.

grandchildren. Each time Ramón made a commission, he considered himself to be that much closer to his dream. Pedro, Ramón’s father, had recently renewed a boyhood friendship with a man named Mitch Ogilvie. For the past 15 years, Mitch had worked in the Northeast, but a few months ago, he had taken an early retirement so he and his wife could move back to the Southwest. Unfortunately, not long after the move, Mitch’s wife Kara had become seriously

A financial advisor can help older people to meet their responsibilities and provide for their future.

Integrity and Trustworthiness

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Savings bonds are one option financial advisors may consider for their clients who are saving for the long-term future.

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26 The Financial Planning Process The financial planner should follow these six steps: 1. When establishing and defining the client-planner relationship: a. Explain or document the services to be provided. b. Define both his and the client’s responsibilities. c. Explain fully how he will be paid and by whom. d. Agree on how long the professional relationship should last and on how decisions will be made. 2. When gathering client data, including goals: a. Ask for information about the client’s financial situation. b. Mutually define the client’s personal and financial goals. c. Understand the time frame for results and discuss, if relevant, how the client feels about risk. d. Gather all the necessary documents before giving advice. 3. When analyzing and evaluating the client’s financial status: a. Look at information to assess the client’s current situation and determine how to meet his goals. b. Include analyzing assets, liabilities and cash flow, current insurance coverage, investments or tax strategies.

ill. Although he was optimistic about her recovery, Mitch was looking for some advice on his financial situation. He also had some questions about wills and insurance. His health insurance provider was making some changes that Mitch felt were not in his best interest. Pedro suggested to his friend that his son might be able to help him with some sound financial advice. Mitch made an appointment with Ramón, and he was impressed with his friend’s son. He and Ramón talked about many things that day. Ramón asked Mitch about his insurances and his investments,

Integrity and Trustworthiness

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4. When developing and presenting financial planning recommendations and/or alternatives: a. Offer financial planning recommendations that address the client’s goals, based on the client’s information. b. Be sure the client understands them so that he can make informed decisions. c. Listen to the client’s concerns and revise the recommendations as appropriate. 5. When implementing the financial planning recommendations: a. Agree on how the recommendations will be implemented. b. Carry out the recommendations coordinating any actions between the client and professionals such as attorneys or stockbrokers. 6. When monitoring the financial planning recommendations: a. Agree on who will monitor the client’s progress toward the desired goals. b. If the planner is in charge of the process, she should report periodically, review, and adjust the recommendations, if needed, as the client’s life changes. Adapted from www.cfp-board.org

including his 401(k). They talked about investment opportunities available to Mitch. As they spoke about a few problem areas in Mitch’s financial goals, their conversation turned to Kara’s illness. Mitch explained that he needed a new health insurance carrier. He wondered whom Ramón would recommend. Ramón immediately gave him information about his most popular carrier. His clients had always had great success with this company, and he made the necessary phone calls and drew up the paperwork to sign up Mitch for the new policy. As Mitch left the office, he thanked Ramón for

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Even a short hospital stay can be expensive—a long-term visit can be financially devastating. Financial advisors help their clients find the right insurance to meet their financial needs, no matter what the future holds.

Integrity and Trustworthiness

29 all his help. Mitch felt confident he could trust Ramón, and he was happy to have accomplished so much in one afternoon. Ramón had no other clients that day, so he worked a little more on Mitch’s files, including the insurance policy. Ramón had a steady and profitable relationship with this insurance group, and their commission was almost three times that of their competitor. Ramón was delighted to subtract the sizeable commission from his mental tally of the money he still lacked for the new wing on his home. But as Ramón looked at the policy, he realized that some of the treatment Mitch had explained Kara would need was not covered as comprehensively as it would be on the competing policy. He made a few phones calls to confirm what he had read. It was true; although most of the care Kara would need was covered, a few medical procedures had limited coverage under the policy Ramón had recommended.

Medical insurance allows people to pay for whatever tests, prescriptions, and doctor visits they may need.

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30 The Four Agreements BE IMPECCABLE WITH YOUR WORD Speak with integrity. Say only what you mean. Avoid using the word to speak against yourself or to gossip about others. Use the power of your word in the direction of truth and love. DON’T TAKE ANYTHING PERSONALLY Nothing others do is because of you. What others say and do is a projection of their own reality, their own dream. When you are immune to the opinions of others, you won’t be the victim of needless suffering. DON’T MAKE ASSUMPTIONS Find the courage to ask questions and to express what you really want. Communicate with others as clearly as you can to avoid misunderstandings, sadness, and drama. With just this one agreement, you can completely transform your life. ALWAYS DO YOUR BEST Your best is going to change from moment to moment; it will be different when you are healthy as opposed to sick. Under any circumstance, simply do your best, and you will avoid self-judgment, self-abuse, and regret. From The Four Agreements by Don Miguel Ruiz.

Integrity and Trustworthiness

31 Ramón hesitated. Mitch had already signed a copy of the policy. The advice Ramón had given him earlier that afternoon had been honest; at the time, Ramón had truly thought the insurance carrier would be the best one for Mitch and Kara. Ramón could easily say nothing now and simply take the larger commission. But Ramón wanted Kara to have the best care she could receive. As a man of integrity, he really had only one option. What would you do in his place?

You cannot do wrong and feel right. It is impossible! —Ezra Taft Benson

A financial advisor with respect and compassion can make the lives of elderly people a little easier.

Respect and Chapter Title Compassion

Chapter Title When we truly respect others, we will do our best for them—regardless of their ability to pay us.

Chapter Three

A

sher Rosenbloom sat in his office looking through the folders of clients with whom he would meet that morning. He smiled as he worked, feeling contented with his life. His net worth was in the millions, and he loved financial planning; his clients stayed with him for years, attesting to his good character and his ability to help them make sound financial decisions. About a month before, the New York Times ran an article about Asher’s success as a financial advisor. The article told of his schooling, his family, his business, and his clients. A few clients were even interviewed, willingly sharing their own success after hiring him to

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Balancing a checkbook may become a challenging task for some older people. help plan their financial futures. His clients were, of course, wealthy individuals or couples who provided Asher with high-income percentages on their investments. As Asher sat in his office that morning, his contentment was disturbed, however, when he received a call from a woman who had read the article. She needed help financially. Recently diWhen you have respect and vorced, she had been able to compassion for others. . . get her payments under control, or at least where she could take • you practice the Golden care of them with her weekly salRule. In other words, you ary. But she had nothing saved treat other people the for the future. Her husband had way you would like to be been awarded their house in the treated. settlement; they had split what• you demonstrate your ever savings they had accumuconcern for others with lated during their marriage, but concrete actions. her share had gone to pay bills

Respect and Compassion

35 and fees occurred from moving, breaking up their home, and the divorce itself. “Mr. Rosenbloom, I’m sure what I have to invest is very small compared to what you’re used to, but I do have a small 401(k) and a few stocks left to me by my parents. The problem is, if I don’t do something soon I will not be able to retire and take care of myself. The burden of my old age will fall on my daughter and her family or the state,” Fran Copelin explained. “Well, Mrs. Copelin,” Asher replied, “I am sure you do need help in this area—but my minimum investment requirement is much higher than the numbers you are giving me. Maybe you could find someone more able to meet your needs.” “But I read what you can do.” Fran said. “I need someone who can make a big difference. I have so little. I can’t make my daughter

Elderly clients may not have much money to invest—but they need help managing their dollars and cents.

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36 take care of me. She’s such a good girl but she has her own family. Isn’t there something you can do?” Asher explained his policy again. Then he told Fran he would see if he could find someone he felt could do what she wanted. He assured her he would contact her soon and directed his secretary to take her name and phone number. The phone call haunted him, though, as he worked on the portfolios of his clients. Their assets, many of them, were so far beyond Fran Copelin’s that he almost wished he could skim something off one of theirs or even his own and give it to her. Yet he knew that was not the answer. There were too many Frans in the world for that to be a viable choice. A week passed. Asher still had not gotten a chance to find anyone else to handle Fran Copelin as a client and he knew why: he

Financial advisors can help clients keep better track of their expenses.

Respect and Compassion

37 A Framework for Ethical Decision Making Recognize a moral issue. Is there something wrong personally, interpersonally, or socially? Could there be damage to people, animals, the environment, institutions, or society? Get the facts. What individuals and groups have a stake in the outcome? Do some have a greater stake because they have a special need? Evaluate the alternative actions from various moral perspectives. Which option will produce the most good and the least harm? Even if not everyone gets all they want, will everyone still be treated fairly? Which option would enable a deepening of the character traits that we value most? Make a Decision. Considering these perspectives, which of the options is the right thing to do? If you told someone you respect why you chose this option, what would that person say? Act, then reflect on the decision later. How did the decision turn out for all concerned? If you had to make the decision again, what, if anything, would you do differently? Adapted from the Markkula Center for Applied Ethics.

was convinced he should be the one to help Fran. But he could not do it through his firm. He needed to maintain the firm’s policies— and he also needed to do what he felt was right. So he would help Fran privately, on his own time.

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Some clients with fixed incomes may be eligible for food coupons. Asher’s approach to Fran’s need is classified by the Markkula Center for Applied Ethics as the virtue approach to ethics. This approach assumes that we should try to achieve certain ideals. We better ourselves as we move toward these goals, striving toward our greatest potential. The Markkula Center states that virtues are like habits. The more we practice them, the more they become a part of who we are. Moreover, a person who has developed virtues will be naturally disposed to act in ways consistent with moral principles. The virtuous person is the ethical person. If Asher chooses to show respect and compassion for Fran and others in her position, he will make these qualities a permanent part of his character. When facing a moral problem using the virtue approach, we ask ourselves: What kind of person do we want to be? As we practice character traits in decision-making, we affect others by our choices. Asher’s decision not only touched the lives of others; it also helped to shape his own character.

Respect and Compassion

39 Asher had respect and compassion for people like Mrs. Copelin. But character traits like these are not mere feelings, emotions that are confined to our internal selves. Instead, character traits demand that we act. We have to express respect and compassion in the external world, or we cannot say we truly possess these traits. That’s why Asher called the local YMCA and found they had a room he could rent cheaply two days a month. Next he called several social agencies and his lawyer to find the exact procedures he needed to follow. Asher’s decision was to spend two days a month helping develop financial plans for those who could not afford to pay for services they desperately needed. He didn’t just feel sorry for people like Fran Copelin—he did something to help them. And he phoned Fran Copelin and set up his first appointment.

Love and compassion are necessities, not luxuries. Without them, humanity cannot survive. —the Dalai Lama

A casual lunch with friends can provide business opportunities—as well as the chance to make an ethical decision.

Justice and Chapter Title Fairness Chapter Title Many times in life, exciting moments are also critical times of decision.

Chapter Four

R

osi Heckman looked around the restaurant as she waited for her two friends to join her for lunch. They had been meeting at the same place for the past four years, every third Thursday of the month. Sharing family stories, job problems, and laughing a lot, they rarely missed their monthly date. Rosi was anxious to share some exciting news with her friends, and she wondered what was keeping them. She had no idea that her excitement would soon lead to a weighty decision. Rana and Louise entered the restaurant at last and came toward Rosi.

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42 “Hi, girls. I’ve got some news,” Rosi said as they sat People who value justice and down. “I got that financial fairness: planner position I wanted.” “Rosi, that’s great,” Lou• consider carefully before ise said. “No more working making decisions that af60 hours a week during tax fect others. season.” • don’t take advantage of Rosi had worked as an others’ mistakes. accountant since graduating • don’t take more than from college. She loved worktheir fair share ing with the clients, but the long hours during tax season were exhausting, especially now that her children were older and more involved in outside activities. Of course, she also worked during the year with those clients who needed help answer-

Economic forecasts are based on customers’ buying trends.

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The more business an individual store does, the more that company’s stock market value will go up.

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Computers provide a new way to analyze finances, allowing advisors to have a visual picture of a client’s spending patterns.

The Canadian Society of Technical Analysts was founded in 1984 to encourage the development of technical analysis and to educate the financial community in Canada about the uses of technical analysis in the investment decision-making process. Members must maintain the highest standards of professional competence, integrity, and judgment. Members must not publish or make statements they know or have a reason to believe are inaccurate or misleading. Members must avoid leading others to believe that their technically derived views of future security price behavior reflect foreknowledge rather than estimates and projections subject to reexamination. Adapted from the Canadian Society of Technical Analysts Code of Ethics

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A financial advisor must give her clients information that is upto-date and accurate. ing various financial questions, but she was eager to begin more comprehensive financial planning for her clients. At the end of last year she had obtained her certified financial planner (CFP) designation, and now she was ready to begin her new position. The three friends discussed Rosi’s new job thoroughly, and then their conversation turned to a new topic: Louise’s boyfriend Dale was the vice president of a growing retail company. He had shared with Louise that a new buying trend was predicted to cause boom sales for his company. “He says it looks as though the stock values will triple in the next few months,” Louise confided. “But who cares about that? I’m just curious to know what this new buying trend is.” She laughed. “I don’t want to be hopelessly out of date, you know.” Rosi tried to join in with the guessing game her friends played as they waited for their meals, but she was too preoccupied to join

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46 Aristotle’s Types of Justice Distributive Justice This form of justice comes into play whenever resources and hardships have to be shared. These issues emerge when salaries, dividends, and bonuses are handed out. Procedural Justice This has to do with the rights individuals have to participate in decisions that will affect their lives. The key notion is that certain decision-making processes are inherently more just than others. The way a decision is made will affect if it is viewed as fair. Retributive Justice This concerns issues of justice that arise whenever a decision has to be made regarding the punishment of someone. Some punishments are perceived as being more just than others. People under stress tend to lump all three aspects of justice together, thus making it more difficult to understand what is the issue behind their problem. As a first step, try to figure out which of the three aspects of justice is at the root of a particular problem.

in their laughter. Dale was pretty sure his company’s stock would triple in the next few months, she mused. That information could mean a huge break for her at the new firm. If she started her job by advising her clients to invest in Dale’s company, with a return like that, she could earn great percentages for herself—as well as the respect of her new employer. But should she depend on Dale’s prediction? Would that be fair and just to those investors who didn’t have access to the information

Justice and Fairness

47 she had just heard secondhand through Louise? And what if Dale turned out to be wrong? Then her clients could lose a lot of money. Of course if she only passed the tip along to clients whose portfolios were lucrative already, then her advice wouldn’t hurt her own income as much if she made a mistake. And if the stock went up as Dale predicted, she’d have a great start at the new firm. Rosi barely noticed when her two friends said good-bye. She was too busy thinking. How could she decide what was the fair thing to do? Making a just decision is sometimes a difficult task. The American Institute of Certified Planners’ code of ethics provides a solid basis for determining a fair course of action. The AICP Code of Ethics and Professional Conduct was written to provide advice on specific problems and questions concerning ethical behavior by members. In Advisory Ruling Number 4, the subject of honesty and fairness in the use of information says:

A person who advises clients about money has the power to shape her clients’ lives for years to come.That’s why justice and fairness are essential.

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48 Ethical Competency Noticing the ethical issues and being committed to act ethically is not always enough. In some situations, reasoning and problem-solving skills are also necessary. Evaluation is the ability to collect and evaluate relevant facts. Creativity is the capacity to develop alternative means of accomplishing goals. Prediction is the ability to foresee potential consequences of conduct and to evaluate how others will be helped or harmed by the decision.

As professional givers of advice that may affect the well-being of individuals for many years, members have a special obligation to cherish honesty in the information that supports their advice. In order to accomplish this, the AICP code lists ways financial planners can strive to be honest: • Provide full, clear, and accurate information. • Never use any false or misleading claims. • Protect and enhance the integrity of the profession. • Never make any undocumented assertions. • Furnish factual findings. If you apply the AICP’s code to Rosi’s situation, what do you think she should do?

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Do justice, that you may live long on the earth. —an ancient king’s advice to his son

A responsible financial advisor is someone people can count on— at home and in the office.

Chapter Title Responsibilit y Chapter Title A truly responsible person is as reliable with clients, employees, or employers as with friends and family.

Chapter Five

D

oug Chisarick’s family and friends knew what a responsible person he was. After all, as a father, a husband, and a friend, people could always count on him. Doug took pride in the confidence others placed in him, and he was resolved to do all that he could for these important people in his life. Professionally, Doug had been a financial advisor before anyone had ever thought to use the term to describe someone who provides guidance to help individuals with their investment decisions. He had started working on taxes for friends in the evening after work. During the day, he sold cars at his uncle’s automobile dealership.

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Many financial advisors may start their work careers in some other professional role—as a car salesman, for instance, or in some other business. Whether he was making deals on cars or figuring people’s taxes, Doug loved numbers. He always had. When he was in grade school he aced all his math classes. In high school he took advanced mathematics classes, but even though he was awarded a scholarship for his grades, he decided college wasn’t for him. He hadn’t felt he needed a formal education to succeed. Doug and his uncle had always been good friends and worked well together. “Learn to sell cars,” his uncle used to say, “and you’ll be able to sell anything.” A few years after high school graduation, Doug decided he would go to school nights to become a certified public ­accountant. If he could sell cars, he figured he could also sell his mathematical ability as an accountant. Only two years after Doug earned his accounting degree, he had the opportunity to open his own office. Over the years, he slowly added financial products to his business, including health insurance and disability insurance. Doug also hired young accountants and Janis, a certified financial planner, who offered financial planning to the company’s clients.

Responsibility

53 People who value responsibility: • think before they act; they consider the possible consequences of their actions. • accept responsibility for the consequences of their choices. • don’t make excuses. • set a good example for others. • pursue excellence in all they do. • do the best with what they have. • are dependable; others can rely on them. Adapted from material from the Character Counts Coalition, charactercounts. org/overview/about.html

Financial advisors are responsible for having up-to-date knowledge of financial analysis. Graphs like this one can help clients better visualize their personal budgets.

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54 The Golden Rule One way to determine your responsibility in any given situation is to use the Golden Rule: If your position were reversed, how would you want others to behave toward you? The Golden Rule is not a new idea; it’s been around for centuries. • • • •

Around 500 bce Confucius said,“What you do not want done to yourself, do not do to others.” In 325 bce Aristotle said, “We should behave to others as we wish others to behave to us.” The Mahabharata (written around 200 bce) said, “Do nothing to your neighbors that you would not have them do later to you.” In 33 ce or thereabouts Jesus said,“Do to others as you would have them do to you.”

The scriptures of many religions teach the “Golden Rule.”

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There is far more to being a good financial advisor than just managing paperwork and files. A good financial consultant is also educated in his field. Doug had noticed that Janis kept up her certification even though Doug did not require her to do so. She took night classes as a part of her certification renewal. Occasionally, she traveled to seminars or training sessions. He also noticed in the two years she had been with him that her schedule was always full. She was a very aggressive young woman and had realized some very successful investments for herself and her clients. Doug admired her—but he had no desire to work as hard as she did at being the best in her field. In his mind, life had too many other things to offer—like fishing with his son or watching a game with his uncle. One day, however, he overheard Janis talking with one of the firm’s young accountants. “Just because he owns this successful business doesn’t mean he knows enough about financial planning,” Janis said to her colleague.

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56 “Sure,” said the accountant, “but why should he bother spending the time on education? It probably won’t get him any further ahead anyway.” “I think you’re wrong,” Janis said. “Just yesterday, I met with a client who told me she didn’t trust Doug to be on the cutting edge anymore. He doesn’t seem to study the market enough to take advantage of evolving conditions. All she sees are meager results—and she doesn’t trust him. When the economy is the way it is now, clients want someone they feel is well-informed on what’s new. She’s worked with him for 15 years, but she confided in me that she’s considering taking her portfolio elsewhere. He can’t afford to lose long-standing customers like that.” Doug heard the disapproval in Janis’s voice. “By not taking the time to be educated in our field, he’s not being responsible to our clients.” With a heavy heart, Doug walked back to his office. He had thought about continuing his education on occasion. But his family took so much of his time. Now that the kids were older, of course, they didn’t Your Rights as a need him around quite so Financial Planning Client much as they had when they were younger. But he hated You have the right to a planner to give up his evenings, the who has integrity. quiet walks with his wife You have the right to objective adand their dogs. He didn’t vice. want to miss time with his You have the right to a planner uncle or his friends. And who is competent. there was the church choir You have the right to be treated and the library board. . . . fairly. He really didn’t have time You have the right to privacy. to fit anything else into his You have the right to a planner already full schedule. who is professional. But the conversation You have the right to a planner would not leave his mind. who is diligent. He thought about the last Adapted from www.cfp-board.org/

Responsibility

57 seminar he had decided not to attend, something about tax laws. Did he know all the current tax law changes? Could his clients be paying substantial penalties simply because he did not know all that he should about the tax law? What about investing and insurance? Sure he kept the licenses he needed, but did he know about the products? Maybe it was it too late for him. He could just coast along comfortably the way he had been. After all, he’d been doing all right so far. Or should he start right now to update his knowledge? The Josephson Institute of Ethics teaches that ethical commitment refers to a strong desire to do what’s right, especially when doing the right things means we have to pay financial, social, or emotional costs. Doug needed to review his own ethical procedures. Was he being ethical when he avoided updating his professional knowledge? Was he the responsible person he thought himself to be? His family and friends could count on him—but could his clients and employees? Or was he compromising what he believed was right for his own comforts? What do you think Doug should do? Can you see a way he might find a compromise between his personal needs, his family responsibilities, and his professional responsibilities?

Provision for others is the fundamental responsibility of human life. —Woodrow Wilson, 20th-century American president

A financial advisor may help clients plan for large building projects. Having the courage to plan for doing the right thing is far more difficult, however.

Chapter Title courage Chapter Title Sometimes you have to take a risk if you want to be a person of character.

Chapter Six

L

indsey Walker owns a firm that advises clients how to manage their finances. Her firm represents businesses, as well as individuals. One of her accounts is the Ashland Family Foundation. The ten-member board of the Ashland Foundation awards grants to eligible recipients. The board prides itself on being objective and fair. They do not like to award grants based on friendships or business relationships, knowing that by doing so they might compromise their privilege of providing help where they feel they can make the greatest impact. Because of their adherence to positive goals, however, certain program areas have become favorites of the board, although they review all proposals objectively.

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60 One member of the board has recently been advocating People who value courage: for several unusually large grants to two institutions need• say what’s right (even ing large construction for exwhen no one agrees with pansion projects. The projects them). are above the foundation’s • do the right thing (even normal giving amounts, but when it’s hard). the grantees are institutions • follow their conscience the board favors. Although instead of the crowd. the board member will not personally benefit from such grants, Lindsey knows that both of his sons own construction companies within the city limits . . . which means they could easily be eligible for the building contracts. Lindsey manages the personal portfolio for both brothers. She also sees the eldest son, Mario, on a regular basis because they

Financial advisors help their clients obtain the things that matter most to them, while handling credit wisely.

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Helping clients understand mortgage rates for their homes is only one part of a financial advisor’s job. Having the courage to stand up for what is right is a far bigger part. have daughters who play soccer together. One day last week Lindsey, Mario, and a group of parents were talking between games. Mario mentioned one of the new expansion projects. He joked that he and his brother were bidding against one another for the large addition at one of the institutions. Lindsey was sure he was just anticipating what might happen. But she felt disconcerted. The board hadn’t voted yet. Both projects did fulfill the foundation’s criterion and would certainly benefit the community, but she was uncomfortable that a board member had apparently indicated to his sons that they had an edge on such projects. The foundation would want fair and equal rights for any construction companies in the area. As these thoughts ran through her mind, she suddenly realized something else: if either of the sons won the bid, she would benefit. Both trusted her for their personal finances, and they had both asked her to begin managing their business finances as well.

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62 Are You Courageous? Most of us do not think of ourselves as courageous. But courage comes in more than one form. One form of courage helps people scuba dive and go bungee jumping. But other types of courage can make a difference in the lives of people. Answer the following true or false statements to find your level of courage for making right choices. 1. I ask questions in class, even if my classmates think I’m stupid for asking. 2. If I were new at a school, I’d sit down at a crowded lunch table and introduce myself to the other students. 3. If my best friend were failing math and wanted to copy answers off my math test, I’d tell her no. 4. If I saw a crime being committed, I’d report it to the police. 5. If kids in school were picking on an unpopular student, I would defend him. 6. If a disabled student needed help, I’d help, even if it meant I’d be late for my soccer practice. 7. If my friends were doing something dangerous, like experimenting with drugs, I’d try to talk them out of it. 8. Instead of getting into a car with a driver who had been drinking alcohol, I’d call my parents and ask them to pick me up. Adapted from “Take the Courage Test,” Scholastic Scope, September 22, 1995.

Courage

63 Financial Terms Best efforts: A designation that a certain financial result is not guaranteed, but that a good faith effort will be made to provide the result that is represented. Blue chip: Term for the most prestigious industrial shares. Originally an American term derived from the color of the highest value poker chip. Bond: A loan that investors make to corporations and governments. The borrowers get the cash they need while the lenders earn interest. Bonds pay a set amount of interest on a regular basis. The bond has a fixed maturity date, which means when the bond expires, the loan must be paid back in full, with an interest set when the bond was issued. A secured bond is backed by collateral, whereas an unsecured bond, or debenture, is backed only by the full faith and credit of the issuer. Broker: An intermediary who works between the person that controls the funds and the provider or trader. Certificate of deposit (CD): A deposit with a fixed time period and a fixed rate of interest. A CD gives back the money you invested plus interest, but it must be left in savings for a specific time period or until it matures.The interest earned may be higher than many other savings options.

Lindsey did not know what to do. She was certain if she went to the board and explained the situation and why she felt such behavior was unethical on the part of the father, the other board members would agree with her. As a result, he might be asked to leave the board. And that would undoubtedly mean she would lose both sons’ personal accounts, and she would not see the gain of their two large business ­accounts.

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64 More Financial Terms Compound yield: The total return on your investment, consisting of the distribution (dividend, interest) and the capital gain or loss, in terms of percentage of the investment amount. Dividend: The part of a company’s post-tax profits distributed to shareholders, usually expressed as an amount per share. Money market fund: Resembles a savings account. A money market fund gives back the money you invest plus interest made from the investments in short term securities that the fund makes. They are essentially risk free, but the interest pay is low when the rate is low. Investors can write checks against their accounts. Net asset value (NAV): The value of a company after all debts have been paid, expressed as an amount per share. Net worth: The stockholder’s assets, which consist of common stock, surplus, and retained earnings. Securities: General name for shares and bonds of all types. Shares produce a variable dividend and bond a fixed interest. Yield: The return earned on an investment taking into account the annual income and its present capital value. There are a number of different types of yield and in some cases different methods of calculating each type.

She was not sure she had the courage to address the board about the matter; she doubted she had the guts to give up such substantial financial gain. After all, the father and both his sons were influential in the community. They could cause serious professional problems for her; they might even make trouble for her personally within their community, or even for her daughter.

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Building projects are made possible by the wise counsel of financial advisors.

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Our professional lives are not just a race toward success; they are also opportunities to do what is right—if we have the courage to make character a priority. In the book How Good People Make Tough Choices, author Rushworth M. Kidder shares three principles individuals use for making difficult decisions. These principles are: 1. Choose to do what is best for the greatest number of people. (This is “ends-based” thinking.) 2. Choose to do what others want you to do. (This is “care based” thinking.) 3. Choose to do what you think is right. (This is “rule-based” thinking.) If Lindsey chooses to do what is best for the greatest number of people, should she just let the matter drop? If no one ever realizes what was happening, does it really matter? The projects will benefit many people in the community, the contractors do reliable work, and they employ a considerable number of laborers.

Courage

67 To do what others would want her to do, Lindsey needs to consider the other board members, who pride themselves on being fair and objective. How would they feel about this? What would her own immediate family think? Finally, Lindsey considers what she personally thinks is the best thing to do. What does she really believe is right? What would she want another board member to do if he were in her position? She thinks about her choices again. Some of her options clearly place her financial success at risk—and yet other options, she realizes, are a greater risk to her good character. Despite her fear, Lindsey knows now what she needs to do. What would you do? Would you have the courage to act on your conviction?

Many of our fears are tissuepaper-thin, and a single courageous step would carry us clear through them. —Brendan Francis

Being a financial advisor is an interesting and rewarding job—but like any job, it often requires self-discipline and diligence.

Self-Discipline Chapter Title and diligence

Chapter Title It’s not always easy to keep working . . . especially when others don’t understand your motivation.

Chapter Seven

J

on Pierre St. James works for a financial firm that represents several small companies along with many individuals in a town in Quebec, Canada. After graduating with a degree in accounting, he became a chartered accountant (CA) and belongs to the Canadian Institute of Chartered Accountants. Presently, his firm offers tax, accounting, financial planning, and bookkeeping services. Jon Pierre is a diligent and self-disciplined employee. He believes that more and more individuals and businesses will benefit from the expertise of those who study and work with the reputable

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When financial advisors are knowledgeable about current tax laws and planning trends, they can help their clients accumulate a “nest egg” of savings. tools and available information. Recently, he began working toward a certified financial planner (CFP) designation. He believes that the added education will make him more useful to his clients. “Working on homework for another class?” one of his coworkers asked him as she entered his office one afternoon. Jon Pierre looked up from his books and smiled at Marie LaSalle. “Yes, I have my CFP exam in two weeks. I want to be sure I know all the information.” “No one spends more time on learning new information than you. Do you really think this will pay off? What do you plan to do with all this education?” Marie asked. “Well, I’m certain my clients will feel more secure if I am knowledgeable on the most current tax laws and the new financial planning trends. I would want someone who took care of my finances to know as much as he could.” His coworker laughed. “You sound pretty self-righteous, Jon Pierre. I find that my clients come back to me simply because they like me—not because I try to impress them with a lot of unnecessary certifications. They recommend me to other clients because they

Self-Discipline and Diligence

71 know they can trust me—not because I always have my head in a book studying. Lighten up a little, Jon Pierre. Have some fun. Clients will like you better.” Jon Pierre shrugged and grinned; then he went back to his studies. He knew Marie had been with the firm for more than a decade, and she had many long-standing clients. Perhaps her years of

People who value self-discipline and diligence: • work to control their emotions, words, actions, and impulses. • give their best in all situations. • keep going even when the going is rough. • are determined and patient. • try again even when they fail the first time. • look for ways to do their work better. Adapted from material from the Character Education Network (www.CharacterEd.Net).

Financial advisors who value diligence and self-discipline will look for ways to do their jobs better.

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72 Do You Have a Good Work Ethic? Employees with a good work ethic want to do the best job they can. They do more than is required of them and always do the best job possible. Your work ethic begins when you are young and develops as you practice. Doing things to help around the house, doing the best you can at school, and helping out at any church or social organizations are all activities that will help you build the selfdiscipline and diligence you need for a good work ethic.

experience gave her all the confidence she needed; but he was still new enough at his job that he needed any help he could get. Her comments made him feel a little uncomfortable . . . but he was selfdisciplined enough that he didn’t let them bother him too much. The following afternoon, he walked into the conference room and found Marie discussing a

Financial goals come in all shapes and sizes. One client may want to save for retirement—while another wants to enjoy his money now by investing in a nice home . . . with a pool.

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Financial advisors can help spouses write their wills to provide for their loved ones after their deaths. client’s will with another accountant. The situation that concerned her had to do with the client’s desire to give percentages to his children and his wife, not a usual practice when setting up an estate. “He wants to set up his estate so that each of his three children receives 20 percent,” she explained. “That would leave his wife with 40 percent. Didn’t we talk about a situation like this at one of our conference meetings last year? I want to make sure I follow the right procedure.” Jon Pierre remembered studying a case like this recently. If he were right, there was a family law that dealt with just such a thing. He would look it up tonight, he decided. The next day he entered Marie’s office. “I overheard you talking yesterday about an estate you were working on.” “Yes, I was asking some advice, but I found the information I needed yesterday.”

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74 If you can keep your head when all about you Are losing theirs and blaming it on you; If you can trust yourself when all men doubt you, But make allowance for their doubting too; If you can wait and not be tired by waiting, Or, being lied about, don’t deal in lies, Or, being hated, don’t give way to hating, And yet don’t look too good, nor talk too wise; If you can dream—and not make dreams your master; If you can think—and not make thoughts your aim; If you can meet with triumph and disaster And treat those two imposters just the same; If you can bear to hear the truth you’ve spoken Twisted by knaves to make a trap for fools, Or watch the things you gave your life to broken, And stoop and build ‘em up with wornout tools; If you can make one heap of all your winnings And risk it on one turn of pitch-and-toss, And lose, and start again at your beginnings And never breathe a word about your loss; If you can force your heart and nerve and sinew To serve your turn long after they are gone, And so hold on when there is nothing in you Except the Will which says to them: “Hold on”; If you can talk with crowds and keep your virtue, Or walk with kings, nor lose the common touch; If neither foes nor loving friends can hurt you; . . .Yours is the Earth and everything that’s in it. . . . —Rudyard Kipling

Self-Discipline and Diligence

75 “Are you aware that under the Family Law Act, if a spouse gets less than 50 percent of the estate, she can claim an equalization payment from the estate?” Jon Pierre asked. “Well, no, I hadn’t heard that.” Marie frowned. “Of course, if the client and his wife are in agreement to this, there should be no problem. But she would need to sign a statement to that effect.” Marie looked thoughtful. “He feels strongly that this is what he wants. But I’m not sure how his wife feels about it.” Jon Pierre nodded. “The law recommends in cases like this that a will also be drawn up appointing guardians for any dependent children. Details should be specific as to who gets what.” His coworker wrote down some notes to herself, and then she glanced up at Jon Pierre. She looked impressed . . . and a little embarrassed. “I guess I owe you an apology, Jon Pierre. I really did think all your studying might not be anything we could use around here. I thought you were trying to convince management you knew more than the rest of us. But I can see I was wrong. You were just being self-disciplined.” “I always ask myself a question when I’m deciding about another class or seminar,” Jon Pierre said. “Would I want my financial advisor to have the information offered by this seminar? If the answer is yes, then I figure the seminar is well worth my time.” His coworker gave him a rueful smile. “Guess I need to get studying.”

Energy and persistence conquer all things. —Benjamin Franklin

As a financial advisor, you will have opportunities to give back to your community in a variety of ways.

Citizenship

Chapter Title Chapter Title Citizenship doesn’t always mean you do something big and noble for your country. . . . Sometimes it means you do something as simple as volunteering your time to make a difference in the lives of others.

Chapter Eight

S

couting has always been a big part of Shelley Watson’s life. As a child, she loved the meetings and all the songs, games, and crafts. She even loved the uniform, especially when she could wear it to school. Every year she went to camp, and she knew one day she would be a Scout leader. She didn’t know that she would also one day be able to affect Scouting through her profession. When Shelley and her husband Dave first moved to Ohio, she had just graduated from college. With a degree in accounting, she searched for a job. One of the first places she applied was a small accounting firm run by Tony DeFigliero. Shelley liked him from the

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78 first time they met. He hired her on the spot, and she worked with him for the next eight years. Tony was the one who talked her into becoming a certified public accountant (CPA). “You’ll be glad you did. Your clients will know you are one of the best . . . and besides, you never know when you’ll be able to use your financial knowledge,” Tony told her. After she became a CPA, Tony encouraged Shelley to become a certified financial planner (CFP) as well. By then she knew she could trust Tony’s judgment as much as his clients did; before long, she had earned her CFP. When Shelley’s husband received a job promotion that meant moving across the country, she hated to leave her job behind. But when she arrived in her new home, she and Dave decided it was in a perfect locality for opening a financial service. They remodeled the garage, and Shelley opened her own planning office. She and

Helping children learn and grow is one way to be a good citizen.

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Citizenship means we go further and faster when we all “row together.” Dave began a family, and she was able to keep working from her home. She was grateful for all she had learned from Tony. Located not far from their home was a large Girl Scout camp. Shelley visited a few of the camp’s open houses, and she hoped that when her daughter was older, she too would enjoy camp. But for right now, between the business, her family, and her other obligations, Shelley had no extra time for being involved in Scouts. One day, however, a gentleman entered her office. He was the director of the camp; they had a problem and were hoping Shelley could help them. One of their important volunteers, an accountant who had advised them for years, had moved away, and they were about to plan the yearly budget. Would there be any chance that she

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80 could help them out? Someone had told him she attended an People who value citizenship: open house not long ago, and they were hoping she had an in• play by the rules. terest in scouting. • obey the law. Shelley shared her own • do their share. Scouting experiences, and the • respect authority. director talked about some of • stay informed about curthe programs available at the rent events. camp. She enjoyed reminisc• vote. ing and getting a feel for the • protect their neighbors camp and its influence on the and community. area youth. But she had no idea • pay their taxes. when she could fit in any volun• give to others in their comteer work. She already felt that munity who are in need. her days were too short. What • volunteer to help. should she do? • protect the environment. This was not a decision she • conserve natural resources wanted to make without giving for the future. it some thought. She told the director she would think about Adapted from material from the Charit, talk to her husband, and call acter Counts Coalition, characterthe director soon. Then she sat counts.org/overview/about.html for a long time at her desk, trying to think. She wanted to do the right thing—but she wasn’t sure what that would be. According to Thomas Shanks, an executive director of the Markkula Center for Applied Ethics, one way to make an ethical decision is to ask yourself questions like these: • Will my small effort really make a difference? Shelley could argue that if she doesn’t help with the camp’s budget, someone else will. But if she chooses to be the one who helps, she could make a difference for all who attend the camp. She

Citizenship

81 The Common-Good Approach This approach to ethics assumes a society made up of individuals whose own good is linked to the good of the community. Community members are bound by the pursuit of common values and goals. The common good is a notion that originated more than 2,000 years ago in the writings of Plato, Aristotle, and Cicero. More recently, contemporary ethicist John Rawls defined the common good as “certain general conditions that are . . . equally to everyone’s advantage.” Examples of goods common to all include affordable health care, effective public safety, peace among nations, a just legal system, and an unpolluted environment. Appeals to the common good urge us to view ourselves as members of the same community, reflecting on broad questions concerning the kind of society we want to become and how we are to achieve that society. While respecting and valuing the freedom of individuals to pursue their own goals, the common-good approach challenges us also to recognize and further those goals we share.

would be a good citizen who cared enough to make her community better for everyone. • Will my community be better if I take this action? For Shelley, the answer is obvious. But she still must decide how much such an effort would cost her. Everyone in her situation must consider the expense of being a good citizen. • Finally, will I be better in some way if I take this action? Shelley will never know unless she makes the effort to give to others.

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A good citizen contributes to the well-being of her country. Shelley found herself remembering all Tony DeFigliero had done for her. He could have said he didn’t have the time—but instead, he had chosen to make the extra effort to advise a new employee. Now, she realized, she had the chance to pass on his generosity to someone else. Maybe that’s what being a good citizen is all about, she mused—being a part of a chain of sharing, passing along what we have to offer from one hand to another. Shelley still wanted to talk over her decision with her husband. But she was pretty sure she knew the right thing to do.

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Like the body that is made up of different limbs and organs, all moral creatures must depend on each other to exist. —Hindu proverb

If a client dreams of traveling, a financial advisor can show him how to make that possible.

Career Chapter Title opportuities

Chapter Title Investing our knowledge and energy in people is one of life’s best opportunities.

Chapter nine

B

ill Bachrach, a successful financial services consultant, believes that one of the most important things financial analysts need to do is earn the trust of their clients. Because of this, he teaches that a value-based relationship of trust, not salesmanship, should be the goal of a financial planner. In his book ValuesBased Financial Planning: The Art of Creating and Inspiring Financial Strategy, Bachrach says: “Values . . . are intangible.” (In other words, we can’t touch them.) “Your job is to uncover these valuebased emotions so people can see the relationship between making smart financial decisions and fulfilling their life values.”

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Financial planners can help clients understand tax requirements. Principles of Good Character 1. You are what you do, not what you say or believe. 2. Your choices define who you are. 3. You do the right thing, even when it is costly or risky. 4. You choose a high standard of behavior, even if those around you do not. 5. You make a difference. 6. You are a better person when you practice good character. 7. When you are a better person, it makes the world a better place. Adapted from goodcharacter.com

Bachrach advises planners to ask their clients questions like, “What’s important about money to you?” and “Why is that important?” Such inquiry helps the planner learn more about the client and understand what is important to that person. It is a way of building a “value staircase” that gradually leads up from what’s least important in

Career Opportunities

87 The security and commodity brokers, exchanges, and investment service firms make up the majority of financial advisors, nearly 60 percent. Financial planners also work for commercial banks, savings institutions, and credit unions. And a still smaller number work for insurance carriers and insurance agents, brokers, and services.

Providing for their children’s college education is a financial goal for many parents.

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88 Ethical Commitment Means: • A strong desire to do the right thing. • Accepting financial, social, or emotional costs if necessary. • Telling the truth. • Standing up for beliefs about right and wrong. • Keeping promises. • Never taking advantage of others. Adapted from material from the Character Counts Coalition, charactercounts.org/overview/about.html

the client’s life to the client’s most important value. He says this “replaces the need for small talk, chitchat, groping for common ground, or talking about your credentials, your experience, or your company.” According to Bachrach, financial planners have the opportunity to not only advise people about money but also about life; financial planners just specialize in money. Bachrach emphasizes that success, for both planner and client, lies in the achievement of personal as well as financial goals. A recent edition of the Jobs Rated Almanac says that financial planning has become

Clients are ordinary people—families and individuals who can live better lives because of their advisors’ expertise.

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An after-school job like babysitting or mowing lawns gives teenagers the opportunity to form their own financial goals.

Financial Advice from Kids Arthur Berg Bochner and his mom, Adrienne Berg, wrote a book called The Totally Awesome Money Book for Kids. In it the mother and son team cover the basics of smart money handling for kids, including the six mistakes that cost kids money, budgets for savers and spenders, investing, and paying for college. According to Adrienne, kids are different from adults in the way they use money. Kids invest in the things they love. They become experts on the things that interest them. They know television, computer games, and food. When they choose stocks, they choose brand names and industries whose products they buy. For instance, the first stock her son Arthur ever purchased was Blockbuster Entertainment Corp. because while driving with his parents in Venezuela, he noticed a store he recognized by the side of the road—Blockbuster Video. He figured it must be big if the same store was in both New Jersey and Venezuela.

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90 the most desirable job in America. Because of Some Fast Facts on Financial Planners people like Bill Bachrach, in the United States, 2010: who care more about people than about money, this Average Pay: $64,750 career can be a powerful Number of Jobs: 206,800 instrument for character Job Growth: 32% (much faster than . . . a way to do concrete average) good in our world. Jobs added, 2010-2020: 66,400 Employment for financial advisors will realize Adapted from U.S. Bureau of Labor a faster-than-average emStatistics ployment growth over the next few years. Businesses and individuals are expected to increase their investing, and this means such jobs will continue to be filled by qualified financial planners. Better retirement planning also increases the demand for personal financial advisors. Clients need advice on how to invest their money, especially since people are living longer and need to provide for more years of retirement. Bachrach would consider all these as opportunities to practice value-based advising. Other responsibilities could include preparation of total financial plans including investment strategies, executing the plan, and maintaining a continuing relationship with the client. Although financial planning is not often thought of as a helping profession, those who choose to be financial advisors do help their clients. Money is an issue that affects everyone’s life, and a person who exemplifies the core qualities of a good character can help clients manage their money to benefit their lives as a whole. As Bachrach teaches, financial advisors care for the entire person, who she is, her fi ­ nancial needs, and her values. When clients can trust the person in charge of their assets, they are able to spend

Career Opportunities

91 more time enjoying their families, friends, and pleasurable activities. They can use their money for worthwhile activities—and their dreams can become reality. Our world often sees money as power. If you choose a career as a financial advisor, you will have the opportunity to use that power for good.

If you will think about what you ought to do for other people, your character will take care of itself. Character is a by-product. —Woodrow Wilson

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Further Reading Bachrach, Bill. Values-Based Financial Planning: The Art of Creating and Inspiring Financial Strategy. New York: Aim High Publishing, 2000. Bennett, William J. The Book of Virtues for Young People. New York: Scholastic, 2002. Berg, Adrienne G. and Bochner, Arthur Berg. The Totally Awesome Money Book for Kids. Eastsound, Wash.: Turtleback, 2007. Josephson, Michael S. and Wes Hanson, editors. The Power of Character. Bloomington, Ind.: Unlimited Publishing, 2004. Kidder, Rushworth M. How Good People Make Tough Choices. New York: HarperCollins, 2009. Orman, Suze. The 9 Steps to Financial Freedom: Practical and Spiritual Steps So You Can Stop Worrying. New York: Crown Publishing, 2006.

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For More Information Certified Financial Planner Board of Standards www.cfp.net Character Education Network www.charactered.net The Financial Planning Association www.fpanet.org Josephson Institute of Ethics www.josephsoninstitute.org Institute for Global Ethics www.globalethics.org Publisher’s Note: The websites on this page were active at the time of publication. The publisher is not responsible for websites that have changed their address or discontinued operation since the date of publication. The publisher will review and update the websites upon each reprint.

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Glossary Accreditation  Official approval or license, usually earned by completing coursework or a qualifying exam. Biennial  Occurring every two years. Certification  An official statement or license that indicates a person has met certain professional requirements. Civil  Having to do with a state or nation’s law for its own jurisdiction. Commission A fee paid to a person for transacting a piece of business or performing a service. Confidential  Private; pertaining to information a person would not want shared with the general public. Criterion  A standard on which to base a judgment or decision. 401(k)  A tax-deferred savings account, often used for retirement funds. Grantees  Those to whom grants or gifts of money are given. Penalty  The sum of money a person loses if he or she does not comply with the particular requirements for an investment account. Portfolios  The financial securities held by an investor. Technical analysis  Using computers to analyze and project financial scenarios.

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Index 401(k) 27, 35 accreditation 17 American Institute of Certified Planners 47 Aristotle’s types of justice 46 Canadian Institute of Financial Planning 19 Canadian Society of Technical Analysts 44 certification 17, 55 certified financial planner (CFP) 12, 15, 17, 19, 27, 45, 52, 56, 70, 78 Certified Financial Planner Board of Standards 15 character 7–9, 20–21, 33, 37–39, 53, 59, 66–67, 71, 80, 86, 88, 90–91 charter accountant CA 69 code of ethics 12, 17, 44, 47 commission 24, 29, 31 core character values 21

financial planning process 26 financial terms 63–64 Four Agreements 30 Golden Rule 54 Hamilton, Alexander 16–17 How Good People Make Tough Choices 66 investment decisions 15, 44, 51 jobs 7–9, 41, 45–46, 61, 68, 71–72, 77–78, 85, 88–90 licensing 17 Markkula Center for Applied Ethics 37–38, 80 skills 8, 17–18, 48 technical analysis 44 The Totally Awesome Money Book for Kids 89

educational requirements 17 ethical decisions 37, 40, 80 work ethic 7, 72 ethics 12, 17, 19–20, 37–38, 44, 47, 57, 80–81

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About the Author & Consultants Sherry Bonnice lives with her husband and two children on a dirt road in rural Pennsylvania. They raise rabbits and have a small farm with a goat, a sheep, chickens, one duck, five dogs, and two cats. Sherry has co-edited quilt magazines and written a quilt book. She has also written several books for other Mason Crest series, including Careers with Character and North American Folklore. Cheryl Gholar is a Community and Economic Development Educator with the University of Illinois Extension. She has a Ph.D. in Educational Leadership and Policy Studies from Loyola University, and she has more than 20 years of experience with the Chicago Public Schools as a teacher, counselor, guidance coordinator, and administrator. Recognized for her expertise in the field of character education, Dr. Gholar assisted in developing the K–12 Character Education Curriculum for the Chicago Public Schools, and she is a five-year participant in the White House Conference on Character Building for a Democratic and Civil Society. The recipient of numerous awards, she is also the author of Beyond Rhetric and Rainbows: A Journey to the Place Where Learning Lives. Ernestine G. Riggs is an Assistant Professor at Loyola University Chicago and a Senior Program Consultant for the North Central Regional Educational Laboratory. She has a Ph.D. in Educational Leadership and Policy Studies from Loyola University, and she has been involved in the field of education for more than 35 years. An advocate of teaching the whole child, she is a frequent presenter at district and national conferences; she also serves as a consultant for several state boards of education. Dr. Riggs has received many citations, including an award from the United States Department of Defense Overseas Schools for Outstanding Elementary Teacher of America.