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What’s this $10M Morgan Stanley advisor’s best advice for new FAs?

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Nicholas Kavallieratos says he learned an important lesson at the start of his career. “I am not a stock picker, I am an advisor.”

Kavallieratos urges industry newcomers, to recognize what the job’s really about — providing guidance and emotional support. And after that, find a specialization. It’s how he says he built out his team.

“When we meet existing or new clients they can take comfort in knowing that they have a roundtable of experts at their disposal,” Kavallieratos says. “Be the best at what you do best.”

The Morgan Stanley advisor and No. 2 on this year’s Top 40 Under 40 shared this and other insights into his approach to the job with On Wall Street, which is taking a deep dive into the best practices and philosophies of the advisors who led the ranking.

Read on to learn more about Kavallieratos.

Finalists for the Top 40 Under 40 were to be no older than 39 as of Dec. 31, 2018. They also had to be registered with a firm in the employee channel. Nominees’ information was confirmed with their employers. Production totals were used to determine the rankings. Production and AUM figures are as of Sept. 30, 2018.

How would you describe your practice?

My goal is to provide proper guidance, support and financial awareness so that clients and their families can make lifestyle decisions without the constraints of financial burdens.

The advisors at the top of the ranking generated more than $59 million in combined annual revenue.
February 4

What was your biggest work accomplishment in 2018, and was there something that nearly kept you from achieving it?

My team and I devoted a large portion of our year toward instituting a comprehensive family office infrastructure for clients. Offering clients a single-post solution for all financial needs — daily financial management, lending, planning, estate services and generational education. Although most large financial institutions offers these services across the entire firm’s infrastructure, corralling these services into a single-post model and bringing together the firm’s various channels can be an undertaking. Our firm encouraged and promoted our endeavor, assisting us with the level of details and attention that our clients required and ensuring that our process and group’s infrastructure could properly support all aspects.

What was your biggest personal accomplishment in 2018?

As a father of six, balancing work and personal life sometimes presents significant challenges. As my oldest is now 10 and the everlasting athlete, he constantly asks to participate in recreational sports. I am very proud of his accomplishments and determination. I make every effort and pride myself to be there by his side supporting every practice, every game and to help guide him through the ups and downs of his activities. For me, supporting and nurturing my children and their development is a personal accomplishment that I strive for every year.

Describe the best 15 minutes of your work week.

Every Wednesday, my team and I have a 15 to 20 minute think-tank session. We review client requests, tasks and discuss strategy. Ideas that emerge from these discussions always result in a beneficial communication, investment decisions and overall business strategy. The best is that it is collective thought!

What’s the toughest part of your job?

Setting expectations. An expectation by definition is a strong belief that something will happen or be the case in the future. Guiding clients with financial advice is not always simple. It requires a delicate balance of education and dialogue to ensure that the client’s expectations are set appropriately. When you have markets similar to the past few months we have all seen, the greatest task at hand is balancing those “great expectations.”

What makes you stand out as an advisor?

During the beginning of my career I learned a valuable lesson — I am not a stock picker, I am an advisor.

In my opinion, an advisor is someone who helps to provide guidance, mental and emotional support — and most of all sound advice on critical matters. My goal is to ensure that the critical advice I provide helps individuals make decisions without concerns of financial burden. I believe in relationships and understanding my clients holistically.

What do you think people often misunderstand about the work advisors do?

All too often, I will meet someone who says, “oh you’re a wealth management guy — got any stock picks?” Advisors don’t have stock picks. We provide guidance and help to structure solutions for the betterment of your overall financial stability. If you want stock picks, try Zoltar at Coney Island or a fortune cookie. Anyone can throw out a stock recommendation. The true talent is the ability to identify if the guidance you are providing is appropriate for your client, if it meets the duration requirements for your client and most of all if it is a sound financial investment overall.

If you could get Americans to change one financial habit this year, what would it be?

Credit card debit! I read a startling statistic in late 2017, that the national credit card debt had surpassed $1 trillion annually. I thought, ‘That is literally insane!’ Especially, considering that approximately 25% of the U.S. population is below the age of 18. When I looked into the statistics what was even more bothersome was the fact that more than 50% of that debt was held by individuals between the ages of 18-45 years old. If that number is accurate, that is an astounding figure that is very scary. Before you can start any process of financial security — first and foremost pay off your credit cards! They charge you way too much interest. There is good debt and bad debt; credit cards are bad debt.

What advice do you give to new FAs?

Stay focused. The most challenging aspect of beginning a career as an advisor in today’s environment is that there are so many financial vehicles, instruments, tools and strategies to try and tackle. I am very much a believer in being a subject matter expert in your area of focus. I built my team on ensuring that every member has a subject matter expertise. The value-add that everyone brings to the table is they are a specialist in their area. When we meet existing or new clients they can take comfort in knowing that they have a roundtable of experts at their disposal. Be the best at what you do best.

What trends are you watching in 2019?

Unfortunately, 2019 seems volatile at best. I believe that technology and expedited service initiatives will continue to drive the markets and economic growth. Future generations and working folks value time significantly greater than ever before. This level of respect for time is leading our society and world toward more efficient and aggregated use of services and technologies. As a consumer you want things available at your fingertips and at an efficient price point. As a provider, you want to manage your services and solutions in the most time efficient method. All of these asks are driving technology and people to work smarter. Although economists and global markets are indicating slower growth, the reality is we are growing more efficiently so the percentages may not be as relevant. If we can manage to keep global politics stable then we may start to see global economic momentum.

What technology can you not live without?

Probably one of the most difficult questions to answer given the interconnectivity of everything in today’s world. Telecommunication for me is critical. I probably spend on average 12 hours per day on the phone. My kids would argue that I am being conservative and it’s more like 20 hours. Having the ability to dial a number and speak to a person and communicate on the receiving end is truly magical. Relaying and receiving information instantly is what makes markets, life and the world efficient. I am not sure what the world would be like for me without a phone.

Who is your personal hero?

My wife. She somehow manages to raise six children, provide to the community and be a role model to those around her at all times. There are days when the markets and the economy is literally upside down and then I take a moment to reflect on how mothers today juggle work, home and personal life all together. I quickly bring myself to the realization that life is all relative and based on perspective. Although my wife is my true hero — all mothers are heroes everyday!

What is your morning beverage of choice?

I wish I could say that I walk into Starbucks and order some fancy triple shot “Venticcino” but the truth is I am a plain black coffee kind of guy. Although, I will gladly admit that my better half cannot function without Starbucks! So, special thank you to Howard Schultz for keeping my house sane.

What goal, professional or personal, do you most want to achieve in 2019?

I would like to spend time providing guidance and financial knowledge to the future generation of young people who never had prior exposure to capital markets and economics. Learning the basics of finance can give anyone a jump start to saving, planning and coordinating the proper financial path for success. On a professional front, I would like to focus on building a more horizontal team structure and incorporating more subject matter experts within the overall team for clients.

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