Paul Tyers, managing director of Wealth Stewards Inc. in Toronto, likens his role to that of Chesley “Sully” Sullenberger, the U.S. Airways pilot famous for landing his passenger jet on the Hudson River after both of the plane’s engines were disabled by a bird strike.
“People want to get to a certain destination safely,” Tyers says. “They hire us to help them get there and, obviously, there are winds that are buffeting us and some things that Sully had to deal with. But the idea is to get them landed safely at their destination, which usually is their goals.”
Tyers’ firm provides its roster of high net-worth clients with a range of financial services, including retirement planning, tax planning, estate planning, insurance and philanthropic planning services. Tyers and his team even help clients’ children shore up their financial literacy.
“We believe we can make a far bigger difference identifying gaps between where people are headed and their comfort level in getting there than in outperforming the markets,” he says. “Financial planning is not just the plan; it’s the guidance and the coaching that goes along the way.”
An important part of those planning services involves helping to ensure that the next generation of clients is prepared for the transfer of wealth. Tyers often leads family meetings in which estate plans are discussed with the client’s heirs. Sometimes at these meetings, the adult children are made aware of their parents’ net worth for the first time.
Tyers recently participated in a family meeting for a wealthy client, which was held in Miami and involved relatives from across Canada and the U.S. Tyers went beyond financial issues and coached one of the clients’ sons to act as a kind of mentor for the younger family members.
“We view our firm as a multi-generational firm because we act multi-generationally,” says Tyers, who is 63 years old. “Everyone else is younger than me here.”
All of the services offered by Wealth Stewards and its sister company, Portfolio Stewards Inc., of which Tyers is vice president and portfolio manager, are provided in-house. Each client deals with one of four primary advisors and a secondary advisor, interacting mostly with the primary advisor. An advisor might bring in an in-house specialist, such as a lawyer or an insurance specialist, as needed. But the primary advisor remains the point of contact for the client. “People open up deeply to one person,” Tyers says.
Wealth Stewards offers frequent client contact, usually meeting with clients every quarter. “We’re like dentists,” Tyers says. “When you’re finished your meeting, you book your next meeting.”
When face-to-face meetings are not possible, the firm uses the GoToMeeting online conference application. And even elderly clients are getting on board with online conferences. “[Using the application] may be the first time they’ve done so,” Tyers says, “but they’re comfortable because, frankly, it’s clicking on a link. We even have a 92-year-old who meets with us online.”
The firm is compensated based on a percentage of assets or, in a few cases, a percentage of net worth. Advisors are paid salaries, with performance bonuses based on financial metrics and client service.
One characteristic that sets Tyers’ firm apart from others is the way it acquires new clients: by forming referral relationships with accounting firms, an arrangement that benefits Wealth Stewards, the accountants and the clients.
In a way, working with accountants brings Tyers’ career full circle.
Born in Sudbury, Ont., Tyers earned his bachelor of business administration at Wilfrid Laurier University in Waterloo, Ont. His first job was with a large accounting firm, for which he performed audits for investment dealers. That experience piqued his interest in the financial advisory business. After a stint working in corporate banking, Tyers purchased (with the help of a venture-capital firm) a financial planning company called Retirement Counsel of Canada in 1987. He ran that firm until 2002, when he sold it to Michael Lee-Chin’s Berkshire Group.
Tyers formed Wealth Stewards in 2006 after learning about a business model popular in the U.S. in which wealth management is integrated with accounting firms. His goal was to build his own firm around that model.
But there were several regulatory hurdles. Tyers had to get approval from the investment, insurance and accounting regulators in order to make his proposal work. The effort to obtain those approvals paid off by enabling Tyers to achieve independence for his firm. Wealth Stewards began as a division of HAHN Investment Stewards & Co. Inc. (now Forstrong Global Asset Management Inc.). Wealth Stewards became a separate company in 2008, with HAHN holding equity in Wealth Stewards until Tyers purchased that stake in 2009.
Meanwhile, Tyers’ business model flourishes: the firm serves about 150 client families and has assets under management of $200 million. The minimum asset level for the firm is $500,000 and Tyers, who serves the higher net-worth end of the firm’s book, has a minimum asset level of $2 million. Most clients are business owners or professionals over age 50; 90% of these clients were referred by their accounting firm.
“We think [the referral model] is a great way for accountants to have a deeper relationship with their clients,” Tyers says. “First, accountants view [the referral relationship] as something that’s helping their clients. But, clearly, it is effective for us as a way to get new clients as well.”
Accountants’ clients referred to Wealth Stewards are treated as that firm’s clients for the services Tyers and his team provide. The accounting firm remains the client’s accountant and receives a fee for the referral.
Wealth Stewards and the accounting firm get the client’s permission to share information about that client’s account with Wealth Stewards, including information about the portfolio and the financial plan, in order to provide the services.
Getting all the parts of that model in place has been a long haul for Tyers. There were provisions in the accounting regulations that precluded accountants from receiving referral fees and from being compensated as a percentage of assets. Tyers worked with the CA Institute to redraft the rules so that such referral relationships with wealth-management firms would be allowed. The latest revision to those regulations was completed last September, ending a process that took seven years, Tyers says.
Wealth Stewards has relationships with 12 accounting firms, and that number is expected to grow. Wealth Stewards is planning an event next month to which it is inviting 50 accounting firms in an effort to forge new relationships. Tyers hopes this exercise will yield agreements with 10 firms. That should keep Tyers’ wife, Peggy, busy. She is Wealth Steward’s director of business development and is responsible for finding new accounting firms to partner with and for guiding them through the partnering process.
Tyers and his firm use a core and satellite investment approach. The core of a portfolio consists mainly of managed products from Toronto-based Dimensional Funds Advisors Canada ULC.
“We believe it’s extremely hard to outperform the public markets in the larger-cap area,” Tyers says.
In the satellite portion of a portfolio, Tyers focuses on fixed-income optimization. Amid the low interest rates, the firm has been investing in alternatives to bonds, such as private mortgages, memory care (Alzheimers) homes, and life settlements. (This last category is the secondary life insurance market in which the firm invests in a pool of policies from older policyholders who are in a position to benefit from the influx of cash.)
Tyers holds chartered accountant, certified financial planner and chartered investment manager designations. He recently was awarded PlanPlus Inc.’s 2017 Canada Financial Planning Award.
In his spare time, Tyers enjoys tennis, skiing and cycling, and he has completed several triathlons.
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