To be truly successful in business, professionals need the talent to create wealth — and the wisdom to preserve it. That’s usually where a Certified Financial Planner comes in, and why clients turn to individuals like Nathan Garries, CFP, EPC, CIWM, FCSI, a Canadian Certified Financial Planner and Certified International Wealth Manager.
As a principal with Beyond Business Financial Solutions, Inc. in Edmonton, Alberta, Nathan Garries demonstrates leadership within his industry, as well as for individual clients. He is focused on helping families and businesses reach their goals and achieve financial success. He provides timely counsel about risks and opportunities, as well as insights about investment opportunities ranging from major corporations to lesser-known startups with promising earnings potential.
Recently, CEOWORLD magazine was able to talk with Nathan about a wide range of topics, from business leadership to financial planning.
Q: What would you say are the keys to success in the financial industry?
Nathan Garries: For me, that’s a two-part question, because my role is that of both a financial advisor and a businessman. I’ve served as a Certified Financial Planner for BB Financial since 2002, advising clients and, at the same time, helping to grow our firm’s business. So I’m both an investor and entrepreneur, and the two roles dovetail perfectly.
As far as having success in both of those roles, I learned those principles early. I come from a family of three generations of financial professionals, and they’ve taught me the basics of investing and saving, and balancing risks and rewards at home.
At the heart of those lessons is the idea that ‘honesty is the best policy.’ I’ve tried to build my own business with that approach, just as my family has done. I’ve helped grow BB Financial by earning the trust of our clients through a commitment to transparency, accountability and candor. I think those are the keys to success.
A lot of people working in financial services have what I would call a “compliance” mindset. Sure, they’re making sure to follow the letter of the law and abide by every regulation, but it stops there. For them, “due diligence” means doing the minimum. But we’ve structured BB Financial to go beyond those legal obligations and provide extra safeguards for our clients. And consequently, we’ve built a stronger layer of trust, as well as security.
Q: What are some important principles of financial health that most people neglect to consider?
Nathan Garries: I would cite two fundamental pillars of financial success that many people don’t consider because they’re not familiar with the concepts. The first is the principle of “opportunity cost,” which is based on the truth that every financial decision has a multitude of effects. There’s the opportunity you seize today and the future opportunities that may move beyond your reach, all based on decisions you are making at a particular moment.
When you buy a new car this year, rather than start saving for your retirement or a child’s college tuition, the opportunity cost is all of the growth you could realize from that amount in ten, twenty, thirty years. For example, if you had invested $1,000 in the S&P 500 Index ten years ago, it would today be worth about $3,200. That’s according to an analysis done this year by CNBC. Now what if you had spent that $1,000 ten years ago? You couldn’t have bought a car with that, of course, but let’s say you bought a product that has a similar trajectory of depreciation. Today you’d be out the thousand and you’d own a good whose market value was much less than that. But most importantly, you would have missed out on the opportunity to grow your money over the decade. Your opportunity cost for making the purchase is $3,200 — and the meter is still running. That thousand could have continued to grow far into the future.
Q: And the second pillar of financial success?
Nathan Garries: It’s diversification – for many reasons. Diversification has a multitude of virtues, not the least of which is that it helps you sleep at night. And as a financial planner, I want my clients to enjoy a low-stress life. That means paying close attention to the risk tolerance and the preferred time horizon for each investor.
With diversification, your risk is broadly distributed. Equities may go down, but the bonds in your portfolio may go up, or at least provide a stable anchor for your investments. Within equities, there are also many choices, from blue chip to higher-risk, higher-reward small-cap opportunities. There are many types of bonds, as well – those backed by municipal or other government entities generally provide the safest harbours. Commodities, real estate and private equity are also popular ways to diversify a portfolio and spread risk.
Once an investor understands this concept, it is equally important for a client to periodically take the time to review the asset class allocation, adjust for varying performance, and fine-tune the balance between risk and reward. That magnifies the benefits of diversification, and optimizes peace of mind.
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