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Saturday, February 4, 2023

Taking Stock

One Saturday afternoon in 1980, Alan Newman was on the golf course with his longtime friend Andy Present, the former manager of Hilliard Lyons in Evansville. During the round of golf, Present casually asked Newman — then a successful retailer — if he ever would consider working as a financial advisor. Newman initially dismissed the idea, chalking it up to gamesmanship. However, after they finished the game, he asked Present, “Were you serious?”

At 8 a.m. the following Monday morning, Newman sat in front of Present’s desk. Within six weeks, he’d sold the women’s apparel shop he owned with his wife, Sandy, and joined Hilliard Lyons as a trainee.

Newman now is the senior vice president and regional manager of the Evansville complex of one of the nation’s leading regional financial services firms. During his 30-year tenure with Hilliard Lyons, he has witnessed a paradigm shift in the financial services industry. From a field where professionals were paid based on how many stocks and bonds they bought and sold for clients, the industry has evolved into “a business of adding value by selling advice,” Newman says: a holistic, comprehensive approach to wealth management.

In the 2010 fiscal year, the success of that approach again earned the Evansville office high honors as the top-performing branch of Hilliard Lyons, a network of 70 branches across 13 states. The ranking is determined by a multitude of quantitative standards, but for Newman, “the credit belongs with the outstanding professionals within these four walls,” he says.

When Newman joined Hilliard Lyons three decades ago, the firm’s five professionals occupied a one-room office in the former Old National Bank building at 420 Main St. Today, the Evansville complex’s 36-person staff — including 16 financial consultants — works at First and Main streets in Downtown Evansville. The atmosphere is open and welcoming, and that’s by design, Newman says. His career in the industry began at a time when it was in the advisor’s best interest to transact lots of trades. “If there was not a transaction,” he says, “there was no compensation.”

Today, Newman and his staff follow a radically different model. The business isn’t so much about commissions, Newman says: “The business that we are in today doesn’t even remotely resemble that business.” Instead of touting the “hot stock of the day,” Hilliard Lyons professionals “ideally are able to quarterback a relationship between clients and other professionals (attorney and CPA), and to make sure that their team is all playing on the same page of the playbook,” Newman says.

The new model has taken root in a relatively short time — within the last decade — and Newman believes the reasons are numerous. In the late 1990s, before the dot-com bubble burst in 2000, investors bought companies with no earnings. Silicon Valley entrepreneurs became millionaires overnight by simply selling concepts. Sound too good to be true? It was, says Newman. So were “get rich quick” investing schemes that almost always resulted in disappointment.

The economic fallout of the Sept. 11, 2001, terrorist attacks and the recent global financial meltdown only emphasized that a comprehensive approach works best, Newman says. Wealth management no longer is a mere peddling of stocks and bonds. Instead, financial planning, education and business succession planning, estate planning and wealth transfer, risk management, asset allocation, portfolio management, tax planning, strategic philanthropy, trustee services, family consulting, and consolidated reporting fall under the same umbrella.

The concept is broad, and so is the expertise of Hilliard Lyons’ Evansville financial professionals. Many of them also have worked in fields outside of the financial services industry — for example, advertising, manufacturing, nonprofit management, and, in Newman’s case, retail. Growing up in Evansville with parents who owned a department store near Fulton Avenue and Columbia Street, “I never imagined I’d do anything else,” Newman says — until that fateful round of golf.

The common threads uniting Hilliard Lyons’ professionals, says Newman, are intelligence, integrity, and people skills. Those are the attributes his predecessor, Andy Present, saw in him; they’re the attributes Newman looks for when building his team. “This business can be taught and learned,” Newman says. “If you can find those traits, it usually doesn’t matter what business the person came from.”

Newman builds his staff methodically and carefully, and he says the team is one of his biggest sources of pride. Employees contribute approximately 3,500 hours of community service each year; that’s the equivalent of one and a half full-time employees. Those hours of service come in addition to new commitments on the job: The business model Hilliard has adopted encourages professionals to complete lengthy continuing education courses. All of the Evansville branch’s consultants have completed or are involved in a six-month course in risk management, and 100 percent of the office’s eligible professionals have earned the Certified Financial Planner (CFP) or Chartered Wealth Advisor (CWA) designation.

The latter educational program, a rigorous six-month process, immerses consultants in topics such as addressing the needs of aging baby boomers, a group — almost 80 million strong — on the verge of retirement. This demographic shift demands a comprehensive approach to wealth management, Newman says: helping seniors live well in their retirement years without worrying about income shortages.

The multidisciplinary effort to ensure a client’s well-being is a far cry from the business Newman entered 30 years ago, a business that centered on the mechanical exchange of stocks and bonds. Since that time, Hilliard Lyons’ Evansville professionals have built a culture that values community, continuing education, and an innovative approach to building, protecting, and transferring wealth. “It is a business of lifelong learning,” Newman says. “It’s a business where you have the opportunity to learn something new every day. That keeps you energized.”

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