As a young man, Bruce Allen wanted to become a prosecuting attorney. Armed with a history degree from Colorado College, he got a job as a stockbroker to put himself through law school.
Instead, he stuck with finance, and in 2004, founded Bruce G. Allen Investments, a boutique advisory firm in downtown Denver.
Allen’s wealth management approach extends beyond investment services to credit and liability management, risk management, estate and trust matters.
“We are our clients’ advocates,” Allen explains. By using sophisticated planning tools, 30 years of expertise and a vast resource network, “We help them move through all the financial decisions they need to make in their lives.”
Allen’s passion for risk analysis stems from growing up in a company town, Oneida, N.Y., home for more than 100 years of the nation’s largest maker of flatware.
“As I was growing up, Oneida had a sense of invulnerability—to some degree arrogance—about the risk that was emerging out of Asia,” Allen recalls.
Offshore competition in stainless steel demolished Oneida’s core business. It lost more than $157 million between 2003-2005, sold or closed its manufacturing plants, slashed its workforce from 2,500 to 450, and was acquired by a private equity firm.
“Watching Oneida disintegrate in front of my eyes, and watching people’s wealth get destroyed, left an indelible imprint on me,” Allen says. People retired with millions of dollars in Oneida stock that turned worthless before they died.
Understanding risks – and helping clients weather them – forms the core of Allen’s advisory practice. “We’re going to help them get where they want to be. I check myself at the door and make sure that we’re really listening to our clients.”
Q&A WITH BRUCE ALLEN
What can prospective clients expect when they come into your office?
It starts and ends with listening to our clients. I want to really understand where someone is coming from financially, where they are now, and what their vision of the future looks like. Once they share that information with me, I roll up my sleeves and go to work. I study, test, analyze and model solutions, and explain those solutions in plain English. We agree on a course of action, and I implement using independent, objective and unbiased strategies. And finally, we monitor, evaluate and adapt.
What is your planning approach?
You don’t want people to be uncomfortable with the level of risk that their investments reflect. It’s important to take time to deeply understand their tolerance for risk, through good markets and bad.
Our process starts and ends by listening to our clients. I want to understand what our client’s vision is for their financial future. Once they have shared that vision with me, we run our clients through a thousand different financial lifetimes to see how many times they made their goals and how many times then ran into difficulties. Once we have done that sophisticated analysis, we build their portfolio to endure.
We diversify clients in ways that go well beyond what traditional advisors look at. Our clients are protected not just from market volatility, but from increasing inflation, multiple economic environments and different geopolitical events.
What’s the biggest worry people have about their financial lives?
The No. 1 pain point for thousands of people is, “How do I make certain that I have enough assets to retire, and that my assets will last?”
Younger clients want to make certain they’re planning, saving and investing wisely to get to retirement. And parents want to know, “How do I make sure that my children can make it through college and be launched without significant amounts of debt?”
How do you address these fears?
Social Security planning can make a tremendous difference.
We had a client who wanted to retire and take Social Security benefits at 65. He and his wife needed monthly income of about $5,000. At 65, they would jointly receive Social Security of about $3,600 a month. We found that if they deferred those benefits until they were 70, they would generate income of roughly $4,800. So their $5,000 goal was going to be met largely by Social Security, and we would supplement their income with other assets over the next five years.
In an environment where investments have been incredibly volatile – returns from 1999 to 2009 in the U. S. stock market were negative for the decade – maximizing that Social Security resource can be critical to assure that other assets endure for 25-30 years.
In a bull market like the current one, is it difficult to keep clients focused on long-term strategy?
In 1999, people were enamored with all things technology. People thought they could become instantaneously wealthy. Several clients were tempted to abandon a diversified multi-asset investment approach and buy a handful of technology stocks. We talked them out of that. And honestly, that was critical to their success when the tech bubble imploded. Risk can come out of the blue in ways that people don’t imagine. You can see how the Oneida story has permeated my being.
Does the way your firm operates help your clients’ peace of mind about money matters?
If we are transparent about what our strategy is, how our clients are doing, and how much we’re charging them, transparency alleviates a lot of anxiety. Even in 2008 when markets were bad, people wanted to know how they did.
We can implement whatever we feel is appropriate for the client, whether that’s an S&P 500 Index Fund or one of the best active managers in the country. We can share with our clients, monthly if they want, how they’re progressing toward their goals. We believe in being totally transparent about what we charge – we’re a fee-based advisor, so we charge based on the value of the assets.
This is a very small firm. How do you compete?
We combine the independence and objectivity of a boutique advisory firm with one of the largest financial services companies in the nation, which gives us enormous financial firepower. Nations Financial Group is my broker/dealer, and all of our accounts are held by First Clearing, LLC, a subsidiary of Wells Fargo & Company. They issue our statements, and we have their resources behind us. We also have the independence to use other resources as well. Having that objectivity is critical to me.
How has technology enhanced your ability to advocate for your clients?
It’s made a huge difference. We now have institutional-quality investment products that didn’t exist four or five years ago. The index fund industry has gone from a handful of products to over a thousand funds across many markets. Combine that with more sophisticated investment technology, and it is an incredible change to help clients achieve their goals.
