Stavis & Cohen Financial is a Houston-based firm that provides fee-based financial planning and asset management and insurance services and solutions. CEO Deborah Stavis and her partner Eddie Cohen founded the firm in early 2009 – right after the financial crisis – and it now manages $500 million for 225 families. Stavis previously owned Stavis Margolis Advisory Services, which she sold to Compass Bancshares, now BBVA Compass, in 2005 for an undisclosed sum. The Financial Times named Stavis as one of the top 400 financial advisers in 2015 and again this year.
I didn’t initiate financial literacy on a digital level. The financial services industry has been really challenging. We’re in the midst of disruption, with fee compression and new regulations. It’s also been somewhat divided on the digital front. Some think it’s so high touch that you can’t integrate computers into human relationships. Others think you have to embrace technology to allow you more time to touch the client. We’re the latter.
Our firm has always been noted for innovative education. No one wants to be sold, but if you educate people, they will realize what they need. So we’d been doing financial programs with live, humorous sketches. So we had this funny exchange about needs and wants. By using humor in education, we were able to engage people.
The problem was that it wasn’t scalable. Our clients’ kids were all over the country, so they couldn’t see the sketches. They wouldn’t read a white paper. So at best, we could have one-on-one meetings on stewardship and how to budget and invest.
Where do people go to know how to budget, save and invest?
I would have started with video, rather than live sketches in a room. It’s like doing film versus theater. In a small theater, you might be able to reach 100 or so. With video, you can reach hundreds of thousands. It really is the way a lot of our clients’ kids want to receive information. If we do a short video, they’re engaged. They’ll go to a video to find out whether buying a home is better than renting.
Education has always been a core value, but these stewardship videos have become a passion of ours. We now have 30 videos, but if we had done this before, we’d have hundreds to get to our clients’ kids.
Despite all the information online, there’s still a retirement crisis. The majority of Americans will not be ready. It’s really sad, but there’s no financial education in K through 12, and in college, all the financial classes are about corporate budgets and balance sheets. So where do people go to know how to budget, save and invest?
Women on average live 14 years longer than their male counterparts, which is why understanding money is so important for them. So we have a video of a successful woman who is retired who would rather do anything than look at a financial statement. Forty-nine percent of people are retired by surprise, whether it’s by layoffs or to take care of an elderly parent or because of health issues, which points to how important financial readiness is.
For young people, there’s a simple concept called “save your age” – start with your age and add two zeros. If you do that every year, by the time you’re 60, you’ll have over $700,000. People don’t understand the message of compounding interest. They think they need to wait for a big lump of something to save – a big bonus, winning the lottery or an inheritance. It’s also not just about retirement anymore ... because you’ll probably have five careers over your lifetime.
Finances can get pretty boring and be intimidating for some people. If we do these videos, we break the ice and even young people are more engaged in the topic. This has become my passion and purpose in life. It’s a labor of love.
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Photo courtesy of Deborah Stavis