Going Deep Into Multigenerational Planning To Better Serve HNW Clients (Not Just Retain Their Assets): #FASuccess Ep 472 With Carli Smith

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Full Transcript:

Michael: Welcome, Carli Smith, to the "Financial Advisor Success" Podcast. data-nav-title="What Drove Carli To Leave A Firm [06:26]"

Carli: Thank you. It's great to be here.

Michael: I'm really excited that you're able to join us today and get to talk about, I think to me, an interesting theme about the ways now that firms are trying to serve clients more multi-generationally across parents and children up and down the family tree. Not just what I feel like has been the popular industry version of this, which is there's a generational wealth transfer coming and all of these parents are going to die and pass money to their children. So you have to have a relationship with them so that someday when they inherit Pop Pop's money, then you'll have a relationship with them. But what it means when the firm truly wants to serve multiple generations of clients together in a more integrated manner, which I feel like has long been the domain of the family offices, the multifamily office firms where I just feel like it's a little bit easier when there's tens of millions, or hundreds of millions, or billions of dollars of family wealth. There's lots of money to pay for lots of services across the whole family.

It's a little harder for those of us who want to work with the merely high-net-worth clients where there's only so much they can or may be willing to pay in fees. And so we have to be engaging across the generations, but we have to be efficient with our time and what we do to make sure it works for the clients and it works for the firm. And I know you have been building your advisory firm in this direction, aiming to do more and more in surveying multiple generations of the clients, the parents and the children where both are actually meaningful clients and not just the parents and the people who someday inherit the parents' wealth. I'm excited just to get to delve deeper into how you're actually doing this, what it takes to really meaningfully engage with parents and their children, what kind of advice and services are meaningful each and how you got started down this multi-generational planning path.

Carli: Yeah, I would love to talk about it. It's one of my favorite things to talk about. So yeah, obviously working with families, it's something we all strive to do as financial advisors and it is the talk, right? The generational transfer of wealth and what that really means. And the way that I view multi-generational financial planning, it's bigger than that. It's not just about retaining assets. It's really about keeping the wealth, serving the family values in a way that's meaningful for them from one generation to the next. And with that comes complexity, comes tax planning, estate planning, obviously the investment management. To some degree, it feels like therapy sometimes, right, for folks because of different family dynamics. So we really serve in that role of thinking about it from the eldest generation all the way down to sometimes the youngest children. The decisions that are made by the elderly generation impact the generation thereafter and thereafter. So we really like to dive into the details, the complexity. In our opinion, it's the best kind of work to do.

What Drove Carli To Leave An Established Firm And Found Signal Wealth Advisors [6:26]

Michael: So I think so we can get context for the business overall before, then I really want to dive deeper into what are these relationships, what these engagements look like, first just tell us a little bit about the advisory firm as it exists today, just so we have context for the business in which you're operating.

Carli: Sure. So Signal Wealth Advisors, I'm the founder and currently the only wealth advisor. I have a team of two besides myself. So I have an associate financial planner and then also a part-time client service associate. So the three of us work very closely together. I founded the firm almost two years ago and building something, being a part of building something was always something that I was striving to do. And an opportunity came up for me to take action and I took it. And it's been a wonderful experience so far. Today we sit at roughly $143 million in AUM and this year alone in 2025, it's been a year of tremendous growth. We've actually grown about 70% since the end of December last year. So it's been a fun, exciting year, but it's also been a year of, okay, we really need to have a path forward, be intentional with everything. But we're a female-owned and operated firm, which I am very proud of. I love having a space for women to grow and evolve in their own careers. That's also translated into having a lot of female clients as well. They feel very comfortable with that. So we're excited. It's a great place to be and we're excited about the future.

Michael: So just for context, you said the firm started two years ago and you've been on this fast growth path. So is this all from starting at zero two years ago or were you previously in the business, some came along and then you got to do your thing and off went the growth?

Carli: Yeah. So I was with another firm in Austin, Texas. It was a large RIA and they were acquired by a national-based firm. And I made the decision to leave and start Signal Wealth Advisors. And thankfully, roughly 90% of my clients came with me.

Michael: So I'm inferring you got to one of those moments that sometimes happens when firms get acquired and you basically get the, so here's the new agreements, you're either staying or you're going, and you made your decision at your crossroads.

Carli: Absolutely. Yes. It was a very tough...that was one of the harder things honestly to go through. The firm I was with, it was a fabulous place to work. The people were amazing. How we approached financial planning and client service, it was really top notch, and it was sad for everybody to see this evolution in the business. And obviously for business reasons it happened. And I still miss everyone I worked with. There were a lot of great relationships there. But ultimately you have to do what's right for you and what's right for your clients. And honestly, that's how Signal Wealth was born.

Michael: There's so much M&A out there in the industry right now. I know you are not the only one that has hit a version of this crossroads and has to make a decision. So I'm sure there are things that are specific to the firm and the acquirer that we don't have to get into. But I'd love to just understand more, what were the factors for you? What were the decisions for you? What drove the evaluation and try to figure out, am I staying or going and ultimately deciding on I'm going and launching my own thing?

Carli: The biggest thing for me came down to what it meant for my clients and how I personally approached the relationship and financial planning. I'm very hands on. I'm very tailored. I handled all of the portfolio management for my clients. I handled all of the financial planning for my clients. So it was very siloed in that way at our firm, but it also meant that it was more of an intimate-type relationship with your clients. And with a bigger national firm, yes, there are a lot of different aspects to it that provide value, but it felt like to me I would lose a lot of that. And it was important to me that I kept that, for my clients, for myself. In addition to that, I always had the desire to be a part of building something or build it myself. That was always a goal of mine. And I knew that if I had moved forward with the firm that acquired them, that would never happen.

Michael: Because you're a smaller cog in a much larger machine. Nothing negative to them, just how it works at big firms, you're a smaller piece of a bigger machine.

Carli: Yes, exactly. And it works great for some people. That's their wheelhouse. It just doesn't work well for me. It's not how I'm wired.

Michael: So although “We bring you scale and centralization”, from your end was, yeah, but I want to build a thing I own and control, and I like my autonomy. So centralization just means I have less.

Carli: Right. Exactly. Some of it sounds appealing sometimes, especially when you're super busy at year end. But ultimately, it just didn't sync up well with my values that have to do with my career and how I approach financial planning and investment management. So that was the decision factor for me. And it was, quite frankly, the kick in the pants I needed to make it happen. I don't know that...

Michael: Because it's hard to just up and take the leap. But when there's a change in ownership and a moment where you have to decide whether to sign a new employment contract or not, it's kind of a really good moment of truth in the mirror and be like, well, I guess if it's happening, it's happening now.

Carli: Absolutely. It was the scariest thing I've ever done in my career. But I could not find any reason for myself to do anything different. It just had to happen. It was my gut. It was everything. And I was being true to myself. I think that was the most important thing. Just realizing truly what it is you want out of the rest of your career. And it was a moment where a decision had to be made.

Michael: And so can I ask, how many clients or assets or revenue was it that came over with you? What was the foundation you got to build on when the dust settled?

Carli: I would say clients came over the course of probably ten months or so. A huge bulk came over immediately and then a handful followed. And at the end of the day, it was roughly, I don't know, $70 million in AUM that came over. That's what I call my starting point. So yeah, I was very happy with that. I did not plan for that. I wasn't expecting it. Obviously, I planned for a worst-case scenario.

Michael: It's always a terrifying thing. I would go and two of them will look me up on the internet and follow me.

Carli: Exactly. It was scary. But it also gave me a lot of confidence. Everybody gets imposter syndrome every once in a while. And sometimes when you go through big things like this, it really comes out. And to see the support and the trust that clients had in me, it was just so meaningful to me to go through that experience.

Michael: Very cool. So then where does it stand today? You'd said earlier a little over $140 million of AUM now. Where is that just in terms of clients and revenue? Can you give us some context?

Carli: Yeah. So the revenue, I would say in 2026 is projected to be somewhere...and this is excluding market growth. If not a single client came on board next year, we're going to be somewhere between $850,000 and $900,000 in revenue. Obviously with new clients, depending on what that looks like and what the market does, it could potentially be much higher.

Michael: Yep. And just how many clients is it of people or households or however you measure client counts?

Carli: We have right now about 67 was my last count, 67 households.

Michael: Okay. So 67 clients into $143 million of assets. The average client is a few million dollars net worth, higher than that. So you've got some fairly affluent folks, which certainly makes sense given the earlier context of doing more multi-generational planning.

Carli: Correct. A lot of my clients that have come on board this year, most of them have several million dollars. It happens to be the type of clients that have come our way more recently.

Michael: Okay. And I think we'll get further in a bit into where's all this growth coming from if you added...where that comes to be like $40 million or $50 million plus in the span of a year. That's a lot of new asset flow.

Carli: Yes. Yes, it is.

Carli’s Ideal Client Profile And The Key Issues They Face [17:06]

Michael: So now I'd like to come back to where we started around doing more multi-generational planning. So can you give us an example of what this looks like for a typical family? Appropriately anonymized, of course, but just is there a sample client case of what one of these engagements typically looks like for you?

Carli: Sure. So typically the main couple that I'm working with is an early retiree. And fortunately for them, they either have one or two parents still living that are elderly at that point. And then they have adult children that need to be thought about as well. Oftentimes there's powers of attorney in place. So that main couple, they're the ones who I'm primarily working with, but there's still a relationship out there with the elderly parents, with the adult children. But there's a lot of different layers that go into it.

Michael: Interesting. So I'm struck in that context for like when maybe our own biases, like when I hear people talking about serving the parents and the kids, I feel like a lot of that is I'm serving clients in their 60s and kids in their 30s and 40s who may inherit someday. Whereas if I'm hearing your situation, it's more like the client might be in their 50s, the kids are in their 20s and 30s and the parents' generation are in their 70s and 80s. Even the "kids," these aren't kids in their 30s. The kids are in their 50s.

Carli: Exactly.

Michael: The grandkids are in their 30s and the parents are the older generation that's still there navigating their own health issues at that point.

Carli: Right. It's interesting how that's played out because oftentimes...I've had a few clients come to me because of this challenging family dynamic situation of how do we work through this? But then I've had other clients come to me without even thinking that there's a multi-generational aspect to their financial planning. And through discovery and conversations, we find out, "Oh, you're about to inherit a $2 million IRA? Oh, gosh, we've got a plan for this. We need to figure this out." And then it just develops into bigger, deeper conversations about their elderly parents or wherever they are in their lifespan. For folks who have kids, I say kids but adult children, understanding where they are in their own tax brackets, what do their careers look like? Do they have kids of their own? The impact of all of this, because the decision-making that occurs, especially for early retirees, there's a lot of planning opportunities that you can take advantage of. How we make those choices is highly dependent on, well, what would happen if I were to die today and my kids are inheriting these assets? How does it impact them? And overall, how do we maximize what's available to them?

Michael: So can you share a little bit more of the wealth level of the clients and the kinds of planning issues you're getting into or the doors you have to open as you're trying to find opportunities to add value?

Carli: Yeah, so everyone has their own story and everyone has their own dynamic. I would say more times than not most of the people I'm working with have done a really good job of either saving, they've been business owners, they've been executives where they've received some level of executive compensation, and there's just massive amounts of tax-deferred money at play. And that's often the intro into everything related to the generational planning, just because of the sheer impact of what it means to inherit an account like that.

Michael: Interesting. So whereas a lot of us will look and say, "Okay, here's a client with lots of IRAs or deferred comp or other vehicles, oh, let me tell you about tax planning, we're going to try to stretch out some of this income," all the various strategies that we do, it sounds like you're entering the conversation more in the vein of, "Hey, it'll be great if you get to spend this money, but if something happens and you don't, this is also a very problematic asset for your children to inherit. Can we start talking about how we might plan for this tax-wise across the family?"

Carli: Absolutely. That's a big conversation we have with a lot of our clients.

Michael: Interesting. So more from the what happens when we inherit these tax-deferred assets than just the good old fashioned, how do we literally unwind and spend these large bucket of tax-deferred assets?

Carli: Right. And even beyond the IRAs, estate planning in general is a big driver of a lot of the planning that we do. It's not the same for everybody. I have some clients where one of their kids is going to inherit more taxable money and one's going to inherit more tax-deferred money. It all depends on various factors. So we talk through, we think through what that looks like. Not everything is equitable when everybody's household looks different. So the estate planning part of it is kind of a driving force of all of that. I do a lot of reviewing of existing estate planning documents. Obviously, I'm not an attorney. I don't give legal advice or anything like that, but I develop relationships with my clients' attorneys. We have a lot of conversations making sure that their documents truly sync up with what their desires are. And if there's any sort of things that need to be pointed out addressing those, just to do the best that we can to make sure that how they want their assets structured, how they choose to leave assets to their family members, it actually shakes out that way in the most tax-efficient manner.

Michael: So thus, not everything is equitable when each inheriting household is different because you could get the scenarios like one of your kids is a wonderful starving artist with very, very low income and the other one has been a wonderfully successful doctor. Can we just leave all of the IRA to the one in the really, really low tax bracket and all the step-up basis assets to the one in the really high tax bracket?

Carli: Exactly.

Michael: That's the type of planning conversations then that you're getting into with them?

Carli: Yes.

Profitably Serving Multiple Generations Within A Family As Clients [24:25]

Michael: So do you end up working with the parents, I guess like the parents further up the line and the kids down the line? Do you end up with multiple generations in the planning relationship or this is... early retiree 50-something person, that's the client. We just have all this value to add by helping them think about assets up and down the family tree?

Carli: More often than not, we work with the generations. So the elderly parents as well as the adult kids.

Michael: So help me understand how that occurs, how that plays out. How do you bring them into the fold as you're going down this path?

Carli: Sometimes that's the overall desire initially from the onset. Other times, I think through our conversations and the depth that we get into, it often highlights how little parents may know about what's going on in either their parents' household or their adult child's household and the impact of that. So it introduces an opportunity for me to have those conversations instead of them being the messenger of these things. And it just sort of naturally and organically leads to us helping them alongside that main couple that we're working with. And then they become clients that way.

Michael: So can you share a little bit more about how that works? I'm just trying to envision...I'm assuming a lot of people don't necessarily just say, "Yeah, I really don't want to talk to my kids about money. Hey, Carli, you seem pretty good at this. Could you just do this and let me know how that goes?" I guess there's probably some client out there that would do that, but I'm assuming you have to introduce this a little bit more. So can you just share further, how does that conversation go? What are you introducing to them or offering to them or inviting them to do to actually open this door?

Carli: Usually it's them telling me, "Hey, I think you should talk to my child." I rarely ask. I offer, I say, "Look, I'm more than happy to have these conversations if you want to make an introduction. But if not, I totally respect that." There's a lot of people that hate to muddy the water and don't want to cross boundaries and so forth. There's others that know everything about each other. I'm very respectful of where those lines are because it's not always easily identifiable. So I sort of let them lead that, to be honest with you. And more times than not, it's the couple I'm working with saying, "Hey, I think you should talk to my kid. Do you mind?" And absolutely, I will always have a conversation and see where it goes.

Michael: So now help me understand how this works from the business end. What is the fee structure for you? How do you charge to handle this growing number of people in the family?

Carli: Any related household gets to share in the fee structure. So it's a tiered fee structure. Nobody sees what the other household has. There's no sharing of information, but they do get to share in that fee structure. So a smaller account size or portfolio size because you're in your 20s or 30s gets that reduced rate because your parents have a larger portfolio and they're at the higher tier of the fee structure.

Michael: Okay. And what is that fee structure sit at for you? Are you the proverbial 1% on a million and it tiers down from there? Are you a little higher? Are you a little bit lower?

Carli: We start at 1% and it tiers down from there after a million dollars.

Michael: Okay. And how sharply does it tier down? Just since you have a lot of people contributing into hitting these tier breakpoints now.

Carli: Yeah. Something that we're finding ourselves having to explore a little more. It tiers down basically up to $5 million in AUM. And then once a client hits $5 million in AUM, or when they come on board with more than $5 million in AUM, the way that we approach it is we need to understand the level of complexity within the financial planning. And then we basically set a fee structure from there. I will say that is not perfect. And I actually have found many reasons to move away from that. But...

Michael: Meaning you'll just try to scope a flat fee, a retainer-style fee at that point?

Carli: A flat fee at that point, yes. Yes.

Michael: Okay. And the challenge is just figuring out what the right number is given uncertainties of their complexity?

Carli: Right. The challenge is that. And then also, at some point, does that flat fee need to be reevaluated? And that's just a harder thing to go back and do versus having a full-blown tiered fee structure all the way up to whatever AUM level you want.

Michael: So what led you to put it in the first place and not just continue to have it tiered AUM schedule up to whatever it is?

Carli: Well, when every advisor starts out, you're not dealing with $5-million-dollar clients.

Michael: Indeed.

Carli: So it rarely comes up. But as you evolve in your skillset and your expertise and the types of clients that you're serving, naturally you're dealing with more clients in that realm. So the fee structure needs to evolve with it.

Michael: Okay. And how far down does the AUM fee get just by the time you're getting to $5 million? Have you gone from like 1% to 0.8% or are you down to from 1% to 0.5%? How far off does it fall for you?

Carli: 0.8% is where it falls off. Yes. We have found that the depths of how far we go into the planning, the attention that we're giving our clients, the touchpoints, it tends to be more than I would say the average advisor. Obviously, there's firms out there that are similar, even more hands on. But we definitely do a lot more touchpoints throughout the year. And you know, oftentimes that calls for a certain type of fee schedule. It just depends, there's some clients that you talk to a couple times a year and some you're talking to on a weekly or monthly basis.

Michael: So are there fee minimums or asset minimums as well that you put in place?

Carli: Yes. We've recently increased our asset minimum at $2 million in AUM. We found that with the growth this year, we had to, which is a great problem to have.

Michael: But in your world, that's $2 million at the family aggregated level if they bring others in. That's not per client, that's per group?

Carli: Oh, great question. So that's per...so let's say it's that initial couple that comes in, $2 million in AUM is our minimum for that. Obviously, if an adult child comes on board and they've only got $100,000, we will happily help them and take care of them.

Michael: But only because their parents are already a $2-million-plus relationship.

Carli: Exactly.

Michael: The entry pathway, at which point now it's a $2.1 million relationship that includes the kids.

Carli: Yes.

Michael: Interesting. So it's a very healthy minimum for, I guess, whoever the entry person is, but then there's no minimum for additional family members coming into that household once the first person has actually hit the minimum.

Carli: Right.

Michael: Okay. So, I guess I can't help but wonder, do you worry about, I guess, profitability across the family or is it a challenge or concern that just now you can have a client that's got $2.5 million or you can have a client that has $2 million and five children who have $100,000 each, which is also $2.5 million, but there's just a lot more people to do planning work for? Is that a problem or is that just me too much in my head worrying about things that don't actually turn out to be problems?

Carli: Well, I think on the surface, it can definitely feel like a problem. The way that I view it is it's a twofold opportunity. It's an opportunity for younger, more junior folks who have the desire to learn about planning and being a financial advisor to really handle those relationships. It's also an opportunity whether...we talk about multi-generational planning and helping the family across the board, but ultimately, yes, we want to keep assets when folks pass away. So it's a great way to establish that relationship with the younger generation to hopefully help with that.

Michael: And so it sounds then that you're not necessarily worried about profitability of each person in the household because there are dollars eventually that come, but you're making sure the household has a healthy amount of revenue to be able to go down this road, which is why there's a $2 million minimum on the family coming in.

Carli: Yes.

Michael: Okay. Okay. So, then how do you think about this now from a capacity perspective? You shared earlier you're cruising towards $900,000 of revenue already, which is a very strong number for a lead advisor and two-person team, right? We call them triangle teams, like three people on the team. So, are you feeling...are you at capacity? Are you close to capacity? Do you still feel like you have a lot more room in this model? Where is that threshold for you?

Carli: I would say my biggest...the thing that I think about a lot is I always want to make sure I'm taking care of my clients that I have today and not lose focus of that. And if that means I need to take a quarter or two off from taking on new clients so that we can successfully handle the amount of onboarding that we did this year, then so be it. I definitely strive to have intentional growth. I don't want to just grow to grow. That's not healthy for anybody. It's not healthy for me or my team. And I also listen to what my team wants in their career path. Are there opportunities for them to grow and evolve into certain roles? And if we can help facilitate that and make that happen, we're going to do that in hopefully a constructive and healthy way by managing our growth, hopefully well. I definitely don't have the perfect answer. And it's something we talk about internally quite a bit is how do we manage this? And the answer keeps coming back to we need to increase our minimums. We need to just be very thoughtful about the time and the things that we say yes to.

Michael: Are you getting to the point where you would actually offboard clients below your minimums as well? Or is minimums more about managing the flow of new clients so you don't get overwhelmed with new clients plus the ones that you're serving?

Carli: I'm not ready to offload clients yet. This is more about the onboarding. Obviously, onboarding takes a lot. It's a lot of work. It's a lot of effort. There's a lot of meetings. So when we look at the average growth a year, how many clients is it? Is it ten? Is it 20? I tend to fall somewhere in that ten to 15 range. So what can I do every year to maintain that while still taking care of my good clients? And honestly, it comes down to having a really rock star team to support that and trying to get ahead of the growth. So we've started exploring, do we need to hire another person to help offload some of the workload from my associate financial planner so that she has capacity to start taking on more responsibility from a client management and planning perspective?

Michael: So meaning do you need to add an associate planner so that the current associate can actually start having some of the clients be their clients and not yours as a way to create capacity?

Carli: Probably not an associate planner quite yet, but somebody who's more of a client service associate who understands and knows the custodians and the work that goes into it. Someone who has the desire to get there as far as a planner is concerned and could definitely learn how to use the planning tools. That is, at least today, the ideal person that we're thinking about.

Michael: Do you have a sense as to where's the line where it's too many clients to add anymore? I hear you, right now you're managing the flow to sort of an average of about one a month, like ten or 15 a year so you can handle the volume of onboarding because you're going very deep with clients. Is there some point where you're just full?

Carli: Yeah, I know, that's honestly the magic question there. I've always said around 100 is probably what works best for me. That's only 30 clients away.

Michael: So two years. It would take a little...two to three years.

Carli: Yeah, it's definitely a real thing. So we're preparing for it. We're preparing to grow and add to our team or we're preparing to say no a lot more often. It's one of those choices.

Michael: I was going to say, do you have a leaning on it? Because it sounds like you're already continuing to attract more clients further up the dollar scale, which means if you get to any point where you're willing to transition some clients that just aren't a great financial fit anymore, you can average up for a long time by continuing to add new folks above the average and then also transition some below the average that just aren't a good fit for the depth of the multi-generational planning work you're doing now. And then you also need a team.

Carli: Right. Exactly. You know, and that's, I think, easier said than done.

Michael: Always.

Carli: You have relationships there with people, people that I don't...I don't want to give up those relationships. And I probably won't, just to be honest with you. I love all my clients. I think they're all wonderful people. We have a rule here that we don't work with mean people. We only work with nice people. So you know, that's going to be a challenge, but we'll go through it and we'll get there. And the good news is that my associate financial planner, she knows all of our clients very well. She's great at what she does. She's a rock star employee. She has the desire to learn and grow. And I feel really good about what her future entails. And I feel confident that eventually when it's time to make those choices, it will hopefully be a smooth transition.

Michael: And so I guess the leaning, it feels that the leaning for you is this team is going to grow, that you're more of a sizing-up path than an averaging-up path.

Carli: My goal is to achieve both. So as a firm, the goal is to go upstream, right? But then also grow our team to support the smaller-level clients that come with that multi-generational aspect of it.

Michael: Okay. In part, I guess as part of the multi-generational strategy, literally you want more advisors to handle the younger folks that you can continue the multi-generational relationship?

Carli: Yes.

Michael: Okay. So then where is all this growth coming from that you have this terrible problem that there are too many multi-million-dollar clients coming at once that we have to keep ratcheting up our minimums?

Carli: I know, honestly, I pinch myself. It's an awesome problem to have. It's come from a few different places. I have some really amazing clients who are advocates of me and my growth and the business, and they've been amazing at providing referrals. I also develop relationships with estate planning attorneys and CPAs, which shockingly has been a great way to bring on new clients. Our website, even though I haven't put any effort into digital marketing quite yet, we've gotten some clients from the website. So I guess I'm searchable to some degree. I think being a female-owned and operated firm has been a big part of that. The ones that have come through the website, I find that they're seeking that out, and that's just not easy to find necessarily.

How Carli Has Fostered COI Relationships And Generated Referrals In The Process [43:49]

Michael: Okay. So I'd love to hear more about what you're doing to actually have some results with estate planning attorneys and CPAs. I feel like a lot of us try to pursue that with very varying degrees of success.

Carli: It's so hard. One of the best pieces of advice that I received at my old firm was...When I was just getting started and learning how to develop your network of COIs [Centers Of Influence], initially I was trying to build relationships with those attorneys and CPAs that the senior advisors at the time had relationships with. And at one point, one of the partners was like, "Listen, you've got to make your own connections. You need to find people that are your age, your generation, going through the same thing that you are in life and develop a relationship with them. And it may not pay off now, but it'll pay off later." And so I took that advice and I have found a great network of attorneys that I truly value. I refer business to them. They refer business to us. We're all women. We all have families. We're all business owners. We're trying to do this thing in life together and succeed. And we all just really support each other. And it's been amazing. There's an open line of communication with them. It's not just a let's talk every time I send you a referral. It's like we have lunch, we have coffee, we talk shop. There's a relationship there. So that's been very helpful.

The CPAs, that's obviously, in my opinion, a more challenging way to generate leads. But I always find you have to make it a win-win situation. Are you making their lives easier? What questions am I asking that help solve problems they have? How can I be of help to them? Really getting them to see that I'm an advisor that likes to get my hands dirty and think through the tax planning side of things, that's paid off for us. I don't know that that's always the case, but it's worked well for us.

Michael: So what is it that's making the attorneys easier than the CPAs for you?

Carli: Mostly because I have this...for whatever reason, estate planning to me, in my opinion, is one of the most important things you can do for your clients. Getting that right, making sure the investment strategy syncs up to the estate planning itself, making sure that all of your clients' financial goals and the things they talk about and the things that are important to them sync up with the estate planning. That's a big, big piece and big, important thing for me. I think that shows up. I just think it shows up in the questions that are asked and the type of work that we do and the collaboration.

Michael: And so the good old-fashioned tax planning and those conversations just don't resonate to the CPAs in the same way?

Carli: I don't want to bash CPAs because I love them all. Not all CPAs are tax planning focused. They just do returns. And the ones that are planning focused, I feel like I've been able to identify who those people are for my clients. And I'll tell my clients, I'll tell new clients, "Listen, if your CPA is not willing to collaborate with me or talk through things, I'm going to recommend you get a new CPA."

Michael: And how often does that come up?

Carli: It's come up a handful of times.

Michael: Okay. So then what are you doing to find these folks? I guess CPAs or particularly the attorneys where it's working for you, how are you finding them?

Carli: Gosh, it's kind of random actually. So the firm I was with prior was affiliated with an accounting firm. So that was a great way to get introduced to the accounting community. I also have a CPA I've used personally for years and I really like how he works. So I refer a lot of business to him. I don't get anything out of it other than I get to work with a great CPA for my clients and collaborate. We talk pretty regularly just in general about what's going on with various clients. On the estate planning side, I've got a couple of attorney clients and they introduced me to their partners. So I would meet up with them, talk with them, and develop relationships that way. Another attorney just happened to be the wife of someone I used to work with at Dimensional Fund Advisors. So it comes from all different avenues. I don't know if this is something you would consider a strength or not, but I love meeting people and I love talking to people and I love supporting others in whatever it is they're doing. And I love having conversations. So I think that natural desire to develop those relationships helps with that.

Michael: And I guess as I'm wondering in reverse, I guess the technical question is how do you differentiate? How are you getting them to pick you? Because I'm sure you're not the only financial advisor who's trying to ping them because apparently you build relationships with CPAs and attorneys kind of thing in our business. What's making it work for you that it doesn't seem to work as well for a lot of other advisors?

Carli: I feel like you'd have to ask them directly. But the feedback I've heard is from one of the attorneys is, "Anytime I meet someone that needs a lot of handholding, I'm going to share your name with them." Another attorney is, "Well, anytime I have a female client or working with a couple where the female is the the one sort of taking charge of things, I'm going to refer them to you." I've heard that feedback. From the CPA, it's been, "You just seem to get into the weeds a lot more than other people do." It's comments like that. That's the feedback I've received.

Michael: Interesting. Okay. And how many are there in this, I guess, proactive network that you're working within? Do you have 12 of these attorneys that you're keeping relationships with, or do you have your two or three go-tos, or something in between?

Carli: I have my two or three go-tos for both the estate side and the CPA side.

Michael: Okay. And that's a comfortable size for you, I take it?

Carli: Yeah, that's comfortable for me. Each of the attorneys has their own focus and strengths and I'll refer clients to them based on those things.

Michael: So they're not necessarily in competition with each other either.

Carli: Correct.

Michael: So can you share then, what are their strengths? How do you fill out this roster for yourself?

Carli: Location has a lot to do with it, honestly. So for clients of mine that live central, I'm going to refer...if location is important for them, I'll refer them to the attorney I know that's more centrally located. If I feel like someone needs guidance on mineral rights and all of that, I'm going to send them to a specific attorney. If it's a business owner and they have to think through all the dynamics of what that means for their estate planning, I'm going to send them to a specific attorney.

Michael: Okay. Okay. So that's part of what it makes it work for you is you've got a range of attorneys that check different boxes. And so as you meet more folks, you have opportunities to send them to someone.

Carli: Exactly. Yes.

Michael: Do you get challenges where, I can't refer you anyone because they came from one of the other ones that referred in and I don't want to break that trust in the other direction? Do you get caught in spots like that?

Carli: That hasn't happened. Yeah.

Michael: So I guess there's enough other sources that clients are coming in that you don't feel a lack of growth to be able to send some referrals.

Carli: Right.

Generating Additional Referrals From Her Clients [53:24]

Michael: Okay. And so it's coming from attorney, CPA referrals, sounds like more of the attorneys than the CPAs, and then some client referrals. So are you an ask for referrals from clients person or is this just good old positive passive flow?

Carli: It's both. So interestingly enough, one of the surprising things that occurred after I started Signal Wealth Advisors, the support that I had from clients and just the excitement of this next chapter led to a lot of referrals. It was great. It was really awesome to see. I didn't realize that that would happen. It was just a very pleasantly surprising thing.

Michael: So you told them you're launching your firm and they said, probably not this way, but like, "Oh, that's great. I've never really referred you before, but I'm so excited for you, now I'm going to go find some friends of mine to work with you."

Carli: So that happened in some cases where a client came over and they share with me how excited they are. And then, yes, they would make a referral that way.

Michael: So what was the difference between...you are you, I'm sure you were serving them well before. So I'm just kind of fascinated by that. What do you think made it so different that, "Oh, now that you're on your own, I'll give you the referral," but I wasn't necessarily trying that hard to refer you before?

Carli: Gosh, I wish I knew. The only way I can wrap my head around that is how I feel about people when I hear that they're taking a huge leap of faith and doing something big and scary, but super exciting at the same time, you want to celebrate it. You want to share that. You want to say, "I know this person. Yes, I want you to succeed." And clients did that for me.

Michael: Interesting. Interesting. I knew one advisor actually that had a similar phenomenon play out and basically one of the themes that kind of came up from a few clients that followed them was...I don't know if it was quite this overt, but it was something, the effect of, "Well, I wanted to refer you to some people and make sure that you succeeded because if you didn't, then you were going to keep being my advisor either. I need your firm to grow to a certain size and critical mass because I'm following you because I want to work with you and I need you to stay in business."

Carli: That's amazing. Yes. I love that.

Michael: They were cheering for them. They were like, "I want you to succeed because I'm happy for you, but I also just want to watch out for myself. And I like you as my advisor, so I need you to succeed."

Carli: Yeah. I have to give credit to also one of my clients in particular, one of the families that I work with. Gosh, they've just been a huge advocate for me in all of this. Literally from day one and they've referred...they mention my name anytime it comes up, and I'm so grateful for that. They even wrote an RFP [Request For Proposal], a two-page RFP outlining the things that I do for them and they've shared it with folks, and it's incredible. They're such wonderful people, good humans, and they're this way with everyone that they know. If they see somebody that they want to support, they go all in and it's paid off. I've gotten several clients because of their willingness to share their experience.

Michael: Wow. And do you give them referral incentives or thank yous or things or they just really like you and are being awesome to support you?

Carli: Obviously, we will go out to a nice meal. Thank you cards always happen. You know, obviously I keep it in the realm of what's okay from a regulatory perspective. Right now we're trying to plan a nice brunch one weekend coming up at a really hard-to-get-into restaurant in Austin. So that's been fun to work on. But yeah, just little things like that.

Michael: Okay. And then you said that you've actually been getting some flow on the digital side as well. So where is where is that coming from? The internet, but what's going on that's causing people to actually find you on the internet and bringing growth? Do you have any sense as to what's working to make that happen?

Carli: There's been two things that people have said that stood out to us. One is the location of our office. I chose very early on to get an actual office for two reasons. One, I'm just not the type that can work from home 24-7. I like to get out. I like to just be away from the house a few days a week. I do like to work from home when it calls for it. And I definitely help my team understand that's okay as well. So I chose to get an office and I was very strategic about the location of the office. And surprisingly, some of our new clients Google searched "financial advisor close to me" and picked us that way. Another layer to that is, "Oh, it's a female financial advisor. Oh, it's a female-owned and operated firm. Great. I'm definitely going to reach out to them."

Michael: Okay. I had a curiosity. I don't know the Austin area well at all, but what was it about the location? Are you a particularly popular suburb? Are you, I wanted to be where the density is downtown? What was unique about the location? Because it sounds like you were very intentional about it.

Carli: It was a few things. So at the firm I was at prior, the office was downtown and while that can be cool and in certain situations, it's such a pain for clients and for employees to get there every day. So I definitely knew I didn't want to be downtown. The next thing was, okay, where do the affluent people tend to live and work in Austin? So I wanted to be close to that location. And I also wanted to strategically be close to certain roads that make it easy for people to come to the office. So that was really...and I didn't want a long commute. I refuse to drive more than 30 minutes to the office.

Michael: Okay. Interesting. And it just sounds like that has worked in that some folks are actually Googling the good old "financial advisor near me," which still, if you look at Google trends, it's still the number one actual search for financial advisors. So you picked a location where that drives favorable outcomes.

Carli: Yes, I did.

What Comes Next For Carli On Her Growth Journey [1:01:09]

Michael: Very cool. So then what comes next on the growth journey as you go through this process and the pace of clients you're adding? Is there stuff you want to change or do differently or are you simply in the add clients, just keep replicating a successful process for more?

Carli: Yeah, I always go back to, I want to be intentional with growth. I don't want to grow just to grow. I'm wired to grow. It's just how I'm built. But I want to always remain true to working with good people, having a great team, and making sure everybody gets to enjoy not only work, but their personal lives. And I include myself in that. I don't want to burn out. I don't want my team to burn out. But obviously I want to build something lucrative for me and for my team. So it has to be intentional. And if that means that we have to take a step back with bringing on new clients or raising minimums or whatever that is, I'm okay with that. I want the work to always remain meaningful. So my team and I, we have conversations about that. What's the type of work that we really like to do and focus and build around that. And I always want to make sure that there's an impact for my clients as well, obviously. It's important to me that they never feel like I'm stretched too thin. I don't want them to ever have that thought in their mind. So with that as my North star, to me, that's what dictates the decision-making on where we go from here.

Michael: So that's what gives you comfort to do things like raise the minimums because you really want to manage the pace and flow of people coming in. And from your end, I think for most of us, it always feels a little scary to implement minimums or raise minimums. We start envisioning the people who were just below the minimum who didn't make it on because we had it in place, but you're getting as much as you can handle for capacity without being stretched too thin. So at that point, more isn't helpful anyways because stretched too thin and having service go down for clients is not acceptable for you.

Carli: Absolutely.

Michael: Okay. So then talk to us a little bit more about, I guess, just what your vision of the growth path is or how this plays out over the next few years.

Carli: Well, I would love to build a team where there's multiple advisors and we all have different strengths that we bring to the table and continue down this high quality, high-touch type of relationship with our clients. That defines growth for me and it's not a financial metric in my mind. It's really what we're bringing to the table for our clients and what our team gets out of it as well.

Michael: So how do you feel about the prospect that eventually you've got to hire people and manage people and train and develop them to be wonderful Carli Smith style advisors?

Carli: It excites me. I mentioned building something has always been something I've wanted to do. The business side of this, I get excited about it. Do I want to manage people? No. I want to create a team where people manage themselves. Obviously, that's not always going to work well. It's a lofty goal. But I would love to be in a situation where we're super picky about who we hire. Everybody's a rock star. If you're not, you're just not going to be a good fit. We all have excellent work ethic. We all care very deeply about the experience that our clients have. And we all have the desire to learn and grow and support each other. If we interview somebody or think about bringing on a new team member and it doesn't fit well with that, we're not going to proceed. We're not going to move forward with it.

Michael: And so where does...I guess I'm just trying to visualize, how do you evaluate and vet that when you're trying to hire and find people?

Carli: Obviously, experience is one thing. I love hearing the questions that people ask. I think that tells you a lot about their intentions, their desires, what they're passionate about, how they think about things. I really try to listen more than talk.

Michael: So even in interviews, it's not necessarily about asking them all the questions that we may ask in interviews. You're waiting to see what questions they ask when you get to the, "So what questions you have for me?" part of the interview.

Carli: Oh, absolutely. I think it's just as important. It's very telling to hear somebody's story. Why do they want to be in this industry? What got them here? Why do you want to change jobs if that's the case? What do you love about this? What do you hate about this? Figuring out if they're a detail-oriented person, figuring out where their drive comes from. Skills can be taught, but the soft skills, the drive, the passion, all of that, I think you have to dig for that more deeply in those initial conversations with folks.

What Surprised Carli The Most Building Her Advisory Business [1:07:18]

Michael: Interesting. So as you now reflect on this journey and how it's evolved, what's surprised you the most about this path of building an advisory business, particularly when it sounds like it was a leap you maybe hadn't even fully contemplated up until two or three years ago when circumstances brought it to you?

Carli: The biggest surprise has been, for years I questioned if I was capable of doing this. And to realize that I am capable of doing this, I have the support, people are cheering me on, it's been an incredible thing to experience. And we all have our goals, our personal goals, our goals in our careers, and this definitely was a big one. And going through that transition and how that's felt and how it's played out has been the biggest surprise for me.

Michael: Because, I'm just kind of inferring by the fact that you've said this is a surprise, you really didn't feel you were capable of doing this?

Carli: No, that's not it. I knew I was capable of doing it. I think I was scared, just like everybody is. It's scary to do something like that. The unknown. I knew I was capable of it. From a practice perspective, absolutely I was capable of it. But having the courage to do it, it was good to go through that. It was really good to go through that. And then to see the support on the other side was awesome. That was an awesome thing to experience and continue to experience.

Michael: And what changed to be the thing that got you over the scary hump? I guess it was your sign the employment agreement to make a change moment because of what the acquisition stirred? Is that what kind of triggered you to get to the point of, I guess now I'm ready to make the leap because I have to make this decision?

Carli: Well, it can go deeper than that. You know, personally, I lost my dad unexpectedly in a plane crash four years ago. And that greatly impacted how I think about things. So knowing that...I knew that he...this sounds kind of wonky, but I feel like he would have disappointed in me if I had not moved forward with this and gone through the emotions of what that entails and being scared, but having the courage. So that was one aspect of it. The other aspect of it was I have a daughter, I have a seven-year-old, and everything that I do and say and the choices I make, she's going to remember that. And I could not, for the life of me, not fulfill this goal of mine because I knew that one day she's going to have a similar experience in her own life. And I wanted her to be able to say, "Well, my mom did this, so so can I." So those are really the two big personal things that gave me the drive to do it, to push through even though it was really hard.

The Low Point On Carli’s Journey [1:11:11]

Michael: So what was the low point for you on this journey? I guess in the more recent transition or just overall, I know you've been in the career for quite a while now.

Carli: One of the things that occurred to me, leading up to the acquisition of my former firm, I busted my butt. I did everything I was supposed to do. I thought that if I just kept trying to prove my value, prove my worth, things would evolve and work out the way that I had hoped that they would. And unfortunately, business decisions have to be made. And these are things that are completely outside of your control. And I realized, it was a light bulb moment for me, I'm the only one who can make this work. I'm going to show that I have value in my own way. I can't keep beating my head against a wall because of things that I just can't control. No matter how hard I worked, it just was never going to turn out the way that I expected because of the state of where the business was at that point in time.

Michael: Because it was one of those…there's founders who are too far along, they need to exit, there aren't enough internal buyers, something has to happen. It's one of those scenarios?

Carli: In my opinion, yes.

Michael: Okay. And so what was the original goal? Was the hope, I can be the buyer, I can be one of the partners? Did you want to be on that kind of path originally? Was that the goal of bust your butt, prove your worth?

Carli: Yes, absolutely. That was the goal. That was the path. And then it started to show itself that that was never going to happen. And honestly, looking back, it's all because of where the business had to go, which I understand that. I understand business decisions have to be made. But at the time when you're going through it and you don't know things, you think it's you. You think it's something you're not doing. And ultimately, that's just not the case in most situations.

Michael: So I guess what else do you know now that you wish you knew then that you could go back and tell you then?

Carli: I think it all worked out the way it was supposed to. Maybe not to be so hard on yourself. Just to realize that these are all things you can't control and that you're doing a great job and your clients love you, the people you work with love you, and to just not take it so...I don't know. not to be so hard on yourself.

Michael: So at least in retrospect, you feel like you could have seen it coming that this path to partnership or successorship or whatever you were hoping it was going to look like, in retrospect, could you have seen it coming?

Carli: The acquisition?

Michael: Yeah, that the path you were hoping was going to manifest wasn't going to come.

Carli: So I did see it coming. I could tell that things were leading in that direction. There were a lot more closed doors, interesting decisions being made, just all the stuff that goes into leading up to an actual acquisition. There's a lot that goes on. And I just sensed that that was on the horizon.

Michael: What about at the beginning? I'm assuming there was an earlier stage where you were hustling and aspirational before it became clear, okay, I don't think this is going to go the way that I wanted. In retrospect, was it seeable for you then or did you just have to go down the road and find out that just turns out this isn't going to line up as originally hoped?

Carli: I had to go through all the steps. I had to go through all of it. I was in denial about it too, I think all of us were, up until they actually announced it happening, because we all really enjoyed working with each other and it was a great place to be. So I wanted to see it through. Right? That's what we all want to do. We just want to see it through. So I feel like I did that.

Carli’s Advice For Newer Women Coming Into The Advisory Industry Today [1:15:52]

Michael: And so what advice would you give younger, newer women coming into the profession today and trying to figure out what their path should look like?

Carli: So there's so many different paths you can take in our industry. And even as a financial advisor, you could go down the path of working for a huge firm and you're in the weeds of doing all the financial planning and you're not having to worry about bringing clients on or hitting certain goals or anything like that. And that works really, really well for some people. What comes with that is a ceiling on how much money you could potentially earn. On the other side of that, if you are more of a hunter and like the idea of building something, having that responsibility of bringing in new clients and the reward is that there is no ceiling on your potential income. Those are two different ways to go in this industry. And I think a lot of times people find themselves with firms that don't align with who they truly are or what they want out of their career and it creates a situation where you're hopping from firm to firm. And I've seen that a lot with some other younger advisors. So I think it's incredibly important to explore who you think you might be with either of those paths because that should dictate which firm you ultimately work with. Do they support you wanting to build your own book of business at some point? Do they not really care about that? And oh, by the way, your income is limited this way. It has to be a good fit. And I think some firms are really good one way or the other. And exploring that's incredibly important.

Michael: And so then what was your path in to find this journey?

Carli: I ended up with a great firm. I've been in this industry for almost 20 years. I worked on the institutional side of the business and met some amazing people in the advisor community. And when I was finally ready to move on to working with individuals instead of on the institutional side, I naturally reached out to folks that I knew and ended up with my prior firm. And one of the biggest things that was a driving factor for me was, "We're going to support you. We're going to teach you everything we know. We're going to mentor you. And oh, by the way, if you decide that you want to be a hunter, meaning build your book of business and do all of these things, we support that. Your income will be based on that." And that was really exciting for me. I like having control of that. So I was very happy with where I ended up, and I felt very supported in that way as well.

Michael: So where were you on the institutional side and how long were you on the institutional side before you became an advisor?

Carli: I started out at a boutique firm in Orlando, Florida. They managed investments for Taft-Hartley and pension plans. So I did a lot of analytical work there. But I spent most of my time on the institutional side at Dimensional Fund Advisors. I started out...

Michael: Thus Austin?

Carli: Yes.

Michael: That's how you got to Austin?

Carli: Yes. I started out in the portfolio management team, worked on the U.S. equity side. And I always thought I wanted to be a portfolio manager. I love investing. It's been something I've been interested in since I was a teenager. And I get into it and realize I'm sitting behind a desk for 50 hours a week without interacting with anyone except my teammates. Right? And, I don't know, it just wasn't for me. I needed more than that. I needed to see the end client. I needed to have conversations with people outside of where I work. So I moved on to another team within Dimensional that works more with retirement plans, which was great. I learned so much about the business. I learned a lot from my boss at the time. And it was just a great stepping stone into eventually working with individuals. So I left that role...I left Dimensional in 2017 because I had a two-year old son at the time. He's now ten. And I was traveling all the time. And I just knew that wasn't the path I wanted to take any longer. So I left and ultimately ended up at the RIA that I ended up with prior to starting Signal Wealth Advisors.

Michael: So the trigger for finally making the leap was the shift in family dynamics, the cross-up of I've become a road warrior at the same time I have young children, this is not working for me?

Carli: Yes, pretty much. It was another kick in the pants, right? Apparently this is a theme in my life where I have these thoughts and desires and hopes and goals, but I need a kick in the pants to proceed.

Michael: And so that became another one.

Carli: It was. It was one of the first ones, I guess.

Michael: Because it sounds like you had some inkling years earlier on the portfolio management side that you wanted to be more externally-facing, be more client-facing. So if I'm inferring, it was a couple of years of thinking about this path before you got to I'm ready and got the kick in the pants moment of like, I guess now's the time we're doing it.

Carli: Right. Right. And I will say it didn't happen immediately after I left Dimensional. I was kind of burnt out with the travel and the opportunity had not come up yet to go to the wealth management firm. So I took some time off and gave the whole staying-at-home mom thing a shot and realized how incredibly difficult that is. It lasted for three months and then I was done.

Michael: So you didn't know where you were going yet. It was just, I'm burnt out. I can't travel anymore. I'm going to try being stay-at-home mom because I've got a...I think you said your son's your youngest. So I have a two-year-old and your other was four or five at that point. So I'm going to try stay at home and then realize, no, that's not going to work for me.

Carli: Right. I am not...I like to work. I love to work and I love what I do. And I'm glad that I did it. It was a great experience because I have zero doubts about that going forward. But yeah, it was a very quick three months and then I was ready to get back to work doing what I love to do.

Michael: So how did you find the particular firm when you were ready to look, have institutional experience, want to be financial advisor, need job.

Carli: Yeah. Well, this goes back to the importance of your network. I reached out to a former colleague from Dimensional who had transitioned herself over to working with individuals, but I reached out to her before I actually left Dimensional because I wanted to talk to her and pick her brain and understand her experience of what that entailed. And lo and behold, she reached back out about three months after I left Dimensional.

Michael: Okay. And said what? "I know a firm that's looking, maybe you should talk to them?"

Carli: Well, we just started having conversations, talked about what things could look like, and then she introduced me to the partners of the firm and we all got along great. It was a good fit. I was actually pregnant with my second child at that point in time. And I was worried about the timing of everything and they basically said, "Hey, just come on board after you have your, your daughter and go from there." So I took the time between speaking to her and getting this job offer, basically, to study for the CFP exam, get that knocked out, get it done. And then about 12 weeks after my daughter was born, I joined the team officially.

What Success Means To Carli [1:25:18]

Michael: Wow. So as we come to the end, this is a podcast about success, and just one of the themes comes up is that that word success means very different things to different people. And so you're now off on this wonderful path of success of the business as you've nearly 2Xed in two years here, you're crossing $140 million. The business and revenue seem in a great place with a really good growth momentum. How do you define success for yourself personally at this point?

Carli: Personally my ultimate goal is to raise good human beings and also to be able to look back on my life at some point and say, I did it right. I did all the things I wanted to do. I achieved what I wanted to achieve. And I feel really good about it. I also want to be someone that my kids look up to. I want them to be able to say, "Hey, that's pretty cool that my mom did this," and whatnot. That's important to me. So that's really where the drive comes from personally and the success and how I define that.

Michael: I love it. I love it. Well, thank you so much, Carli, for joining us on the "Financial Advisor Success" Podcast.

Carli: Thank you for having me.