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Advisor Profile: Research Over Chocolates

Susan Kaplan gives her clients first-class advice, not frivolous gifts.

Karen Dolan, 12/30/2010

This article first appeared in the December 2010/January 2011 issue of Morningstar Advisor magazine. Get your free subscription today!

This isn't the first profile being written about Susan Kaplan, and it likely won't be the last. In her 18th year as proprietor of her own financial-planning firm, Kaplan has built a successful practice with 150 clients, $950 million in assets under management, and five employees. She's been featured in The Wall Street Journal, Barron's Top 100 Independent Financial Advisors, and Louis Rukeyser's Mutual Funds, and she is the co-host of a weekly radio show in Boston.

When I met with Kaplan at the offices of Kaplan Financial Services in Newton, Mass., she referred to herself as "the little old lady of asset management." She professed her love for good, old-fashioned balanced funds and talked about avoiding the hot trends that seem to come and go every few years. Kaplan hasn't needed to chase trends to keep her clients happy. She's achieved success by offering a full-service, conservative, long-term-oriented approach to meet her clients' financial needs.

And like her approach, Kaplan's message to clients has remained consistent throughout the years. In a 1997 article, for example, she was quoted as saying that her clients have unlimited access to her and that she conducts all client meetings. Her firm is much larger today, but she hasn't relaxed that principle. In that same article, she also pointed out that she invests top dollar to having the best research and software tools available and chooses to forgo frivolous expenses, such as sending chocolate to clients during the holiday season. Once again this year, her clients won't receive any from her. And back then, her favorite kind of fund was the balanced fund. It still is. When many investors and advisors are leaving static 60%/40% stock/bond portfolios for dead, Kaplan continues to use them across her client portfolios, pointing to their stable returns minus the sharp drops.

Family Atmosphere
"Most planners," Kaplan says, "use the financial-planning title because that's what clients want but then focus on the portfolio because that's where the money is."

Kaplan has a different model. She does a lot of things for her clients that she isn't directly paid to do. She provides financial counseling to all of her clients' family members for free, for example. She's usually her clients' first call for advice when they're making decisions about buying a business or selling a real asset. The morning of our interview, Kaplan had just met with a client who recently learned his employer was being purchased. She ran an analysis estimating what it would mean for him to stay through the acquisition, move to a competitor, or retire. That kind of work isn't a part of her client's portfolio review and not something she's paid directly to do, but it is a key part of the full-scale financial counseling that Kaplan has built her practice around.

The strong tie Kaplan has with her clients extends in both directions. During the financial meltdown in 2008, Kaplan's clients were calling to make sure she was doing OK--one even sent flowers.

The Investments
The chocolate money goes to pay for research. Kaplan buys data, research, and tools from many sources, but she relies heavily on Morningstar Principia for investment research and reports. Rather than keep her clients in the dark about their investments, she uses meetings with them to review snapshots of their portfolio and Morningstar Page reports of their individual investments.

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