2 min read September 2022 — Jacksonville offers a highly competitive landscape for high-net-worth asset management firms, so much so that striving for excellence requires a specific business acumen not unlike that of professional athletes. Don Davey, owner and chief wealth engineer of Disciplined Equity Management, shared with Invest: what it takes to succeed in the area’s financial advisory landscape.
How has your past experience as a professional football player and your master’s in mechanical engineering impacted your leadership style and your vision in your current role?
My business career has very much mirrored my academic and athletic careers. My engineering background taught me tangible critical thinking and problem-solving skills. And all of the intangible qualities I learned from football: hard work, discipline, teamwork, being accountable, etc., have had a direct correlation on business success as well. When you combine those two skill sets, you get a tremendous background for success. I honestly did not know what I was going to do after my NFL career, but I always kept my eye open for opportunities. It wasn’t very long into my NFL career that I realized some of my teammates could use some help with their finances. So, I started helping and advising them informally because I wanted to see them succeed. That was the genesis of Disciplined Equity Management back in 1998.
How would you say the definition of financial freedom differs between industries and generations?
True financial independence means having enough money saved and invested such that it generates a perpetually rising income stream that is impossible to outlive. It might take five, 10, 20, or even 30 years of disciplined saving and investing to reach that point. But all of our clients have either achieved that status or are following a Lifetime Financial Plan to get there. Business owners really embrace our approach, because they know how precarious owning a small business can be. At any time, a competitor can set up shop right next to you, you can lose your largest customer or technology can completely disrupt your entire industry. So my goal is to do everything possible to help our business owners achieve true financial independence before any of those things have a chance to happen. That way, they achieve their goals whether they are able to sell their business or not.
How are priorities between the different generational categories you serve either different or sharing common cause when it comes to their retirement plans?
I think millennials get a bad rap for not taking personal finance seriously, living for the moment, and being irresponsible in their spending. While that may be true in some cases, I have found a large subset of millennials who have adopted the Financial Independence / Retire Early (FIRE) mindset, which is ironically similar to that of the baby boomers. As children of the Great Depression, baby boomers were notoriously frugal and excellent savers. They did not have much growing up, so they were forced to work hard, scrape for pennies and cut expenses out of necessity. We are seeing that more and more among the younger generation as well, not out of necessity, but because they value their free time and want to retire in their 40’s or 50’s. I admire that.
What is it that separates Disciplined Equity Management from the competition?
Unlike most financial advisors who juggle hundreds, if not thousands of clients, DEM provides comprehensive wealth management for only about 100 affluent client families: professional athletes, business owners, executives and retirees. By narrowing our focus to serving as the outsourced CFO to fewer, larger clients, we are able to dig very deep into our clients’ financial lives. And in the process of handling their retirement planning, portfolio management, tax planning, estate planning, insurance, children’s college funds, charitable giving, etc., we have developed close personal relationships with each and every one of them and their family members. Someone once told me that a good financial advisor turns friends into clients. But a great financial advisor turns clients into friends. And after doing this for 24 years, I can honestly say that all my clients have become close personal friends. I am very proud of that.
What do you believe clients will be looking for from the financial advising landscape in the future?
I used to think that my only job was to deliver exceptional returns for my clients. But as I’ve matured in my career, I have come to realize that helping clients decide what to do with those exceptional returns matters much more than the returns themselves. I call myself a Wealth Engineer, but I am gradually evolving into a Happiness Engineer. Every day I challenge myself to consider the question: “How can I help my clients use their assets to improve the quality of their lives?”
We all have a finite amount of resources, so the name of the game is finding ways to maximize the utility of those resources to maximize happiness. That means different things to different people – investing in health, frequent travel, helping children, continuing education, donating to charity, starting a business, going back to school, etc. – whatever may be most important to you. My job is to customize a Lifetime Financial Plan that uses resources in a way that makes my clients’ lives as good as they can possibly be.
Money by itself is just a number on a piece of paper. My challenge is finding real world solutions that improve the quality of my clients’ lives. And to compete in the high-net-worth space, I believe financial services will need to join us in going far beyond traditional financial planning. We will always need to know taxes, estate planning, insurance and investing. But the truly superior firms will measure success as we do: by how happy and worry-free their clients’ lives are.
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