Inside Track: ‘Everything balances’
Numbers capture Jeff Williams’ imagination, but trust is where the real value lies.
Oddly enough, Jeff Williams’ big career break came after he was already managing about $500 million.
Overseeing that much money wasn’t the highlight of his career. Williams’ proudest moment, when everything changed for him, was when he set out on his own to start Grand Rapids-based financial management and investment firm Grand Wealth Management LLC in 2004. The firm provides financial planning and investment management for select individual and institutional clients.
“We basically service our clients for a fee in a conflict-free environment,” he said. “Most of our clients are either business owners, executives or professionals, or retirees of one of those groups. We’re a professional services firm. We work with a lot of other professionals, CPAs, attorneys, very closely.”
In a given year, Grand Wealth manages just under $200 million. Williams said a strong sense of personal responsibility and trust comes with managing that much money, and that’s why the Grand Wealth process of choosing how to manage money is very thorough.
Most of Grand Wealth’s clients have some connection to West Michigan, although some come as far away as New York, Florida and California. The firm works with clients in about a half dozen states, Williams said.
“The way we manage money, we only begin managing a client’s money after we’ve gone through a very thorough process of determining if it’s a good fit for a client and developing a wealth management plan and investment policy statement,” he said. “So, there’s a very clear understanding of how the money will be managed and what we control and what we don’t control.”
Ever since he was a little kid, Williams has lived in environments saturated with financial responsibility. He grew up in Marshall, and both of his parents were always responsible with money, Williams said. His father was a business owner who purchased the local Calhoun Travel Agency. Williams did a little bit of the bookkeeping for Calhoun Travel while still a teenager and “had a natural inclination toward it,” saying he was comfortable writing checks and handling money.
He also was an ambitious paper carrier, with two routes. The daily experience taught him important lessons about finances at an early age.
“I learned a lot. It was year-round, and it was through good weather and bad weather, being able to bike the route or hoof it on foot, and then we had to collect money,” he said. “Sometimes people had the money, sometimes they didn’t. Sometimes you had to go back multiple times to collect. I learned some of the value of hard work and perhaps just some perspective on people who did have money and people who didn’t.”
Even though he was always good at math, Williams didn’t think about being an accountant or going into money management. But after graduating from Marshall High School in 1983, he studied economics and management at Albion College before transferring to Michigan State University two years later. He graduated from MSU with his B.A. in accounting in 1986.
“There probably is something different about accountants. I’ve always kept track of everything that I spend. I count everything,” he said. “The accounting part to me is this: Everything balances. You can reconcile and balance the books. That’s something that I just liked.”
Williams got a job straight out of college with Grand Rapids-based business management consultant firm Ernst & Young, where he would spend the next 18 years. He spent a year doing auditing, got his CPA designation, transferred into the firm’s tax group, then decided to go back to school. He received his master’s in taxation from Grand Valley State University in 1990.
Although he considers starting Grand Wealth as his biggest achievement, many little achievements at Ernst & Young along the way helped get him to where he is today.
It was those “little career breaks” along the way that got him hooked on wealth management, he said, but the main lesson he learned was client service.
“There’s a lot of technical training involved, but at the end of the day, we’re providing professional services to clients. And understanding clients’ needs and serving those needs is really the foundation of any service business, and above all else, that’s what Ernst & Young trained me to do,” he said.
“It is more than the numbers. The key to managing wealth is really based on trust. The beginning point for us is understanding the client and what their values are around money and what their financial goals are, and having a thorough understanding of that first. We work with some people that like to delegate the details … so for us it’s really paying attention to the details.”
After 18 years with Ernst & Young, now EY, Williams was ready for something new. He wanted to start his own business in Grand Rapids for two reasons:
- To be nearer to his family.
- To deal with fewer of the regulatory issues that the financial world was seeing after the Enron Corp. scandal.
“Much of my responsibilities for Ernst & Young were in the Chicago marketplace, so I was overseeing investment practice for the Lakeshore office that included the Chicago marketplace, and I was spending a lot of my time in Chicago. (And I wanted) to focus my efforts more in West Michigan and travel less. And that was mostly for my family,” he said.
“There were also some regulatory changes going on. This is post-Enron. There were some restrictions on the types of investment relationships we could have with certain clients within Ernst & Young.”
“I really didn’t see (starting my own business) as that risky at the time. I felt like I wanted to focus on West Michigan and felt like I had enough experience, and I had great training at Ernst & Young. Tremendous training. I felt fully prepared to be able to do this through an independent firm. And I felt more security doing it that way than joining another firm.”
Grand Wealth launched in 2004. It currently has six full-time employees and an office downtown at 200 Ottawa Ave. NW. Grand Rapids is a city where managing finances is just part of a financial stewardship culture that already exists, Williams said.
“There’s a lot of financial responsibility here. It’s a family-oriented community. Our clients generally see themselves as good stewards of their wealth and are very responsible with their money,” he said. “It comes from the conservative family values, the traditions that are set by some of the more prominent families.”
For anyone who wants to learn more about financial management, Williams recommends the New York Times bestseller, “The Investment Answer,” by Daniel C. Goldie and Gordon S. Murray. He also encourages reading anything by author Larry Swedroe.
And if he had to boil down what he’s learned about financial management into three lessons, here they are: Know your time horizon. Have a plan. And stick with it.
‘Know if you’re investing for short term or long term. Develop an asset allocation that matches your need for the money. So, if it really is long-term money, invest more in stocks. If it’s money that’s going to be needed in the next couple years, it really should be put into a money market fund or savings account,” he said.
“Markets are going to go up and down. There’s going to be turmoil. That goes back to starting out up-front with the time horizon, having retirement money be retirement money, and setting money aside for the short term.”