Celebrating Advice: The Bag Lady of Bay Street

Profile : Sandra Pierce

Senior vice-president and investment advisor The Fox Pierce Segal Group Blackmont Capital Toronto Years in the business: 25

About me

I help clients express their financial fears or concerns and educate them about the issues and solutions available.

How I work with clients

We definitely attract clients like us—very sensitive, thoughtful, and seeking meaningful relationships. Not everyone is like that—some people just want the return. We don’t last long with the latter.

Bag-lady syndrome means a fear of outliving your money and ending up like a bag lady. I first heard about the bag-lady syndrome when I read an interview with Sherry Lansing, the first woman to be appointed head of a major movie studio. So here’s a woman who’s incredibly powerful and obviously money is no object. Then, she started talking about the bag-lady syndrome and it was a light-bulb moment. I personally felt outed. I was a woman who came into this business when there weren’t a lot of women.

And although I was very successful, I felt similar insecurities. And the bag-lady syndrome made me realize if I felt this way being in the industry, other women felt it too. Many women worry about money and they don’t think they’ll have enough upon retirement. They wonder if there will be enough discretionary income to live the lifestyle they are accustomed to. Will their husband die before them? Can they handle the money? It’s all of these irrational fears and they are the basis for some rational fear.

I never blatantly marketed to women. It just seemed to come along with the clients we were taking on. Women come with men. Most women have a man, so quite often if women start with me, the husbands will be with me or if I had the husbands, the wives over time will get more involved because I insist on it.

A prospective client will always meet with me first because it’s usually through “bag lady” that they’ve heard of us. I like to go to their offices to meet with them because people tend to be more comfortable in their own settings.

Working with clients is intimate, like a marriage. You have to be able to go deep into the psyche of your clients and talk about incredibly personal things that touch the soul of who they are.

We tell clients what they can expect from us but we also communicate what we expect from them. I think clients forget the obligations they bring to the table. For example, I expect them to return my calls on a timely basis. I don’t think clients realize how much work goes into a call before you actually call them. And if they don’t return the call, all the work you put in is useless because things change. So we always clarify the best way to communicate with the client: Is it e-mail, or phone, or in person?

We also want to make sure our clients are open to education. We’ll educate them on what risk means because people get blindsided by returns. They have to agree to understand the risk, what they’re taking on and what that means.

Very few people understand why they own what they own. So if they just want us to manage their money, there are still certain areas they need to understand. For example, what is the rate of return they are trying to achieve? We spend a lot of time trying to figure out what that money should do for them. We really try to get the client to understand what a 6% rate of return means versus 8%. We also explain what’s actually possible.

Finally, we want clients to appreciate we’re not going to be right all the time. We’re going to make mistakes but our experience tells us we make more good decisions than bad.

A lot of smart people forget the most important tenet of investing which is, what if we’re wrong in a decision we make? How much damage can happen? This is something we emphasize with clients and we always ask ourselves when we’re making investments.

My philosophy

It’s not only about investing their money. Most people don’t work to just accumulate money. It’s a means to an end. To truly be a good advisor, you have to find out what that end is.

It’s difficult to be in this business and be a sole practitioner. Things happen too fast, nobody can be a specialist. A sole practitioner ends up being a jack of all trades and not good at any one thing. One of my partners solely focuses on research and the market and while another focuses on financial planning, insurance needs and education.

Why I matter

It’s fascinating the way people respond to the financial industry. Most people don’t think they can cut their own hair and look good. Most people go to an accountant for special needs. Yet people think when it comes to money, they should be able to do it themselves.

In any profession, there are rotten apples. There will always be a charlatan in any field that has a high level of trust. There are some terrible doctors, for instance, but do you dismiss the whole medical profession?

Some people can do it themselves but you need to consider practical experience, years of knowledge and gut feel. Unless you are doing it as a profession, you tend to lack gut feel. So I think advice does matter.