Insights with Zayed & Glisczynski A Turnkey Asset Management Platform

ADVISORS

SEP 2021

magazine

zayed & glisczynski insights with

a turnkey asset management platform

Book of Five Rings

Legendary Japanese Advice

Companies Hit by Cybercriminals Survival of the techiest

Retirement Barriers for Millennials How financial advisors can help!

PLANNING WITH PURPOSE.

Financial confidence starts here.

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Erwin E. Kantor Michael Gordon Jude Scinta L. Guerrero

CEO & Publisher Managing Editor Editor-in-Chief Writer-at-Large

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Creative Director

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Feature Writer Feature Writer Business Reporter Business Reporter Business Reporter

CONTRIBUTORS & GUESTS Steven Selengut IAR, Vitaliy Katsenelson CFA, Judith Bowman, Ron Oertell, Tim Sheehan

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6

Beyond TAMPS In creating a turnkey asset management platform (TAMP), core values and shared client philosophies are a must for successful collaboration according to Dean Zayed, founder of Registered Investment Advisor/ Turnkey Asset Management Platform Brookstone Capital Management and Jason Glisczynski, co-founder of Silvertree an independent Investment Advisor Representative. Both discuss the path to building an independent fiduciary advisory firm with a partner to help them grow and scale.

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Book of Fiver Rings

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Legendary Japanese swordsman's advice still remains relevant to modern business in the age of big tech

BEYOND TAMPS Collaboration bolsters such platforms retirement barriers for millennials

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Biggest Retirement Barriers for Millennials It’s no secret that saving for retirement is harder today than it’s ever been. Millennials face more barriers to retirement saving than perhaps any generation to come before them

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Small Companies hit by Cybercriminals

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Small and midsize businesses (SMBs) are estimated to have spent $57 billion on cybersecurity in 2020 alone, a figure that is expected to hit $90 billion in 2025

five ways fintech helps consumers 4 / ADVISORS MAGAZINE

SEPT 2020

BOOK REVIEW by matthew d. edward

Book of Five Rings Legendary Japanese swordsman’s advice still remains relevant to modern business in the age of big tech

Miyamoto Musashi’s “Book of Five” Rings might not be Sun Tzu, but it still deserves a place on every entrepreneur’s shelf.

E

ntrepreneurs with experience in Asia know that reading clients, competitors, and even their own local business partners can be difficult, at best.

Information remains more precious than dollars in the East – China, especially, comes to mind, although Thailand, Vietnam, and everywhere else in the region runs on essentially the same principle – and sharing is not the norm. Just as Sun Tzu’s “The Art of War” found itself repurposed as a howto for business deals, Miyamoto Musashi’s “Book of Five Rings,” written as a guide for swordsmen, offers insight to modern entrepreneurs on how to see into a competitor’s mind – and better understand their own.

“In strategy your spiritual bearing must not be any different from normal. Both in

fighting and in everyday life you should be determined though calm,” Mushashi writes, one message of many recommending resilience, mental calm, and to understand the right time and place for action.

The warrior wisdom still applies today. One can see, for example, President Donald J. Trump following Mushashi’s dictums on unsettling the enemy – media outlets recently reported that China, internally, admitted to miscalculating the U.S. president’s willingness to engage in a “trade war.” That Trump has read Mushashi is unlikely at best, but common wisdom often finds its way into the larger culture. So too, can one see the common attitude in Asia toward negotiating contracts, with frequent feints, renegotiations, and last-minute additions,

as having a home within the swordsman’s worldview.

But where “Art of War” looked at the marco of warfare, from large battles to siege warfare, “Book of Five Rings” takes readers to the micro level of mano-a-mano combat.

The advice in this book is personal, focusing instead on how warriors should keep their minds, and swords, sharp.

“Your attitude should be large or small according to the situation. Upper, Lower and Middle attitudes are decisive,” he writes.

“Left Side and Right Side attitudes are fluid … The decision to use Left or Right depends on the place.”

Mushashi’s five books parallel the ancient Japanese elements of earth, wind, fire, water, and void.

Each book follows a theme – for example, the fire book covers

combat, in line with its element. Mystical in places, philosophical throughout, but also containing a wealth of practical thought on knowing others, “Book of Five Rings” is worth the read for entrepreneurs and executives either bound for Asia, or just looking for a new take on negotiation.

The Book of Five Rings

By Miyamoto Mushashi, published 1645

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Jason Glisczynski, CFP®, CAS®, Co-founder of Silvertree

by joe innace

BEYOND TAMPS

COLLABORATION BOLSTERS SUCH PLATFORMS 6 / ADVISORS MAGAZINE

SEPT 2021

A

Dean Zayed - Founder of Brookstone Capital Management

lways competitive and often cut-throat, the financial advisory sector has also embraced the spirit of collaboration. Joel Bruckenstein, CFP®, noted three years ago in an article for thestreet.com that the trend of financial advisors working together would likely continue far into the future.

And so far, it has.

Consider the relationship between Dean Zayed, founder of Registered Investment Advisor/ Turnkey Asset Management Platform (TAMP) Brookstone Capital Management and Jason Glisczynski, CFP®, CAS®, co-founder of Silvertree an independent Investment Advisor Representative. Brookstone’s specialty is helping like-minded independent advisors build and grow their practice in a scalable way that makes it both enjoyable and profitable.

Such partnerships can mean mutual growth. Brookstone recently earned the top spot on Financial Advisor (FA) Magazine's 2021 RIA Survey and Ranking.

After ending the year with more than $7 billion Assets Under Management (AUM) and 137 percent growth, BCM captured the honor among the Top 50 Fastest-Growing Firms in the United States.

Likewise, Silvertree had one of its biggest years in 2020 in terms of bringing on new clients, a trend that has continued this year.

“We feel like we're in a great spot,” Zayed told Advisors Magazine in a recent interview.

“Brookstone is a leader in the industry, and we want to be the thought leader in the RIA/TAMPs ADVISORS MAGAZINE / 7

space.”

Turnkey Asset Management Platform The entrepreneurial idea fueling BCM sprang from Zayed’s own personal practice, which in addition to Silvertree’s Glisczynski, counts more than a thousand partnerships with some of today’s most innovative advisors who affiliate with BCM. BCM’s own investment expertise spans evaluating and implementing traditional and alternative vehicles, analyzing market trends and investment strategies, in addition to assisting advisors in launching and growing their businesses.

“I targeted like-minded advisors that would have a couple of things very much in common with my philosophy,” Zayed said. “Number one was to embrace the idea of being a fiduciary; that was important because Brookstone is an RIA. We are not a broker dealer.” Number two was to be independent and provide feebased money management as part of the firm’s offerings.

“I had an epiphany, around 2007 or so, when I had met up with Brookstone Capital Management and had seen the option of working as an investment advisor representative versus as a broker and being able to help clients in a fiduciary capacity,” echoed

Glisczynski in a separate interview. “And that was a real game changer for me; it completely transformed all of my client relationships and how I did business.”

It also spurred Glisczynski over the next few years to obtain his CFP designation and to focus sharply on holistic, complete financial planning.

Core values and shared client philosophies give such collaboration a big boost.

Glisczynski’s Silvertree does not require a minimum investment, but there are minimums for different levels of service.

“We have a very basic entrylevel client who maybe is just starting out and doesn't have a lot of money,” he explained. “Maybe they're far from retirement, but they still need some guidance. So, we do have a service package that is available for them at an extremely low cost.”

Zayed, in targeting advisors, was not overly selective and also didn’t require a minimum.

“A lot of our advisors came to us with very low AUM, but it was the idea that we had a cultural and philosophical fit in terms of growing our businesses in sync and doing it together.”

The key ideas behind the creation of Wheaton, Illinoisbased Brookstone Capital Management were to make sure that clients are happy and that advisors were growing their practices. “Nobody would be captive or sell any proprietary products,” Zayed emphasized. “It was all about being an independent fiduciary with a hunger to build a personal practice in partnership with a platform, in this case, Brookstone.”

Zayed saw the win-win potential in creating BCM. “It was really that simple – advisors that were looking to be independent producers and looking for partners to help them build and grow and scale their own personal wealth management practice,” he added.

Of course, there is nothing stopping financial advisors from doing the same on their own, or with other partners.

“But my idea was that Brookstone would provide a turnkey asset management platform,” Zayed explained.

“We would do all those things necessary to help them on the fee-based managed money part of their practice to free them up, to do those other things that we cannot do that

“We feel like we’re in a great spot,” Zayed told Advisors Magazine in a recent interview. “Brookstone is a leader in the industry, and we want to be the thought leader in the RIA/ TAMPs space.” -- DEAN ZAYED 8 / ADVISORS MAGAZINE

SEPT 2021

they're really, really good at – like building new client relationships, cultivating existing ones, and so on.”

Education is a critical shared value for the collaborating firms, and it’s at the core of how Brookstone works with clients – both when they’re prospects and after they decide to come on board.

But Brookstone also has developed extensive training for its advisor partners, especially to help them navigate client meetings and conversations, according to Zayed.

Professor Dean An educational thread runs throughout Brookstone’s training, so much so that several advisors gave Zayed the nickname ‘Professor Dean.’

“It’s kind of funny, but it’s true,” he laughed. “Because I really do honor the idea of educating both advisors and clients in taking the high road and not really being a salesman per se.”

He added that there are not hard sales type people in the Brookstone organization because of the firm’s consultative and educational approach. “Being more educational gets us to the same result typically -- and that's getting clients comfortable to hire us to help be their financial go-to person into their retirement years,” Zayed said.

Such training and lessons were not lost on Silvertree’s Glisczynski, who said that most clients discover the firm by attending one of many webinars or classes taught at the office in Stevens Point, Wisconsin.

“We'll break down social security or health insurance, for example, or long-term care

We’re not trying to beat the market,” Glisczynski noted.

“We try to minimize downside losses as much as possible on the investment side, and then get hyper-efficient with managing taxes and cashflow.

-- JASON GLISCZYNSKI insurance or investments or taxes into these 30-to-60-minute classes that are easy to digest,” he said.

And then, when meeting with clients one-on-one, Glisczynski will lay out and explain maybe a half dozen financial planning options, elaborating on each one until the client fully understands them all.

“We might then say, ‘we think these are the three best suited for you,’ and then we'll help the client make the very best decisions for themselves,” Glisczynski continued. “It's not just a matter of us telling our clients what to do; it's important for us to have the client involved in the decisionmaking process.”

The approach reflects Silvertree’s tagline, which is ‘Planning with a Purpose.’

“We do everything with a purpose,” Glisczynski stressed.

“And it is very important for us to be independent, impartial, and to provide clear, concise, easy to understand answers to client questions.”

At Silvertree, where the focus is mainly on retirement planning, another central philosophy is to control risk.

“We're not trying to beat the market,” Glisczynski noted.

“We try to minimize

downside losses as much as possible on the investment side, and then get hyper-efficient with managing taxes and cashflow so that we maximize the client's potential for every financial aspect of their situation.”

His firm also handles estate planning in-house. “So, we can wrap it all up in a neat little bow by making sure that the estate planning is all tied together,” Glisczynski said, “their tax situation, their estate and legal position and their financial position. We get all of those

ADVISORS MAGAZINE / 9

singing from the same sheet of music.”

RAISE-ing the bar In fact, when it comes to retirement planning, Silvertree and Brookstone are part of the same choir. Brookstone even trademarked its philosophy as RAISE. “We liked the word raise, it's a positive word, but RAISE as an acronym does stand for something,” Zayed explained, “It stands for risk appropriate investment strategy evaluation, and that's trademarked to Brookstone.”

“RAISE truly is our philosophy,” he said. “This risk appropriate investment strategy evaluation leads us to make the right decisions and give the right advice to clients. And what goes hand-in-hand with RAISE is our investment platform. We have a very experienced chief investment officer and investment committee, but the platform is an open architecture platform in which we vet all of the funds, whether they're mutual funds, ETFs, individual securities, and others.”

The open architecture allows advisor partners to customize and tailor portfolios using any number of investment options and tools that are allowed on the platform after being sanctioned

by Brookstone’s investment committee.

“But this world has also gone more towards a model portfolio, a direction that allows us to scale things,” Zayed added. “So, we've built close to 10 different series of Brookstone-managed model portfolios, each of which has its 10 / ADVISORS MAGAZINE

SEPT 2021

own particular risk and reward profile and its own philosophy.”

RAISE 360°, for example, is just one group of select portfolio models designed to adhere to proper diversification and risk appropriate portfolio selection across market cycles.

Such portfolio models can serve the dual benefit of managing multiple clients, but still offering tailored financial planning solutions.

“What becomes really challenging is not so much the actual act of managing the client accounts properly,” Glisczynski said, “but rather helping the client understand that a lot of the things they were taught about how money works are now changing, particularly when it comes to investment strategy.”

Glisczynski remarked that during a typical person’s 20-30 year working life it’s mostly all about how much and what’s the rate of return. That’s an attitude that’s difficult to unwind.

“The mathematical reality is that the rate of return does not solve the retirement problem,”

Glisczynski said. “In fact, clients with lower rates of return tend to have a higher probability of success in their retirement because of low volatility,” he added. “If you're trying to chase higher returns, you end up with higher volatility, and the probability of running out of money increases dramatically.”

This is why he believes a primary effort is helping clients overcome the mindset that big returns automatically mean a life on easy street. “This is our biggest challenge, because our partnership with Brookstone Capital Management gives us a tremendous amount of behindthe-scenes technology that helps us take care of the actual account management part.”

Glisczynski adds: “And again, that all comes down to controlling volatility, controlling risk, still delivering a fair return, but giving the client the stability and the peace of mind in the knowledge that their money is going to be there and it's going to last longer than they will.”

Zayed concurs and also notes

Radio Host Jason Glisczynski, CFP®, CAS®, co-founder of Silvertree

Brookstone and Silvertree client meeting

that the media and the hyperattention on the stock market and cryptocurrencies nowadays adds to the high rate-easy street mentality.

“Anything emphasizing these short-term gains or short-term wins is an issue for the financial advisory industry,” Zayed said.

“It often distracts a client from their longer-term plan and goals, which is to build a solid retirement plan with a solid portfolio that matches their overall risk tolerance and their overall financial profile.”

Ongoing mission As one of the leading turnkey asset management platforms in the United States, Zayed said Brookstone has no intent to slow down now.

“We feel like our mission is incomplete,” he said. “While Brookstone has helped tens of thousands of families all over the country achieve their retirement goals in a successful way, that's very gratifying for us, but we remain focused on helping as many people and as many advisors as possible with an eye towards the markets being at alltime highs.”

That means staying on top of its platform, Brookstone’s risk management approach and its model portfolios. “We're very

careful to not want to incur any large losses,” Zayed said. “So for us, it's an extra vigilant time over the next year or so.”

Zayed stressed that he is not predicting a market crash. “But given some of the valuations and maybe some headwinds we have coming up here, we are very much focused on making sure clients don't get hurt—should there be a larger correction,” he said.

For more information, visit: brookstonecm.com and silvertreeplan.com

Registered Investment Advisors and Investment Advisor Representatives act as fiduciaries for all of our investment management clients. We have an obligation to act in the best interests of our clients and to make full disclosure of any conflicts of interests, if any exist. For a complete description of investment risks, fees and services review the Brookstone Capital Management firm brochure (ADV Part 2) which is available at www.brookstonecm.com. Investment Advisory Services are offered through Brookstone Capital Management, LLC, a Registered Investment Advisor.

Brookstone Capital Management, LLC and SilverTree Retirement Planning are independent of each other.

ADVISORS MAGAZINE / 11

The Biggest Retirement Barriers for Millennials

How financial advisors can help!

I

t’s no secret that saving for retirement is harder today than it’s ever been. Millennials face more barriers to retirement saving than perhaps any generation to come before them—from student loans, to rising property costs, to the way modern society pressures them to spend more and “level up,” even when it’s at the expense of their savings.

Let’s take a look at some of the most significant challenges millennials face when it comes to retirement, and how we as financial advisors can step in to help.

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Barriers to entry: why it’s harder for millennials to save for retirement Higher monthly expenses: Millennials carry more student loans than previous generations, and have higher monthly costs (for example, studies have shown that the average household spends $47 per month on streaming services, with seven to nine monthly subscriptions). These higher recurring expenses make it significantly harder for Millennials to achieve two mainstays of financial health: a rainy-day fund of six to nine months’ worth of

expenses in case of emergency, and completely paid off credit cards.

Delayed entry into the job market: Though millennials have proven to be good savers, many kick-started their careers later than members of previous generations.

This disrupts their saving cycle and 401(k) progress; some millennials jumped into their first full-time job in their mid-to-late twenties, and getting a late start on retirement savings can have long-term impacts.

Rising popularity of the gig economy: Many millennials are

turning to the gig economy to make financial ends meet, and unlike traditional career paths, there are no 401(k) options there. In turn, this inhibits millennials from following the tried-and-true advice I always give to people beginning their careers: to get started in their company’s retirement plan right away, to automatically contribute at least what their company matches, and to utilize other employer-provided benefits such as long-term disability and life insurance.

The impact of social media: The rise of social media in millennials’ lifetimes has fueled a rise in social comparison and socially motivated spending.

Social media exposes us to the lifestyles of the rich and famous—whether it’s a peer on an exotic vacation, or a successful influencer showing off the latest brands. This creates a “keeping up with the Joneses” mentality to splurge and live beyond one’s means.

Fewer retirement resources: Unlike previous generations, millennials can’t rely on social security or company-funded pensions. The onus of saving for retirement falls entirely on their shoulders.

Access to financial advice: Finally, younger generations often see quality financial advice as an unnecessary expense.

And with some professionals imposing investment minimums of $100,000 or more to bring on new clients, it’s really no surprise.

What we can do about it: financial advisors’ role in removing those barriers What’s a millennial to do when they’re just starting out, in need of financial advice, and unsure how to get it? A little research

goes a long way: it’s important for millennials—and anyone seeking financial advice—to do their due diligence before putting their financial futures into an advisor’s hands. There are plenty of advisors out there ready and willing to guide millennials through overcoming the financial barriers to their successful retirement. And it’s on us, as the professionals, to make it clear that we’re available to help and provide guidance.

Working with an advisor will give millennial clients expert help in putting together a comprehensive financial plan.

This plan should outline how much a client needs to save to

A consideration of tax-free growth benefits, like Roth 401(k) options.

A plan for the client’s children’s education, if applicable. This will often include a 529 savings plan, or age-based portfolios that help clients stay ahead of the rising cost of college.

Systematic savings into an investment account outside of the client’s retirement plan.

A plan for life insurance. What level of coverage would the client’s family need if they were to pass away prematurely? A financial advisor should review the different types of insurance and develop a cost-effective plan to cover their client’s risk.

A will and other essential estateplanning documents.

achieve both their short- and long-term financial goals. This plan could include: An understanding of investment risks, and likely a higher percentage in stock investments to achieve higher returns since millennials have a longer horizon for retirement planning. The power of compounding is impressive, and it takes less money in our younger years to build a healthy nest-egg.

The inconvenient truth is that it’s much harder for millennials to save for retirement than it has been for members of generations past. But alongside the barriers come plenty of opportunities, if you just know where to look and how to save smartly. Working with a financial advisor can be a huge benefit to millennials, to ensure they’re on the right path and maximizing their benefits and savings toward a secure financial future.

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1 in 6 small companies hit by cybercriminals says the attack threatened their survival

T

he consultancy firm Analysys Mason indicates that one in five companies have no endpoint security at all, while 43% don’t have a cybersecurity defense strategy in place.

A survey carried out by insurance provider Hiscox revealed that small businesses in the US had lost $25 thousand per incident on average, an alarming number as 23% of surveyed companies have suffered an attack in the last 12 months. Additionally, 83% of SMBs have no funds put aside to deal with the aftermath of a cyberat14 / ADVISORS MAGAZINE

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tack, and one in six attacked companies says the incident threatened their very survival.

To counter the threats, some businesses opt for cyber insurance, which covers the expenses if a subject suffers a cyberattack. The numbers reflect that too - according to Global Data, the global market for the cyber insurance industry will more than double by 2025 to exceed $20 billion.

However, cyber liability insurance is not a replacement for having a comprehensive cybersecurity strategy in place, says Algirdas Sakys, Informa-

tion Security Manager at NordVPN Teams: "For small businesses, preventive cybersecurity measures like making periodic backups, using a network-wide firewall, managing network access privileges, or simply providing basic cybersecurity training for personnel should be a no-brainer," commented Mr. Sakys. "Regrettably, too many companies underestimate existing cyberthreats and pay a steep price for it. Sure, cyber insurance might soften the blow but counting on that while putting their entire businesses in jeopardy is not a

adapt to remote work certainly left many cybersecurity blindspots unchecked," the cybersecurity specialist continued. "Now, we see a steady upsurge in small businesses investing in the protection of their digital assets, but too many organizations remain in the red zone when it comes to cybersecurity."

For SMBs to mitigate the risks posed by cyberthreats, adds Mr. Sakys, they need to be aware of three main cybersecurity verticals: people, process, and technology.

There is an extensive list of components to each of the fundamental areas, but addressing at least the core items in each category would substantially minimize the risk of a successful cyberattack: People. Management needs to get their staff aware of possible threats and safe online practices.

Process. A basic incident response plan and the mechanism ensuring critical security patches are timely deployed should be in place.

Technology. A company must protect its network by using firewalls, anti-viruses, traffic encryption software like VPN, and making regular critical data backups.

sustainable long-term strategy."

According to the expert, SMBs overestimate the money-saving benefits of cyber insurance. Those wishing to save money by ignoring cybersecurity and opting in for an insurance policy will not get what they bargain for.

"Don't get me wrong - having a cyber insurance policy is better than not having it," added the NordVPN Teams expert. "But companies hoping to save by underinvesting in cybersecurity only to hedge it with insurance won't get what they desire. In reality, the weaker the cybersecurity framework is, the costlier the insurance. There is

no way around the fact that every company needs robust cybersecurity protocols in place."

The SMB cyberthreat landscape According to ENISA, the European Union Agency for Cybersecurity, the five most common cyber incidents suffered by SMBs are phishing, webbased attacks, general malware, malicious insiders, and denial of service.

Small businesses have become more vulnerable to the mentioned threats in the face of the pandemic-related remote work reality.

"The rush in which SMBs had to

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