Today we’d like to introduce you to Nathan Kinzinger.
Nathan, please share your story with us. How did you get to where you are today?
Not long after completing a degree in Business Administration in 1995, I decided to start my own business installing and refinishing hardwood flooring. There was no real logic to that choice – my best friend installed ceramic flooring so I thought I could run a complementary business in hardwood. That business lasted until 2001 when I began to realize my knees hurt, my margins were always under pressure from large stores and an expanding labor pool. I had made a reasonable living but wasn’t fully satisfied and didn’t see myself able to grow this company much further than where we had gotten. So, I prayerfully sat down with a pad of paper and made a list of the top things I hoped for in a lifelong profession.
1. I wanted lifelong friendships with the people we help.
2. I wanted to be home most nights with my family.
3. I wanted unlimited financial upside.
With this list I went looking for my next business and Northwestern Mutual jumped off the page as the most appropriate option. They provided me with the infrastructure and support/mentoring that you would expect from a Fortune 100 firm – and also the flexibility to be an entrepreneur and act in the best interest of our client. When I went down the list each of my three boxes checked off nicely and the only downside was that I had no guaranteed salary, which I actually liked as that is always a trade-off of virtually unlimited.
In June of 2002, I sold off my hardwood equipment, closed that business, and went to work as a 28 year old financial advisor with two kids and no salary. 15 years later – I can say this career is the single best professional choice I’ve made. From the beginning, I recognized the importance of education and have made a career of learning while also understanding that no company grows and no clients are helped if you’re not also always expanding your clientele and improving the quality of the team that serves them. Today our team has expanded to two client facing advisors and another 10 in house professionals supported by Northwestern Mutual’s Chicago Loop office. Our best clients tend to be successful entrepreneurs or executives who have advisors in place but are now searching for that ‘next level’ team. We describe ourselves as a family office style boutique team, with the support of a Fortune 100 firm and we’re probably more energized in the ways we can help today than I even was back in 2002.
Has it been a smooth road?
Oh man, there are the obvious struggles I believe most of us faced – cash flow, self-doubt, lack of experience – these are common among most of the entrepreneurs we’ve helped and I was no different. But my biggest challenge came in 2006 when I went through a divorce with 4 and 6 year old daughters. I can remember being on my knees between their bed while they slept, understanding how their world was about to change, and in tears making the decision that no matter what I would remain close and give whatever was needed to stay in their lives. If you have ever seen the movie ‘Saving Private Ryan’ there is a scene where the Jewish American soldier wrestles with a German solider for control of a bayonet. The director in that film cuts all sounds but breathing and wrestling and it’s probably the most painful scene I’ve watched on film … that scene fairly well articulates my feelings around carrying out a divorce with children. Someone has to finish things, no one will be better off, there will be grieving … but it’s going to happen anyway.
Prior to this circumstance, I had some early success at Northwestern Mutual and they had invited me to begin training and developing into one of their national Managing Partners. The thought of taking over a large office somewhere in the nation had been the big vision and was the next step in my career, but now I knew I would not relocate until my daughters were older and had to resign from that career track. Simultaneously, my now ex-wife wanted to return to her roots in Chicago (we were in Bloomington-Normal) and we negotiated a joint custody of the girls that included a move to Chicago. In a matter of weeks I went from a successful advisor, on a career track to be an executive leading a large team and changing a community – to an unknown advisor starting over completely in a new market with no accolades, no affirmations, a broken heart and a broken home.
All that said, here is the best part of the story – I wouldn’t trade a single day of that season. I leaned heavily into my Christian faith during that time and what I discovered is God began to take all the pain and trauma began to shape me into a better, more authentic person. There’s a reason I’ve grown to love my work – it’s because I understand the things our clients have struggled with and I can empathize and partner with them to keep moving. My knowledge is not simply intellectual, it’s also emotional because I actually do understand. Without pain that more than likely doesn’t happen.
Now on the happy side – through Northwestern Mutual I actually met an incredible woman – my wife Gina. We both had some pain in our lives and developed a friendship that grew into love, that transitioned into marriage in 2009 and is going strong with two more kids today and a couple of crazy dogs today. She’s been an amazing support, she’s a great mom and she’s been a real affirmation in my belief that you can love one woman for life and have a safe, vibrant home life.
So let’s switch gears a bit and go into the Northwestern Mutual – Chicago Wealth Management story. Tell us more about the business.
We’re a family office style team that provides comprehensive financial planning and investment management for profitable businesses and the people that own or lead them. Our Private Clientele generally own/operate companies with $3-$300M in gross sales or earn highly taxed annual income and simply need good counsel on building wealth.
The most common projects include.
1. Comprehensive Financial Planning. We listen to what a client is trying to create, review the plans already in place, and if we see opportunities share ideas to help a client use their wealth more effectively.
2. Portfolio Design. We have an in house team that works on all accounts under $3M, and a Private Client Team in Milwaukee that works on our accounts over $3M. Both teams’ works with our clients to create properly priced portfolios anchored with low cost global indexes and actively managed individual stock holdings with some alternative investments layered in. The ultimate goal is to purchase the performance of the marketplace, while pursuing above market gains in intelligently purchased individual holdings.
3. Business Succession/ Share Transfer Plans. Our clients rely on privately held, less than liquid stock – exposing themselves to drastic loss if an unplanned event requires the transfer of shares. Our ideas here are intelligent and cost efficient so clients can avoid selling shares on their earnings both now and during an unplanned event.
4. Personal & Corporate Deferred Compensation. Often higher earning executives can’t save enough using the 401k – our teams design both voluntary and company funded executive compensation. We can either help a client retain top talent with vested benefits for key non-shareholders, design an ESOP when appropriate, or create voluntary retirement programs not subject to ERISA.
5. Buy-Sell Planning as a Retirement Tool. Most clients are not aware that money they’re spending on their buy-sell could be used to both fund the buy-sell and generate wealth for retirement that can be distributed in a tax-efficient manner.
In our marketplace, we find that most successful clients have plans but have outgrown their current advisor. They all have some plans in place, but have no idea what they are paying in fees and most often have spent so much time helping others succeed in the companies that they do not have a coordinated plan that is effective and easy to understand. This is no fault of their current advisor as these are complex clients. However, much of our industry is one person trying to perform every task and they end up fixated on the thing they do best (insurance, investing, estate planning, etc.) at the expense of moving the client forward effectively. We don’t do that. We start by listening to understand what a client needs, then assemble a team of professionals to brainstorm the best ideas. When we’re done with a client we should have a simple, easy to follow, highly effective process for managing risk and returns, managing risks and having a process for stewarding lifelong wealth.
How do you think the industry will change over the next decade?
The industry is obviously moving towards automation – specifically for the lower balance investment account. I think this is a positive for our industry when coupled with sound financial counsel. Companies like Northwestern Mutual and Learnvest have partnered to blend the best of one on one planning with technology and I believe we’ll be seeing more and more partnerships like this.
At some point I would LIKE to see a return to the corporate pension fund. After more than 12,000 meetings I am actually quite concerned for the smaller investor. My grandparents’ generation had wealth stewarded by an organization and they were cared for via pension in retirement. With the 401k plan we’ve offloaded that responsibility to employees who are most likely just not wired to properly manage their money. Our clientele tends to be highly affluent, but occasionally when I do talks I am exposed to the more middle class finances and see people doing exactly the opposite of what they should do when investing (example – selling when the market drops to ‘protect’ their money and buying back in once it rises). Not sure how to fix this one but I think we’re going to begin seeing the pain of this in the next 20-40 years – when companies are not helping employees retire, employees turn to the government and the government is forced to turn to taxes. That’s not a good cycle and I’d love to see our industry get in front of this one and lead instead of react.
Contact Info:
- Address: 1 N Wacker Drive – Suite 4600
Chicago, IL 60606 - Website: www.nathankinzinger.com
- Phone: 312-251-3756
- Twitter: @NathanKinzinger
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