Fix your finances now! After three of the worst years for investors, we offer guidance from top financial advisors - Investment Roundtable

Black Enterprise, April, 2003

IF INVESTORS EVER NEEDED SOLID ADVICE, THEY NEED IT NOW. As the stock market careens toward a possible fourth consecutive year of negative returns, the responsibility of averting or diminishing further losses to your 401(k) statements and other investments rests squarely on you.

It's time to fix your finances NOW. Time to assess the damage that recession; the Enron, WorldCom, and Global Crossing scandals; and the uncertainty of war have inflicted on your retirement account and your dreams for the future. It's time to create a new strategy to help you survive a market that has been in a slumber with no end in sight. In these unpredictable times, BLACK ENTERPRISE is providing you with insight from some of the best independent financial advisors from across the country. They are ready to share the same advice they regularly give to their clients.

BE invited Dale Bryant, portfolio manager of The Bryant Group in New York City; Walt Clark, president and CEO of Clark Capital Financial in Columbia, Maryland; Cheryl Creuzot, president and CEO of Wealth Development Strategies L.P. in Houston; Pierre Dunagan, president of The Dunagan Group in Chicago; Michael M. Smith, a certified financial planner at the Phoenix-based ProFocus Inc.; and Kathleen Williams, CEO of Williams Financial Services Group in Oklahoma City. We engaged these men and women in a discussion about how investors can get their financial houses in order. Here's what they had to say:

BLACK ENTERPRISE: What advice have you been giving your clients over the last year?

CREUZOT: My clients are asking when is it going to be over. There are market indicators that would lead most of us to believe we are at or near bottom. More than likely, we'll just continue to move sideways, which is what we have been doing for a while now. A lot of the analysts who we rely on think that 2003 will be up slightly, and that's about as detailed as they are willing to get.

I think the hard part for us right now is being disciplined and focused. It's very difficult to not let our clients' emotions get us off course.

SMITH: We see indications that the economy is up, but the stock market is down. All my retired clients, or my clients who are dependent upon unearned income, are very concerned because their accounts are their sole source of revenue. My clients who are working and generating income continue to put money away.

I think the biggest impact on this economy has been accounting scandals, which cost investors trillions of dollars and harmed the integrity of the market. A lot of people just flat out don't trust the market right now. I think we need a slow and steady increase in the market to restore confidence.

BRYANT: My clients haven't been too shaken. Whenever I interview a client, we have an understanding that it's for the long-term. Sometimes they come in to get a little hand-holding. The more money you have, the more hand-holding you need. My clients with less than $25,000 are OK with a little volatility in their returns. My clients with more than $500,000 need some reassurance from time to time.

As far as the market goes, I'm cautiously pessimistic. I think it's easy to want to reach out and grab on to some unrealistic hope. After the second half of 2000, the experts on Wall Street were saying we'll have a quick rebound in 2001. After another bad year in 2001, they said it would come back in 2002. Now here we are, three years in, and everyone is hoping for another rebound. I say wait and see.

I haven't added any new money to equities in the last year and a half. I have been putting money in REITs and preferred securities. I'm in a wait-and-see mode. I don't think it's important to be the first one in when the market recovers.

DUNAGAN: We've gone back to the basics of asset allocation to make sure our clients are not overly weighted in stocks or bonds. Another thing we've done is to diversify our clients' [portfolios] into income-oriented real estate. With all of the foreclosures that are going on out there, it presents an opportunity.

WILLIAMS: Many of our clients are retirees. We do a lot of lump-sum distribution business. We also do quite a bit of business with women, recent widows. Bight now, the recently retired group is feeling scared. They are focusing on what would happen if there is a war. We are somewhat optimistic about what the market will do toward the end of the year, but we're sitting on the sidelines trying to figure out what is going to happen.

CLARK: I've been trying to let people know that things are going to get better sooner rather than later. Back in 1991, when we had a recession, people wondered how we were going to get through it, were stocks ever going to come back, and was the economy ever going to pick up. Our forecast was that in three to five years, we should look pretty good, and we went on to have an eight-year bull market, which I don't think anyone could have predicted.

So today we feel cautiously optimistic. I think Sept. 11 set the economic recovery back between 12 to 16 months. We look forward to better times.