On the money as markets took a tumble

CELEBRATING 40 years in business is a significant milestone for any company, an achievement all the more notable in the challenging area of financial advice through the turbulence of the past three years.

As an independent firm specialising in the provision of financial planning for company directors and the self employed, City Life Wealth Advisors has weathered stock-market crashes, political upheavals and global debt fears with the majority of its original clients still intact.

“It has been difficult for any company to avoid falls in the value of their invested funds when practically every sector throughout the world has suffered sudden drops of price resulting from the global downturn over the past number of years,” says Ted Dwyer.

“In recent years our company has focused on understanding clients’ attitude to risk and matching that to realistic financial goals.” Steering clear of the property market ensured a softer landing for City Life clients compared to those deeply invested in what became the bubble meltdown.

“With over €130m of funds under management, we were never involved in property speculation but rather in the delivery of conservation, safety and achievable growth of the funds under our control.”

While Dwyer and his colleagues did spend many difficult periods over the last three years hand holding fearful clients through the plunging see-saw of global markets, any initial losses have since been clawed back by taking a prudent view of global economics based on decades of experience:

“Some of our clients saw their portfolios lose up to 30% of value, but by not realising that loss through selling during the most volatile periods in the market, we have now brought the majority of these funds back to where they were originally and better.”

Building relationships through trust and the achieving of realistic returns have been key elements of the company’s ongoing momentum despite the downturn. “The last few years in Ireland have been the most difficult I have ever experienced in all of my four decades in business,” he says. “Who could have forecast property to fall so hugely and bank shares to drop by 95%? It’s simply unprecedented. There were times over the last few years where we at City Life Wealth Advisors needed to be counsellors as well as financial advisors.”

The planned transfer of assets and estates to the next generation accounts for a significant portion of the company’s activities — an area where recently changed values have offered opportunities.

“Recent falls in the value of personal assets has focused people’s minds more than ever, and foremost for many is the process of moving their assets, and indeed their businesses, to the next generation. With major reductions in estate values this is naturally a very good time for action, as values could now be down 40% to 50% on what they were a few years ago.” Presenting clients with independent advice remains the core ethos of the company — an outlook that has benefited City Life through the crash and burn scenario experienced by many competitors in recent times.

“We have no hidden agenda, and are completely independent of any bank, insurance company or investment house. We will always take our clients overall asset bank, including properties, into account before making investment recommendations, as diversification is the true key to reducing risk in investment.”

Customer loyalty remains one of the fundamental barometers of commercial success for Dwyer and his colleagues: “Many of our clients have been with us since day one, something we feel is a fair testimony to how we do business and our dedication to taking the long-term view. To truly gain from investing in pooled investment vehicles, where the assets are managed by the most qualified people in the business, we subscribe to proven economic fundamentals and shy away from fly by night investment ideas.”

However, any company in business for 40 years will likely have had its own version of peering into the abyss — a scenario encountered by City Life in the mid-1980s. “We had a problem after 15 years on the road where we didn’t really know what our business was,” he recalls. “We were trying to do everything — life insurance, pensions, running building society offices and even auctioneering.”

A stern meeting with the bank manager on how to bring a ballooning overdraft under control forced a thorough belt and braces rethink of the where the company was headed: “Company cars were the first to go, followed by expenses. No fixed salaries, and commission only for the principals in sales, including myself. In fact, I haven’t been paid a salary since that very day — I get paid a percentage of the business I bring in to the firm each year. It’s the real world,” he says.

“In a nutshell, we faced up to reality and understood that survival dictated we change our business model.” A follow-on effect of this reappraisal was what Dwyer describes as “a long hard look at the way life and pensions business operated in Ireland.”

With a very high percentage of clients’ first annual payments into their pension being paid by way of commission, City Life — after a protracted search — found one company willing to move away from the practice toward “a more level type trail of income which benefited our clients immediately and us in the long term through a reliable income stream during recent tough years when new business dried up.”

With the next generation, in the form of his son Eamon, firmly grasping the reins of City Life as it heads for the 50th milestone a decade hence, Dwyer surveys the current landscape of Ireland Inc with the inherent experience of a family line dating back multiple generations to Sunbeam Wolsley on one side and the Irish Examiner’s founder John Francis Maguire on the other.

“We are in a war right now, and one that yet has some time to run. There have been casualties already, and there will be more, unfortunately,” he adds. “That said, there are increasing signs of reality returning to the marketplace and, hopefully, a degree of security. I would be cautiously optimistic going forward.”

With his 65th birthday close on the horizon, Dwyer has no intention of retirement anytime soon, rather a mixture of fairway and finance whilst keeping a weather eye on the company he’s nursed through more than one global meltdown. “This economic cycle will turn, as they all eventually do,” he concludes. “When that time comes around, there will be incredible opportunities in the new Ireland. It’s a prospect that makes me wish I was 40 again.”

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