Episode Transcript

# FA Episode 6 - The Advisor Legacy Problem No Spreadsheet Can Solve with Sean Kuttin

Speakers: Craig Andrews, Sean Kuttin, Bluesman Grendel and the Compliance Choir

[00:00 - 01:32] Craig Andrews:
You never know how much time you have. For me, that stopped being an idea and became reality on
August 22nd, 2021. The doctors put me on a ventilator and told my wife to call hospice so she could
prepare for the day they planned to pull the plug. Six weeks later, I woke up to an entirely
different reality. I could not walk, I could not talk, I could not even lift my own arm, and I woke
up realizing something else, I had not made the right preparations for my family. The plans I
thought were pretty good fell through when it mattered most. That is why Fiduciary Alchemy welcomes
voices that would have warned me about the holes in my plans. My hope is that you live a long and
prosperous life, but I also hope you make better plans than I did. So tune in, take notes, and stay
with us through the end when Bluesman Grendel and the compliance choir. Giving a word of caution.
Today I want to welcome Sean Kuttin. Sean is the business development manager with Kuttin Wealth
Management. They are a nationally recognized wealth management firm with more than 18 billion in
assets under management. They have 250 team members serving over 27,000 clients. And you know, this
is just an amazing scale that I don't see very often. And really interested in the conversation,
Sean, welcome.

[01:32 - 01:37] Sean Kuttin:
Thank you, Craig, excited to chat today and appreciate you having me.

[01:37 - 02:00] Craig Andrews:
Yeah. You know, we were talking a few minutes ago about lacrosse, you know, you grew up on Long
Island, I grew up in Maryland, we both grew up, I think I got my first lacrosse stick in elementary
school, and this was decades ago when, you know, it wasn't, you know, most people didn't play
lacrosse, at least when I was playing. But what position did you play?

[02:00 - 02:03] Sean Kuttin:
I played midfield.

[02:03 - 02:06] Craig Andrews:
So you ran your butt off.

[02:06 - 02:09] Sean Kuttin:
Yeah. Yeah, a lot of up and down.

[02:09 - 02:14] Craig Andrews:
Yeah. So where did you play?

[02:14 - 02:22] Sean Kuttin:
So I went to Chaminade High School on Long Island, and then I played in college at Yale University.

[02:22 - 02:36] Craig Andrews:
Cool. And you said you were all American? All American in high school played in the Under Armour All
American game, and then went

[02:36 - 02:39] Sean Kuttin:
on to Yale. Yeah.

[02:39 - 02:58] Craig Andrews:
That's amazing. Yeah. So when I was playing, there was no such thing as Under Armour. I didn't think
it was a company yet. Or if it was, he was still driving around in his car selling shirts out of the
back of the car. Now, Under Armour was actually founded, I think, in Baltimore, or at least it's
headquartered

[02:58 - 03:00] Sean Kuttin:
in Baltimore today.

[03:00 - 03:32] Craig Andrews:
Yeah, he was a football player for University of Maryland, and, you know, he would finish a game,
you know, like 10 pounds heavier than he started, just from all the sweat. No. But, you know, we
could probably play a better football if we had a shirt that just kind of wicked sweat and let it
evaporate, and that's... And so he figured out that shirt, he ordered a bunch of things, and he put
him in the back of his car, and he would go from campus to campus trying to sell the shirts.
Interesting.

[03:32 - 03:37] Sean Kuttin:
I didn't know that was the founding story, but it makes sense.

[03:37 - 04:01] Craig Andrews:
You know, I played defense, and one of my favorite moves was when the ball was coming back to my end
of the field, I would just kind of flip my stick around so as the attackers were backpedaling, they
would naturally just kind of run into my stick and goose themselves, and didn't hurt them, but it
really screwed up their concentration. Right.

[04:01 - 04:07] Sean Kuttin:
Yeah, everyone has their tricks up their sleeves.

[04:07 - 04:36] Craig Andrews:
The one thing I did... Now that, of course, was legal. The one thing I would do that was maybe
across the line was when they were screening the goalie, you know, of course I had to get them off
the crease, and you know, I could ask them politely, but usually they wouldn't move. So I'd wait
till the ref wasn't looking, and I'd take my elbow and just kind of knock him in the crease, and
have one guy actually fall out of his shoes, trying to stay out of the crease, and the ref looks
back, blows the whistle. He was like, "I was pushed!"

[04:36 - 04:56] Sean Kuttin:
Yeah. Yeah. But hey, at least the way we played was a lot tamer than the origins of it. You know,
there was nobody died in any of my games. 100%. Yeah. No, it's crazy and a great, great sport, so
it's awesome.

[04:56 - 05:01] Craig Andrews:
You mentioned that you were injured. What kind injury did you have?

[05:01 - 05:28] Sean Kuttin:
Yeah, going into my junior season before the first game, I messed my knee up, hyper-extended it, and
then a bunch of soft tissue issues there, and then the following fall after I recovered broke my
fibula and ankle during practice. So back to back years with injuries.

[05:28 - 05:43] Craig Andrews:
Wow. That sucks. That sucks. So, when you graduate college, obviously your firm was founded by your
dad. Did you join the firm at that point, or did you do something else in between?

[05:43 - 05:57] Sean Kuttin:
Yeah. I joined the firm right away, so I had interned during the previous summers, and then once I
graduated, I was working pretty much, I think maybe a week or two after graduation.

[05:57 - 06:12] Craig Andrews:
Yeah. Yeah. Tell me what that was like. Tell me what that was like joining your dad's firm. Was it
daunting? Was it? I don't know. What was that dynamic like? It's been great.

[06:12 - 06:53] Sean Kuttin:
I grew up going to different conferences for the business overall, so I've been around it for a
really long time, and had always seen the behind the scenes of my dad on calls and the car rides and
whatnot, so to be inside the organization is a blessing and is great. I have my second brother who
joined in June. My third brother will be joining this July, I believe, and then my youngest brother
is a freshman in college, but eventually he'll be joining too, so it's great having all the family
involved. Yeah.

[06:53 - 07:33] Craig Andrews:
Well, at Ascension, so I'm always looking at things from a marketing side, and one of the things I
know about that industry is there's 9% percent is a high net worth investors, and the number one
persona at 34% is a family steward. Their primary motivation for investing is create a financial
legacy for their kids and grandkids, and the one telltale sign is they're often business owners.
They have all their family working in the business, so that tells me a lot about your dad. He has a
higher mission of, hey, I want this to go on many generations, create multi-generational wealth.

[07:33 - 07:54] Sean Kuttin:
Without a doubt, yeah, my dad has worked really, really hard for the past 30 plus years building the
organization, and it's really special that my brothers and I are able to have the opportunity to
join and hopefully continue the legacy as well.

[07:54 - 08:45] Craig Andrews:
That's something my dad had to business when I was growing up. His perspective was he didn't hire a
business, didn't hire a family, because it created complications. Different perspective. He went, by
the way, he went to a family steward. He was a persona called an independent, which are not
independent, but an accumulator, which Warren Buffett is, and it's not Warren Buffett's kids are in
his business. The thing that raises for me is one of the reasons my dad passed that concern down to
me, I want to hire a family, part of the reason is if you're in business together, you inevitably
have conflict. I don't want to screw up Thanksgiving dinner, but folks like your dad and yourselves,
your brothers have figured this out, how do you manage that?

[08:45 - 09:48] Sean Kuttin:
I think we all have really good relationships to begin with that outside of work and working
together has strengthened our relationships to be frank as we're all working on the same mission,
even more so. We really don't have conflict. My brothers and I really have never argued, even when
we were younger, and I think that's a testament to how our parents raised us, but it's really
special and really exciting just to know we have everybody coming in and working towards a higher
mission beyond just wealth, but it's really helping other people go get theirs is what our mission
is focused on right now, helping more financial advisors realize their potential and helping more
families around the country with financial planning, tax, everything along those lines, that's kind
of the higher calling that we're really focused on right now.

[09:48 - 10:13] Craig Andrews:
Well, and let's break that into like two things. Let's start with financial advisors that, so you
guys do a live acquisitions. That's the focus of a lot of your growth. What's the thing that keeps
holding them back, that keeps them from becoming their own Kuttin Wealth on their own effort? What
are the limiting factors that you see in these firms?

[10:13 - 12:04] Sean Kuttin:
I would say one from the acquisition side, we really look to provide a safe haven for retiring
advisors where they know that their clients will be taken care of, and they'll be able to rest
comfortably known that they're in good hands. And then for the advisors that wind up joining us from
external broker dealers, some of it is just a vehicle that they're in today where they don't have
certain capabilities or resources to be able to scale the way they want to, or their economic
structure isn't as ideal, so there's a whole lot where we really partner with the advisors that come
and join us and help them go scale through M&A, through CPA partnerships, through different
specialists and resources that we have internally to take more off of their plate, and maybe things
that they are not as proficient in, to go help them just go be in the best seat possible, and
leadership is a really big piece to the organization. We have a leadership coach that trains the
entire organization on an ongoing basis, and you're not only a leader of your clients, but you're a
leader of your team and family and in your local community, whatever it may be. So the leadership
piece, culture is a big buzzword and a cliche, it seems today at least, where a lot of people talk
about culture, and it's the best culture. We have a lot of high achievers inside the organization,
so when folks join us from other broker dealers, their eyes are just opened to what is possible and
how others are thinking about it inside a cut in mouth.

[12:04 - 12:35] Craig Andrews:
Well that's, I love the fact that you have a leadership coach, you know, when I used to work in
corporate America, we had, there was one company I worked for that had somebody in HR whose sole job
was to kind of coach and mentor the managers and how to become better managers. And so I love that.
It's a rare trait. The reason I'm bringing it up, I, it's a rare trait that infrequently see, who
figured out they needed that.

[12:35 - 13:53] Sean Kuttin:
That was my dad. So my dad hasn't seen a client in about 15 years. So solely CEO, visionary,
building new steel, and he's really just, just not just, but he's a leader of the organization now,
helping our other leaders inside of here. We have a saying inside of the organization of leaders
developing other leaders. So it was my dad, he had a leadership coach always looking to get better,
he's big on self development and just continuing to grow and get 1% better a day. So that, that was
him and it's been great as to put in perspective, I think it was 2019. We maybe had three or four
offices, pretty much Long Island and a couple in the tri-state area. And today we're north of 50
offices around the country with 250 plus team members. So it's a different game, right? You don't
have everybody in the same office and being able to help them. So being able to have other great
leaders inside the organization has been critical to continue to scale the way that we have. Yeah.
Nice.

[13:53 - 14:12] Craig Andrews:
Well, let's switch over to the personal side that one part of your vision was to really help
individuals achieve what they, they're looking for in life. It's kind of the same question, what
are, what are the roadblocks that you keep seeing people fall into?

[14:12 - 15:59] Sean Kuttin:
I would say it's similar, I think for the other advisors, it's just not having the right people
around them where, again, the cliche, but you're the average of the five people you just surround
yourself with inside the organization. Everyone here is trying to build something really big and to
build an enterprise inside of the organization. So when you're around that kind of thinking, it just
rubs off on you, rather than some folks who are maybe just happy with where they're at and on cruise
control, which to each their own, but that's not necessarily our culture or our vision for the folks
inside the organization. So I think really being around great people is a big piece. And then on the
client side, you just don't know what you don't know. And a lot of advisors today, externally, it's
more of just investment managers where they create a portfolio and give you a call once a year and
that's why the industry sometimes gets a bad rap, we're a financial planning firm first to short,
medium, long-term goals, cash flow, budgeting, analysis, tax planning, tax strategy, you have a
business, there's a million different things that we could talk about with the business. So it's
really diving into the holistic plan and diving in deep where there's significantly more gaps and
more value to go provide and it's a misconception a little bit that financial advisors are really
just stock pickers. It goes way beyond that and that's where the most impact is as well.

[15:59 - 16:11] Craig Andrews:
Yeah. So do you guys put together blends of stocks or do you do more funds or what type of, what's
kind of the portfolio of investing that you guys provide for folks?

[16:11 - 17:45] Sean Kuttin:
Yeah, we have an 11 person investment committee with three CFAs inside a Kuttin Wealth. So they have
about a dozen model portfolios today that our advisor can go plug clients into based on their goals
or just more custom portfolios. For example, we have a faith-based model for the individuals that
prefer faith-based investing and it's case by case, but with the model portfolios, we can trade on a
discretionary basis as well. So volume at scale certainly helps just from a price perspective along
with efficiency perspective. We have a great alternative platform, but overall, case by case, we're
looking to instill a confidence simplicity and success in our clients' lives and overall financial
picture. So that's the real goal with the portfolios and then the real alpha in our opinion is in
the tax planning, tax strategy side of things. We're not a hedge fund, we're not looking to be a
hedge fund. We absolutely hope for the best returns possible, but the real alpha is in the tax
planning, tax strategy side of things and making sure everything is aligned with their goals and
getting there in the right manner.

[17:45 - 18:05] Craig Andrews:
Now I believe everybody out there wants to pay less taxes, but I'm not convinced everybody out there
understands the multiplicative effect behind that. How would you express that in terms of why that's
such an important part of their strategy?

[18:05 - 18:59] Sean Kuttin:
It's important just because as we go up, it's inside the network game or whatever may be. No one
really wants to pay more in taxes, so if we could find a few ways that make sense for everybody to
maybe, whether it's a 1031 exchange and that's not related to your portfolio, but be able to go put
more cash down on another property that turns into a better investment that maybe gets passed down
to the next generation or just different strategies. We do a lot of work with accounting firms. We
actually own three accounting firms and our minority partners inside of it. So we have great CPAs,
EAs that are surrounding our advisors with a true collaborative tax centric approach to financial
planning.

[18:59 - 19:05] Craig Andrews:
What would you say is the typical net worth for the client you serve?

[19:05 - 19:46] Sean Kuttin:
It's all over the place. We really look to help if someone wants service and needs service, we're
happy to work with them. So we have different divisions inside of the organization. The average
client, the typical client, falls anywhere between half a million to five million in investable
assets, then we have the five million plus, which is the fastest growing part of the organization,
and then we actually have a half a million below division two. So someone wants service, we're happy
to help them and look to go make an impact on their finances.

[19:46 - 19:55] Craig Andrews:
Yeah, a couple of minutes ago, you mentioned that you have faith based portfolios. Can you help me
understand those?

[19:55 - 20:29] Sean Kuttin:
Yeah, so those are directly tied to different holdings that align with the religion. So it's
comprised of different holdings that really are in alignment with what they are looking to do. So
there's do's and don'ts with certain faith, faiths and those portfolios are in conjunction with
that.

[20:29 - 20:33] Craig Andrews:
What do you feel it? What faiths do you have products for?

[20:33 - 21:10] Sean Kuttin:
I don't know the depth, I know Christianity is one. There may be a Judaism one as well, but I know
there is a Christian one. I don't know how many different faith based ones there are. But our
investment committee can also create other portfolios that are more custom if there's other faiths
or just different ones in needs. So there's nothing really off limits as long as it's in the best
interest of the client ultimately.

[21:10 - 21:23] Craig Andrews:
So like one thing that comes to mind for Jewish is I think they have this concept of surety in how
loans are handled. Is that like something's factored into the portfolio?

[21:23 - 21:40] Sean Kuttin:
Definitely can be. Yeah, that definitely can be it's open architecture here. So nothing necessarily
off limits as long as it's on the platform. So certainly can put that into practice as long as we
have access to it.

[21:40 - 21:58] Craig Andrews:
Yeah. Cool. What do you feel sets you apart from other firms? Because people have like a gazillion
choices out there. What are things that you guys do that you feel like just really sets you apart?

[21:58 - 23:24] Sean Kuttin:
I think it's really leading with financial planning for from the client perspective leading with
financial planning, the all of it coming together from a holistic manner from the tax. We have a
health and benefits property and casualty arm, small business consulting arm with a proprietary
valuation software payroll, outsource CFO, real estate advisory, boutique investment bank. Those are
more tailored towards business owners. And then on more of the personal side, we have our 11 person
investment committee. We have a retirement plan team, a life insurance team, a high net worth team,
financial planning team. All of those folks are solely there for Kuttin Wealth advisors to go come
into meetings as some advisors may be great with portfolios, but they may not be the best with
insurance or whatever it may be on that front. So being able to bring all of that together, the team
approach I think really sets it apart. And there's nothing that we really can't get answered as if
your primary advisor maybe doesn't know the answer, there's likely someone inside the organization
that does.

[23:24 - 23:45] Craig Andrews:
Now, one of the things I've heard is, I think I've heard the average age of a financial advisor is
like 56 or 58, something like that. And there's not a lot of young folks coming into the industry or
at least not a replenishing rate. How do you guys handle staffing?

[23:45 - 25:35] Sean Kuttin:
Yeah, we have great people inside the organization. I don't know the exact average, but I believe
our average average advisor age is somewhere between 40 to 45. So we actually have a pretty young
organization. Some of the ways that we go about it, we have a massive internship program that we
have every summer, so that's a great way to bring in younger folks inside the organization. We look
to hire some of them after the internship. We view it as a three month long interview process, and
with that, we'll hire them going into their senior year and then we'll pay them to come work a
couple hours a week. But throughout the semester, we get them fully licensed. So they're coming in
and hitting the ground running after college. So that's one that's great. We have our virtual
planning team, which works with clients that still want service, still need service, but maybe just
take an RMDs or aren't as complex as cases. We put a lot of our younger advisors there to kind of
get their feet wet, getting used to working with clients, and it's a great training ground to get
them up and running. And then we have, I believe it's a 53 step process from getting licensed to
getting the green light to be client facing. So a whole curriculum built to really train our next
generation up to be ready to go. So we have a strong process in place for sure.

[25:35 - 26:38] Craig Andrews:
You know what that reminds me of is there's a few folks in the HVAC industry that have been
addressing the talent issue by opening up their own HVAC schools. There was one that was in
Charlotte, North Carolina. They actually wouldn't hire you if you'd worked for one of their
competitors. You had to go through their school and they actually paid folks to go through school.
They were making an $80K going through HVAC school. And then pretty quick coming out of that, they
were making six figures as a HVAC tech. They got acquired by PE and who knows what's going on there
now. They've probably shut down the school or started charging them tuition or something. But
there's another big HVAC company in Missouri in St. Louis who's doing the same thing. So I think
that's really wise. I think for any business out there, you got to be asking who are going to be my
main producers 10 years from now and how do I start developing them today?

[26:38 - 26:59] Sean Kuttin:
A hundred percent, having young talent is fantastic and be able to have them along for a fair period
of time certainly. Just helps the organization can continue to scale and grow.

[26:59 - 27:09] Craig Andrews:
What about tech? AI is shaking up a lot of industries. How do you see that impacting your world?

[27:09 - 28:17] Sean Kuttin:
We think it's going to be great for the industry and us in general as those who aren't all that
advice centric are going to be in a little bit of a difficult situation. It's going to add a whole
lot of efficiencies to the industry, just having more knowledge readily available. And then the real
alpha there is going to be more in that planning aspects and the emotional side of things where
there's the BFA designation that a lot of our advisors have and the leadership coach organization
that we work with actually created it and essentially why people think about money the way they do
and why they do with it, what they do. So I think that's even more so where we'll continue to head
and if we could have even better portfolios by leveraging it, even better.

[28:17 - 28:48] Craig Andrews:
So let's wrap up with the whole, I think one of the questions that a lot of people have is once
they've scaled the mountain and looked back, what should their attitude be? And ultimately it takes
a lot of hard work and effort to scale the mountain, but I know I've seen some people reach the top
and they haven't seen very grateful, they haven't seen some very nice. What are your thoughts?

[28:48 - 30:25] Sean Kuttin:
I think it takes a certain person to be able to achieve really, really great things and uncommon
things as it's a different mindset sometimes. But I know my dad has gone through tremendous growth
and has just changed his overall outlook and mindset as the first 20 years of building the business,
it was hardcore leadership, I would say, and today it's much more of a servant leader than anything
else and going back, helping others go get theirs. So I think that's it, I think it's happened, the
gratitude and the expectations for others as the founder or the people who are kind of at the top,
you can't expect everybody inside the organization to have a similar mindset and goals as everyone
has different ones and needs and being able to bring the best out of them and help them go get what
they're ultimately hoping to do. We have every team member go through what we call a WDYWFY, which
stands for what do you want for yourself and that just helps us get more clarity on is your biggest
goal to go make a bunch of money or is it more so work-life balance or community, purpose, whatever
it may be, really having that alignment helps us then go be able to lead the individuals inside the
organization.

[30:25 - 30:42] Craig Andrews:
Yeah. Well Sean, this has been amazing, appreciate you coming on Fiduciary Alchemy. How can folks
reach you and how can folks that maybe you're looking for a change in their advisory, how can they
reach your firm?

[30:42 - 30:58] Sean Kuttin:
LinkedIn totally works, email totally works, which is on the website, but just googling Kuttin
Wealth management, there's a consultation link that I'll take you right to it to schedule some time
with an advisor.

[30:58 - 31:02] Craig Andrews:
No, well thanks again for coming on Fiduciary Alchemy.

[31:02 - 31:08] Sean Kuttin:
Absolutely, thank you Craig.

[31:08 - 32:19] Craig Andrews:
Thank you for tuning in to Fiduciary Alchemy, the coolest financial podcast you're likely to find.
We go looking for voices like the one you just heard because I want you to dodge the mistakes that I
made and learn it without the coma, without the drama, without nearly paying the man. I don't know
why I lived, when so many others die, that part's still a mystery. Now some folks ask, Craig, what
is it you do? Well I'm telling you now, that's no mystery at all. We solve hard marketing problems
in crowded markets, so good folks like our guests can rise above the noise, become visible,
memorable, irresistible and grow like never before. If organic growth is your problem, reach out,
call me, let's make a plan and bring your next steps into the light, but don't leave yet, stick
around a minute more and listen to blues man grendel and the compliance choir deliver a word of
caution, just for you.

[32:19 - 36:01] Bluesman Grendel and the Compliance Choir:
This podcast is for information, education, that is all, it is not financial tax or legal advice to
guide your call, nothing here is an offer, nothing here is a buy or sell, no recommendation, no
solicitation, I'm saying it plain and well, plain and well, past performance ain't no promise of
what tomorrow brings, markets turning people loose on all kinds of hopeful things, every investment
carries risk, prints a book and fade away, what works for one won't fit us all, that truth is here
to stay, fade away, fade away, yeah, that's the compliance blues, get your own financial tax and
legal help before you make your move as the compliance blues, your situation's yours alone, your
needs are not the same, different facts and different goals can change the whole damn game, so talk
to somebody qualified before you make your own plan, your needs are not the same, your needs are not
the same, your needs are not the same, your needs are not the same, your needs are not the same,
your needs are not the same, your needs are not the same, your needs are not the same, your needs
are not the same, your needs are not the same, your needs are not the same, your needs are not the
same, your needs are not the same, your needs are not the same, your (upbeat music)