Clifton Gunderson LLP’s wealth management division, founded about 10 years ago, has seen significant growth since it began and has rebounded nicely from the recession.
“We got through the recession just fine. Our clients are a little more conservative,” said Bob Mathers, chief executive officer of the wealth management group. “Today our earnings are very strong.”
Wauwatosa-based Clifton Gunderson is one of the largest CPA firms in the nation and is best known for its accounting and tax-related services, but its wealth management division has become a significant source of business.
The company’s wealth management group now has about $850 million in assets under advisement and more than 2,000 clients across the country. About 40 percent of the wealth management group’s clients are in Wisconsin. The group has offices in Wauwatosa, Middleton, Stevens Point and Oshkosh.
The group has 36 employees in its investment advisor division and another nine in a separate division that serves as a third party advisor to qualified plans.
The clients of Clifton Gunderson’s wealth management group have seen their investments rise since March 2009. The company expects to reach $1 billion in assets under advisement by the end of 2010.
Although the wealth management group’s clients have benefited from the rising stock market over the last year, it is still being careful with its investments.
“Generally, I think that our clients timed their returns more in fixed income. Equity exposure will be more sluggish because unemployment needs to get fixed,” Mathers said. “We’re trying to look for a yield that’s safe, rather than the zero percent that they’re getting in cash.”
Clifton Gunderson’s wealth management group is a wholly owned subsidiary of the firm. Most of its growth has been through its connection to its corporate parent, Mathers said. Many of the firm’s clients are referred through the accounting and tax services provided by the company.
“We oftentimes find ourselves getting involved when clients go through life-changing events – the sale of a business, an inheritance or a divorce to name a few,” he said. “(Our clients are) coming to us for wealth management, investment advice or business advice.”
Part of the firm’s value proposition is its close working relationship with tax and accounting professionals in Clifton Gunderson, Mathers said.
“We look at our clients and their investments with one set of eyes,” he said. “We’re arm-in-arm with our tax professionals, which helps make us unique.”
During the Great Recession, Clifton Gunderson’s wealth management group lost a handful of clients, Mathers said. Last March, the firm’s investments had lost 15 percent of their value. Most of that value has been regained now.
“We didn’t lose a lot of clients during the recession, but a lot of our clients got much more conservative,” Mathers said. “We provide advice whether or not we manage the money. If a client wanted to pay down debt or put money toward something that would make them sleep better at night, that’s what we did.”
Almost all investment professionals agree that increased regulations on the financial services sector and higher taxes are on their way in the near term. While some individual investors dread these new regulations and taxes, Clifton Gunderson’s wealth management group sees opportunity there.
“The opportunities in the marketplace will be there in helping our clients keep what they make,” Mathers said. “We are finding that with increasing government regulations, whether it be the stimulus package or the sun setting of the 2001 tax laws, our clients are finding the integration of tax and investment advice to be their best opportunity to grow their wealth in a safer environment.”
