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Austin V. Shapard
Title: President and CEO, Fiduciary Trust Co.
Age: 46
Experience: 21 years
Given his profession, it’s perhaps fitting that Austin Shapard enjoys jigsaw puzzles in his spare time. He started working as a management consultant after business school, but soon pivoted to the asset management business. He likes the business because the goal resonates with him, he said; “Someone has worked very hard to save these assets. They’ve been frugal, creative and I think that’s a noble purpose.” Shapard sat down with Banker & Tradesman to chat about demographics, technology and the coming generational transfer of wealth – and how those puzzle pieces fit together.
Q: The Baby Boom generation is beginning to enter retirement; what does that mean for your business?
A: In my mind, there are two material macro trends going on. One is demographics and one is technology. I think that if I look at demographics in the United States and even globally, we can say the last three decades have been the heyday of asset management as Baby Boomers were saving for retirement. As a culture, we’ve gone through a long period of a large population saving for their retirement while they worked. As Baby Boomers come into the retirement phase, we now are coming into a different phase that will probably play out for the next three decades. It won’t be accumulation. It will be preservation and disbursement.
The emphasis on putting money aside changes. From my perspective, what a lot of families start to look at are a couple things: First, asset protection. It’s not necessarily about how much you’re saving, it’s about how much saving and preservation you have about that income stream.
Second, it comes back to insurance – some level of health and long-term care insurance. I think the other thing that comes into play is planning and advice. While people are busy with their careers and working and saving, now they’re coming into a period where they need much more advice – both on how to access and preserve their assets, but also on generational changes, how you transfer assets to the next generation. What happens when one spouse passes on and the other is still there? What happens when that second spouse passes on?
For us, as an advice-based player that doesn’t have any specific products, that fits into very much our activities around working with families over a long period of time during that generational transition.
Q: Since you mentioned it, how has technology changed your business?
A: If we have the demographic trends going on in the client base, you’ve had technology on both the client side and the professional side. Across Baby Boomers and Gen X and Millennials, consumer adoption and use of technology has changed. The way that people engage with each other has changed. Therefore, their expectations about communication have changed.
The way clients view the technology they get from Apple or Google or Uber, that translates into our space. So the expectation becomes, “If I can do that with Uber, I should be able to do that same functionality with my financial services representative.” We have a change in both the desire for advice and the nature of financial planning and we also have a change in how they embrace technology and communicate. That’s on the client side.
On the professional side, I would say technology has dramatically changed the way we do investments. Forty years ago we did not have nearly as much real time data about what’s going on in the markets. We could not create ETFs without the technology that allows us to run that in an efficient way.
Q: How do think about high net worth families handling this generational transfer of wealth? How do you help those clients have the conversations they need to have with their children?
A: Every family is different, and our responsibility is to help and facilitate each unique family. Each family has its own norms and history and cultural aspects around how they communicate, how they raise their children, what are their values and what are their expectations. Our role is largely one of appreciating that diversity and customizing and tailoring not only our investment program but also the way that we engage with each family.
Some families are very open about discussing these topics. Other families, just given their history and their DNA and who they are, are maybe less prone to having some of those discussions, and that’s OK. What we feel is important is being able to ask the question.
Philosophically, you could say more information is probably better, but every family has to translate and use that information in whatever way that works well for them. I don’t think there is a perfect answer.
The way that we approach it is, it’s all about the officer – what differentiates us is we are looking for incredible, high-quality, high-integrity problem solvers, with great analytics, good communications skills and some degree of empathy. And that type of person can engage with a variety of different clients.
I do think that our business is the business of the human condition. This aspect of dealing with families is probably the most complex puzzle there is. It also comes back to one of our general beliefs: it comes back to cash. What I mean is that, it’s about after fees, after taxes, what is the purpose of money? The purpose of money is to use it. There are many people in the industry who are in the business of generating statements. That is their goal.
Our goal is to make certain that the savings these families have created are usable, that they’re able to be spent in whatever time frame for things that fit their goals. Our objective is not just sending out statements, but actually making things happen.
Shapard’s Top Five Cups Of Coffee In Boston:
- Café Nero at Downtown Crossing
- Thinking Cup on Tremont Street
- Peet’s on Charles Street
- The Coffee Trike at Dewey Square
- Tatte on Charles Street
