Investing in Your Family
After you sell the company you've worked so hard to build, you have a substantial amount of capital, but you're not generating any income. That's where Michael Marcovici and Patrick Baldwin come in.
Photograph by Maria Corley
When you live through the experiences of the last two years, it reinforces the way we manage money,” says Michael Marcovici, First Vice President in the Private Banking and Investment Group of Merrill Lynch. “We anchor people’s portfolios and lifestyles so they can live their lives in the fashion to which they’ve grown accustomed, regardless of the current economic or political landscape. We provide that for them.”
Keeping high net worth families insulated from the shock of sudden economic shifts is Michael’s business. As Private Wealth Advisors, he and his partner, Patrick Baldwin, specialize in managing the family assets of the most affluent Merrill Lynch clients, those whose balance sheets range between a minimum of $10 million to upwards of several hundred million. In fact, out of the 15,000 advisors who work for Merrill Lynch, approximately 300 are accredited to perform like Michael and Patrick.
“The first thing that we do is provide an income strategy for the family—what they would like their portfolio to generate on an annual basis,” says Patrick. “We build the liquidity bucket first. After that, we build assets around it. We are the bridge between a family’s assets and the liquidity they need to derive their lifestyle.”
Let’s say that you’re an entrepreneur and you sell your business. Now you have a large amount of capital to work with, but you’re not currently generating any income. Michael and Patrick buy income-oriented investments on behalf of their clients to generate a current income that matches the family’s lifestyle needs. The family is then living off of a steady stream of new income instead of selling assets at, perhaps, inopportune times to meet lifestyle needs. After providing for the family’s immediate financial needs, Michael and Patrick’s next objective is to use that principal to make growth-oriented investments, to secure their client’s wealth for generations to come. It’s their multi-generational approach that truly resonates with their clients.
“The purpose of money is to allow you to do what you want, when you want,” says Michael. “Some families want to take care of their own family with the income we generate for them. Other families have philanthropic interests. Others may want to travel, see the world, own various homes in different regions of the world. And we help them facilitate their desires.”
Unfortunately, there’s an old proverb that all too many once-affluent families are familiar with: “Shirtsleeves to shirtsleeves in three generations,” sometimes also stated as, “The father buys, the son builds, the grandchild sells, and his son begs.” Without careful and studied advisement, a family can find themselves tearing through the principal balance of their wealth, confident that the money will always be there, and sooner than later find themselves coming up short. Michael and Patrick preserve, protect, and grow that principal prudently using time-proven methods of investment to safeguard generations of their families from that startling eventuality.
But it’s really Michael and Patrick themselves that differentiate their practice from other advisors. Their commitment to the families they represent can be seen in their collective 40 years of results as well as their dedication to be available 24/7. When someone is so involved in the financial welfare of your family, that kind of availability is invaluable. In return, their clients treat them as an extension of their own family. You can find them at the baptisms, bar/bat mitzvahs, and weddings of the families they represent, some of whom they have been doing business with since the inception of their careers. Their practice is built on steadfast dedication, personal attention, and deep industry knowledge.
That kind of dedication and experience is more important than ever given the staggering market fluctuations of the last couple years. “When you develop a portfolio the way we do, it allows families to have peace of mind during these difficult times. It really has validated what we do for families,” says Patrick.
“Building that bridge to allow people to live the way they want is clearly what we do exceptionally well. Beyond that, we think about how to propagate that wealth over the course of time,” says Michael. “How can we sustain it? That sort of cerebral exercise is our day-to-day mission. We think in those terms so that our families don’t have to.”
For more information on The Baldwin/Marcovici Group, call 312-325-2626, or e-mail Bal[email protected], Private Wealth Advisors at Merrill Lynch.