Teresa Jacobsen started as a CPA at KPMG, then did tax planning for wealthy clients at US Trust. That’s where she began managing portfolios and that’s what she’s been doing for UBS since 1999.
The way women clients are treated has undergone change in the money management industry over the last 20 years or so. To find out more about that and a few other topics, Ms. Jacobsen agreed to answer questions.
John Navin: You were working as a CPA then you got into actual money management—what about managing other people’s money interests you?
Teresa Jacobsen: I’ve always been fascinated by the markets and the analytical aspects of money management. I also enjoy building long term client relationships and helping clients define and achieve their goals. I started my career as a CPA with one of the Big Four accounting firms.
I moved to a boutique trust company to handle tax planning for their wealthy clients before transitioning to an investment management role. The CPA/tax background is extremely helpful to this day. In working with families, it is second nature to spot tax and financial planning issues and work with my clients’ outside advisors.
The CPA’s and attorneys I work with find it helpful to work with someone who has a broad background in planning issues.
Navin: You’ve been in money management for 20+ years now. What’s changed about your role since 1999?
Jacobsen: As investments and taxes have become more complex, our role has become more integrated into our clients’ lives and businesses. We take a much broader role in estate and retirement planning. We are also working much more closely with the second and third generation with the growth in family wealth.
Certainly technology has transformed the industry. Access to broader types of investments is much easier and cost effective for a client. We can now provide clients the types of investments that were only available to institutions several years ago. It’s my job to assess the broad array of investments for a family’s portfolio.
Navin: Are you favoring certain types of investments now? Which ones?
Jacobsen: With cash providing meager returns and bonds with historically low yields, the longer term view is that stocks will provide more total return—that is dividends and appreciation—over time. But stocks and bonds will have greater volatility over time than perhaps an investor is used to. I help our clients understand the environment and evaluate their tolerance for risk.
Navin: Generally, are you recommending specific stocks, specific sectors, index funds or what? Which ones? Why?
Jacobsen: I recommend that investors first have an optimal allocation between cash, stocks, bonds, and alternatives before evaluating indices or sectors. Many clients are concerned about technology, however I recommend an appropriate allocation to this sector.
We are in a low growth environment, so an allocation to a sector with growth in a portfolio is important. Technology is one area of the market that continues to deliver growth and is likely to continue to do so.
Exchange traded funds are a very tax efficient way to achieve portfolio allocation and the costs on ETFs can be extremely low.
Navin: What is UBS doing to encourage their women clients to be more confident investors?
Jacobsen: In 2018, UBS pioneered a ground-breaking study called “Own Your Worth”, which started with the recognition of two major trends impacting women: increased life expectancy and the rise of “grey” divorce. This means that at some point in their lives, eight in ten women will end up alone and solely responsible for their well-being.
We’ve now produced three reports on this topic, and one of the main findings in each study is that most women are highly involved in short-term financial decisions, but often defer long-term financial decisions to a spouse or partner. Surprisingly, we are seeing an increasing number of millennials follow this trend, as well as their older counterparts.
We have been using a number of vehicles to encourage women clients to take an active seat at the financial table. UBS’s “Own Your Worth” website is a phenomenal resource.
On a personal level, I strive to include both parties (men and women) in all discussions and client meetings. Over time, I’ve found that most of our female clients eventually take a seat at the “money table” and enjoy getting actively involved with their financial lives and planning for the future.
Navin: Why do some women defer to men in investment decisions?
Jacobsen: In this year’s “Own Your Worth” report, we found that 49% of women allow their spouse to take the lead on handling long-term financial decisions. The biggest reason why? They think their spouse knows more, which is often not the case.
I think it’s important for women to be knowledgeable in all aspects of their finances, especially given that eight in 10 women will end up alone due to death or divorce of a spouse or partner.
Simple tactics like keeping up with financial news, understanding financial goals and being involved in all meetings and conversations with your financial advisor can help build money confidence over time.
I do not hold positions in these investments. No recommendations are made one way or the other. If you’re an investor, you’d want to look much deeper into each of these situations. You can lose money trading or investing in stocks and other instruments. Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor.
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