Goldman Sachs recently brought Ayco, which provides corporate-sponsored workplace financial planning, and Personal Financial Management, its rebranded United Capital business, under one corporate umbrella called the Goldman Sachs Personal Financial Management Group, co-headed by Joe Duran and Larry Restieri. Duran, head of Personal Financial Management, said the integration has brought synergies benefiting both, with the financial advisors in his group signing on over a dozen corporate programs since joining Goldman.
On its fourth quarter earnings call, Goldman CEO David Solomon said there had been over 4,000 bilateral referrals, representing over $7 billion of assets under supervision, across the firm’s private wealth management group, Personal Financial Management and Ayco in 2020.
For Goldman's PFM business, those referrals take one of two forms, Duran said.
On one end, Ayco provides financial management for C-suite employees, including expense management, concierge-level financial planning, taxes, estate planning, and can often include investment portfolios as well. For other employees, Ayco has developed a self-directed financial wellness program, which includes phone access to an advisor, often a CFP, for one-off questions or advice.
What they didn't have is an offering for employees with financial planning needs in between those two services. Personal Financial Management fills that gap, Duran said.
“There are people who want an actual advisor dedicated to them, but don’t need the full suite of services that might be necessary for an executive,” he said. “That’s in the wheelhouse of exactly what we do, which is planning-centric.”
The financial planning that Duran’s group provides is not as white glove as Ayco’s, but with more personalization and attention than a call center.
“It’s personal, it’s human, but it’s not as comprehensive,” he said. “It includes a financial plan; it includes understanding their benefits, and it includes, if they want it, investing.” Duran said one-third to one-fourth of those clients want help with investment portfolios; more often they want help with a financial plan.
PFM can also step in with corporate clients that are offering early retirement packages to employees who need to know how the package works and whether they should take it. The corporate clients want an arm’s length professional planner to help them with those decisions.
“Our advisors will get on the phones, build the plan and let the employee—the participant—know if they can afford to take the package or not," he said. "What does it mean? What does it not?”
Duran said there is still room for greater synergies. Ayco offers a broader range of services, and PFM is mapping out ways to integrate personal financial planning into them. Grievance support services, for instance, which helps employees navigate the financial issues that arise after the death of a loved one, is an area where PFM may offer value, he said. It involves simple things like providing a checklist for putting together a funeral, a checklist for all the documents the client needs to have signed, how to file a death certificate, etc.
“These are the things nobody really thinks about until you’re there, so having somebody you can call, a dedicated resource, and having seen it all, to say, ‘Here’s how you deal with the situation,’” Duran said. Those types of services will be rolled out to PFM advisors as well, Duran said.
While PFM has slowed its pace of RIA acquisitions since joining Goldman, Duran said the group was still open to buying firms, especially if there’s a corporate client where they don’t have a presence. In fact, the firm plans to announce an acquisition in the next few weeks.
But acquisitions are not the primary growth engine going forward, he said. “We don’t need to pay for growth anymore; we’re getting organic growth,” Duran said. “The pricing is really, really aggressive, and hard to make the math work, honestly. I think a lot of the firms making acquisitions have to, because they’re playing on financial arbitrage and they’re looking to go public. That’s of no particular interest. We’re already a public company.”
