Advisers carve out their own territory

Seven years ago, certified financial planner Andi Y.H. Kang assumed the care of her brother, who is deaf, autistic and suffers from seizures.

Navigating the financial and logistical intricacies of government support programs was an agonizing experience, but one that came to define her career as an adviser. After Ms. Kang successfully placed her brother in a center that caters to people with special needs, she began using her personal experience and financial know-how to benefit families in similar situations.

“Some of these families are so downtrodden, because taking care of a special-needs person can be a 24/7 job,” said Ms. Kang, president of Crown Wealth Management in Huntington Beach, Calif. “Helping them is very rewarding work.”

Ms. Kang is one of many advisers who have carved out niche practices. While some are more conventional than others, experts say having something to hang your hat on is simply good business.

“If you are not in a niche, you don’t have a growth strategy,” said industry consultant Tim Welsh, president of Larkspur, Calif.-based Nexus Strategy LLC. “When advisers have a focused message, their clients will refer them, and those referrals become very powerful.”

The choice of a niche often springs from a personal passion or interest. In other cases, it is simply a matter of geography.

In Smithfield, N.C., which was once a large tobacco market, Mark Hall, of Market Street Advisors LLC, focuses on tobacco farmers.

Of the $70 million in assets his firm manages, roughly 20% comes from clients who were involved in the tobacco industry as farmers, auctioneers or buyers.

In 2004, the government began paying farmers to not grow tobacco. That meant a windfall for many former growers, who pocketed from $5,000 to $100,000 annually.

Additionally, many participants have taken the buyout and then sold their land to developers. One of Mr. Hall’s clients sold his 130 acres for $3.5 million.

“These folks were land-rich and cash-poor,” he said of his newly wealthy clients.

Many are unaware of the power of investing, and Mr. Hall spends time educating them.

“I tell them that … something will grow out of their new assets, just like something grew out of that dirt on their acreage before,” he said.

Halfway across the country, David Jackson, a certified financial planner in Kansas City, Mo., offers counsel to his niche: black investors.

“It’s primarily because I’m African-American, but also it’s an underserved community, and not a niche that many financial advisers go after,” said Mr. Jackson, an adviser for Waddell & Reed Inc. of Overland Park, Kansas.

Of the $20 million he manages, about 75% comes from his niche market.

“It’s been obvious to me that a lot of African-Americans don’t invest,” Mr. Jackson said. “They might not have much education about investing, and they think it’s the exclusive domain of the rich.”

Most of Mr. Jackson’s clients are middle-class individuals or families investing retirement account roll-overs of $50,000 to $200,000. He acknowledged that he is limiting his business growth by focusing on clients with smaller accounts.

“If my sole motivation were money, I’d probably expand [my target clientele], but that’s not my only motivation, so it’s OK,” he said.

As part of his business strategy, he speaks to church groups and public-school children in the black community in hopes of teaching them about personal finance.

Bing Waldert, an associate director with Boston research firm Cerulli Associates Inc., agrees that not all niches will be gold mines.

“If advisers have a very specialized niche, they must consider whether there are enough people to build as profitable a business as they’d like,” he said.

Indeed, Ms. Kang is aware that her passion for helping special-needs families won’t necessarily expand her business. Just over $3 million of the $30 million her firm manages comes from such clients.

Nevertheless, in the same spirit of Mr. Jackson’s public outreach, Ms. Kang strives to help families who can use her advice even if they will never become clients.

The issues facing caretakers require specific financial planning expertise that most advisers lack, said Ms. Kang. For in-stance, to qualify for government services, a special-needs person cannot own more than $2,000 in assets.

“You can set up special trusts that benefit that child or adult, but they can’t own it,” she said.

Ms. Kang has not advertised herself as a specialist in special-needs financial concerns. Part of the problem, she explained, is her firm’s $1 million minimum. That’s a high bar to cross for many families whose assets have been siphoned away as they’ve paid for the care of family members.

Meanwhile, Jim Saulnier, a certified financial planner in Fort Collins, Colo., advertises heavily to his target audience: lovers of the outdoors. His billboard — the second-largest in the Ft. Collins area — pictures him with his two Chesapeake Bay retrievers.

He spends his free time hiking, backpacking, camping, fishing and hunting. And as a member of the Colorado Mountain Club, a hiking club, he spends time with people who discuss financial matters with him.

“When an appointment is finally made, we’re friends,” he said. “And a level of trust has already been established.”

Mr. Saulnier manages roughly $17 million, and believes that his focus has contributed to his business’ growth. He says roughly 50% of his clients came from his ads and about 25% of his clients are “hard core” outdoor enthusiasts.

“I moved to Colorado nine years ago knowing no one,” Mr. Saulnier said. “I now have a very successful practice and numerous outdoor-loving friends.”