Financial Advisor Carl Richards Bares All In The New York Times; How He Lost His Home And Was Financially Ruined Hot

 

I don’t know Richards, but I admire the bravery he’s shown by telling his personal story.

 

Carl Richards is to financial advising what Frank Abagnale Jr. is to check kiting.

 

Abagnale, whose inspirational story is portrayed in the movie, Catch Me If You Can, conned millions of dollars worth of checks by pretending to be a Pan Am pilot, doctor, and prosecutor. After his arrest, he went straight and became a security consultant, advising businesses on how to avoid being defrauded and teaching at the FBI Academy. Just as Abagnale could serve as a security consultant because he was a crook, Richards can become a better advisor from the mistakes he made.

 

“There are many stories these days of people who lost their financial bearings during the housing boom and the crisis that followed, but my story is a bit different from most,” Richards writes in The Times. “I’m a financial adviser. I get paid to help people make smart financial choices, and I speak and write about personal finance issues for this publication and others.”

 

“The thing that few people know, though, is that I learned a lot of this from experience,” adds Richards. “I made a bunch of mistakes, the very same ones that I now go around warning people to avoid.”

 

Richards says he got his first job in the financial advice business by responding to an ad for a job in “security” (as in security guard). When he showed up, he found out it was, in fact, related to “securities.” Merrill Lynch hired him.

 

Richards recounts how he bought a home for $575,000 in Las Vegas in 2003 after determining he, his wife, and four children could only afford a home costing $350,000. He refinanced in 2004 after becoming an independent advisor and lowered his mortgage payments and, over the next couple of years, found it increasingly difficult to make the payments as the mortgage crisis set in nationally.

 

“But then came the collapse in the stock market,” Richards says in The Times “I had clients calling in tears and breaking down in my office. People who had never worried about their portfolios were calling me from their vacations. It was like talking people in off a ledge virtually every day, maybe three times a day, for maybe 90 days in a row.

  

The emotional toll on Richards made him sick. “The pain would start in my stomach, and then I’d spend six hours vomiting,” he writes. “It happened once, then three months later it happened again, then one month later it happened yet again. Eventually, it was happening every couple of weeks. The doctors couldn’t find a physical cause.”

 

Richards is now a regular contributor to The New York Times as well as Morningstar Advisor.

 

“The experience has changed just about everything about how I do financial planning and the advice I give in public,” Richards reports. He now lives with his family in a rented home in Park City, Utah.

 

Some may view Richards’ confession as a marketing gimmick. Indeed he has parlayed being a financial advisor who wrecked his own financial life into a way to become more successful. But it takes great courage to come clean and he makes a colorful and useful contribution to the financial advice profession.