Investment News profile of Szifra Birke


By Charles Paikert

August 13, 2007

Szifra Birke is fascinated by money.That may not be unusual for someone who works for a wealth management firm, except that she is not a wealth manager, nor is she a portfolio manager or a financial adviser.Ms. Birke is a psychologist.

Her role at Lexington (Mass.) Wealth Management Inc. is that of a “wealth counselor” or “financial behavioralist specialist.” The job involves an “understanding the complexity of the interplay between money and values, and money and emotions,” Ms. Birke said.

Her interest in the subject began at an early age. Ms. Birke’s father was a wealthy man in Poland before World War II, but he had to start from scratch when he immigrated to the United States after the war. She recalls growing up above her parents’ clothing store in Lowell, Mass., in a rough neighborhood near a housing project. Across the street was a bar where hometown luminary Jack Kerouac was known to hang out.

But by the time Ms. Birke, was a teenager, her father had become successful again, and the family moved to a much nicer home in an upper-middle-class neighborhood. The “emotional resonance” of the shift in circumstances stayed with her, and she realized that she wanted to come to terms with “my own relationship with money.”

In her private practice as a psychologist, Ms. Birke found herself doing a lot of work with entrepreneurs for whom “money was really important,” further stimulating her interest in, and studies about, behavior and wealth. She also was a client of Lexington Wealth Management, and when the firm found out about her professional specialty, she was asked to do some consulting work in 2001. This year, the 57-year-old was put on full-time retainer.

Using Ms. Birke’s services has been a way for the firm both to “strengthen and differentiate ourselves,” said Michael Tucci, president and co-founder of Lexington Wealth Management, which has $250 million under management. Also, Ms. Birke has been credited with making clients feel comfortable enough to discuss their fears.”It was really important for us to find someone like Szifra,” said Margo Vangeli, a clinical psychologist in Groton Mass., who has referred patients to Ms. Birke. “Therapists are not necessarily comfortable talking about money with patients, but Szifra is. People feel they can trust her and be vulnerable in front of her, and she makes it easy to address things they may have fears about, including money. The feedback we’ve gotten has been enormously positive.”

Q. What’s the hardest part of being rich, from a psychological point of view?

A. Everyone assumes if you have enough money, your life is great. People in general are not sympathetic to stress that money brings. There’s also a struggle to find relevance or meaning to your life once you no longer need to work for money. I often think that people lose their sense of purpose if they don’t have to strive.

Q. What’s the hardest part of a wealthy client’s situation for an adviser to understand?

A. They don’t understand the lack of empathy their clients get from other people in the world.

Q. Is talking about money normal in therapy?

A. No, it isn’t. I wish it were. In general, therapists don’t open up that conversation.

Q. Why not?

A. They are uncomfortable with it. They don’t want to be seen as greedy or invasive. Most therapists come from an altruistic, service-oriented place. In general, they are not comfortable or experienced in the business world or the world of money. They are used to topics like extramarital affairs or drugs or alcohol but tend to feel like they’re trespassing when talking about money.

Q. How should financial advisers interact with wealthy clients?

A. There’s no set way. Wealth is only one aspect of who those people are. I see it as my job to help advisers understand that someone’s wealth does not define them or the direction of the interaction.

An emotionally educated adviser understands that their job is to be engaged in the way that a particular client wants to be interacted with.

Q. How do you help advisers to do that?

A. By teaching them to pay attention to the client and be client-centric versus adviser-centric. I teach them to be pretty straightforward in their interpersonal competency skills.

Q. Such as?

A. Such as asking clarifying questions, making empathetic statements and listening in an active, engaged, client-focused way.

Q. Mr. Tucci mentioned that sometimes you sit in on client meetings with an adviser. What do you do, and what kind of observations do you share ?

A. One of my functions during the meeting is to make sure the client’s needs are being met as optimally as possible. For example, I might slow the adviser down, increase the number of questions to the client and get clarification from the client. By watching the client’s body language, I can tell when the client is interested or saturated or bored. [I] can help redirect what happens.

I also teach the advisers strategies. For example, if a client is leaning forward or writing frantically, advisers should pay close attention and adjust their pace accordingly.

Q. Could you describe a few cases where wealthy people really needed psychological counseling for money-related issues?

A. There was a man in his 50s who had built a business up from nothing, and it had become a tremendous success. He was stepping out of day-to-day operations, and he was just lost. There was no way for him to understand that loss on his own. It was a very emotionally confusing time. He didn’t want to be in the business anymore, and there was a vacuum between his old life and the new life that had not yet formed.

Another man had inherited a significant amount of money, but he felt horrible about it because the money represented his parents’ death. He felt guilty, he was fighting with his wife, and he was desperate to talk to somebody.

Q. Do these kind of cases have anything in common, and what are the most common kind of issues where wealth counseling is needed?

A. Yes, they are mostly life transition issues, such as the
sale of a business, death and inheritance, a divorce or a new marriage. Children and values are also important issues.

Transition issues are one of my loves. Any change we make, even changes we choose or a change for the better, still results in a loss of control and a change from the familiar status quo. We need to understand the vacuum between ending what we had and the new beginning that has not yet solidified. Understanding that this is normal is extremely helpful to us.

Q. Can you describe a case where an adviser needed help working with a client?

A. One client was in a complicated second marriage, and the adviser worried about the reaction of the client’s adult children to the marriage. We told the adviser that it’s OK to ask personal questions. The way the adviser phrased it — and this was at a family meeting with everybody present — was: “Am I at liberty to scratch the scab a little?” It may not have been the wording I would have used, but that’s all right. It was natural for the adviser. The family agreed, and he asked the client’s daughters straight out how they felt about their father’s second marriage. They answered honestly, and it helped resolve the issue.

Q. How else have you helped advisers?

A. One adviser asked me to help him resolve confusion about when to call a prospective client. He met a man who he thought would be an ideal client for the firm. But the adviser said the process was like dating: you never know when to call.

I asked the adviser if he felt comfortable explaining to the prospective client his ambivalence about asking for his business. The adviser said he never thought about that. When he did call the prospect and articulated his hesitation, the man thanked him for being open about it.

Q. Did he get the business?

A. It just happened, but they’re still talking.

Q. Have you come across other therapists who do what you’re doing?

A. A few but not many. There used to be a group called More than Money that met to discuss these issues, but now I think they’re part of the Naropa Institute in Boulder, Colo.

Q. How great is the demand for this kind of counseling?

A. I think it’s badly needed. Money tends not to solve personal problems; money solves money problems.