Ann Covington, CFP, CPWA, Principal & Founder, CovingtonAlsina

Ann Covington, founder and financial advisor at financial planning and investment advisory firm CovingtonAlsina, spoke with Invest: about the firm’s move to Jacksonville, its focus on financial education for women, and changing retirement goals. “More people want the independence to do what they choose regardless of salary, and they want it sooner,” Covington said.

How has the firm changed or evolved over the past year?

Our company was founded in Annapolis, Maryland. Last year, we expanded to a second location. Jacksonville is now our headquarters, and it’s where we’ve been growing our staff.

We are a financial planning firm focused on serving women. We certainly work with men and married couples, but our mission is to help educate women so that they can make wiser financial decisions. We do that through comprehensive financial planning. Our planning covers wills and legal documents, cash flow, debt, every type of insurance, benefits at work, investments, and goals such as retirement, sending children to school, or buying a first or second home or a boat. We also consider taxes now and over a client’s lifetime. We provide that comprehensive planning and then manage assets for clients going forward.

Why did you choose Jacksonville for the firm’s headquarters?

Florida’s tax and business climate is great. Working with the state is much easier than where we have been, and taxes are better overall. Beyond that, Jacksonville is growing. I was here 25 years ago, and I finally feel downtown is taking off. The work that is being done downtown is exciting.

I am a UF alumna, so I am excited about the new University of Florida graduate campus a few miles from my office in the heart of downtown, the stadium renovation, and the riverfront. We are a capital campaign sponsor for the Museum of Science and History, which is planning a massive new building on the Northbank. Downtown is being revitalized.

Jacksonville also has a diverse economic base that is not centered on one industry. People are moving here and are excited about what is happening, and our firm fits into that environment. Our original building in Annapolis is about 220 years old. In Jacksonville, we are in Riverside-Avondale in a building that is about 120 years old. We have partnered with Riverside Avondale Preservation to sponsor and promote its activities and preserve that unique history while downtown is new and growing.

What recent milestones are you most proud of?

For the second consecutive year, we were named to the Jacksonville Business Journal’s Fast 50, the 50 fastest-growing businesses in the Jacksonville area. We were No. 11 this year. Earlier this year, we also earned our fourth Gator100 recognition. The Gator100 recognizes the 100 fastest-growing companies owned or led by a UF alum, and we were No. 22 this year. Those are two notable milestones from the past year in Jacksonville.

What financial concerns are you hearing from clients?

Our clients are diverse. Some are older business owners who want to retire and are asking whether this is a good time to sell. Interest rates have had a significant effect on sellers because either they provide owner financing or someone else has to finance the acquisition. We also see the effect personally when people buy homes or office buildings.

People forget that interest rates are not historically high. The long-term average for a 30-year mortgage in the United States is 7.71%. Rates have been creeping up, but they are still below 7%, which is below average. We had artificially low rates of 2% to 3% for an extended period following the financial crisis. People across the board are concerned about interest rates. If there is a rate hike later this year, stocks might come down because so much of the market is made up of growth companies that are sensitive to interest rates. It is something we all watch.

What gaps do you see in women’s financial confidence?

The confidence gap appears across many aspects of women’s lives. Women are less likely to negotiate salaries or ask for a promotion. When applying for a job, they may look at the qualifications and decide not to apply if they do not meet every qualification. We also see women who feel they know less about finances than they actually do.

Women also have strengths that can benefit them as investors. They are less likely to buy and sell overnight and are generally more inclined to buy and hold, which can help avoid the costs and risks associated with frequent trading. Women are also more concerned about what money does for them. They ask what it can accomplish for their family, business, employees, church, or the nonprofits they support rather than using money simply to keep score.

Those strengths can make women good investors, and sometimes what is needed is education. We hold about 70 educational events a year, including our monthly Women, Wine & Wisdom™ event. Those events help educate women and give them confidence that they can do all of this.

How does that educational approach shape your role in the business community?

It positions us as a thought leader. We continually provide educational content through webinars that are open to the public, Women, Wine & Wisdom™, and Second Saturdays, our divorce webinars. Those programs position us as people who know the field, have good information, and can be a trusted resource.

How are clients’ retirement goals changing?

More people want the independence to do what they choose regardless of salary, and they want it sooner. Retirement used to mean age 65. Now we see people in their mid-50s or even early 50s asking how to position themselves to do what they want without depending on a paycheck.

That might mean volunteering, taking a less stressful job, or joining a nonprofit in a paid position that offers less money but a mission they believe in. People are asking how to reach a point where they can have a second or bonus career that motivates them and feeds their soul rather than working only for a paycheck.

Part of that is generational, and another part is the wealth people have accumulated in their 401(k)s. Over the past five to 10 years, I have also seen families become more interested in sharing wealth while they are alive. Older boomers were more likely to say they had provided an education for their children and that whatever remained after they died would go to them.

More families now want to fund their children’s IRAs, help with a down payment, or pay for their grandchildren’s school, college, or activities. They want to see their families enjoy the money when it can help them while they are raising children and holding down jobs, rather than leaving them a large amount after they have already retired.

Where do you see the firm’s biggest opportunities over the next three to five years?

The industry talks frequently about the massive wealth transfer from the Silent Generation and older baby boomers. That wealth is expected to pass to Generation X, but what is missed is that women often outlive their husbands. The money does not necessarily go directly to Generation X; it first goes to widows.

Many widows do not have a strong relationship with their current advisor because, in that older generation, the husband traditionally earned the money and handled investments. They may not have much education or confidence, so helping those women has been a significant opportunity for us.

We are also seeing gray divorce. Women in their 60s and even 70s are increasingly navigating divorce later in life, and they are looking for people who can educate them.