‘Financial planning is for everyone’ — With Osmar Garcia

When COVID-19 shutdown orders forced many small businesses to close, Osmar Garcia checked on his small-business clients. That checkup couldn’t have come quickly enough for one client, Melbourne Gonzalez, a painter who told Garcia he had lost $110,000 of business in two weeks and feared he wouldn’t be able to make his weekly payroll. Adding to the anxiety was that the client owned several rental properties and feared his tenants would be unable to pay their rent.

At that point, the painter had been Garcia’s client for about five years. During that time, Garcia had helped the client buy cash-value life insurance and had advised him on how to build up some cash reserves that would tide him over any rough spots.

Garcia reminded his client that he could tap into the cash value in his life insurance policy to access needed funds, and he helped him reach out to his bank to discuss whether he could defer his mortgage payments if his tenants were unable to pay him. Garcia even helped his client apply for a Paycheck Protection Program loan. After a few slow weeks, business came rolling back, and the painter was able to weather the financial storm.

The story of Garcia and his client eventually became a TV commercial for Northwestern Mutual. Garcia is the cofounder and CEO of Garcia Wealth Management in Conway, Ark.
COVID-19 impacted many of Garcia’s small-business clients, and he said that helping them through an uncertain time became his mission.

“There was a lot of uncertainty then,” he said. “My clients didn’t know what was coming. Early on, we had a lot of conversations with our clients around what resources were available. We met with some of our lawmakers to understand the legislation that was being passed — PPP funding — so that we could relay that information to our clients in a simple manner. We also collaborated with our clients on how to strategize things such as speaking to the bank they work with, how to retain their employees.”

Garcia said the majority of his clients emerged from the pandemic “and actually did really well.” And that led his work with them in a different direction.

“Then the conversation turned to ‘We actually had a lot more business than we anticipated, so please tell us what we can do to mitigate some of our tax risk,’” he said. “So we had very different conversations at polar ends of the pandemic. But we’re thankful we were able to give our clients some good guidance at the beginning and then follow up with some additional work toward the end of it.”

In search of opportunity

Garcia has an affinity for small-business owners, mainly because his father owned a small business.

Garcia, his parents and his brother were born in Jalisco, Mexico. His father moved to Ontario, Calif., in search of work, and the rest of the family came to the U.S. a year later. A few months after settling in California, the family moved to Morrilton, Ark., and put down roots there.

“My parents decided to bring us here for a better opportunity,” he said. “That was a big decision on their part. And I’m thankful that they did. They made a lot of sacrifices that paid off for all of us.”

Garcia’s father started out by working as a painter and eventually started his own business.

Garcia’s mother started out by working in a sawmill but soon became a housekeeper for a member of the Rockefeller family.

The language barrier proved to be difficult. Garcia remembered starting school in the U.S. as a third grader and having to rely on a classmate to translate for him. After Garcia became proficient in English, he helped his father translate and negotiate business contracts.

Overcoming the language hurdle taught Garcia “communication is key.”

“I focused on how I can be an effective communicator,” he said. “Today, I really believe that what has helped me and helped our firm to grow is having good communication skills.”

A lack of financial literacy hurts

After graduating from college, Garcia began working in a bank, working his way up to becoming a real estate appraisal officer and consumer lender. He soon discovered that few of the bank customers who sought loans were eligible to obtain them.

“I had to turn down about 70% of those who came in for a loan,” he said. “The reason for that was mainly a result of a lack of financial literacy. A lot of loan applicants were required to have a certain percentage to put down toward the loan, and they didn’t have the savings to do it. Or they didn’t have a credit history. Some didn’t know how to leverage what they had in a way that could help them.”

Garcia decided to switch gears and become more of a financial coach.

“I found myself spending time with people, coaching them on how to get out of the financial rut they were in,” he said.

During his time at the bank, Garcia bought life insurance and was asked by his advisor whether he would consider going into the business himself.

“At the time, I had no interest in becoming an advisor,” he said. “But God had other plans. An opportunity came up, and I looked into it. I found I was able to transfer the knowledge and experience I had into helping small-business owners in terms of financial planning. So that was a really cool transition. It also allowed me to think about the business differently. I could tell that no one else was running a practice like a bank, and that’s what we’re doing today.”

He founded his firm in 2015 with his brother, Gilberto.

“It’s an interesting dynamic,” he said. “My brother is what I would call the executor. He is very good at following through, he sets a goal, and he helps us get there. I’m more of a strategist. I think about what do the next five, 10, 20 years look like and what decisions can we make today that will get us there. I think we complement each other well. Whenever I share a vision and he has a passion for it, we execute really well together.”

Helping Hispanic clients succeed

Conway’s population is about 6% Hispanic, and Garcia said those he serves are small-business owners.

“They represent anything from construction to manufacturing to real estate,” he said. “We do everything from 401(k)s to group and individual planning for business owners and top-level executives, and we also serve many of their employees.”

One issue that Garcia said his clients are focused on is passing their businesses to the next generation. “We collaborate with attorneys and CPAs so that there’s a team that will help them carry this out,” he said.

His clients also need help improving their financial literacy. “A lot of our Hispanic clients come from Mexico and South American countries, and there’s a distrust toward the financial sector,” he said. “So we have a lot of conversations on how financial institutions work in America. What is a Roth IRA? What does it mean to protect my family with life insurance? We start with the basics and build on that.”

Garcia said that he believes community involvement is the best way to connect with Hispanic prospects. He is active in his local United Way and serves on the board of his local symphony orchestra. He also participates in activities in his church.

He ultimately believes that the biggest misconception about insurance or financial advice “is that people think it’s only for the wealthy.”

“Financial planning is for everyone. You don’t have to be wealthy to plan. You can start at an early age or if you’re just starting out in your business. There are things you can start doing today — saving, reducing debt. Then you can start jumping into investing and protecting your family or income. From there, you can start thinking about estate planning. So I encourage those who have not started their financial planning journey to meet with a professional and take the first steps.”

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].