This Advisor Shares the Early Money Lessons That Shaped Who He Is Today

Get to know the people behind the financial advice in our Planner Profile series.

Becoming a financial advisor wasn’t part of Rich Woo’s original plan. After working in corporate finance while doing real estate on the side, he was getting ready to transition into real estate full time when a Northwestern Mutual managing director approached him to discuss financial planning as a career.

Woo knew it would be a challenge, but building a business while getting to impact people’s lives ultimately led him to make the switch. Plus, he knew firsthand how a lack of planning could affect families. After losing his mom in a whitewater rafting accident at 15, he remembers his father struggling to make ends meet.

“Not only did we lose a parent and what that does to a family, but both my parents were working, so we lost an income, too,” he says. “It was tough, but there were a lot of learnings: How to live modestly, how to be thankful for what you have and how financial planning — or not doing financial planning — can impact your life in a lot of ways.”

Woo has been a wealth management advisor for more than 12 years now in Chicago. Below, he shares how the early money lessons he learned shaped his values, and the legacy he hopes to leave behind.

What were your earliest memories around money?

I don’t think my family proactively talked about money. There were periods when I was younger when my parents were doing OK financially, but we struggled, especially after my mom passed away. So there wasn’t much to talk about. My dad paid the bills and hopefully made rent on time, but there wasn’t anything left after that.

Because I didn’t get an allowance, I remember getting a part-time job my freshman year in high school working at the cafeteria of a local hospital where I made $7.75 an hour cleaning up people’s dirty trays and mopping the floors — and if you worked overtime, you got time and a half. I remember thinking, “Yeah, I hit the jackpot!”

I was making probably $240 a month and after taxes, it was around $190. I remember thinking, “Wow, I work really hard for $190?” I would go to a fast food restaurant, buy a value meal and think, “I have to work almost an hour to eat this meal?” That was when I really started understanding the value of money.

What are the challenges you see when it comes to the Asian American community and financial planning?

In the Asian community, for better or worse, there’s not a lot of help in that department. Culturally, a lot of Asians are private about their money — there’s a lot of, “Hey, can I trust you?” or “Do we even want to trust anybody?” And in the Korean community, which is who I’m most familiar with, there isn’t a lot of saving, and retirement might be income you get from a property or business you invested in — but how many people does that actually work for? So whether it’s shame, pride, a lack of trust, privacy or all of the above, a lot of people just end up left to their own devices.

I felt that when my mom died. There was no savings, no retirement, and definitely no life insurance. I remember our church put together a fundraiser to help us raise a few thousand dollars to help pay for the funeral. It was great to know we had people trying to support us, but it didn’t have to be that way. If we had done even some very basic planning, we could have been OK. As a kid, that experience taught me to live lean and find joy in the smaller things — but it also inspired me to grow up and provide for my family in such a way that we didn’t just have to scrape by.

So what would you say to someone who insists they can DIY their financial plan?

It’s not as simple as hey, you do or don’t need to work with a financial advisor. When I have conversations with people, it’s to help them discover what they don’t know, and maybe introduce some new ideas they hadn’t heard before. And then second, if they do know a lot, I help them realize that it’s not about what they know, it’s about executing on what they know. Think of it this way: Sure, I can change the oil in my own car, but is spending a Saturday afternoon under the hood the best use of my time, or can a professional help? A lot of our clients hire us to help them execute on what they know they need to do, but never get around to doing because it takes too much time and energy.

Do I think people can set up an investment account, press a button and link up their bank account to it? Sure. But financial planning is much more comprehensive than that, and there are so many other things that you need to do. I think people have the desire to do these things, they just don’t get around to 90 percent of it.

What is the biggest mistake people tend to make with their money?

I can answer that a little bit differently. I think the biggest flaw in peoples’ mindset is that they don’t have a clear picture of the trade-offs they’re making in life. They might understand the impact of short-term decisions, but not long-term ones.

For instance, they don’t understand that if you invested $2,000 a month starting from age 22, and it grew at an 8 percent growth rate, you could have almost $1 million by 40. So maybe you rent a one bedroom apartment or studio instead of that two bedroom apartment you don’t really need. Or maybe you buy a used Honda instead of leasing a brand new BMW for now. But no one really thinks like that. They just think, “Oh, it’s impossible to retire before 65, so I’ll just spend all my money now and just hope I’m going to get there.” People don’t have a vision or an understanding around what they’re not going to get in the future by doing that.

What’s a personal financial goal that you’re working toward?

First and foremost, taking care of my family, making sure we have enough for financial independence, making sure that my kids can have their college paid for. I also want to be able to leave my kids enough to do something, but not so much that they’ll do nothing. That’s how I think about transfer of wealth. Beyond that, I want to set up a foundation that will give money to nonprofits, charitable organizations and faith-based organizations that are very important to me.

So, that’s my long-term vision for my life. Not everyone has the opportunity to build generational wealth, let alone give money to amazing causes. I want to do that in my lifetime. My money is not just for me, it’s entrusted to me so that I can do the right thing with it, which is to take care of me and my family and bless other people.