Hometown: Littleton I Age: 56
Assets under management: $610 million as of Feb. 28, 2017
What he's reading: "Success and Succession," by Erich Hehman, Jay Hummel and Tim Kochis
What he's watching: Showtime's "Billions"
Investment advice for the average Joe: Any large cap U.S. company that pays a meaningful dividend of 2 percent to 5 percent and increases dividends annually two to three times the rate of inflation.
As a kid, he'd blow his allowance on Richie Rich comics. But these days, Fred Taylor thinks much more carefully about the way he's spending his money--and the millions of his 315 clients. The president and co-founder of Denver-based Northstar Investment Advisors majored in history and education in college, but it was only natural that he'd pivot to finance eventually; it's in his blood. He's a descendant of Moses Taylor--Fred Taylor's father and son share the name--a New York banker who was one of the wealthiest men of the 19th century, with a fortune at his death estimated at $1.7 billion in today's dollars.
When Taylor's not investing, he's golfing, skiing, playing tennis or reading, or working with his favorite philanthropic venture as the Children's Hospital Colorado Foundation board treasurer and chair of the hospital investment committee. Under his stewardship, the endowment has grown from about $40 million to $850 million in 18 years.
"Our goal is to hit $1 billion in three to five years," Taylor says.
Richie Rich would no doubt approve.
CB: How much wealth do I actually need to be your client? FT: $1.5 million.
Let's just pretend I might ever actually have $1.5 million. Why should I give it to you?
We have a very unique model in the sense that we don't manage money to beat the market every quarter or every year. Instead, what we're trying to do is create a cash flow. Seventy percent of our clients live off the income that we generate. And we can generate cash through individual stocks. We only buy stocks that pay dividends that yield 2 to 5 percent. The most important thing is they have to increase those dividends every year, two to three times the rate of inflation.
If you were to interview 10 different registered investment advisers, nine of them would try and convince you your money should be managed in more of an endowment model and copy what Yale and Harvard and Princeton have done, which worked extremely well from 1990 to 2007. But since then, because of diversification and hedge funds not performing as well as the...