About Mitchell Kauffman
UCSB Economics Professor
It doesn’t seem so long ago that I was an MBA (and UCSB) grad trying to decide on my career direction. UCSB provided a supportive environment that helped me blossom, from academic and study skills to financial aid and work study. Plus, while a Gaucho I enjoyed learning many valuable theories; I also craved opportunities to learn how those theories were applied in real life.
At the time, the financial planning profession was in its infancy. Groups of insurance and mutual fund salespeople had begun a movement towards a more client-centric, relationship-oriented approach. This was in contrast to the sales-transaction mindset that permeated Wall Street since its founding (and likely well before).
Financial Planning’s appeal to me stemmed from the diverse skills that the career demanded, including:
- Multi-Disciplinary: Ability to combine economics and finance/investments with marketing/sales and psychology.
- Entrepreneurial: Opportunity to serve clients and do business as I thought best.
- Interpersonal: Becoming a meaningful part of my clients’ lives.
In the early 1980’s, I found myself riding the first wave of those transformative efforts, embodied by what was then the new Certified Financial Planner™ training and certification.
My early years in financial planning were particularly difficult as I worked to develop my technical skills, while simultaneously striving to persuade prospective clients of my value. In contrast to paid apprenticeships found in law and accounting, entry-level planning positions were often commission-only, and focused on selling individual investments. Persuading clients to share their entire financial picture with me was an additional challenge that, at times, made things that much more difficult. The good thing about challenges, it has been said, is they can reveal what lies beneath.
Having also developed my public speaking skills, —from anxious dread to proficiency, and actual enjoyment—I was able to offer workshops and guest lectures at local colleges. These efforts were combined with psychologists and physicians I knew to expand the event focus to life quality, financial “health” being a key component. This seemed a unique approach that resonated with audiences, helped attract more clients, and provided a sense I was giving back regardless of whether attendees hired me. And I enjoyed encouraging people to learn about personal finances in hopes that knowledge could help them avoid costly setbacks.
The frequent first-hand stories that clients would share of their own experiences where they trusted someone only to be disappointed or outright cheated, brought home the pain such acts would cause. Seeing that pain up close served to reiterate the importance of doing the right thing, period.
Investors found me trustworthy and sincere enough to place their entire life’s savings under my stewardship. My drive toward self-improvement found me constantly identifying investment and tax planning strategies that could help clients achieve their financial dreams, often with less risk than what they previously experienced. And as I did well for them, they would refer their friends, colleagues and family members, which would help my practice grow even more.
Thirty-five years later, the wealth management practice I had spent over half my life building, was being sold for more than I had ever imagined earning. Enough to fund a comfortable retirement in Santa Barbara and provide our twin granddaughters some of the best schooling available.
In 2016, the opportunity arose to return to my alma mater and share what I had learned during my career; it was nothing short of elation. I’ve taken my teaching role as an occasion to document many of the practices I used to help clients address financial and investment challenges and integrated these as case studies within my coursework to illustrate how they can be applied using the most ethical approaches and solutions possible.
UCSB has given me considerable latitude in creating a portfolio of three undergraduate ethics courses plus three economics courses with the Strategic Investment Program. While each course offers practical real world applications of the theories taught so to help students benefit from my career experience, the undergraduate ethics courses provide opportunities for student presentations and discussions as well:
- Ethical Investing to Impact Social Change (UCSB RS 190EI)
- In this initial course I created, focuses on how profit incentives may be combined with social consciousness for a win-win investment outcome. Our theory topics explore what differentiates Socially Responsible Investing (SRI) from Impact Investing with a week spent on each of the Environmental, Social and Governance (ESG) impacts investors seek. On the application side, we simultaneously review many of the corporate scandals and investing solutions that conscious investors may seek. Learn More about UCSB RS 190EI
- Wall Street Ethics and Economic Calamities (UCSB RS 190WE)
- This course explores business cycle theory and how they impact our economy, and how policy makers can employ monetary and fiscal policies to help moderate downturns. Concurrently we explore the causes of the 10 most significant downturns in history beginning with the first recorded case of an investment bubble, Holland’s Tulip Mania in the late 1600’s and extending through the US bank expansion era during the industrial revolution and culminating with a deep dive into causes and remedies of the ’08 Financial Crisis. Learn more about UCSB RS 190WE
- Have Ethics Gone Awry? (UCSB RS 190GA)
- This course examines the post-civil war period that Mark Twain called the “Gilded Age.” He purposely coined the term “Gilded” to sharply contrast the historic advances the US enjoyed in sharp contrast to the tremendous social and economic injustices of the era. In fact, many of the social challenges facing us today can be sourced to this period; racial, gender, religious, wealth and national origin prejudices as well as political and corporate corruption. As we review these, we concurrently contrast them to challenges with those facings us today.
UCSB’s Strategic Investment Program offers real life exposure to the retail financial advisory industry with these three courses focusing on practical skills and case studies taken from actual client situations. Learn more about UCSB RS RS 190GA
- This course examines the post-civil war period that Mark Twain called the “Gilded Age.” He purposely coined the term “Gilded” to sharply contrast the historic advances the US enjoyed in sharp contrast to the tremendous social and economic injustices of the era. In fact, many of the social challenges facing us today can be sourced to this period; racial, gender, religious, wealth and national origin prejudices as well as political and corporate corruption. As we review these, we concurrently contrast them to challenges with those facings us today.
- Exchange Traded Funds (ETF’s) and Portfolio Construction (UCSB Econ x499.10)
- Financial Advisors often see constructing and managing investment portfolios is a fundamental skill. This course will explore the role Exchange Traded Funds can plan in that process. ETF’s are fast becoming a preferred way to participate in a widening variety of investments. In that sense, they are said to offer the best of both worlds; the intra-day trading of individual stocks with the convenience and pooled investment approach of mutual funds. All at a significantly reduced cost! Students will receive hands on experience in navigating this at times confusing landscape, how to analyze and select between competing programs, along with a realistic view of ETF’s pros and cons. Learn more about UCSB Econ x499.10
- Financial Crises (UCSB Econ x499.11)
- Managing economic fluctuations can be one of the most vexing challenges facing decision makers, especially since unexpected shifts can dilute even the best laid business plans. This course employs actual case studies to explore how business cycles influence economic activity and portfolio performance, which industrial sectors can make the most sense, and which to avoid at the various stages, and how authorities apply Monetary and Fiscal Policy to smooth cycle disruptions. Learn more about UCSB Econ x499.11
- Impact and Socially Responsible Investing (UCSB Econ x499.12)
- The phenomenal growth of Ethical Investing reflects the increasing investor realization that they can help address their Environmental, Societal and Governance issues with their investing dollars. This course explores the ways profit incentives may be combined with social consciousness for a win-win outcome. This course balances theory with actual case studies to show how profit incentives may be combined with social consciousness for a win-win outcome. Learn more about UCSB Econ x499.12