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Growing Your Financial Advisory Practice | Insights for Financial Advisors, Planners and Investment Managers
45 minutes | Jun 23, 2020
061: Building a Successful Practice That Is a Good Fit for You
Advisors need to be able to help their clients meet not just their short-term goals, but also their long-term wealth management goals, and that means building strong relationships with clients and having a clear understanding of their needs and priorities. Today’s guest has built a successful practice doing just that. Daryn Form has built a successful financial advisory business over the past 20 years. In 1999, he earned the Certified Financial Planner™ professional designation. In 2011, he earned the Canadian Investment Manager (CIM™) offered by the Canadian Securities Institute; this professional designation is required to be licensed as a discretionary portfolio manager in Canada. Daryn uses a scientific process-driven approach to investing—along with his breadth of experience and knowledge in wealth management and advanced financial planning—to help his clients achieve their financial goals. Topics Discussed in This Episode: Who Daryn’s firm serves (1:14) Why Daryn decided to become an advisor early on (3:24) Daryn’s onboarding process for clients (9:36) How Daryn approaches client acquisition (14:18) Why Daryn decided to switch to an AUM-based model (20:53) How would he start in the wealth management industry today (32:07) Links and Resources: Assante First Avenue Quotes From the Show: “In some ways the business has changed dramatically, in some ways it hasn't changed at all - this is still a relationship-oriented business.“ “The majority of our new clients come from our overwhelming effort to do terrific work for people, such that they want to tell other people about it.” “Their problem is unique to them, but it’s not unique to others, which means it wasn’t unique to us.” With over two decades of industry experience, Daryn’s expertise stemming from building his own successful practice is useful to advisors of all different levels. Today, he is sharing his experience and wisdom with us. Below, we’re sharing three key ideas from the episode: Daryn’s clientele and how he approaches serving and acquiring them How to build a business that is a good fit for you Daryn’s advice for young advisors breaking into the industry To listen to the full episode, find us on iTunes or Stitcher, or click the link at the top of the page. Daryn’s clientele and how he approaches serving and acquiring them Many advisors build a clientele that is niche-oriented, allowing them to serve people on a deeper level than they could if operating in a diverse market. Daryn’s niche is owner-managed enterprises. Operating in Saskatoon, his client base is typically made up of business owners across the different industries in the area such as manufacturing, mining, construction, and more. This commonality amongst the client base of his practice has its benefits. The majority of these business owners come in seeking help with similar financial planning problems, allowing Daryn and his team to know what the future solutions look like early on in their relationship. This has allowed the practice to build a proven suite of services that can be reused over and over again, making the work they do more efficient and therefore, more impactful. Serving Clients and Client Acquisition When it comes to acquiring new clients, Daryn’s firm is a relationship-oriented business. Most of his clients come from referrals, something that he attributes to consistent hard work and delivery for his existing client base. While he doesn’t put emphasis on manufacturing referrals, he does point out that it is important to let your clients know when you’re taking on new business, along with the types of clients you wish to serve, so that they are given a nudge to refer their friends and family members. From there, your previous dedication will lead to successful client acquisition. To serve his clients, there is not one process that fits every situation. Typically, Daryn and his team begin by getting to know the client and their needs in a comprehensive way - Who are they? Why did they start the business? What are the biggest challenges they need help solving through wealth management? From there, Daryn’s firm steps in with suggestions of how they can fix the headaches the client is facing, using a solutions-based approach early on. He points out that taking several meetings upfront with a client is worthwhile in an industry where it could turn into a relationship spanning decades. Hint: If you want to learn more about the operations at Daryn’s firm, check out the investor resources on their website for articles and videos covering different aspects of investing. How to build a business that is a good fit for you For Daryn, running his own business is something that excites him, making it easy for him to be excited about working with other business owners. This is the key to building a successful financial advisory practice that is a good fit for you: finding out who you will be happy serving in the long run. Instead of focusing on the net worth of clients you wish to attract, or going down a path that you think you are expected to follow, Daryn suggests spending time and energy to build a business that feeds your sense of personal fulfillment, setting you up for long term, sustainable success. When it comes to the number of clients a firm should serve, Daryn says that you can find success at any number of clients as long as you establish a process that makes sense for all parties involved. Whether you have 3 clients or over 100, setting up a service model that aligns the needs of the clients with the needs of the advisor, as well as setting up a revenue model that allows the advisor to be properly compensated, is the best path. Hint: Interested to hear more from about approaching financial advising from the lens of being a business owner? Check out Episode 41 with Dustin Serviss, where we discuss how owning his own business helps him advise his clients. Daryn’s advice for young advisors breaking into the industry For those wishing to break into the financial planning industry, Daryn suggests utilizing the community of advisors around you. Take time to research firms that align with your value set and that serve communities that interest you, and look for mentorship opportunities within them. Similar to the legal or accounting world, the structure of the industry has shifted to people coming in as associates and working their way up at firms through hard work. Daryn suggests volunteering your services at different firms to find the best fit, and then making yourself a useful component at that firm, positioning yourself for upward mobility. To hear more from Daryn about the compensation model at his firm, what he attributes his success to, and his opinions on financial planning technology, check out the full interview. Listen with the link at the top of the page, or subscribe on iTunes or Stitcher to make sure you never miss an episode.
36 minutes | Jun 9, 2020
060: Grow Your Practice by Closing Estate Planning Gaps for Clients
Financial advising isn’t just about what an individual should do with their money while they’re still alive. It’s also about their family and what happens to wealth after an individual passes away. Wills, estate planning, powers of attorney, and healthcare directives are all important things that a financial advisor’s clients should be thinking about, and that means that financial advisors need to think about them as well. Today’s guest is Tom Deans. Tom is a professional speaker and the author of two best-selling books that deal with the intergenerational transition of family wealth: Every Family’s Business and Willing Wisdom. Listen to the episode to hear what Tom has to say about why there’s an estate planning gap, how advisors can fill that gap, and what kind of effect the COVID-19 crisis has had on the subject of estate planning. Topics Discussed in This Episode: How Tom became focused on the issue of estate planning (3:37) Why Canada has an intergenerational wealth issue (6:10) How advisors can fill the estate planning gap and provide advice to their high net-worth clients (12:01) What Tom has noticed about the culture of families that transfer wealth successfully (15:16) What is The Willing Wisdom Index (23:09) Whether there are any trends over the last few months related to COVID-19 (26:57) Links and Resources: For a free software trial: Sales@willingwisdom.com Call Tom: (519) 938-2069 Willing Wisdom Quotes From the Show: “Estate planning isn’t just about answering the question ‘Who gets my stuff when I’m dead?’ There’s a whole part of estate planning that’s very much about the living.” “A will is like an MRI for a doctor - the will and a conversation about a will reveals everything.” “Wealth has always been about family and family relationships.” Tom provides a unique perspective from outside of the traditional financial planning industry at how advisors can grow into an untraditional niche. His many successes in publicizing the issues facing intergenerational wealth position him to provide insight to all advisors on how they can grow their business by opening discussions on estate planning with their clients. Below, we will be discussing three key ideas from today’s episode: The Biggest Problem Facing the Transfer of Intergenerational Wealth What Successful Advisors Are Doing Right With Estate Planning How to Use Estate Planning Software as a Sales Funnel To listen to the full episode, use the audio player at the top of this page, or find us on iTunes or Stitcher. The Biggest Problem Facing the Transfer of Intergenerational Wealth In Canada today, many advisors are seeing more and more clients that are a part of the first generation in their family that faces dying before they can spend all of the money they have earned. As people accumulate wealth that has the potential to be intergenerational, one problem stands out amongst the rest: 12.5 million Canadians do not have legal wills as a part of their estate plan. It isn’t just low-income Canadians who are missing this key component of their financial plan; high net-worth individuals are coming up short too, putting their family’s wellbeing at risk once they pass away. If a person dies without a will, their province will use a unique formula to distribute their assets to their surviving relatives. Even if the family wishes to divide the property according to provincial law – which is rarely the case, having a will in place will reduce delays and expenses. If not having a will has such a negative impact on the ones closest to them, why do so many people not have one? Why are Canadians Not Making Wills? There are a few different reasons Tom provides to answer this question. The first is that many estate planning professionals have abandoned the practice of writing wills for more lucrative alternatives. With DIY will writing kits becoming more popular and more affordable, many lawyers have abandoned will writing for estate litigation. Not only is it harder and harder to find a will writing professional, but many people have superstitions around writing a will, finding the topic too morbid to discuss. With several first-generation clients not seeing their parents set an example by writing a will, it is left off of their list of priorities as well. For financial advisors, this leaves a corner of the market wide open for them. With nearly a third of Canadians not having a will, and the majority of people who do having less than perfect ones, financial planners are set up to take advantage of the market. As Tom puts it, “What is a more valuable role for an advisor to add value to a client relationship in than an area that every other professional has largely walked away from?” Hint: Interested in learning more about intergenerational wealth transfers? Check out Episode 47 with Cindy Radu, where we discuss how to increase the odds of successfully transitioning wealth. What Successful Advisors are Doing Right with Estate Planning If you are a financial advisor considering adding estate planning to your services, you may be wondering how to approach it. Tom points to the successes of American and European advisors in the space who have one thing in common: they have positioned themselves to be central to an entire family’s success. The main way to do this is to organize quarterly or yearly family meetings that cultivate a more formal approach to familial wealth preservation. Many people shy away from having these necessary financial discussions out of the fear of it causing family rifts. When an advisor acts as a facilitator for these discussions, resourcing solutions to the issues brought up and delivering them in these meetings, they become much more than a financial planner. They are set up to become a central part of the family’s financial success for generations to come. Tom points out that if an advisor is not offering this service, it is highly likely that their competitors are. In many cases, older clients are not as concerned with the amount of money an advisor has generated for them as they are knowing how they will be taken care of as they age. Offering this service could mean the difference between a client choosing your firm over your competition’s. The other main piece of advice Tom offers advisors is to make sure they have their own will locked down. If a financial planner does not have a will of their own, how can they successfully advise their clients on how to structure one? Tom suggests going over your own will and taking note of the questions that come up naturally for you. Who will care for you if you become incapacitated? How will your assets be divided amongst your children once you die? These are the same questions you can assist your clients with to form a long-term relationship. How to Use Estate Planning Software as a Sales Funnel Tom’s estate planning software, The Willing Wisdom Index, gives advisors the unique opportunity to simultaneously get automated data about an individual’s existing estate plan and to use it as a sales tool to lock down a potential client. The software works by creating an email that a financial planner can send out to a potential client or post on their social media channels. The prospect will then complete the questionnaire attached to the email, which will populate a robust report on the state of their estate plan. The report includes a general score out of 100, information on how their estate plan measures up to their peers, and a list of key areas they need to improve on. With this report, advisors have their foot in the door to suggest their assistance in closing the gaps in a person’s estate plan. By opening up a conversation about the topic using this software, the advisors are able to capitalize on this market that has been left open by other professionals. Hint: Interested in this software? Email Tom at Sales@willingwisdom.com for a free demo and to get more information. To learn more about how Tom got into the industry, how his books gained popularity, and the trends he sees emerging from the current pandemic, listen to the full episode. You can check it out at the top of the page, or subscribe on iTunes or Stitcher to ensure you never miss an episode.
51 minutes | May 26, 2020
059: How to Create a Value-Based Portfolio that Performs Well
Is it possible to make investments and get good returns while investing in assets that reflect your values? Today’s guest says that it is. Tim Nash is the founder of Good Investing, an investment planning firm with a focus on sustainable investing. Tim's blog The Sustainable Economist has inspired thousands of Canadians to invest according to their values with model portfolios to reflect different definitions of sustainable investing. Tim writes a bi-weekly column for The Toronto Star and is regularly featured in publications such as CBC’s The National, BNN Bloomberg’s Market Call, and the Globe and Mail. Listen to the episode to hear what Tim has to say about what’s involved in sustainable investing, what kinds of returns can be expected from those investments, and how Tim approaches helping his clients invest in a way that reflects their values. Topics Discussed in This Episode: What Tim and his firm do (1:09) How Tim got into his niche of the industry (3:22) Terms of Socially Responsible Investing (8:50) Where socially responsible investing is in terms of returns (14:20) Tim’s approach to advising and serving clients (20:00) Tim’s sliding scale (24:45) Tim’s advice for investors (46:19) Links and Resources: Good Investing The Sustainable Economist Quotes From the Show: “The number one indicator that is most correlated to financial outperformance is gender diversity on the Board of Directors." “You don’t need to sacrifice financial performance. You can do at least just as well, and most socially responsible funds have outperformed by a little bit.” “I very much believe in price discrimination- that some people can afford a higher price, and some people can afford a lower price.” From his unique business approach to his success in the sustainable investing niche, Tim Nash offers insights backed by years operating in the industry. Advisors at any career stage can benefit from learning from his expertise, along with hearing about the potential performance implications of cultivating a sustainable client portfolio. Below, we will be discussing three key ideas from today’s episode: How Tim Breaks Down Sustainable Investing Expected Returns in Sustainable Investing How Tim Structures his Business to Serve People from All Walks of Life To listen to the full episode, find us on iTunes or Stitcher, or listen with the link at the top of this page. How Tim Breaks Down Sustainable Investing To discuss the core of Tim’s business, we must first establish what sustainable investing really is. He breaks it down into two different groups: “Doing less evil” and “Doing more good”. Doing Less Evil The most common route to socially responsible investing (SRI) that Tim’s clients take is what he refers to as the “doing less evil” route. This style of investing still uses a typical approach: you are investing in large companies with the goal of getting market-rate returns. However, the companies that the client is investing in are vetted according to their values in order to get rid of the least sustainable companies, making sure that their money is being invested using a value-based system. The beginning of this model relied heavily on negative screening, which focused on excluding specific industries that the client did not want to invest in. A common example of this is a client not wanting to invest in any fossil fuel company. The model evolved further into relying on ESG analysis, which stands for environmental, social, and government research and analysis. This model evaluates companies based on those key factors to determine if they are acceptable for inclusion in a sustainable investing portfolio. For example, if a company contributes to pollution with the way they create their products or has a large carbon emission problem, they would fail the environmental analysis. If a company has poor labor standards or lacks diversity on its board of directors, it would not be up to par on its social analysis. If the company spends a lot on political lobbying, it may not qualify for sustainable investing due to the government analysis. Combining ESG analysis with participation such as shareholder engagement including voting on shares to push the companies toward more sustainable initiatives is what makes up the “doing less evil” model today. Doing More Good For those that are extremely committed to sustainable investing, they may opt for the “doing more good” model. This is based less on the traditional goals of financial returns, and more on the intention of investing for the greater good. Also referred to as impact investing, this model typically contributes to the private side, relying on things such as microfinance, green bonds, community bonds, etc. The investments are usually hyperlocal, impact-focused, and do not put much emphasis on the individual’s financial gains. Hint: If you want to learn more about value-based investments, check out Episode 39 with Ryan Fraser, where we discuss his approach to charitable giving. Expected Returns in Sustainable Investing For potential clients interested in sustainable investing, the main question on their minds is whether or not they would be sacrificing returns in their portfolio by using a socially responsible contribution model. While Tim admits there is no way to predict the future with complete certainty, over the past ten years companies who have good ESG have outperformed those who don’t. Tim’s clients have experienced high returns on their investments, largely due to major players with poor ESG falling out of popularity in the last 5 years. “My portfolios have done very, very well over the last 5-10 years… a large part of this is due to the fact that we are underweight or zero weight in fossil fuels.” Even if the energy sector does bounce back causing underperformance, Tim predicts that we will see climate change become more of a common issue, which may favor sustainable investment portfolios. He also notes that since many social funds are overweight in technology and healthcare, they are set up for success in the post-COVID world. Although there is no definitive answer to how the space will shape up in the future as sustainable investing becomes more and more mainstream, Tim’s clients typically do not have to sacrifice any returns at all, and oftentimes they can expect to slightly outperform traditional portfolios. Hint: Want to hear more from Tim on the debate around sustainable investment returns? Check out his appearance on Ben Felix’s podcast, where they discuss the economic impacts of SRI in detail. How Tim Structures his Business to Serve People from All Walks of Life Tim’s investment planning and coaching business is designed to allow him to serve all Canadians, no matter how large of an investment they can make. He does this with his in-depth investment coaching and education plan, as well as charging an hourly fee based on a sliding scale. At Tim’s practice, the goal is to educate a client to the point that they are comfortable investing on their own, setting them up for long-term independence and success. The first step is to teach his clients about the space, walking them through the complexities of financial planning so that they are confident in making decisions for their own portfolio. Next, he works with them to determine where they are on the spectrum of sustainable investing - whether they want to “do less evil” or “do more good”. Once that is established, he coaches them through their options in the sustainable space, explaining the tradeoffs in the industry and empowering them to choose an approach that fits them best. In the end, they have built their own portfolio based on the values they find most important, and Tim walks them through their first time investing. This unique approach is designed to alleviate the anxiety and fear around first time investing, allowing his clients to have long-term results thanks to him equipping them with confidence to make their own future investment decisions. In order to ensure that no one is unable to work with him due to cost, he created a pay scale that charges an hourly rate that is based on how much money the client has to invest. This way, he is able to serve clients who would normally have to make these decisions on their own, while still allowing him to profit off of his expertise. Listen to the full episode to hear about how Tim got into the sustainable investment niche, how he is expanding his business, and the biggest obstacles he has overcome while running his own practice. You can check out the episode at the top of this page, or subscribe on iTunes or Stitcher to make sure you never miss an episode.
45 minutes | May 12, 2020
058: How to Build a Successful Practice by Swimming Against the Tide
Sometimes, you may encounter an idea or opportunity that hasn’t yet been adopted by the mainstream, but you just know that it makes sense. Having the vision to know when something makes sense for your practice or your clients even though it isn’t yet mainstream in your field is a quality that can separate the average advisors from the exceptional ones. Today’s guest – an early adopter of ETFs – has insights to share about the importance of knowing when to swim against the tide. Keith Matthews is a Partner and Portfolio Manager at Tulett, Matthews & Associates. He has an MBA from the Richard Ivey School of Business and is a Chartered Investment Manager. For close to 25 years, Keith has been working with his clients to deliver leading-edge wealth management strategies to help his clients reach their long-term goals. Listen to the episode to hear Keith talk about why he decided to become an advisor, what attracted Keith to ETFs in the early days, and how clients respond to Keith’s book, The Empowered Investor. Topics Discussed in This Episode: Why Keith decided to become an advisor (3:22) What attracted Keith to ETFs early on (5:57) How Keith approaches advising and serving his clients (12:08) Why doing taxes for clients gives you an edge (15:53) The role of Keith’s book in the client acquisition process (21:17) How Keith leverages software at his practice (32:11) Advice for new advisors (40:11) Links and Resources: Tulett, Matthews & Associates The Empowered Investor Quotes From the Show: “All of the early advisors that were doing this knew it made sense, knew it was the right thing, knew it was very friendly for clients.” “The idea of at least understanding tax sensitivities is huge for an advisor, and it’s a huge value-add for clients.” “If a client buys into all the following things and wants to have the sort of comprehensive approach that we’re dealing with, wants to be engaged, is serious, wants to see themselves reach their goals, and subscribes to the investment approach, then I think we’ve got a really nice connection.” With an expansive career in the industry, Keith has become an expert on ETFs and passively managed strategies. His knowledge and experience can help you evaluate your processes, no matter what career stage you are in. Below, we’re discussing three key ideas from today’s episode: How Keith Pioneered the use of ETFs How to Set Up Clients for Success with a Thorough Onboarding Process Keith’s Advice for New Advisors To listen to the full episode, use the link at the top of this page, or find us on iTunes or Stitcher. How Keith Pioneered the use of ETFs When Keith began his career in the financial services industry, he worked in a bond trading position at the institutional level. As he began to understand the way financial performance was being measured, he realized that there were a lot of institutional firms that were not performing at the level they boasted. It is then when he started thinking about serving individual investors by delivering wealth management services and building portfolios using asset allocation strategies and attaching those strategies to underlying ETFs. When Keith began this practice in the 1990s, he was swimming against the tide- going against other firms marketing different approaches as the “secret” to successful long-term investing. Keith continued pursuing this new approach because it made sense for both the advisor and the client. The business model allowed the advisors to have the time to focus on the things that their clients cared about the most: Do I have enough money to retire? How can I optimize my taxes? Are we on track to meet our financial goals? By pioneering a model that put client needs first, he was able to build a successful practice and implement an approach that has since grown in popularity. Hint: Want to learn more? Check out Keith’s book, The Empowered Investor, which outlines 8 key investing principles in a way that anyone can understand. How to Set Up Clients for Success with a Thorough Onboarding Process When it comes to serving clients, Keith starts the relationship with a strong onboarding process that allows the advisors and the clients to get to know one another. They begin with a discovery meeting, which can last up to an hour and a half, where there is no presenting from the firm - only listening to what the clients have to say. They learn who the clients are, what their goals are, and what they wish to accomplish by working with a wealth planning team. At the end of the meeting, they do a deep dive into the client’s financials to understand where they’re at at. If both parties feel like the fit is good, then they move on to a proposal meeting, in which Keith and his team inform the prospective client on how the firm operates and what investment approaches they take. As a result of this comprehensive process, Keith is able to work with clients that are serious about the process and that want to be engaged in it. An educated client will get more out of financial planning services because of their level of involvement, their accurate understanding of expected returns, and the trust that is built with their financial advisor. Hint: Interested in learning more about the importance of client education? Check out Episode 54 with Sasha Djurdjevic, where we discuss how he approaches educating his clients. Keith’s Advice for New Advisors After 25 years in the industry, Keith has one key piece of advice for aspiring financial advisors: to find the services that you love and put a lot of energy into those strategies. The more passionate you are about the way you are investing, the more likely it is that you will find success with clients. For young advisors fresh out of college, Keith recommends joining a firm and finding a philosophy that you identify with. There are many opportunities at firms for those that work hard, and they are a good place to begin your career. For more seasoned adults looking for a career change, whether they take an entrepreneurial route or join an existing team, as long as they find an approach that fits and put client needs first, they will be set up for success. Listen to the full episode to hear how Keith utilizes financial planning software at his practice, and how his clients and colleagues have responded to his book. You can listen to the episode at the top of this page, or you can subscribe on iTunes or Stitcher to make sure you never miss an episode.
52 minutes | Apr 28, 2020
057: How to Use Financial Storytelling to Help Non-Traditional Clients
People in different fields and with different types of learning styles think about finances in different ways. There is more than one right way to talk about finances and financial planning – the trick is finding the language that works for you and the language that can best speak to your segment of clients. And that’s what today’s guest is here to talk about. Chris Enns is not just a financial planner – he’s also an opera singer. Over the last 10 years as a performing artist, he’s learned the hard way that ignoring money doesn’t really work. That’s why he founded Rags to Reasonable - an advice-only financial planning & money coaching firm that specializes in working with creatives and people with other non-traditional financial situations. Listen to today’s conversation to hear what Chris has to say about non-traditional financial planning, Chris’s biggest challenges and successes, and what it’s like to speak a different kind of financial language. Topics Discussed in This Episode: Who Chris’s firm usually serves (8:48) Chris’s strategies for coaching and planning (14:30) What happens after clients improve their financial stability (19:50) Using different financial language for different kinds of people (28:55) What things Chris believes have contributed to his success (31:37) The biggest challenges Chris is facing (35:37) Chris’s advice for financial planners (49:53) Links and Resources: Rags to Reasonable Quotes by Chris: “The truth is, the things that make people great artists, and really good at their craft, are the exact things that are going to make them good at their finances.” “I think that one of the things we need to think about more in the financial space is that the answer cannot be that we talk about money in one way.” “I have never had a real job in my life – I’ve worked for myself my entire life.” Chris is using his performative background to portray a new type of story - a story of financial success for his clients. By helping his fellow artists rethink their ability to handle money, he has found success in the niche he has created to help those with unique financial situations. His experience in growing his advisory practice teaches businesses both young and old that customizing a client’s experience and solidifying a client/planner relationship is the key to maintaining success. Below, we’re sharing three key ideas from this episode: How to work with variable income clients How mentorship and financial independence helped Chris start his practice How to use relationship building as a client acquisition tactic in times of market instability To listen to the rest of the episode, click the link at the top of this post, or find us on iTunes or Stitcher. How to work with variable income clients Before Chris became a professional advisor, he saw the need in the arts community for a specialized approach to financial planning. When he transitioned into running his fully online financial advisory practice, he wanted to meet the demand he saw during his own arts career. It was natural that his client base would be made up of sole proprietors and small businesses, almost all of whom had variable income. Clients with variable income often struggle with common financial questions like how to save money, pay off debt, or plan for retirement when their cash flow is so irregular. They are also often younger and less versed in the financial planning world than other advisory clients, making it important for Chris to listen carefully to their background before jumping in with a plan. His solution? To build a plan that can transition into a lifelong technique, knowing that not everyone can fit into the same system. Crafting a repeatable, customized plan The first step Chris takes with a new client is to get to know them and make sure that his services are a perfect fit. If not, he takes the time to send them in a direction that will help their financial needs. If he feels he can provide value to the prospective client, he creates a custom proposal based on their exact needs. This ensures that each unique financial situation is taken care of in the way that best fits their situation, rather than forcing a general approach on them. When Chris is coaching clients with variable incomes, he uses their time together to craft a set of steps that can be worked over and over again, allowing the result to become more than a one time financial plan. As he says, “It’s more teaching the person to fish, rather than handing them a basket of fish.” Hint: It may seem like a lot of extra work to start from the ground up for each client rather than use a standardized system. Try creating a customized quoting system like Chris uses to make sure that your extra effort is reflected in what you are paid. How mentorship and financial independence helped Chris start his practice Even though Chris’s practice is relatively new, he has been very successful at producing early growth. He attributes his success to two key components: mentorship and financial independence. Since Chris had an untraditional pathway into the business, having mentors allowed him to see what his own path could look like in the field. Especially for young businesses starting their practice, he recommends finding experienced planners to learn from, which will help them wrap their minds around the complexities of the industry. Hint: Want to learn more from some of Chris’s mentors? Check out Episode 9 with Julia Chung and Sandi Martin from Spring Financial Planning. The second thing that helped Chris through his early years in financial advising was his ability to not rush to monetize his business. He dipped his toe into the field by writing a blog, which eventually led him to further opportunities to expand and create the business he runs today. Because it was his side gig and he was fully supporting himself with his operatic career, he did not have to take on non-ideal clients. This has helped him continue to work with the people that are the best fit for his practice, as the more ideal clients he works with, the more ideal clients he gets referred to him. How to use relationship building as a client acquisition tactic in times of market instability One of the biggest challenges Chris is facing right now is pivoting his practice to be more accessible during the pandemic. With many of his clients facing an extended time period of not being able to find work in their native fields, he is having to solve new financial problems. Even with emergency funds, many of his arts industry clients will be forced to take on different jobs to make ends meet. The new opportunity that Chris sees is making his services more affordable, so that he can continue to work with his clients. He is working to create different ways to serve them, whether that be through shorter sessions, a smaller budget, or through his free office hours offered on his website. While this is allowing Chris to help his clientele when they need it the most, it is also a good business move. By taking the time to continue to build relationships even when there is no profit to be made, his investment into people will create more business when their financial lives are back to normal. Chris anticipates that once we are on the other side of this crisis, the demand for financial planning will be larger than ever. To learn more about Chris’s unique journey to the industry, how he uses workshops to attract new clients, and how he wants to enlist artists to create financial art, listen to the full podcast by hitting the link at the top of this page. Make sure to subscribe on iTunes or Stitcher so that you never miss an episode.
46 minutes | Apr 14, 2020
056: How to Help Clients Visualize Their Financial Success with Dashboards
What does it mean to think outside the box when it comes to financial planning? And what do financial advisors need to know about working with clients through turbulent and volatile events, such as the coronavirus pandemic? Today’s episode will explore some of those questions. Lucas MacMillan has been working in personal finance for 10 years. He is a Certified Financial Planning Professional and graduated from the University of Manitoba with a Bachelor of Science. Lucas manages Camber Private Wealth’s financial planning effort; where all prospects are given a financial plan before investing and all clients receive ongoing financial planning support using Camber’s immersive custom financial dashboards. Lucas also leads Camber’s data science team. What You’ll Learn in This Episode How Camber approaches building a plan with clients (5:43) How client dashboards work and what their goal is (12:06) How Lucas starts with dashboards (14:30) The client response to recent market volatility (24:20) The goal of Lucas’s data science project (30:49) How Lucas’s firm has been acquiring clients (37:35) Lucas’s advice for listeners (43:31) Links and Resources: Lucas MacMillan Camber Private Wealth Quotes by Lucas: “We really wanted to go way outside the box on financial planning.” “Just getting people a financial plan is a huge win.” “It isn’t extremely important that you get their financial life 100% accurate the first time you touch them. It’s something that you can massage over time, as you get to know the client.” Lucas provides a fresh perspective on the future of the financial planning industry. His practice is using technology and data science to change the way their clients interact with their financial plans, creating a unique way to attract and retain clients. Whether you’re a seasoned wealth manager who is comfortable with status quo, or you are building your financial advisory practice and want to employ fresh tactics, you can learn from the innovative ways Lucas approaches his work. Below, we’re sharing three key ideas from this episode: How Lucas customizes client experience using data visualization How Camber is leveraging data to combat low conversion rates in the financial industry The importance of client education and continuous marketing during times of financial instability To tune in to the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link at the top of this post. How Lucas Customizes his clients’ experience using data visualization Coming from a background working in a centralized planning division at a larger firm, Lucas was used to communicating with clients via huge stacks of paper packed with information. When he moved on to Camber, his goal was to redefine the way in which he could display the key messages in a financial plan to his clients. His solution was to build custom dashboards for each client, visualizing their personal data and allowing them to access any detail of their financial plan with ease. How It Works Before meeting with a client, Lucas sends them an adaptive questionnaire that allows them to fill out as much or as little information on their financial status as they would like to. From there, his team builds a financial dashboard that houses the information they provided, as well as the financial plan the firm has built for them. Over time, they add more information on every client, making their dashboard more and more robust. The complete dashboard replaces the need for a lengthy, printed financial plan that makes it difficult to find specific details. His clients are able to see their financial assets on a high level when they just want general figures, or they can dig down into any specific area to get full visibility into their wealth management status. For example, a client can open their dashboard and check out a summary of their cash flow sources. If they want more information on a specific area of cash flow, they can click through and get details on every aspect, like salary, bonus pay, stock-based compensation, and more. Camber’s immersive dashboards also include two key sections for client visibility: a “your control” section and an “our control” section. The “your control” section allows clients to visualize the aspects of their financial plan that they can directly control. How much should they save over the next five years? How caught up are they on their RSP contributions? If they follow the steps recommended by their financial planner, how will it affect them in the long run? The “our control” section allows clients to clearly see the things their financial planner is controlling. Things like asset allocation and diversification are displayed in a way that makes it easy to see the contribution the planner is making to the client’s financial wellbeing, forming a stronger client relationship over time. Hint: Do you struggle with collecting financial data from your clients? Consider allowing them to provide only the information they can easily access and then make their plan more specific over time. The less they have to do, the more likely they are to convert. Client Response Lucas says the response he has gotten to Camber’s dashboards has been overwhelmingly positive. His clients feel like they are able to participate in important conversations about their financial health because the data is presented in a manageable way. The dashboard is like a custom search engine for each client to be able to quickly access answers to common financial planning questions, allowing them to make more informed financial decisions leading to better long term outcomes. How Camber is leveraging data to combat low conversion rates in the financial industry A key issue Lucas is focused on is the low conversion rate in the financial planning industry. Why are potential clients abandoning the process of developing a financial plan? In the hopes of solving industry problems such as this one, Lucas started a data science division at Camber, which works with students at the University of Calgary to fill in the blanks using survey data. Reported spending habits from clients are often guesses; no one keeps track of every dollar they spend. To tackle this discrepancy, Lucas’s team uses microdata files containing surveys of large groups of people to estimate spending data based on parameters such as age, income level, gender, family size, and more. Using these findings, he is able to communicate comparative data to his clients to give them an understanding of how they match up to their peers. Are they spending more money than the average person of their age? Are they spending less money, setting them up for a stronger financial future? This allows people to fully understand their financial status and encourages them to make smart decisions to keep up with the pack. The importance of client education and continuous marketing during times of financial instability In the midst of the Corona Virus pandemic, clients want to know how the changes in the market are going to affect them. Lucas has found that his client base has stayed calm during this time of market volatility. He credits this to Camber’s dedication to keeping clients informed with their dashboards. With stress testing displayed in an easy way, clients are able to visualize their worst-case financial scenarios, helping them to understand that in most cases, they will be okay despite market downturns. Lucas stresses that times like these are not anomalies, but are to be expected when investing. “It’s not a bug in the market, it’s a feature of the market. The market doesn’t always go straight up”. For financial planners, Lucas sees this time as an opportunity to focus on their marketing efforts. While some people are taking a break from promoting their firms, the practices that focus on marketing will come out of this crisis ahead of their competition. He advises making a push towards digital marketing, setting yourself up for success once this is over. Hint: Want to learn more about attracting new clients despite the COVID-19 crisis? Check out our episode with best-selling author and marketing expert Allan Dib. To hear more about Lucas, like why he made the switch from environmental chemistry to asset management and how Camber is overcoming technological challenges, listen to the full episode using the link on the top of this page. Make sure to subscribe on iTunes or Stitcher so that you never miss an episode. To get notified the next time an episode goes live, subscribe to our mailing list below!
43 minutes | Mar 31, 2020
055: Practical Ways to Keep Improving your Skills as a Financial Planner
In theory, everyone wants to constantly be improving their financial planning skills, but what does it mean to put that into practice? Today’s guest is a relatively new financial planner who has already achieved more than many who have been in the industry much longer. He’s here to share his proven methods for improving his craft. Zak Smith is the Senior Manager of Financial Planning and Wealth Strategies at Sagium, an independent wealth management firm in Calgary. He is a founding member of the newly formed Financial Planning Association of Canada and volunteers his time as a mentor for the Mount Royal University business department as well as with the CPA Financial Literacy Program. His recent successes include being named the 2019 winner of the PlanPlus Canada Financial Planning Awards, and 2nd runner up of the PlanPlus Global Awards program for the Americas region. Listen in to hear Zak talk about how feedback and competition make him a better financial planner, how he’s helping clients through the recent volatility in the markets, and what it’s like to serve clients as a team. What You’ll Learn in This Episode: What made Zak switch from accounting to planning (3:20) Zak’s typical process for clients (6:00) How Zak prepared clients for volatility in the markets (11:30) How feedback and competition make Zak a better financial planner (15:05) The challenges Zak encounters in his practice (23:45) How Zak’s team can provide a personal touch while working as a group (30:30) How Zak applies different perspectives to his work (34:15) Links and Resources: Zak Smith Sagium Why Financial Planning Software Doesn’t Make Advisors Faster Quotes by Zak Smith: “Whether volatility exists now or in the future, we know it’s going to happen.” “I was always cognizant that hey, is there any metric to what we actually do in this industry as far as a standard for what we’re delivering to our clients?” “Clarity became the utmost piece in developing our plan reports so that it just made the conversation a lot easier with the clients.” Zak is unique as a guest on this show: he’s only five years into his career as a financial planner, and he doesn’t run his own practice. And yet, he’s built into his career ways to constantly improve himself as a planner. So whether you’re just starting or have been doing this a long time, and whether you run your own firm or not, you can draw from his experience and find ways to build on your skills. Below, we’re sharing three key ideas from this episode: How Zak prepared clients for volatility in the markets How feedback and competition make Zak a better financial planner How Zak applies different perspectives to his work For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. How Zak prepared clients for the recent market volatility Market volatility has been on all of our minds recently, and financial advisors are at the front lines of questions from clients about what they should do. Do they stay the course? Pull out as quickly as possible? Take advantage of low stock prices? But Zak has seen fewer questions from clients than he would have expected, and he credits that to the stellar process his firm has when planning for clients. They engage clients in the process right from the beginning and make sure their clients understand that downturns and volatility are just part of the process. Specifically, they use planning software to actually show clients what kind of volatility can exist in the markets and how it might affect their financial plans — so when clients see it happening in real life, a lot of the fear and confusion just doesn’t happen. Zak makes sure they know what the plan is and how they’ll be looked after no matter what’s happening in the market. Of course, if clients do have questions, Zak’s team welcomes the conversation. But at no other time has the value of the process been more clear to Zak because he can see firsthand how much comfort their process has provided clients in uncertain times. Hint: For another perspective to help you guide your clients through a difficult market, listen to How to Measure Client Progress Effectively (Even If Markets Decline) with David Christianson. How feedback and competition make Zak a better financial planner Anyone can learn from Zak’s (so far) short but successful career as a financial planner. In particular, he’s been very committed to improving himself as a planner, which has helped him achieve recognition in the field already. But more importantly, it’s made him able to provide a better service to clients. External feedback In 2019, Zak won the PlanPlus Canada Financial Planning Awards and was the second runner up in the Americas region for the global awards. While the accolade is a major honour, Zak simply entered the competition because he wanted to see metrics and a standard for what he was delivering to clients. He had the sense that his team’s process was excellent, and his clients and colleagues seemed happy, but he wanted a panel of industry experts to look at what he was doing and give him feedback on what he could improve. Before he entered the competition, he took a few years to evolve the process and plan reports with his team until he felt comfortable asking for that external feedback in the form of the competition. Internal feedback Zak’s passion for feedback doesn’t only come out in prestigious competitions, though. It starts in his office, where he and his team do the planning for all of the firm’s clients, whether they’re looking for investments or insurance. Zak and his team do a lot of diverse financial plans, so they can’t always be in the room when those plans are presented to clients. As a result, they rely on frequent discussions both among themselves and with the advisors at the firm to make sure their plans are working for clients. Zak’s door is always open to colleagues who have an idea to streamline the process, bring more clarity to plans, or improve the client experience. More formally, they also meet at least once a month to debrief with the advisors and generate ideas for how they can improve the plans. This built-in opportunity to discuss and offer one another feedback is the foundation of Zak’s success as a planner. How Zak applies different perspectives to his work Since Zak is still new to the industry, he relies a lot on hearing others’ perspectives and learning from others’ experiences. Podcasts in particular have been a big source of learning from him, and he tries to keep an open mind to different ideas and points of view. Some of his industry-specific favourites include: Michael Kitces’ Financial Advisor Success Podcast — a well-known classic. Jason Pereira’s Fintech Impact — a friend of the show who focuses on technology and how it impacts the industry. XYPN Radio — a US-centric show. But since the US seems to be further ahead in terms of industry changes, Zak finds this one relevant in terms of learning how he can adapt and service the next generation of clients. One additional step Zak recommends is reaching out to people after consuming their content. When he has questions or just really connects with what someone writes in an article or says in a podcast, he isn’t afraid to reach out to connect and learn more from them. Hint: Zak emphasizes that the most important part of learning from others is having a good filter. Everyone has different needs and contexts, so make sure that when you apply others’ ideas, you filter out what doesn’t work and shape the rest to your situation. To hear more from Zak, like how his accounting background has informed his planning career and why he’s obsessed with clarity, take in the full episode, which you can find right here on this page. Or better yet, subscribe on iTunes or Stitcher so you don’t miss any episodes. To get new episodes directly to your inbox, you can also sign up for our mailing list below.
49 minutes | Mar 17, 2020
054: How to increase the value of your financial advisory services by educating your clients
When it comes to the question of how open to be with clients, at what point of the spectrum do you fall? Do you teach them enough that they feel invested in the plans that you build? Do you bore them to tears with lectures about the industry that have nothing to do with them? Today’s guest has found the balance between transparency and relevance, and he’s here to show you how you can increase the value of your service for your clients. Sasha Djurdjevic, CIM, FMA, DMS, is a portfolio manager serving global private and institutional clients at his firm, River Wealth. He has extensive capital markets experience and has held senior investment roles at prominent investment companies in Canada. Listen in to hear what Sasha has to say about his educational approach to financial planning, his tricks for communicating complex ideas to clients in a way that’s relevant to them, and how he balances his business with raising four children. What You’ll Learn in This Episode: Sasha’s unusual niche (6:40) Sasha’s 70% rule for financial planning (13:10) How Sasha acquires clients who live abroad (20:00) How Sasha uses idea generation to communicate complex ideas to clients (24:20) The value of transparency and openness (28:05) How Sasha balances running his practice with his personal life (38:20) Why it’s important to know yourself as an independent advisor (46:10) Links and Resources: Sasha Djurdjevic Aligned Capital Partners Inc. Quotes by Sasha: “Trying to bucket people, and say that if you’re a non-resident you have these unique issues, is useful to a point, but the reality is that every client is different.” “Help people to understand the context a little more, and you’ll end up with a more satisfied or self-actualized client, who then will value your work more highly.” “Instead of trying to come up with a perfect plan, come up with a plan that does a pretty good job of reflecting what’s in front of you and what you know, then put your full effort into that plan.” With Sasha’s experience working with a mix of institutional, retail, and global clients, he’s had to shift contexts, meet people where they’re at, and translate difficult concepts into learning opportunities relevant to each unique client. Below, we’re sharing three key ideas that he’s imparting to you: How Sasha approaches educating his clients The value of transparency and openness Sasha’s 70% rule for financial planning For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. How Sasha approaches educating his clients When Sasha first started serving retail clients, the biggest challenge he had coming from working with industry clients was the amount of hand-holding he felt he had to do to help people understand their financial situations and the work that he does. He was used to working with people who knew as much as, or more than, him about finance. But with retail clients, he knows so much more about the topic, and numbers are so much more a part of the way he thinks, that he found it difficult at first to relate to where his clients were coming from. He realized that as an advisor, he can ask all of the right questions… but his clients will still not necessarily know the answers. They may have a basic idea of what they want and what they can do with their money, but they don’t really know what’s possible. But he also didn’t want to take client education in the other direction — some advisors give a lot of information to their clients, but that information isn’t relevant to the specific person they’re talking to. Without a focus on the client and their objectives, an overload of information is useless and overwhelming. Sasha has learned over time to find a balance between the two extremes. He spends time dialoguing with clients and making them part of the planning process. Within it, he finds opportunities to integrate education about their contexts. In these conversations, he helps open their minds to what they can do in their situations — thus helping them achieve goals they didn’t even know were possible. The value of transparency and openness with clients Hand in hand with education comes transparency — and Sasha likes to take the time to explain to his clients how the industry works. He doesn’t teach them the full nuance; rather, he gives them enough context to help them understand their place within it. Transparency doesn’t specifically produce revenue in itself — instead, Sasha’s reasoning behind it is that it purely benefits the client. Hopefully, that means more business for him, but the goal is never to extract as much revenue as he can from people. The outcome he’s looking for is that the client is informed and happy. “Help people to understand the context a little more,” he explains, “and you’ll end up with a more satisfied or self-actualized client, who then will value your work more highly.” And when they value your work, they are willing to pay for that value. Hint: To hear from an advisor with a commitment to radical transparency, listen to our episode on building and managing a successful investment firm. You’ll hear from Steadyhand’s Tom Bradley about his “obscenely transparent” practices and how you can apply them in your business. The taboo topics A commitment to transparency means breaching the taboo topics of fees and benchmarking. There’s a common misconception that discussing these topics has a risk of poor optics for the advisor — what if you’re underperforming the benchmark? What if someone else has a lower fee? (And let’s be honest: there will always be someone out there with a lower fee.) If you’re avoiding these topics, clients will feel like you have something to hide. And if anyone does ask you about them, you’ll feel thrown off and uncomfortable answering their questions. If you address these topics head-on, though, your clients will feel that you’re being open and honest with them, and they’ll trust you more for it. Hint: A great question to ask potential clients is, “what have your conversations about this (fees benchmarks, or whatever else) been with your past advisor?” Unfortunately, most clients won’t have an answer because their advisor won’t have discussed these things with them — automatically making you look like a more trust-worthy, valuable choice. Sasha’s 70% rule for financial planning Sasha feels that the financial plans he creates for his clients are more general than what many other advisors do. One reason for this is that people’s predictive abilities aren’t very good; most people can’t reliably tell what their lives will look like in the future. And that makes sense — there are so many variables to consider that it’s impossible to know what the future will bring. Especially with younger clients, there is always time to adjust the plan, and a lot of control over your strategy. It just doesn’t make sense to put in every little detail and obsess over little things 30 years from now that you are still able to change in the meantime. Hint: Not only is too much detail not very useful, it often bores clients. If you fill your financial plans with information that isn’t meaningful to them (and a lot of numbers they don’t understand), they won’t feel as invested in the plan and will be less likely to stick with it. When it comes to financial planning, Sasha applies a rule used by the US Marines: the 70% rule. In imperfect situations — like a battlefield or, let’s be honest, life in general — don’t aim for a perfect plan. Instead, aim for a plan that’s 70% there. If you have 70% of the information you need, 70% of the possible implications of your plan and 70% confidence in its accuracy, that’s a great start. And that’s the caveat — it’s a start. Put your full efforts into the plan, with the full understanding that you will adjust it continually as you learn more information. Catch the full episode to hear from Sasha about how he works globally while thinking like a local business and why as a business owner, the first thing you need to understand is yourself. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
41 minutes | Mar 3, 2020
053: Building a Referral-based Financial Advisory Practice
Financial advising is a profession that draws in an eclectic mix of individuals who come from different backgrounds and whose career paths haven’t always been straightforward and predictable. Today’s guest formerly served in the military as a forensic accountant; now he not only runs his own financial practice, he’s also the world’s first (and probably only) forensic accountant blockchain professional. He joins the show to share what he’s learned from his military experience that has helped him serve his clients and grow his practice on referrals alone. Robert Watterson is the owner of Watterson Financial Solutions, a firm that handles financial planning, accounting, compliance, insurance, asset protection and tax services. Listen to hear what Robert has to say about how working in forensic accounting informs his current work, how he remains focused with so many different areas of practice, and how his interest in blockchain technology helped him develop an audit-ready bookkeeping system. What You’ll Learn in This Episode: How Robert moved from military forensic accountant to advisor (5:00) How his military experience informs the way he acquires clients (9:10) Staying focused while providing different offerings (18:40) How the different parts of Robert’s business build on one another (21:40) The blockchain’s impact on the financial industry (23:40) Robert’s audit-ready bookkeeping system (30:30) Robert’s biggest challenge in growing his practice (35:10) Why service is the most important part of running a practice (38:00) Links and Resources: Watterson Financial Send Robert an email Quotes by Robert: “In the military, one of the things that they taught us was never look for what’s good for you; look for what’s good for the overall project you’re working on. And if you’re working with a client, that means the overall good for the client.” “Make yourself referable… If you are referable, they will come back to you for work or they will have somebody come to you for work.” “If you don’t worry about making money off every client, the client will worry about making sure you make money.” With Robert’s different interests and areas of expertise – forensic accounting, blockchain technology, compliance and financial planning – it can be difficult to see how everything fits together. And yet, he’s able to pull knowledge and skills from different areas to create a unique practice in a way that we can all learn from. How Robert’s military experience informs the way he acquires clients Robert’s obsession with learning Robert’s biggest challenge in growing his practice For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. How Robert’s military experience informs the way he acquires clients In the military, there is a high emphasis on sharing information freely and looking out for the team. Robert had to make sure that if he was injured or killed during an assignment (yes, the stakes were that high), somebody else still had the knowledge and skills to do his job. As a result, he is used to an open culture of constant teaching and learning. He explains that “in the military, one of the things that they taught us was never look for what’s good for you; look for what’s good for the overall project you’re working on. And if you’re working with a client, that means the overall good for the client.” Robert feels deeply that his job is to help people, and he’s never afraid to give his time freely to people without expecting anything in return. At the large insurance firm he worked at, he often took on the clients and cases nobody else wanted because they didn’t come with obvious financial gain for the advisors. People did tell him that if he did this, eventually clients would come back to him. And while that’s not why he helps people, the prediction was correct. That’s the irony of good service – when you don’t look at how much money you can make and focus instead on helping people, financial success often follows as a result. In fact, Watterson Financial Solutions no longer advertises their business at all – they can’t because they have so many referrals coming through. Robert summarizes the approach like this: “Service your client. Give them the information they need and don’t worry about making money off of them. If you don’t worry about making money off every client, the client will worry about making sure you make money.” Robert’s obsession with learning Another aspect that Robert brought from the military into his advising is his ability to learn. In the military, he would have to learn about projects (and the associated knowledge and skills) quickly and expertly – when investigating other countries or protecting against financial warfare, a mistake could cost him his life. As a civilian, Robert has maintained a hunger for knowledge. He isn’t a dabbler – if he’s going to proceed with something, he needs to know everything he possibly can about it. He certainly doesn’t feel comfortable advising people on anything he doesn’t fully understand. For example, he recalls that his team once spent 18 months looking into a new investment before ever mentioning it to a client – he wanted to be sure he thoroughly understood everything there was to know about it first. He certainly refuses to do things halfway. Similarly, he realized early on that blockchain technology was going to transform the financial industry. When he found out that post-secondary schools were beginning to offer courses and degrees in blockchain, he took one of the first offerings available in North America and became the first (and still only) forensic accountant blockchain professional. With or without Robert’s military background and remarkable ability to absorb and understand new information, you can apply his principles about learning to your advising. Your clients expect you to be an expert in your field – make sure that’s what you deliver. Own your expertise and be aware of your limitations so that you can address them and serve your clients to the best of your ability. Hint: To hear more about the importance of learning throughout your career, listen to our episode on improving your practice through professional education with Jason Watt. Robert’s biggest challenge in growing his practice Robert says that the biggest challenge in his career has been always wanting to already be at the next higher level. For example, when he left his insurance company, the company’s regulations stated that he couldn’t take his 700 clients with him; he had to walk away from relationships he’d built over years and begin rebuilding his client base. Robert has been learning to feel comfortable with the level he’s at right now even as he strives for more, and channeling his frustrations to fuel his motivation. Hint: If you’re feeling frustrated about your practice’s growth (or lack thereof), keep in mind that running a business is not a sprint by any means. Listen to our episode on predictably growing your practice with systems, tools, and referrals for suggestions from John Page on where to focus your efforts to build a sustainable business. Make sure you catch Robert’s full episode to hear more, including his early involvement in blockchain technology and how it informed his audit-ready bookkeeping system (yes, it really is audit-ready). You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
43 minutes | Feb 18, 2020
052: A Smart Approach to Balancing Risk and Return for Your Clients
Higher returns often mean higher volatility — so how do you know when it’s worth it to be more aggressive and when you should settle for a lower, but more stable, return? And how can you help clients trust that you’re taking the right approach? Today’s guest is always thinking about risk and return and has a framework to help you balance the two. Martin Pelletier is a portfolio manager and managing director at TriVest Wealth Counsel, a division of Wellington-Altus Private Wealth. He is a Chartered Financial Analyst (CFA) charterholder and has extensive investment industry experience, including senior roles in capital markets, private banking, venture capital, wealth management, and family and multi-family office. Martin is regularly featured in the media and is a weekly contributor to the Financial Post's Investment Pro section. He is a member of Thomson Reuters Canada’s top 40 social influencers in finance, innovation and risk (2017), was a top-10 finalist for the BlackRock Award for Canadian Portfolio/Discretionary Manager of the Year (2018) and was recently named to Wealth Professional Canada Magazine’s Leading Portfolio Managers (2019). Listen in to hear what Martin has to say about risk, return, and the foundation of his success. What You’ll Learn in This Episode: How Martin (accidentally) avoided the financial crisis (2:05) How goals-based benchmarking removes unnecessary risk (6:25) How asset management differs between high net worth and ultra-high net worth clients (12:30) Building trust at scale (17:00) How thinking big and building small has contributed to Martin’s success (21:55) How advisors need to reposition themselves to succeed in a changing industry (28:20) How Martin has eliminated the most challenging aspect of his business (33:40) Why he thinks you should never get comfortable (40:40) Links and Resources: TriVest Wealth Martin Pelletier Email Martin Quotes by Martin: “With ETFs coming out, it’s democratized the investment industry, and commoditized it.” “It’s all about building relationships. The number one reason why someone’s going to decide to go with you is trust.” “If you really want to impose change, you have to think big and build small.” Martin Pelletier’s financial advice is sought after both by the media, and high and ultra-high net worth families. Today, he’s sharing his expertise with us. Below, we’re sharing three key ideas from this episode: How goals-based benchmarking removes unnecessary risk How asset management differs between high net worth and ultra-high net worth clients Building trust at scale For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. How goals-based benchmarking removes unnecessary risk It’s pretty clear at this point that the value proposition of financial advisors needs to change — with technology and new products making do-it-yourself investing easy and inexpensive, advisors have to offer something more. For Martin, that something more is a holistic planning solution that tailors investment portfolios not to an index, but to a client’s specific goals. Every investor has a goal they want to achieve, whether it’s retiring in five years, travelling, spending their time volunteering, or working part-time. Martin starts by understanding what it is his clients want to achieve. Next, he derives a cash flow statement and comes up with a target return. Finally, he designs a custom portfolio and structures it to provide that return. If a client needs a 5% rate of return to achieve the lifestyle they want, there’s no reason to have a more volatile portfolio. Beating, or even matching, an index isn’t the point — the point is meeting the client’s goals while minimizing risk Client reactions You may be reluctant to try this approach with your clients because you’re worried about how they’ll react. Wouldn’t anybody want to squeeze as much out of their portfolio as they can? Why settle for a 4% or 5% rate of return when you could shoot for 7% or more? Martin hasn’t found that to be an issue. First of all, he interviews prospective clients to ensure they’re a good fit for one another, and this is one thing he looks for — if someone is trying to outperform the market, they aren’t the right client for him. And once his ideal clients get to know him, they trust him to focus on their specific goals rather than beating some kind of average. Hint: To hear from another advisor who personalizes portfolios to his clients’ goals, listen to our episode with Peter Cishecki on the one change you can make to your practice to really put clients first. How asset management differs between high net worth and ultra-high net worth clientsWith most of his clients’ AUMs falling between $1 million and $20 million (with one family at $500 million), Martin’s specialty is around the high and ultra-high net worth segments. And while the two might seem similar, Martin has found a big difference between managing $1 million and $20 million portfolios. With more assets, he’s able to introduce more unique investment products, like private equity. That often doesn’t make sense to someone with $1 million — you often can’t invest a meaningful amount while keeping the portfolio weighting reasonable. Just $100,000 is a full 10% of their portfolio, and the risk can be too big. That’s not to say that a high net worth client can’t have a well-diversified portfolio or achieve similar goals — of course they can. The process might just look different. And the ultra-high net worth clients don’t just allow for more customization — the sophistication of their profile often demands it. Typically, they have far more complicated financial situations, with cross-border companies, unique compensation structures, assets in various currencies, and multiple holding companies. As such, the planning needs to be more in-depth and personalized. Building trust at scale When it comes to marketing himself and acquiring clients, Martin gets right to the heart of the matter. “It’s all about building relationships,” he says. “The number one reason why someone’s going to decide to go with you is trust.” And with social media, you can start building trust before even meeting a prospect by creating and sharing good quality content online. You might worry that writing down and sharing your best advice and tips is giving away your secret sauce. Sure, there will always be people who will read your work and apply it themselves — but those aren’t real prospects because they aren’t people who want to work with an advisor anyway. The clients you are targeting are people who want you to manage their money for them, not people who want to do it themselves. Martin has been a longtime contributor to various media outlets, including a weekly column in the Financial Post. But with social media, you don’t need a platform like that to reach potential clients — you can provide good quality information straight to your own audience. Hint: Whatever information you want to convey, make sure you connect it with something topical — something in the headlines or that your audience is already thinking about. You can have the most important advice in the world, but if it doesn’t grab their attention or seem relevant, they’ll never read it in the first place. To hear more from Martin about his practice, the habits that have made him successful, and how he managed to neutralize the most challenging aspect of his business, listen to the full episode. You can find it right here on this page or subscribe on iTunes or Stitcher so you don’t miss any future episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
36 minutes | Feb 4, 2020
051: Full Practice Management Platform for an Independent Financial Advisor
Eight years ago, it would have been nearly impossible to imagine the incredible impact fintech would have on the financial services industry today. And even now, we’re just scratching the surface of what this industry can become in the future. In a change of pace, today’s episode is an introduction to one of our favourite podcasts: Fintech Impact. You’ll hear host Jason Pereira interview Tea Nicola, CEO of Wealthbar, and our own Pawel Brzeminski, CEO of Snap Projections. The Fintech Impact Podcast is hosted by Jason Pereira who explores the fintech space and interviews its major players — both incumbents and newcomers. Whether they’re trying to make existing finance players more efficient or looking to disrupt the industry altogether, this show explores their impact on consumers and the industry as a whole. Listen in to hear about Wealthbar’s acquisition of Snap Projections, what that relationship will look like going forward, and Tea and Pawel’s shared vision for how fintech can impact the industry — and the lives of average Canadians. What You’ll Learn in This Episode: Why a partnership between Wealthbar and Snap Projections makes sense (2:05) What the end product looks like for both clients and advisors (6:30) Pawel’s product-building philosophy (16:40) Revealing Tea and Pawel’s wishes for their industry (23:00) The biggest challenges Tea and Pawel have faced in scaling their companies (27:05) What gets these founders out of bed every morning (30:55) Links and Resources: Wealthbar Tea Nicola Snap Projections Pawel Brzeminski Fintech Impact Jason Pereira Quotes from the Episode: “It just made sense to basically own software that is going to eventually become what I want to see, which is a vision for a full practice management platform for an independent financial advisor.” — Tea Nicola “This is technology that’s gonna enable you, not threaten you.” — Jason Pereira “In a lot of cases, it actually takes an advisor to make adjustments. I don’t think we can really have a fully automated tool that can provide the best solution for every single case.” — Pawel Brzeminski With their shared goal of transforming the financial services industry in Canada and making the lives of both advisors and consumers easier, Tea and Pawel’s recent partnership is a match made in heaven. Today, they’re opening up about what that vision is, how it brought them together, and the impact they hope to have on Canadians. Below, we’re sharing three key ideas from this episode: A vision for personal finance in Canada Where automation leaves financial advisors Tea’s wish for the average Canadian For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. A vision for personal finance in Canada Picture a busy mom walking into her home carrying bags of groceries. As she sets them down, she gets a notification on her phone. Maybe her TFSA contribution limit just increased, or RESP season has started. With one button, she can react to the notification without a second thought. Or, if she wants support making a decision, she can easily get in touch with a real-life advisor who can talk her through next steps. That’s Tea’s vision for what Wealthbar can be for the average Canadian consumer. It’s a guided, one-stop-shop for Canadian consumers for everything to do with investing, planning, insurance, mortgages, lines of credit and so on. Most actions can be routine, so users barely even have to think about what they need to do — they can trust that the software’s suggestion makes sense for them. And if they need further support, a human advisor is there to act as their quarterback. Where automation leaves financial advisors You might be wondering where exactly this kind of automated system leaves financial advisors. Does it devalue the hard work many have put into their careers? Is it a cheap mimic of the skills advisors and wealth managers have developed over many years? From Pawel and Tea’s perspective, robo-advisors do just the opposite: they let you manage your time more effectively by taking care of your rote tasks — the administration, much of the research and portfolio management. These tasks, which often take a lot of time, are not the true value-add that an advisor offers clients. If you’re like one of the many advisors we’ve spoken to and worked with over the years, the part of your job that you love and value the most is the actual relationship with your clients: the advice you can give them when they’re stuck, or making sure their financial plan makes sense not only in terms of the numbers but also in terms of what they seek to get out of life. This is also doubtlessly what your clients appreciate most about working with you. And if you can spend less time on the dreary routine tasks and more on your clients, think about the impact you can have on their lives. Luckily, the rote tasks are the exact things that a robo-advisor lets you outsource to automation. It’s just about making more room for you to provide what technology can never replace: the human touch. For instance, with today’s robo-advisor and planning software, you can generate a pretty solid financial plan and a solid investment strategy. But as Pawel explains, “in a lot of cases, it actually takes an advisor to make adjustments. I don’t really think we can really have a fully automated tool that can provide the best solution for every single case.” With the time-consuming heavy-lifting out of the way, you can focus on tailoring the plan for your clients to take their plans to the next level. That human aspect — the qualitative details, the behavioural coaching — can’t be replaced by any machine. As Jason summarizes, “this is technology that’s gonna enable you, not threaten you.” Tea’s wish for the average Canadian If Tea had one wish, she would love to see financial literacy among average Canadians increase tenfold. Currently, Canada scores at about a C-minus for financial literacy. But this is a worldwide problem — sadly, we’re among the most financially literate countries in the world. But as Tea says, “being the best of the worst is still not good.” For Tea, this lack of financial literacy is not just bad for Canadians — ignorance is actually her biggest competitor. When people don’t know any better, they buy into media sensationalism and fads, believing the hype about the shiny new thing. If average Canadians knew enough about finance, Tea feels they would realize why they need a product like Wealthbar in their lives. They would see the value of a good financial plan, and they would love to see it better integrated into their lives. To hear more of Tea and Pawel’s conversation with Jason, and their shared vision for the future of financial services, listen to the full episode right here on this page. You can also find us and subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
48 minutes | Jan 21, 2020
050: Busting Your Myths and Misconceptions about Financial Advising
It’s one thing for the general public to misunderstand what financial advisors do or be mistaken about important principles of personal finance. But what about financial advisors? What myths and misconceptions do you believe that might be holding you back from giving your clients the best advice? That’s what today’s guest is here to talk about. John De Goey is a Portfolio Manager with Wellington-Altus Private Wealth. He has built a national reputation as a trusted authority on professional, transparent and evidence-based financial advice. He’s written for publications including Canadian MoneySaver, MoneySense and The Globe and Mail, and appeared on television programs like CBC’s MarketPlace, News World and BNN’s Market Call. He’s the author of The Professional Financial Advisor, now in its fourth edition, and STANDUP to the Financial Services Industry, released last year. In today’s episode, he’ll discuss misconceptions commonly held by financial advisors, why advisors might hold these misconceptions, and what you should believe instead. Listen in to hear more about John’s work, research and advice for advisors and investors. What You’ll Learn in This Episode: The unglamorous yet insightful reason behind John becoming an advisor (3:35) Common myths and misconceptions in financial advising (5:00) What advisors get wrong about cost (9:15) Why advisors ignore the evidence and recommend activities that don’t add value (18:20) The key beliefs advisors should focus on improving (26:35) Why investors will need to be part of the solution (21:55) Why the reason for advisors’ beliefs isn’t the most important question to explore (38:20) Links and Resources: Standup Advisors STANDUP to the Financial Services Industry: Protecting Yourself From Well-Intended But Oblivious Advisors Email John Quotes by John De Goey: “There are a lot of advisors that should be part of the solution, want to be part of the solution, but the really ugly secret that a lot of people in the industry don’t want to come to terms with is that there are many advisors that are themselves part of the problem.” “Any advisor who is worth his or her salt would do very well to understand that where the rubber hits the road is in the behaviour that they help to enforce or disabuse their clients of.” “This is perhaps the only industry in the world that I’ve ever found where the low-cost products are the best products.” We’re so thrilled that for the fiftieth episode of Growing Your Financial Advisory Practice Podcast, John De Gooey is back on the show to celebrate with us. If you missed his first episode, it was all about determining the key assumptions you should use when developing financial projections. Today, we’re looking at the opposite topic: John is here to bust the myths and misconceptions you may have as a financial advisor — myths that could be holding you, and your clients, back. Below, we’re sharing three key ideas from this episode: What advisors get wrong about cost Why investors will need to be part of the solution The key beliefs advisors should focus on improving For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. What advisors get wrong about cost A lot of advisors tend to act like the cost of products is immaterial. But in fact, cost makes up a full half of the value proposition, the other half being the benefit. When you change the cost of a product, you actually change its value. Cost is also one of the most reliable determiners of a product’s performance — it’s inversely correlated to product’s performance. Consistently, lower-cost products perform the best over time. But many advisors either don’t realize this or ignore this fact. This might be because with most things in life, you get what you pay for. A good quality suit or vehicle, over time, deliver far more value than a cheap version. But when it comes to investing, as Vanguard founder John Bogle used to say, “you get what you don’t pay for.” The more a product costs, the more it eats into your return and the lower your return is expected to be. So, in what might be the only exception in the world, the low-cost products are actually the highest quality products. This fact is more relevant than ever — in a world economy in which returns are significantly lower than they used to be even just 30 years ago, this information becomes all the more important to apply. Why investors will need to be part of the solution For most of his career, John focused on other advisors, working to get them to challenge their assumptions and rethink the advice they give. The whole time, even through releasing four editions of his book, The Professional Financial Advisor, he’s felt ignored and overlooked inside of his industry. Now, he’s turned his attention to investors. His newest book, STANDUP to the Financial Services Industry is written for clients, and he wants to show them how their advisor may be part of the problem. While he’s careful to clarify that advisors’ intentions are generally very good — most people don’t go to work every day with the desire to hurt people — the results of poor financial advice can be harmful. What investors need to do John encourages investors to take the following three steps in ensuring their advisor is using evidence-based practices in their advising: Summon up the courage to ask their advisors tough questions (as Canadians, we know this isn’t always easy). Ask the right questions — John has included a number of questions that he recommends people ask right in his book. Discern and call out if the answer isn’t evidence-based. John includes some of the best pieces of research on his website for investors to find and use in conversations with their advisors. There are two things keeping investors from holding their advisors accountable: not having the tools and knowledge to do so, and being too accepting of unsatisfying answers. John’s helping cover the first piece — the latter is up to each individual to combat on their own. The key beliefs advisors should focus on improving If there’s one area John wants advisors to focus on, it’s beliefs around behavioural economics and behavioural finance. More and more, the emerging evidence reveals that investor behaviour is probably the most important factor of financial wellbeing, yet most advisors don’t pay much attention to it, seeing their role too firmly in the investment side of things. John explains it like this: “When you ask a typical advisor what he or she does for a living, many of them will say, ‘Well I recommend products and I help my clients save taxes,’ and whatever. But some of the more enlightened ones will go a little bit further and say ‘I help my clients by engaging in behavioural coaching.’” If you can help clients invest in the right registered account or save just $100 more every month, you can have a major impact on their life. Hint: This sometimes means disappointing your client by correcting their misguided beliefs: rather than just facilitating what it is they want, challenge their assumptions and give them advice about what will actually help them in the long term. Correcting the implementation gap One major part of investor behaviour that you should be focusing on is implementing the plan that you put together. You spend so much time and effort doing the proper diagnostics, suggesting great solutions, and coming up with the perfect plan, but none of that helps the client if they don’t actually put anything into action. A plan that doesn’t get updated or used isn’t worth anything. So along with actually updating plans on an ongoing basis, helping clients implement solutions should be a major focus of financial advising. To hear more of John’s advice, listen to the full episode where he explores various financial advising myths in depth, speculates as to why advisors hold these beliefs — and explains why that’s actually the wrong question altogether. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
56 minutes | Jan 7, 2020
049: Unraveling Cross-Border Financial Planning
What unique financial planning challenges do individuals face when they live full- or part-time in the US but have Canadian citizenship (or vice versa?) How can you help clients who straddle two countries? And more to the point – should you always be the one to help them? Today’s guest is diving in deep to help you understand the pertinent issues around cross-border financial advising. Terry Ritchie is a Partner and Director of Cross-Border Wealth Services for Cardinal Point, with offices in Toronto, Calgary, Irvine, Phoenix, and Boca Raton. He is a Registered Financial Planner in Canada and is enrolled to practice before the U.S. Internal Revenue Service as an Enrolled Agent. Terry is also a Trust and Estate Practitioner affiliated with the Society of Trust and Estate Practitioners. He has been practicing cross-border financial, investment, tax and estate planning for more than 30 years. What You’ll Learn in This Episode: What actually drives people to move between Canada and the United States (6:45) Why cross-border work matters to Terry (10:10) What advisors need to know about visas and green cards (13:40) Important elements of U.S. income tax (23:50) Investment limitations of Canadians in the US (28:10) How cross-border living affects estate planning (37:10) The biggest cross-border planning mistake you can make (43:45) Terry’s #1 tip for growing a career you really love (53:20) Links and Resources: Cardinal Point Email Terry Quotes by Terry Ritchie: “I can quantify the numbers that you might be better off from a tax perspective in that jurisdiction or country versus this one. But really at the end of the day, it’s truly around lifestyle. Where are they going to be happiest?” “It’s just the nature of the business. Markets go up and down... Tax laws change. Family dynamics change.” “Advisors have a right to say no,” he says. “There has to be a fit – on both sides.” Terry’s firm, Cardinal Point, offers a total solution to individuals who have Canadian and American financial matters – snowbirds, those who have dependants in one country while living in the other, and those who move between the two countries. And as someone who has financial matters in both countries himself, he has unique insights into what it takes to plan for people like him. Below, we’re sharing three key ideas from this episode: What actually drives people to move between Canada and the United States The biggest cross-border planning mistake you can make Terry’s #1 tip for growing a career you really love For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. What actually drives people to move between Canada and the United States If you were paying attention to social media around the 2016 American election, you probably would have heard Americans who were dissatisfied with or worried about the results and saying that they would be moving to Canada. However, that flood of Americans moving to Canada hasn’t panned out. It turns out that tax talk doesn’t much affect people’s decisions about where to live, either. “I can quantify the numbers that you might be better off from a tax perspective in that jurisdiction or country versus this one,” says Terry. “But really at the end of the day, it’s truly around lifestyle.” It’s about where they see themselves living and where they will be the happiest. Healthcare is often a big factor, but family is the biggest reason for people choosing to live in one place over another. Terry has had clients go through many of the steps required to permanently move to the United States… until a grandchild in Canada came along and changed all of their plans. It’s important to know all of the factors going into a move or change of citizenship, but people rarely act purely in their financial best interest – and that’s ok. The biggest cross-border planning mistake you can make The biggest mistake Terry sees financial planners making in the area of cross-border planning is… well, taking it on at all. If they’re not well-versed in it, that is. If it’s not your niche, the truth is that you probably don’t have the skills needed to do cross-border planning effectively. And it’s not subject matter that you can just brush up on in a weekend seminar and be ready to go. If one thing is clear from Terry’s advice, it’s that cross-border planning is very complex. From limitations on holding investment accounts depending on where an individual resides or has citizenship to multiple sets of tax laws to immigration… there is a lot of liability for the client, for you, and for your firm. Not to mention that all of these laws change from year to year, and just keeping up with the updates and knowing how they’ll affect clients is almost a full-time job in itself. If you don’t have the background to take on a certain aspect – or even the entirety – of your client’s planning, there’s nothing wrong with bringing someone else in or referring them to someone who can offer them the services and experience they need most. Yes, it can be hard to let go of the AUM (and the pay that comes with it…), but, put simply, “if you don’t know what you’re doing, you shouldn’t be doing it.” Hint: If you’re looking for advice on working with other financial professionals, listen back to the show with Cindy Radu, where she discusses bridging the gap to work effectively with other advisors. Terry’s #1 tip for growing a career you really love Terry really wants you to take away that you don’t have to do everything for every client. At the beginning of your career, it’s easy to feel like you have to take on any client and do whatever they ask you to do, even if it’s not within your preferred niche. But, says Terry, “advisors have a right to say no. There has to be a fit – on both sides.” It’s definitely not worth it to take on people you call tell are jerks – they’re only going to cause you trouble down the road. Work with nice people so that you look forward to meeting with them and putting in the work for them. You’ll not only be happier – you’ll likely do a better job for them, too. This goes for your niche, too. If you know what niche you want to serve (and Terry recommends having one), don’t feel like you need to work for clients who aren’t a good fit for that niche. Your time is valuable, so the time you put into your business should be spent building your expertise in a particular area, not catering to anyone who comes along. Terry’s firm has this very well defined: they only offer full-service solutions, not individual services. If someone’s just looking to get some tax advice, they’re not the right fit. “We’re not for everybody, but for those people that we can serve, we try to do a really, really good job.”Defining guidelines In addition to working with good people on work you want to do, make sure you’re clear for the beginning on what the relationship is and what kind of work you will or won’t do. Setting up clear boundaries is the best way to avoid uncomfortable situations in the future. For more helpful advice from Terry, make sure you catch the full episode where he talks about the ins and outs of the tax, estate planning, and immigration considerations that can affect financial planning. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
36 minutes | Dec 10, 2019
048: Transforming the Financial Planning Industry into an Evidence-based, Fiduciary Profession
It’s one thing to build up your own practice. But as we approach the end of the year, we’re taking a step back to look at what it takes to build an entire profession. Today’s guest is here to show us what the financial planning industry can become at its best. Jason Pereira is a Senior Financial Consultant with Woodgate Financial Inc and IPC Securities Corp. He is one of Canada's most respected authorities on financial planning, the financial industry, and financial technology. He’s been awarded 7 industry designations including the CFA, CFP, and RFP. He has won and been named a finalist for several industry awards, and he is the only 3-time winner of the PlanPlus Global Financial Planning Awards. Jason is also the leader of a growing group of financial advisors seeking to improve financial planning, both for advisors and consumers. As the president of the newly launched Financial Planning Association of Canada (FPAC), he’s here to talk about his hopes for the future of financial planning in this country. What You’ll Learn in This Episode: Why FPAC exists and what its goals are (2:40) Why FPAC needed to be a new organization in order to reach its goals (10:30) How FPAC will benefit the public (15:30) How FPAC plans on handling enforcement (17:05) The benefits of FPAC membership to advisors (21:40) What types of memberships are available (27:05) What the reception for FPAC has been like in the industry (29:45) Links and Resources: Financial Planning Association of Canada FPCA Charter Email Jason Woodgate Financial Inc Quotes by Jason Pereira: “This is a coming together of like-minded individuals who want to see the professionalization of planning in Canada, and to basically move this industry and this country forward.” “We’re trying to create the member body that basically is going to push for active change.” “We’re not going to be able to build the industry up if we don’t provide the resources to do that.” You might remember Jason from an earlier episode of the show (and if you didn’t, do take the time to hear his advice for competing – and winning – in the Canadian HNW segment). However, today’s show is a little different as we’ll be hearing from Jason about his passion project of transforming financial planning from a sales-based industry to a robust profession in Canada. Below, we’re sharing three key ideas from this episode: Why FPAC exists (2:40) The goals of the Financial Planning Association of Canada The benefits of FPAC membership to advisors (21:40) For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. Why FPAC exists Jason and others started FPAC out of frustration with the status quo of financial planning in Canada. He was seeing that worldwide, among established and even many developing markets, Canada is far behind in terms of its financial planning infrastructure. While there are many planners who want to see the landscape improve, there hasn’t been a committed yet accessible members’ association that can use the strength of numbers to push for real change. As Jason puts it, “this is a coming together of like-minded individuals who want to see the professionalization of planning in Canada, and to basically move this industry and this country forward.” This means pushing for regulatory, technology, tax and legal changes to build out an ecosystem supportive of a strong financial planning profession. The goals of the Financial Planning Association of Canada Looking at other countries and different industries, Jason and others outlined an end state for what the industry should look like. They broke that ideal down into three main goals. Fiduciary-level planning This is the cornerstone of professionalization. Most consumers just assume that financial planners have a legal obligation to act in their best interest – but that’s not the case. There are certainly organizations that ask or require their members to act in clients’ best interests, but the legal weight doesn’t back the requirement up. To be a member of FPAC, you must pledge from the first day that you will act as a fiduciary. FPAC is also calling for a legal fiduciary standard for anyone calling themselves a financial planner. Higher professional standards Speaking of which, right now in most provinces anyone can call themselves a financial planner – the term doesn’t really mean anything. The result is that the level of service and competence can vary wildly. FPAC wants the term financial planner to mean something. They also want there to be no question that anyone carrying a CFP or RFP can provide sound financial planning. Evidence-based financial planning Too many advisors operate on unproven heuristics, assumptions, and rules of thumb. FPAC wants advisors to operate based on evidence. Are you recommending an investment portfolio? Make sure you have a solid risk tolerance questionnaire to back it up. If you’re advising on insurance, you have to have a solid needs analysis, and so on. The benefits of FPAC membership to advisors On the surface, belonging to FPAC might sound like signing up to follow a lot of rules. But Jason is committed to building up the resources planners need to help them reach the required standards. “We’re not going to be able to build the industry up if we don’t provide the resources to do that,” he explains. While they’ve only just launched the association, they will be rolling out major initiatives to help planners improve their practices. Best practices wiki FPAC is creating a wiki of best practices that will act as a guide on how to run your practice from start to finish. While anyone can edit it, there will also be curators to help create definitive guidelines and suggestions and ensure the content doesn’t become outdated. Planning portal Jason sees this as a hybrid between an academic journal and a concept library. It will include how-tos on everything planning-related, all backed by evidence and research. For example, if you’re executing an individual pension plan, there will be a definitive article on what that is, where it fits into a financial plan, how to implement it, who to go to and what tools you can use. You can think of it as a one-stop repository for how to actually plan for your clients. A large online forum They will also create an online forum for members to participate in. This will work to build a community of members who can help one another raise the bar for financial planning in Canada. Opportunities to give back Jason has been hearing from colleagues across the country for years that there’s not a great structure for financial planners to offer financial planning services pro bono. As a result, they want to build a pro bono community to connect financial planners with communities that most need their help. Trust Jason’s vision is that as consumers start to learn about FPAC, they will demand its standards of their own financial planners. Consumers want to be able to trust their financial professionals, and they will seek out those who are demonstratively working for them. If you want to learn more about FPAC, be sure to listen to the full episode and check out the FPAC charter. And come back in two weeks for more great financial planning advice from experts like Jason. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
54 minutes | Nov 26, 2019
047: Transitioning Family Wealth: How to Increase the Odds of Success
Family businesses inevitably come with complex scenarios for a financial advisor to sort through. But the biggest complications may not be what you expect: the emotional aspect of family, business, and money is often the foremost concern when beginning conversations around business transitions. Today’s guest brings a rock-solid technical background and soft skills that helps her see the full picture and help families navigate the wealth transition landscape. Cindy Radu is a family wealth transition advisor. She works with individuals, family enterprises, business owners and family offices to maneuver the complexities and opportunities of multi-generational wealth. Cindy has over 25 years of legal, fiduciary, trust and governance experience, giving her a bird’s eye view of the many issues families can face. Listen to the episode to hear how Cindy frames wealth, family enterprise, and success in a way that helps her clients handle the complicated financial and emotional factors involved in transitioning family wealth. What You’ll Learn in This Episode: Rethinking the key issues around transitioning wealth and family businesses in Canada (8:05) The difference between a family business and a family enterprise – and why it matters (11:10) Cindy’s first steps when advising clients (18:45) How Cindy bridges critical gaps by working effectively with other advisors (25:25) Helping families avoid assumptions and get on the same page (33:40) What wealth and wealth management really mean (39:30) Links and Resources: Cindy Radu Cindy on LinkedIn Email Cindy Quotes by Cindy Radu: “Way too many families are willing to stake everything they work so hard for on basically a hope and a prayer that everything is going to turn out alright.” “Referrals from clients are frankly the strongest possible referrals that you can get.” “I’ve been successful in my practice because I’m able to bridge those emotional and technical aspects of the wealth planning and transition.” Cindy has been a Chartered Accountant and estate planning lawyer, and she’s also worked with large financial institutions. And yet all of her work has had one common goal: helping families through transitions. Today, she shares her experience to reframe the conversation around family wealth transitions. Below, we’re sharing three key ideas from this episode: Rethinking the key issues around transitioning wealth and family businesses in Canada The difference between a family business and a family enterprise – and why it matters What wealth and wealth management really mean For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. Rethinking the key issues around transitioning wealth and family businesses in Canada There are nearly 900,000 family businesses in Canada. Together they contribute to over 60% of GDP, employ over 6 million people, and donate annually $1.5 billion to charity. However, successful wealth transition from the first generation of a family business to the next only has a 30% chance of success. Worse yet, the chance of a second generation transitioning their wealth to the third generation is a measly 10%. So where does this failure come from? If you look at what most financial professionals focus on, you’d think that tax and financial planning problems are the major issue. However, together these only contribute to about 3% of transition failures. Here’s how the other 97% breaks down: The vast majority – about 60% – of wealth transition failures come from a breakdown in communication and trust between family members. Around one quarter of failures is due to the next generation not being adequately prepared to be good stewards of the wealth. In just over 10% of cases, a lack of mission or vision contributed to the failure. These numbers are a stark wake-up call to anyone who believes that financial planning is all about the numbers. That’s why Cindy focuses most of her time on bringing multiple generations of a family to the table and helping them find common ground. Hint: You’ve probably heard of the Pareto principle, which states that 20% of activities generate 80% of results. In this case, think of the amazing results you could have just by getting two or even three generations of a family discussing their plans together! The difference between a family business and a family enterprise – and why it matters. The difference between a family business and a family enterprise amounts to a critical difference in how Cindy helps families. A family business is exactly what most people think it is: a business owned and run by a family. They vary in scope, from your local corner store to McCain, but they’re all considered family businesses. A family enterprise, on the other hand, includes the family business as well as all the other elements that make up a family’s financial situation: real estate, art collections, investment portfolios, registered investments, insurance products and so on. Traditionally, we break these things out, with different experts taking on different asset classes. And that makes sense because each area is itself rather complicated. But when they just work in a silo at different points in time, the family enterprise as a whole gets forgotten. Without really knowing how all the pieces fit together, it’s impossible to get a clear picture of the family as a whole. That’s why a major aspect of Cindy’s work is liaising with different financial specialists and making sure everything fits together in a way that helps – not hurts – the family members themselves. Hint: For more on working effectively with other professionals, listen to our interview with Jamie Robb. What wealth and wealth management really mean When asked about how Cindy approaches wealth management, she pointed out that everyone has a different definition of what it means. And in most cases, the definition is far too limited – usually just involving investment management. Cindy has been trying to shift the meaning of capital beyond just the financial – though that part matters, too. “This term of wealth management for me,” she says, “really is a very, very broad term that encompasses all of the financial, social, human, and intellectual capital that a family has, all tied up in a bow around a shared dream of where that family wants to get.” So when Cindy works with a family on wealth transition, she’s always keeping in mind all of these pieces – not just the family business, not just the family enterprise, but the family members themselves, too. To hear more from her on how she works successfully with teams of advisors and specialists, why you need to be honest about your blindspots and what post-mortem exercises can reveal, make sure you listen to the full episode. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
44 minutes | Nov 12, 2019
046: The One Change You Can Make to Your Financial Planning Practice to Really Put Clients First
Everyone says they put their clients’ best interests first, but what’s the best way to set yourself up for success in this regard? By introducing portfolio management companies into his business model, today’s guest has structured a financial advisory practice that allows him to focus on his clients first. Peter Cishecki started Everything Financial Group in 1996 after working for many years at one of Canada’s leading insurance companies. He has created an all-in-one financial experience for his clients where he built trusted, long-term relationships by providing complete financial strategies and solutions for financial peace of mind. Listen to the episode to hear about how Peter came to work with portfolio management companies on a referral basis and how it’s affected his business. What You’ll Learn in This Episode: Why more advisors don’t work with portfolio management companies (9:30) Why your clients wish you worked with a portfolio management company (14:35) How Peter structures his fees – and how he provides enough value to earn them (18:55) How Peter’s work culture transformed when he began working with portfolio management companies (27:30) The biggest challenges Peter has faced in his career (30:40) Three misunderstandings about wealth management (33:50) How Peter gets in front of prospective clients (35:20) Links and Resources: Everything Financial Group Quotes by Peter Cishecki: “When I can get people to change their outlook on life and start to enjoy their money while they’re young and healthy, that’s huge satisfaction.” “If you’re going to collect a fee, do something for the person.” “Truly look yourself in the mirror every day and say ‘What am I gonna do today to make a client’s life better?’” In late 2010, Peter noticed he was already running his practice like a portfolio management company – offering six different model portfolios and spending all his time on administrative work. He realized that by working with an actual portfolio management company, he could let other professionals handle that work while focusing his efforts on what he really wanted to do: building financial plans. Since making the switch, his practice has grown by at least 500%, and his entire office culture has changed into less of a team and more of a family. Below, we’re sharing three key ideas from this episode: Why your clients wish you worked with a portfolio management company Why more advisors don’t work with portfolio management companies How Peter makes sure he provides value and earns his pay For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. Why your clients wish you worked with a portfolio management company Peter realized that working with a portfolio management company came with enormous benefits for his clients. Here are the four main benefits: A true fiduciary Legally speaking, portfolio management companies are the only true fiduciaries within the Canadian financial services industry. Their responsibility is to the client, never to the advisor, so the client can rest assured that their best interests are always being considered. Active management Portfolio management companies provide active management of portfolios – someone is working daily to ensure the client is reaching their goals and nothing is going off the rails. Imagine trying to do all that by yourself. Fee transparency and tax deductibility Portfolio management companies provide 100% transparency and disclosure on the fees they charge. Hint: This one can be tricky because a client who is used to working with a mutual fund salesperson, for instance, likely doesn’t realize the fees they were paying before because they weren’t being disclosed. Learn about properly articulating the value of financial advice in our previous episode with John Page. Additionally, unlike commissions, management fees on non-registered investments are 100% tax-deductible, so clients are already saving money before the market even does its work. Personalized portfolios Portfolios are designed for the financial plan and not the other way around, meaning that a client’s portfolio is perfectly suited to their situation. For example, if according to the plan the client only needs a 4% return to stay on track and meet all their goals, there’s no point in having a portfolio that chases a 7% return. This results in less risk and volatility, which in turn means the plan is more accurate and realistic. Why more advisors don’t work with portfolio management companies Ego Some advisors think they can do a better job than a portfolio management company. In truth, they can’t possibly succeed at advising clients, creating great financial plans and managing portfolios better than a company with hundreds of staff whose job it is to actively monitor and manage portfolios. Money Earning a deferred sales commission is easy and quick. A referral fee from a portfolio management company, on the other hand, may not end up in your bank account for up to a year and a half after you start working with a client. A lot of advisors aren’t willing to give up on that comfort by changing their business – and compensation – structure. Lack of knowledge In the end, Peter believes that most advisors just don’t realize the opportunity exists. For example, they think there are regulatory barriers, or that portfolio management is only for their wealthiest clients – not the case at all! How Peter makes sure he provides value and earns his pay One objection financial advisors may have to working with a portfolio management company on a referral basis is that it feels wrong to earn the referral fee (usually around 1% of AUM) when it seems that the company is the one doing the work. In short – does Peter ever worry that he’s not delivering enough value to justify his pay? Not at all, he says, because the value he does deliver is clear to him and his clients. Sure, it would be wrong to just earn a referral fee and then do nothing else for the client. Simply put, “If you’re going to collect a fee, do something for the person.” And since Peter outsourced all the administrative work behind portfolio management to someone else, he’s had far more time to actually do things for his clients. His firm offers its own Omni Formula financial plans, a proprietary system that has undergone significant revision (and still gets tweaked once in a while). They update the plans annually to make sure they’re still meeting clients’ needs. For clients over $2 million, they also provide some legal and tax services to make sure those clients get their money’s worth. Peter – and perhaps more importantly, Peter’s clients – are confident in the value he provides them. For more helpful advice from Peter, make sure you catch the full episode where he talks about his fee structure, how his work culture changed after transitioning to this business model and more. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
40 minutes | Oct 29, 2019
045: How to Grow Your Practice from $30 million to $150 million AUM and Exit - On Your Terms
When growing your book of business, you can either build it from scratch yourself or join up with another advisor and purchase their practice. Today’s guest is most experienced in the latter, and he’s here to share the insights, benefits, and perils of buying (and selling) your business. Brad Amlin has put in more than 17 years in the financial services business. His primary area of expertise is financial, estate and tax planning, focusing on strategies that include the use of life insurance and investment vehicles. He works with both business owners and high net worth individuals. Brad has also been through numerous business transitions, both as the advisor buying practices and, more recently, as the one selling his own business. Listen in to hear how Brad built a $30 million AUM business to $150 million – and why he decided to sell. What You’ll Learn in This Episode: How Brad sought out clients in his early days as an independent advisor (8:15) How Brad built Cornwall Wealth Management from $30 million to $150 million AUM (12:35) What Brad looks for in clients (24:45) How to help your clients through a business transition (28:50) Why Brad’s practice has both MFDA and IIROC advisors (31:30) Major challenges when undergoing a business transition (33:35) Links and Resources: Email Brad Cornwall Wealth Management The Personal Coach Quotes by Brad Amlin: “Success really revolves around the continuity of who the client’s dealing with.” “Even if you do want to, over time, rebrand the company, I think maintaining the brand… for a specified period of time post-transition really helps the continuity and maintains that client.” “I find the challenge to be maintaining confidence and maintaining that ‘up’ feeling in an environment that seems to be rapidly shifting through regulatory change.” While Brad started his financial services career working for a bank, he’s since had quite the career building and buying financial advisory businesses; at its peak, his practice had $150 million AUM. In his mid-forties, he decided it was time to sell his business to another advisor and get back to what he loves best: time and working directly with clients. Below, we’re sharing three key ideas from this episode: What Brad looks for in clients How to help your clients through a business transition Solutions to 3 major business transition challenges For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. What Brad looks for in clients Now that he’s sold his business and no longer needs to worry about strategy and operations quite as much, Brad has the freedom to be more picky about which clients he wants to work with. There are two characteristics he looks at first when choosing which clients he wants to keep working with. Clients who listen Brad now works just with the clients who listen to what he has to say and are willing to put in the work to put his advice into practice. While some consumers just shop around until they find an advisor who will tell them what they want to hear, Brad likes working with people who are ready to hear the truth and act on it. Clients he can relate to Brad most enjoys working with clients who are within his age group. He finds that clients in their forties and fifties see retirement looming and are therefore more motivated to take advice. As well, they’re just at a similar point in their lives as he is, and it makes it that much easier to relate to one another. How to help your clients through a business transition In his experience going through numerous business transitions, Brad has found that maintaining the client experience is the most important. As he puts it, “success really revolves around the continuity of who the client’s dealing with.” For this reason, when talking to his clients, he positioned his recent business sale as a strategic alliance. He’s not broadcasting to them that he sold equity in the business – they don’t need to know all that. While the logo may be different, all they care about is that they now have more offerings and people available to help them than they did before. In time, the advisor who bought Brad’s business may make further changes. But letting clients adjust to the transition and see that nothing drastic has shifted in the level of service is key to keeping the relationships running smoothly. Hint: For more on keeping your clients happy while navigating transitions in your business, listen to our episode with Jim Greenwood. Jim shares the two most important values that he’s keeping at the forefront while helping another advisor transition out of the industry. Solutions to 3 major business transition challenges Having gone through several business transitions now – on both ends of the deal – Brad has seen his fair share of challenges coming up. Here are the biggest three, along with the solutions that helped him overcome them. The clients aren’t the right fit When you build a book of business from the ground up, you have the chance to pick clients who see eye to eye with you, and the clients can grow with you as you develop your practice. When buying a book of business, however, it’s hard to know whether the clients will be a good fit. Solution: Luckily, Brad foresaw this potential problem when he bought his first business, and he avoided it proactively. He and the senior advisor agreed to a one-year trial where Brad would work under the advisor and get to know the clients and the business. When it came time to buy the practice, Brad was sure it was a good fit. He had also begun noticing ways he could grow the business, so when he took over, he was ready to hit the ground running. A lack of mentorship One major challenge Brad experienced was working with the financial advisor whose business he first bought. While Brad had been expecting a mentor to show him the ropes in the first several months of working together, it turned out that the other advisor was too busy to spend much time with Brad at all – he was essentially left to his own devices and felt like he was floundering for several months. Solution: Brad’s firm hired a business coach (The Personal Coach) – someone he could be accountable to and who could help build his confidence in the business. Together, they created a value proposition, wrote scripts that Brad could use, roleplayed different scenarios and brainstormed how he could reach out to prospects. It was exactly what he’d been missing from his senior advisor. Loneliness This one’s more related to running a financial advising practice in general – Brad has found that it can be a very lonely business. When you’re the one running everything yourself, it’s easy to second-guess yourself and question every decision. Brad still beats himself up any time a client leaves his practice (and it does inevitably happen to everyone). This uncertainty can lead to loneliness – you’re the only one who knows what it’s like to be in your shoes. Solution: Brad’s best advice is to work with a senior advisor. While it’s true that he didn’t get the mentorship he had hoped for when he worked with a more experienced advisor, he still recommends it to others. Find someone to teach you about the industry – and, just as importantly, someone who knows what it’s like to be new to the business. You’ll definitely want to hear about Brad’s unique experience in the industry in his own words – as well as his keys to a smooth business transition and why his practice has both MFDA and IIROC advisors. You can find the show here on this page or better yet, subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
58 minutes | Oct 15, 2019
044: 5 Principles of Good Financial Planning
You’re an expert in your field, but what do you do when you come across a planning situation that’s out of your depth? Today’s guest works with advisors and their clients to create better financial and retirement plans. Yvonne Martin-Morrison is a financial planner with Raymond James Ltd.’s Retirement and Financial Planning Group. In 2019, she was the winner of the PlanPlus Global Financial Planning Award for Canada. She provides planning services, advice, and tax intelligence for Raymond James advisors and their clients. Her work also involves creating educational materials, presentations, and publications to empower advisors and help them better serve their clients. Listen to the episode to find out what Yvonne has to say about her no-nonsense approach to financial planning, her principles of good financial planning, and how to approach decumulation. What You’ll Learn in This Episode: How Yvonne approaches working with advisors and their clients (5:25) When advisors should reach out to Yvonne for support (13:20) Overcoming clients’ objections to planning (17:35) Yvonne’s basic, no-nonsense definition of financial planning (19:45) Yvonne’s approach to decumulation in retirement (36:20) The power of principles (40:40) Common mistakes advisors make when bringing in an outside expert (50:45) Links and Resources: Raymond James Quotes by Yvonne Martin-Morrison: “It’s very important that I avoid getting lost in the details right at the beginning.” “What is the point of planning if you’re not implementing the strategies and solutions?” “When we get those outputs and those software results, that allow me to really dig into analysis. And I think that’s one of the challenges for a lot of advisors is they think an output is the end. For me, that’s the beginning.” Yvonne has been through it all as a financial advisor – from her uncertain rookie years to taking on some of the most complex situations in the business. Now, she steps in to help other advisors create integrated and comprehensive financial and retirement plans for their clients. Below, we’re sharing three key ideas that Yvonne has to share in this episode: How Yvonne approaches working with advisors and their clients Overcoming clients’ objections to financial planning The power of principles in retirement planning For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. How Yvonne approaches working with advisors and their clients Yvonne approaches working with advisors the same way you probably approach working with your clients. She asks them about where they are at in their planning, how they’ve been doing, what’s been working for them, and what their frustrations are. Because she works with so many different advisors (and their clients), it’s important for her not to get bogged down in minutiae. She wants to get right to the heart of their issue so that she’s not wasting anyone’s time. Earning trust Advisors are often a bit cautious when bringing on an external expert like Yvonne to help them. And that makes sense – you probably feel the same way if you start recommending a new accountant or lawyer to clients. When you’re ultimately responsible for your client’s financial well-being, you want to make sure that the person coming in is the expert they claim to be and that they will impact your relationship with the client positively. To earn their trust, Yvonne works hard to establish open communication and clear expectations. She’s been where they are, so she respects the fact that they are running their own business. She gets that they know their clients better than she does, so she seeks to understand their situation. She shows that she knows what she’s talking about and that she’s really there to help. Her ultimate goal isn’t to make them the perfect advisor; her goal is progress. She works with them and empowers them to help them be a little bit better tomorrow, the day after that, and the day after that. Overcoming clients’ objections to financial planning Planning is such an important part of financial well-being, but a lot of clients are reluctant to do it. So how can you convince them of the value of planning when they’re not interested? Yvonne shares how you can overcome two main objections. They’ve tried it before and it didn’t work Often, clients have had some financial planning experience, but it didn’t go well or wasn’t useful for whatever reason. This is a reasonable objection. There’s experience behind it, and it’s your job to find out why it exists. You need to dig in and listen to what they’ve shared with you. What has been their experience? What was the result? Where did their frustration with planning come from? Once you understand why they didn’t like financial planning before, you can show them how their experience with you will be different – what you’re going to do that will be new to them and how it will help them. Planning is hard It sure is! But, as Yvonne puts it, “anything worth doing is going to have a level of difficulty and challenge.” This is especially true when they’re trying something new for the first time. The great thing about planning is that it does get easier with time – let them know that the work they need to put in upfront will lessen, and they’ll start to see benefits that will more than make up for their initial effort. Hint: One great tool that Yvonne loves to use to show clients the value of planning is storytelling. If you can tell someone, “I have a client like you who had similar concerns” and share with them what results they were able to achieve, they’ll be able to visualize what you’re telling them in a much more visceral way. The power of principles in retirement planning When Yvonne works with advisors, they often ask her for basic rules they can follow to get the best results every time. Of course, planning doesn’t really work with rules. You can pretty much expect that any assumptions you make will be a bit off, and projections never come to be exactly as expected. That’s why Yvonne likes to share basic principles – not rules or formulas – that she encourages advisors to work off of. Here are some of her favourites: You can’t have everything, so you need to prioritize: There are unlimited strategies and possibilities when it comes to financial planning, but you can only pick one. Go for strategies that have the highest impact but minimize the risk (that is, impact and likelihood) of negative consequences. Don’t get locked into one idea: Even though you can only pick one strategy at a time, don’t get too hung up on one particular idea. Keep evaluating other options to ensure your clients are on the right track. A guarantee is very valuable: If your client can have a guaranteed, reliable source of income in retirement, that’s very valuable and greatly reduces risk. Hint: There’s a lot of misconception out there that the CPP is always in danger of failing; while this was true in the 90s, it’s just not the case anymore. It now has guaranteed benefits for the next 70 years, as well as huge protections. Get paid to wait if you can: If you’re able to rely on other sources of income and defer the CPP, do it. You likely can’t get that kind of guaranteed return anywhere else. Consider longevity: If your client is very ill and isn’t expected to live more than a few years, that’s an important consideration. Don’t defer benefits for someone who is unlikely to be able to enjoy them in the future anyway. Hint: Are you looking for more advice from retirement planning experts? Listen to Episode 11: The Art and Science of Retirement Income Planning with Howard Dixon. Yvonne has a lot of wisdom to share about financial and retirement planning, so don’t miss the full episode where she shares her detailed planning process, how she uses software to aid in her financial planning and more. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
55 minutes | Oct 1, 2019
043: Life-first Financial Planning Helping Clients Look at the Big Picture
Helping people succeed financially isn’t about dollars and cents or numbers on a spreadsheet. It’s really about uncovering and understanding where clients are in life and how they’re feeling about it. Today’s guest runs a practice that helps his clients uncover their goals and find smarter ways to achieve them. Mark Shimkovitz has been providing financial planning advice and managing investment portfolios for 25 years. He works together with his wife Robin, a life coach, to take a life-first approach to financial planning. This approach allows him to build personalized financial plans and investment strategies. Listen to the episode to hear what life-first financial planning is, what it was like for Mark to start an independent practice after over twenty years working for banks and why he’s excited about giving back. What You’ll Learn in This Episode: How Mark compares working for a bank to running an independent practice (5:10) How Mark brings his philosophy into the conversation with clients (12:30) Mark’s three-dimensional planning process (14:45) How Mark and his team help clients create – and stick with – a budget (26:10) Why investment management is just a small slice of the wealth management pie (31:15) Mark’s focused approach to acquiring clients (37:40) How giving back is – and isn’t – part of Mark’s business (49:25) Links and Resources: Mark Shimkovitz Living Richer Podcast Quotes by Mark Shimkovitz: “I’m very clear, in fact, in saying that you know when you’re hiring me, the investment management component is only one slice, and it’s not a very large slice.” “We need to be able to articulate and demonstrate why we deserve to be paid more than, you know, 30 or 40 basis points that could perhaps be attributable to the investment management.” “Let’s really look at the big picture. Let’s look at what’s really most important to you. Those should be your benchmarks for measuring success.” With plenty of experience working for banks and now running his own financial practice, Mark has figured out a lot about what works in financial planning – and what doesn’t. He has a clear philosophy and strategy for his own business, so it makes sense that’s exactly what he helps his clients with in their own lives. Below, we’re sharing three key ideas from this episode: A three-dimensional planning process How Mark and his team help clients create – and stick with – a budget Why investment management is just a small slice of the wealth management pie For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above. A three-dimensional planning process Mark’s life-first approach means he has come up with a custom three-step planning process that he uses with clients. He calls it the 3D process: discover, design, and deploy. Discover Financial discovery is obviously a crucial part of providing good financial advice. And Mark goes deep into it with clients: where are they now? Where do they want to be? What financial obligations are likely to come up in their lives? When do they want to retire and what does that look like to them? But for Mark, the financial side is the easy part of discovery. First, he needs to understand where clients are at emotionally. How do they feel about where they are today? What gets them up in the morning? What keeps them up at night? He wants to understand their goals so that he can truly provide life-first advice. If he doesn’t know what they want out of life, it’s hard to know what financial strategies make sense for them. Hint: This deep-dive into clients’ goals is a great way to separate yourself from what the big banks offer. For more on this topic, listen to Episode 23: How to Differentiate Your Independent Practice from the Big Banks with Chris Rawles and Spencer Tilley. Design Next, Mark looks at what needs to be done to get clients from where they are to where they want to be. He looks at all aspects – the savings strategy, the estate planning, tax strategy and so on. Of course, no one wants to be given a huge list of things they need to do. That’s why Mark also prioritizes the steps so that it’s clear where the focus needs to be. He shows clients what they need to do now and what they’ll want to address later on but don’t need to worry about just yet. Deploy Deployment is pretty self-evident – it’s putting the plan into action. As assets start to come in, Mark begins working with clients on their investments and savings strategy. He also brings in his office’s internal experts to review wills and powers of attorney to make sure all their bases are covered. How Mark and his team help clients create – and stick with – a budget Have you ever seen clients balk when you bring up budgeting? It makes sense. Budgets are tough to build accurately, they can feel restrictive and they’re about as easy to stick with as a fad diet (so… not easy at all). A lot of people think about budgeting as subtracting expenses from income to figure out what they should be saving – but does it ever really work that way? Instead, Mark frames budgeting as “spending money with purpose.” Rather than mindlessly letting money go where it goes, he encourages clients to be intentional about the way they use it. And yes, the first step is knowing how much money is coming in, followed by figuring out the non-negotiable expenses. But to Mark, one of those non-negotiable expenses is paying your future self. This is part of his “pay yourself first” strategy. It means having a really strong “why” – a meaningful reason for putting the money away. As long as the goal is clear and stronger than in-the-moment impulses, budgeting works well. The caveat Often, people will get excited about a budget that they can see truly aligns with their most important goals. But after a while, they won’t necessarily stick to it. That’s where Robin’s side of the business – the life coaching – comes in. She helps clients understand why they might have trouble sticking with a budget, why they might want to work on their behaviour and how they can do it. Hint: You may not have a life coach working with you, but the takeaway here is that a budget isn’t a one-and-done kind of deal. It’s a recursive process that requires a lot of reinforcement to help clients remember what that budget is helping them accomplish. Why investment management is just a small slice of the wealth management pie Mark finds that people often conflate wealth management and investment management. But they’re not the same thing – the first is just one component of the latter. For example, if a client is saving $1000 a month in their RRSP and Mark helps them find a way to save an extra $100 a month, he’s just helped their retirement savings grow by 10% – a huge gain. On the other hand, trying to shave four or five basis points on an ETF or negotiating down a small fee isn’t going to have nearly the same effect. Wealth management to Mark means taking a step back to look at the whole picture and identify what’s really important to the client – and what’s going to have the biggest impact on getting them there. To hear more advice from Mark, including a break-down of his investment strategy, what he suggests to new advisors and more, make sure you catch the full episode. You can find the show here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
44 minutes | Sep 3, 2019
041: Leveraging Your Experience as a Business Owner to Help Business-minded Clients
What’s the best way to offer financial advice to business-minded clients? For starters, it helps to be clear on what it means to be a business owner yourself. Today’s guest has taken serious steps to develop himself as an entrepreneur, which helps him work with his own clients, most of whom are business owners. Dustin Serviss of Serviss Wealth Management has been featured as the number 1 Top 40 Under 40 leader in 2014 by the Kelowna Chamber of Commerce. In 2017, Serviss Wealth Management was awarded the Top 10 Wealth Builder Award by its previous investment dealer (consisting of over 800 advisors). Serviss Wealth Management was also voted one of the Top 3 Micro Businesses in Kelowna by the Kelowna Chamber of Commerce in 2018. Listen in to hear how Dustin helps business owners manage their wealth – and their businesses. What You’ll Learn in This Episode: How Dustin went from day trading as an engineer to running a successful practice (4:10) Dustin’s unique approach to leadership (11:25) Three lessons learned from working with a business consultant (20:20) How Dustin leverages what he learns from his clients to offer even more value through consulting (28:15) Why ongoing learning is critical to business success (33:35) Overcoming the grind of the first few years in business (36:35) Links and Resources: Serviss Wealth Management Quotes by Dustin Serviss: “Now when we are going and talking to clients, we are talking on a level that is business-minded first, financial planning second.” “When you’re exposed to bigger stuff you realize that other people think differently than you do.” “As entrepreneurs, we have a lot of good ideas and we have even more great ideas… And before you know it, you’ve got so many things to do, so many processes, so many touchpoints, so many this, so many that.” Serving business owners and lawyers, Serviss Wealth Management is a powerhouse of an independent financial planning firm. Acting as the quarterback (as he puts it) for his clients’ financial affairs, and taking his own entrepreneurship very seriously, Dustin has a lot to share about the business side of financial planning. Below, we’re sharing three key ideas from this episode: Three lessons learned from working with a business consultant Dustin’s unique approach to leadership Why ongoing learning is critical to business success Three lessons learned from working with a business consultant Two years ago, Dustin decided that he wanted to rewrite his business plan. And he certainly didn’t do it half way. Instead, he hired a consultant, James, to work with him over the course of an entire year. Together, they looked at all aspects of the business and decided on a new path forward. Read on for Dustin’s three main takeaways. Hint: For more on the importance of having a business plan, listen to our episode with Chris Paterson on the major drivers of advisors’ business growth. The importance of professional help All advisors know the importance of a talented professional who can help challenge clients and help them reach their goals. And that’s not just true for clients in need of financial services. Dustin half jokes that every business owner should work with two professionals: a therapist and a business consultant. And in essence, the two are similar. There are very few people whom you can count on to ask the hard questions and help you overcome your ego. This is critical in both the personal and professional spheres. Dustin recommends finding a professional (or two) to help you challenge your beliefs and get you out of your comfort zone. A clear understanding of what it means to run a business Since Dustin works primarily with business owners, getting a clearer sense of what it means to be a business owner himself was invaluable. Now, he can work with his clients confident in his own approach and skills as an entrepreneur. As he puts it, “now when we are going and talking to clients, we are talking on a level that is business-minded first, financial planning second.” The importance of shedding Entrepreneurs tend to have a lot of ideas, and they’re all great (or at least that’s what we like to believe). It’s so easy to add great ideas on top of one another, layering on and layering on. The problem, as Dustin puts it, is that “before you know it, you’ve got so many things to do, so many processes, so many touchpoints, so many this, so many that. It’s so hard to train new staff, it’s so hard to keep going myself.” James helped Dustin cut the baggage – so much that it was a bit scary to Dustin. But by asking what clients actually value in the relationship, they were able to shift the focus to the important things and shed the rest. Hint: If you’re curious, the lesson was that Dustin’s clients didn’t care so much about all the checking in and the birthday cards – and maybe this is true for your clients, too. Instead, they just wanted timely and satisfying responses to their questions. As a result, Dustin and his team focus on getting back to people within 24 hours whenever possible. Dustin’s unique approach to leadership Dustin’s approach to leading is all about transparency – probably more than what many leaders would be comfortable with. For over five years now, he has shared all the numbers of his business with his staff. They know how much each revenue source brings in, what the expenses are – everything. When Dustin hired James to help him with the business plan, the whole office got involved. James would come into the office for a couple hours every two weeks to discuss different aspects of the business with everyone on the team. Dustin believes this is important because it allows his staff to help make decisions and drive the company culture. Having them involved in the process means that everyone feels that they have ownership – each one of them, after all, is a stakeholder in the business. Why ongoing learning is critical to business success Dustin attributes his success in the industry to two things, and they both show how invested he is in learning: Dustin has a lot of letters behind his name, spelling out five designations. He believed from the beginning that the more designations he had, the more marketable he would be. He now attributes much of the growth in his career to the designations he earned early on. Dustin is grateful for the two mentors he worked with, both about 10 years ahead of him in the business. You don’t know what you don’t know, and at the beginning, there’s a lot you can’t know about advising or running a business. His mentors exposed him to situations he never would have imagined possible and allowed him to overcome his own restrictions to see things from clients’ points of view, not just his own. Whether it’s through a set curriculum or from experts in the field, Dustin’s dedication to learning what he could from others early in his career set him up for success later on. For more advice from Dustin, listen to the full episode where he shares how he manages the different aspects of his business, how he offers even more value through a consulting service, and more. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. And to get new episodes directly to your inbox, sign up for our mailing list below.
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