My Number One Piece Of Advice

For anyone looking to improve themselves as a financial planner, or become more intelligent in general, my number one recommendation would be to read. More specifically, read books.

Josh Brown recently had a post on “Tips for Savvier Consumption of Financial Media” where he wrote the following:

Hierarchy: Books > Articles > Blogs > Tweets

Shane Parrish has noted that reading is the number one priority for Warren Buffett and Charlie Munger, chairman and vice-chairman at Berkshire Hathaway:

Warren Buffett says, “I just sit in my office and read all day.”

“You could hardly find a partnership in which two people settle on reading more hours of the day than in ours,” Charlie Munger commented. 

Munger adds: “We read a lot. I don’t know anyone who’s wise who doesn't read a lot.”

Warren Buffett on Charlie Munger:
“And Charlie—his children call him a book with legs.”

During the summer between my junior and senior year of college, I made a specific decision to start reading more. Now I read all the time. It is a large part of who I am and a huge influence on my life. I read more than 70 books last year, and I was busy much of the year studying for the CERTIFIED FINANCIAL PLANNER™ examination. In the month of December, after the exam was over, I read 24 books. My average month consists of reading between 5 and 10 books. I read about everything, including both fiction and nonfiction on business, investing, science, history, art, medicine, technology, nature, biographies, and more. 

This is not to emphasize quantity over quality. Rather, it speaks to how addictive reading can become. I love reading. Although I started out with the purpose of gaining knowledge, I quickly found it to be enjoyable too. Learning becomes a byproduct of reading.

There is no doubt in my mind the biggest influence on my professional development has been reading. The benefits consist of more than just understanding the technical content. I think reading has made me a more sociable person. This may seem counterintuitive because people often envision those who read a lot as being shy. However, since I read about so many topics, I can talk with a wide variety of people about a wide variety of subjects. In addition, when two people have read the same book, it is remarkable the connection and rapport it creates.

To aspiring financial planners and young people in general, my advice would be straightforward: read all the time. Not only will you learn a lot, but you will find it entertaining as well.

Distinguishing the vital few from the trivial many

“No is a complete sentence and so often we forget that. When we don't want to do something we can simply smile and say no. We don't have to explain ourselves, we can just say "No".”

                                                                                                     -Susan Gregg

“...there are often many things we feel we should do that, in fact, we don't really have to do. Getting to the point where we can tell the difference is a major milestone in the simplification process.”

                                                                                                     -Elaine St. James

“The difference between successful people and very successful people is that very successful people say “no” to almost everything”

                                                                                               -Warren Buffett

I recently finished reading Essentialism: The Disciplined Pursuit of Less by Greg McKeown after reading a blog post by Shane Parrish on FarnamStreet (a blog I highly recommend). Without a doubt, the thing I took away most from the book was the realization of how many things I volunteer my time to. Things that are often in direct contradiction to what I see as my overall goal.

It is intuitive to believe that productivity, execution, or efficiency can be achieved by addition. McKeown argues that the Essentialist, focuses on what needs to be removed. 

Below are some of the selections from the text I found thought-provoking:

“Essentialism is not about how to get more things done; it’s about how to get the right things done. It doesn’t mean just doing less for the sake of less either. It is about making the wisest possible investment of your time and energy in order to operate at our highest point of contribution by doing only what is essential.”

…

“Today, technology has lowered the barrier for others to share their opinion about what we should be focusing on. It is not just information overload; it is opinion overload.” 

…

“In this example is the basic value proposition of Essentialism: only once you give yourself permission to stop trying to do it all, to stop saying yes to everyone, can you make your highest contribution towards the things that really matter.”

…

“The killer question: “If I didn’t already own this, how much would I spend to buy it?” 

…

“The way of the Essentialist means living by design, not by default. Instead of making choices reactively, the Essentialist deliberately distinguishes the vital few from the trivial many, eliminates the nonessentials, and then removes obstacles so the essential things have clear, smooth passage. In other words, Essentialism is a disciplined, systematic approach for determining where our highest point of contribution lies, then making execution of those things almost effortless.” 

Your Intro Guide to a Financial Planning Career

Know Thyself

When it was time for me to look for jobs, I didn’t mess around. I knew two things: 1) What I wanted to do, and 2) Where I wanted to do it. For me, the answer to those inner-discussion questions were “I want to be a fee-only financial planner at a small firm in the San Francisco Bay Area”. If you are reading this and you do not know the answer to YOUR two questions, I suggest that you first take a step back and really figure out what you want. It’s important to be self-reflective while making larger, life decisions. For me to be able to really know what I wanted, I needed to sit down with a third-party counselor and untangle the webs that make up the human psyche. Do not be too proud to sit and get vulnerable with a friend or a counselor on this topic – it is potentially the largest decision of your life.

While I would not consider myself a life coach, I was recently challenged with the opportunity to help a younger Financial Planning student approach his “first real job” out of college in financial planning. I left my home state of Texas to pursue Financial Planning in the Bay Area, and this particular student who contacted me wanted to know the best way of doing something similar. So it got me to thinking, if I were on the receiving end of job inquiries (which I guess I am now…), what would I want to look for in a prospective new hire? In this post, I will share some of the things I recommended to this student, and more.

Know the End Goal

Eluding to first paragraph in this post, I’m very strict about beginning with the end in mind. If your goal is to become a good basketball player, you should shoot hoops every day. If you want to create a smart phone app helping me choose what I want for dinner tonight, you should probably learn how to code. My point is: if you want to know where to start, you need to know where you want to end up. I create this large build-up because jobs in Financial Planning are not just ‘one size fits all.’

You need to know what the end goal is – do want to counsel and create budgets? Do you want to manage investment portfolios for the middle market? Do you want to evaluate individual’s private investments or create sophisticated estate planning techniques for business owners to lower their gross estate? Do you want to work on a team as the financial planning software guru? Do you want to earn a salary working under someone, or do you want to begin creating your own business from day one? The differences are subtle, yet significant.

First, you should look for an opportunity that may fit your personality type the best.

Extrovert vs. Introvert

When deciding which type of job you should pursue, you should ask yourself if you want to be an advisor who communicates and presents to clients on a regular basis, ie. “the client-facing role”. If you want to be a client-facing advisor, you should immediately begin working on your soft skills. If you are smart, you can learn anything technical; but not everyone can be taught to be likeable. When I say “likeable”, I mean you need to learn how to be approachable, listen better than you speak, and learn how to convey trust by being relatable. If a client does not trust you, you are not going to get their business. The easiest way to make someone trust you is to listen and be able to explain difficult concepts in easy ways. Albert Einstein said, “If you can't explain it simply, you don't understand it well enough."

On the other side of the spectrum, extroverts (or an ‘ambivert’, as described in Dan Pink’s ‘To Sell is Human’) are not the only successful people in this industry; introverts are also wildly successful in the financial planning space. Financial topics can be very difficult, and someone has to create the sophisticated financial planning techniques and investment portfolios that help clients succeed. For the introvert, your likely first successes will come from creating financial plans for other advisors, running software, creating investment portfolios, and other behind-the-scenes, yet hugely important skills.

Obviously, a great opportunity is going to come with responsibilities that are for all personality types - extroverts, ambiverts, and introverts. Based off of your own personality, it will help you initially highlight what type of “first job” opportunities to pursue. The best, first job you can land is something that is great for you, not for the general public. Be sure to pursue an opportunity which will enhance the skills that match your personality, and will develop your weaknesses as well.

Do Your Research – No Two Firms are the Same

I could spend hours explaining to someone the difference between my firm and the firm down the street. While we might have the same job title, we could be in completely different spectrums of the industry. For example, how many times have you heard someone call themselves a “financial planner”, only to find out that they sell insurance products (often for only one company). In my opinion, it is absolutely unfair to prospective clients, who have no idea what makes each advisor so different.

If you gave me the name of an advisor and what their company name is, I could tell you in 60-seconds: what their main business is, how they get paid, what their business structure is, and who their clients are. You need to learn how to do this. First, start by getting familiar with a company’s ADV. An ADV is what firms, by law, have to fill out which completely describes their business and how they get paid.

To do the best research and find a firm’s ADV, first, go to this official website. From there, you can do a search on any firm, or individual advisor, you’re doing research on. The easiest place to start is by going to Form 2A. You will be able to see if a firm manages client’s portfolios (assets under managements), how they charge, if they get any referral fees from other companies (for example, lead generation/agreements), and much more than you even wanted. If you want the high level stuff, you can most likely do a Google search for the firm name with the word “brightscope” or “find the best” in the search. Websites like Brightscope pull information from the official website I gave a link to above.

When Career Fairs aren’t enough - The Cold Email

A couple of months ago, my firm’s general email line received a “cold email” from an unrelated business rep who wanted us to use/buy their products. While my firm was not in the market for his products/services and I had no reason to respond to his email, I felt that I needed to respond. Why, you ask? Because he clearly did his research. He referenced something from my firm’s ADV that was sort of hidden. It was so hidden, that I had basically forgotten about that detail. It showed the individual’s attention to detail, and it was appreciated. That is someone who deserves a response.

Dealing with some Rejection

In your eyes, you are a great candidate. You are driven, you are a ‘people person’, you were heavily involved in extra-curricular activities in college – and you did not get an offer! How could the firm not hire you and what could you do differently?

One of the hardest pills to swallow is someone not reciprocating your interest for them. Job interviews are the same as dating, in my opinion. Once you set up an interview (the “date”), you have one shot to make an impression. You think things go well, then they don't call you back.

The mark of a true champion is someone who can stomach defeat, or loss, and move forward. When a prospective firm does not give you an offer, it can hurt the ego. Odds are, there are many factors behind their decision that you will never know. And you need to be okay with that. Whether an opportunity is going to work depends on so many different factors and it is hard to cover it all in a one-hour interview. Keep working hard, keep doing your research, and keep working on the skills that will get you to your end goal. Begin with the end in mind, and connect the dots until you have reached your end point.

If you have any particular questions, feel free to email me or reach out to me on LinkedIn.