For those who have read my prior posts, this article will certainly be a departure from the normal nuts and bolts analysis or commentary on a financial topic. My intention here is to pull the curtain back, so to speak, and convey the foundational belief system that drives my motivation to be an independent and fee-only financial advisor. Most who are reading this know what I do. I think it’s important for people to know why I do what I do.
So the Reader’s Digest version is as follows: I do what I do because I believe it is the right thing for me to do and the right way to do it. While that is admittedly vague, it really does capture my manifesto in one sentence.
Before getting into details, I must acknowledge up front the devil’s advocates out there who could and should counter with: “Yeah- but you’re getting paid to do this…” and there is no denying that. I will fully acknowledge that I certainly want to provide for my family. However, I can say with certainty that the manner by which I have chosen this line of work (fee-only, self-financed) is not the most lucrative model to employ for a financial advisor and I was certainly making more money in my prior career. That being said, I believe that negative is vastly outweighed by the fact that my enterprise embodies the perfect mix of factors for me: provide a nice living for me and my family while fully utilizing my God-given skills to help others in a completely independent context. That’s basically it.
Now, on to the details…..
As noted above, the first portion of my motivation is that I believe my vocation as an independent financial advisor is the culmination of several factors which all center on the concept being “the right thing for me to do”. Why should you care about that? Because I believe you want someone working for you who wants to be on the job.
So first, I firmly believe this is the right thing for me to do because at my core, I realize a high degree of fulfillment knowing that I am using my knowledge, passions and skills to serve individuals and families. In practice, this means I am gratified coming to work every day knowing I am helping folks employ prudent financial strategies to help them progress toward their goals while at the same time, reducing the family stress associated with the “great unknowns” such as retirement savings needs, investing strategies, tax efficiency, etc. As you may have inferred, I also like to write and I don’t mind talking at length about these topics so I feel my role is also as a “translator” of these sometimes bizarre concepts suits both me and my clients well.
Second, this is my passion. Even as far back as my college-age, I have always been interested in finance, economics and investing and knowing the solid fundamentals and latest developments in these fields, then applying them to helping people, is my dream career. The flowery self-help industry often asks “If money were no object and you could do anything for a living – what would you do?” For me, my practice is my answer. Now admittedly, if money were no object I would not build my practice up to a large scale which takes a lot of time, effort and investment of personal funds. BUT I would do exactly what I am doing now on a smaller scale, even if I didn’t have to worry about my role as a provider for my family.
Which leads me to the second part of my motivation, “…..the right way to do it”.
I do this because I have found a way to combine the aforementioned fulfillment for helping others in a manner in which I can operate with complete independence. Years ago, I investigated doing this for a living but what I found was I would clash with the idea of having a sales manager direct my day. While not having to deal with somebody monitoring my progress on performance metrics sounds great, there’s a price to be paid for that independence and that is self-financing. Specifically, I receive no “salary”, no commissions- nothing from anyone but my clients, who can plainly see exactly how much their investment advice is costing them by the amount of my annual fee or project fee. Of course I would argue that my service provides much more of a value than my fee but that’s a topic for another discussion.
The critical component to the story is that what this “expensive” independence buys me is the ability to provide people advice in the manner which satisfies “the right way to do it” and that is with an annual fee for handling a multitude of financial topics without my clients having to worry about who else might be providing me “incentives” to make the recommendations I am making. (Side note: I must take a moment to acknowledge that there is no doubt in my mind that there are many fine, non-independent financial advisors who are ethical, serve their clients well and do not make recommendations based on incentives. However, in a planning relationship that is built mostly on trust, I do not want clients questioning my motivations for even one second.) So the way I have chosen is certainly more difficult (especially in the early stages) and the road-less-travelled in this industry but I firmly believe it is the most appropriate model for both me and my clients.
To wrap up, I do what I do because I believe I am fortunate enough to have found a means to make a living that aligns with my passion for personal finances, my strong desire for independence and my satisfaction in knowing I am actually helping real people.
(This post was originally published in July 2013)