Keeping your head above water. Drowning in paperwork. Trying to stay afloat. Up a creek without a paddle. Smooth sailing. Have you ever noticed how many water-related expressions there are for describing the way you do business? That’s because it’s such a great metaphor, and one you can easily relate to.
In my recent coaching program, a roomful of attendees did an interesting little exercise using this metaphor. They took out a piece of paper, drew a horizontal line across the middle, and pretended it was a water line. Above the line, they listed all the activities that really matter in building a successful business. Below the line, they listed the distractions that could keep them from being successful financial advisors. Basically, only three activities belong above the line: acquiring clients, serving clients, and building your team.
Nearly everyone agrees that brand-new advisors should spend a huge amount of time on client acquisition. Unfortunately, many established advisors think the rule doesn’t apply to them. They often ignore this crucial above-the-line activity. Instead, they spend their time on all the activities below the line and soon find their businesses starting to go under.
The second above-the-line activity, serving clients, simply means delivering what you’ve promised. Meeting your clients’ expectations is an absolute must for keeping your head above water. This includes ensuring the timely delivery of financial plans, money management services, and advice about insurance, budgeting, debt reduction or elimination, cash management, and emergency reserves.
The third above-the-line activity is building your team. This means organizing your employees and creating successful relationships with outside resources who can provide the services your clients need.
Basically, that’s it. Unless you’re doing things to acquire clients, serve clients, or build your team, you’re spending your time on below-the-line activities that do nothing but distract you from becoming a successful advisor. Here are five common examples.
1. Overeducating Yourself: Some advisors think their job is to know everything about insurance, investments, and financial planning. Instead of harnessing the knowledge of experts who can best serve their clients, they spend all their time becoming educated in those areas. If you’re paying a money manager to manage the client’s money, you don’t need to know everything the money manager knows. You simply need to know which questions to ask the client so you can give that information to the experts and they can provide accurate advice. Your job is to serve your clients by holding them accountable for acting on that advice. That’s what it really means to be a Trusted Advisor.
2. Reading Financial Pornography: Watching 24-hour news reports, reading financial newspapers and magazines, tracking the prices of oil and gold, and trying to guess the impact that the next terrorist bombing will have on the market is a waste of time, yet advisors are consumed with that kind of stuff. Your clients really want you to help them achieve their goals—and for the record, beating the market is not a goal. If you want to keep your head above water, focus on your clients’ real goals, which include things like sending their kids to college, funding their retirement, and buying a vacation home or sailboat.
3. Wasting Time at Conferences: There’s nothing wrong with attending a conference, but sitting in sessions and learning information you don’t need to know is a below-the-line activity. Before you attend your next conference, look at the agenda and ask yourself, “Will this conference and these specific sessions help me achieve my main goals, which are the things above the line?” If the answer is no, don’t go. It must seem strange for a guy like me who gets discovered at conferences and in financial publications to suggest that you be more selective, but that’s the best advice I can offer. Many conferences offer a variety of programs that can conflict with each other and therefore potentially confuse attendees. Pick your method and stick to it as it’s been proven to work. Stop looking for the new, best “silver bullet.” If you’re on a path that’s vastly different from something that I could help you with or the path of Values-Based Financial Planning™, then you’re better off not hearing me speak—at least about my method.
4. Hanging Around with the Wrong People: If you’re hanging out with people who have average businesses with average client satisfaction and average productivity, then chances are your business will be a lot like that, too. Don’t confuse consensus with wisdom. Just because most of the financial services industry is living below the line doesn’t mean it’s the right place to be. As Jim Rohn says, you can do anything you want. You’re not a tree. Move! Be where you want to be, and do what you want to do. How can you tell whether you’re hanging out with people who are living below the line? Here are some signs:
- What do they talk about? If they talk about things beyond their control, like the market and the economy, they’re living below the line.
- Do they do a lot or talk a lot? How productive is their business? How good is their life? Do they have some staff that they can delegate to? If they’re workaholics with thousands of clients and mediocre production, they’re living below the line. If they’re significant producers with a manageable number of clients and they’re living great lives, they’re living above the line.
- Are they focused on what really matters? After recently finishing the British Open, golfer Jack Nicklaus was asked about his legacy. His answer may surprise you. He said he hoped his real legacy was more about his kids and grandkids than about his golf game. Are you hanging around with people who are focused on what really matters? Is their business an enjoyable vehicle for creating a great life while doing good things for their clients, or are they consumed by minutiae?
5. Failing to Delegate: As a financial advisor, you don’t need to sit in front of your computer and learn how to create financial plans, be a money manager, or give insurance advice. Trying to do everything yourself is the last and probably worst example of below-the-line activity. Many advisors spend time on activities like these for one of two reasons: They don’t want to delegate or they don’t have the money. When advisors don’t want to delegate, they’re usually avoiding work that might feel uncomfortable, such as asking for referrals. When advisors can’t afford to delegate, it’s because they aren’t spending enough time working above the line.
The last person I hired earns a $250,000 base salary. If you think I had a quarter of a million dollars burning a hole in my pocket, I can assure you that I didn’t. But good people pay for themselves. It’s more important to learn how to hire and manage a couple of people than it is to learn everything there is to know about writing a financial plan, being a money manager, or giving insurance advice.
No one wants to see their businesses sink. To keep your head above water, remember this simple metaphor and spend your time above the line. Focus on the three activities that really matter—acquiring clients, serving clients, and building your team—and don’t get drowned in a sea of distractions.
Don’t be a salesperson. Be a Trusted Advisor.