Between Now and Success

Can you get a true understanding of a client's risk tolerance and place them in a portfolio with the appropriate portfolio risk by asking a few simple subjective questions? Robo Advisors Betterment (see my interview with Betterment founder Jon Stein) and Wealthfront believe they can but today's guest, Aaron Klein, co-founder of Riskalyze, believes those firms have it all wrong. Aaron's firm tackles the risk tolerance and portfolio risk challenge from a different angle by utilizing concepts borrowed from Prospect Theory. Prospect Theory was developed by Daniel Kahneman and Amos Tversky and essentially says, "People value gains and losses differently and, as such, will base decisions on perceived gains rather than perceived losses. Thus, if a person were given two equal choices, one expressed in terms of possible gains and the other in possible losses, people would choose the former." Source. We had a fascinating discussion about how investors deal with risk and we capped it off with some thoughts about the future of the financial advice business. Aaron has strong opinions and he has the smarts to back them up. Don't miss this episode with Aaron Klein of Riskalyze.

We all love great stories and in today's podcast I share some insights on why stories are better than facts when it comes to influence. You'll also hear my conversation with academy-award winning producer Ed Saxon, as we discuss the power of story. But wait, there's more! At the T3 Technology Conference I also talked to Jay Jay French, a founding member of the popular band Twisted Sister. And you'll hear our conversation on this podcast as we discuss four ways to deal with setbacks. He also shares a story about Keith Richards that you won't want to miss. Fun stuff! Jay Jay is a columnist for Inc. Magazine so he knows more than just how to get a crowd rocking.

This is a jam-packed episode filled with my takeaways from the T3 Technology Conference as well as interview clips from six industry leaders. I cover four themes that emerged from the conference including: enhancing the client experience, offering a client portal, delivering a quality financial planning offering, and using big data to make better business decisions and personalize the client experience. In today's show, you'll hear from: Phil Cunningham, CEO of Advicent Kevin Knull, – President of PIETech Inc., the creators of MoneyGuidePro Drew DiMarino, Head of Sales for eMoney Greg Friedman, CEO of Junxure, CEO of a top RIA called Private Ocean, and author of Advisory Leadership: Kevin Cimring, CEO of Invesco Jemstep, and Josh Self, Envision Wealth Planning Greg Sauer, – Business Development at Oranj

I just got back from the TD Ameritrade National Conference and in today's show, I'll share a few quick comments from the event. Yes, the conference covered the usual slew of technology sessions dedicated to robo advisors and scaling your business. But what I found most interesting was the theme of putting the "human" into finance. TD Ameritrade clearly understands the importance of the "human" in the financial planning process and the importance of using story to connect with others. I start the podcast by discussing an important insight from keynote speaker Sally Hogshead and then wrap up with on-site conversations I had with Matt Brinker of United Capital, Spencer Segal of ActifFi, and Matt Ackermann of Investment News.

Podcasting is a great way for financial advisors to differentiate themselves in a crowded marketplace. My good friend, Bill Keen of Keen Wealth Advisors, joins me in the studio for today's podcast and we discuss how he got into podcasting and how it's working for him. Bill is one of a small number of financial advisors who are pioneering the use of podcasting as a way to educate investors and expand the reach of their business. If you are interested in learning more about podcasting and whether it might make sense for you to start your own podcast, then I suggest you do two things. Listen to today's show. Complete the podcast interest survey. As you can tell, I love podcasting and think it's a great way to get your message out and complement your other marketing/outreach activities. 

“All the world’s a stage” said William Shakespeare. Turns out we’re all actors playing multiple roles in our business and the better job we do “acting” in each of these roles, the more deeply we’ll connect with other people, says Steal the Show author Michael Port. On the surface, thinking of yourself as an actor playing a role sounds like I’m asking you to fake it, to be someone you’re not. Actually, it’s just the opposite. Today's guest, Michael Port, is a New York Times best-selling author, professional speaker, and former TV and movie actor. Michael wrote a book titled, Steal the Show, where he talks about how to apply the methods of top actors to, “connect with, inspire, and persuade any audience.” In today's show, you'll learn how to use actors' tools such as honesty, rehearsal, blocking, and silence to own the stage and deeply connect with your audience.

Optimism is only half of the equation to overcoming a tough situation. Regarding the current volatile financial markets, I hear many advisors talking right now about staying the course, we're in it for the long-term, "this too shall pass," and other similar comments. Intellectually, that makes sense as over the long-term, the odds are high we'll hit new all-time highs in the market again. But if this optimism prevents you from taking action because it will all work out in the end anyway, well, I think that's a mistake. "Action" does not mean you start timing the market and make bold portfolio moves. Rather, I'm talking about proactive client communication and other things you can do to deepen your client relationships and show your value in times like this. I'm talking about having a contingency plan in place that you can spring into action on short notice should this current turbulence turn into a major tailspin. In today's show, I discuss the "Stockdale Paradox" from Jim Collins and how it is timely and relevant for what advisors are facing right now. When you couple it with last week's Friday Podcast on confidence, you have two excellent tools to make sure your mindset is in "great shape" to not only weather this storm but come out stronger from it. I also share about a dozen comments from other financial advisors who explain what they are doing right now to deal with the market turbulence. I end the show with a quote from Maria Robinson about the power of making a new decision today.

With the turbulence in the financial markets and client accounts running near the flatline over the past couple years, it’s easy to get discouraged. Yet now more than ever it’s critical that you maintain one key characteristic. The importance of this characteristic was driven home to me during an interview I did last week with Sheldon Wolitski. Sheldon is a hugely successful entrepreneur (Inc. 500/5000 winner for 9 consecutive years) who learned a business-saving lesson during the depths of the tech recession in 2001. In today’s show, I tell Sheldon’s story and the lesson he learned that is directly applicable to each of you. If you maintain this “one key characteristic” that Sheldon discovered, you’re not only going to survive these rough times, you’re going to absolutely crush it and come out much stronger. I also share many of the “My 3 Words” that listeners posted on my blog, on Linkedin and emailed to me. I also reference a panel I was on last week at Mariner Wealth Advisors National Advisor Meeting and end with a stirring quote from Nelson Mandela.

Can you organically grow a multi-billion dollar RIA? Many of the large RIAs you read about got there because they acquired firms or they were part of a banking, accounting, or law firm that fed them a large number of clients. Today's guest, Scott Hanson of Hanson McClain, built the firm with his partner Pat McClain the old-fashioned way--one client at a time. Using gorilla-marketing tactics, a radio show, and smart marketing, these guys built a $2 billion RIA with about 4,000 clients and an average account size of $500,000. Similar to Edelman Financial Services, Scott and Pat built a hugely successful RIA with relatively modest size clients. I've known Scott for more than 20 years and in today's show, we take a chronological look at what he systematically did to build a top RIA from scratch and the strategies he's now using to keep the machine humming.

Well, it's been an ugly start to the New Year in the stock market. And in today's episode, I share three things financial advisors can do right now to prepare for the next bear market. Whether what's happening now is the start of one, nobody knows, but the top advisors are doing a "bear market drill." I also share an idea on how to move beyond the "overwhelming tasks" that probably are lining your "to do" list this time of year. You'll also learn what golfers Phil Mickelson and Roger Sloan can teach us about the big difference small incremental improvements can make in your business. I end the show with a quote from Ralph Waldon Emerson.