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Managing Your Practice
Health Meets Wealth: The Power of Transformational Financial Advice
00:45:01
In this episode of the Managing your Practice podcast, Catherine Williams of Dimensional Fund Advisors is joined by Brady Fineske, president of TFO Wealth Partners, and Richard Stott, CEO and CIO of Connectum Capital Management. They explore the...
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- [00:00]
A
Foreign Hi everyone. Thank you for joining us today. My name is Catherine Williams and I'm head of practice management here at Dimensional Fund Advisors. And my team is responsible for helping advisors really around the globe thinking about how to grow their business, manage their business, drive the value they're looking for in their business. And we do that through studies, we do that through consulting, and we do that through a podcast, which is why we're here today. You know, really excited for the conversation we're going to have today. Before I introduce our two guests. In preparation for today's topic, I was reminded of a quote by the American philosopher Ralph Waldo Emerson who said the first wealth is health. And while he said that back in the 1860s, and I think elements of our conversation today are based on some sort of the newness that we're seeing in some of the ways that advisors are working with clients, we've absolutely had a long time observation of this connection between your health, your wealth, your financial well being, what does that look like for how you're living the rest of your life? And certainly advisors, for those of you that are working directly with clients, this is an area that, whether it comes up organically or it's something you're getting super purposeful about, we wanted to talk about that today. So to help me with that conversation, I'm really excited to introduce you to Brady Faninski, who is the president of TFO Wealth Partners based out of Ohio. Great to have you here with us, Brady.
- [01:27]
B
Well, thank you for having me.
- [01:28]
A
Yeah, it's gonna be a fun conversation. And then from a little bit further away than Ohio, really pleased to introduce Richard Stott, who's the CEO, CIO and founding partner of Connectum Capital Management, based out of Oslo, Norway. Richard, it's great to have you.
- [01:44]
C
It's a pleasure to be here.
- [01:45]
A
Thank you for traveling across the pond here. We're actually for those who don't know as are listening to this, we're sitting in person, which is sort of a rare treat. So really, really excited about that. And both of you have, because of the types of organizations that you are responsible for, the kinds of clients you work with, and also just the area of the world that you're in, have very unique perspective on what we're going to talk about today. So really, really looking forward to that. Before we dive in, I'd love for each of you and Brady, I'll start with you, just, just share a little bit about, you know, what brought you to this industry, what brought you to even your current role with TFO what does that look like?
- [02:20]
B
Yeah. So I thought I wanted to be a teacher and a coach until I was.
- [02:23]
A
Well, you are. Yeah, until I was.
- [02:25]
B
Yeah. And. And I met my father in law who was in. And I saw kind of firsthand as I watched him that he was teaching and coaching. He was taking very complex things and making them simple, but doing so in a way that he was helping families and helping and mentoring other young advisors, guys that became my close friends to do the same thing. And so I realized I could teach and coach. And then as I became president of the company, I realized I could still manage a team. And all the things that I was doing back then in college and right out of college I was able to do professionally and make a bigger impact or a different impact, I guess. Yeah, yeah. That's how I got here.
- [03:02]
A
And what does TFO look like today?
- [03:03]
B
TFO in Ohio is about 65 team members. We have a separate RIA in Phoenix that has about 85 and a trust company in South Dakota. So I don't know what that is now 125 or so. We manage about 12 billion of assets collectively together, our RIS and trust company.
- [03:23]
A
Richard, you have an interesting journey. I feel like it's almost practically in your DNA, if you will.
- [03:30]
C
Yes.
- [03:30]
A
But what brought you in terms of particularly creating Connectum? Like what was leading up to that?
- [03:36]
C
I took the example from my father's business. I grew up around somebody who built up an independent financial advisor business in the UK following what was called the big bang in financial services in the UK in the 1980s, and built that up brick by brick until he sold it in the early 2000s. So I learned an awful lot of the principles that we use today in Connectum from my dad when I was still pretty young.
- [04:08]
A
That's great. And what does the business look like today?
- [04:11]
C
Business is largely based in Scandinavia. We're the only certified fiduciary advisor in Norway. We were the first one in Scandinavia. And we have clients both in Norway, Sweden, the UK and one or two other places around the world.
- [04:27]
A
So I'd love to kind of level set. I obviously as already talked a little bit about what we're going to cover today. But when we do talk about what we often refer to as sort of this intersection between health and wealth, how it relates to your clients, what does that mean to each of you? What does that mean to you? Richard, as you think about that, I.
- [04:46]
C
Think for us one of the key things has always been when interacting with the clients, you're concerned about Them as people you actively care. And it's one of the values that we have within our strategy to show that we actually care about the clients. So the discovery process that we go through with them. I think clients are quite surprised that it takes us a while to get on to talking about investments. It's about them, it's about their lives. And there's this wonderful graphic that was done a few years ago about the intersection of your life, your money, and in the middle is real financial planning. And I think that's what we as an industry have become a lot better at through the last few years.
- [05:38]
A
Do you have specific questions or topics that you raise with a client to try to understand what their perception is or how they're feeling about? Maybe more on that health and wellness side?
- [05:52]
C
Very often I think that will come out of the overall discussions that we have.
- [05:56]
A
More organic in nature.
- [05:57]
C
Yeah. And particularly being based in Norway where people generally look ridiculously healthy. I mean, it's sickening sometimes.
- [06:06]
A
We would agree.
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B
It's all that coffee you drink. Right. We were talking at lunch. All that coffee.
- [06:09]
C
It's the coffee, the cross country skiing, the walking in the forest.
- [06:13]
B
Oh, we do it all wrong here.
- [06:15]
A
I know we're on the opposite end of that spectrum at times. So, Brady, how about for you and I, TFO has started. Begun to take a very purposeful look at this. But just a level set. What does that intersection mean to you all?
- [06:26]
B
I was thinking about it and I don't know that there's a client meeting where we're not really talking about it in some way. I often kind of draw on the board. I thought you mentioned a graphic. But as we go through life, our health tends to decline as our wealth increases. Right. And that's really what we say is we like to help connect wealth and purpose. So if we have a big gap there, if you have all the wealth in the world and no health. Right. And for me, it's a real personal topic really for kind of two ways. The first one is my son Jeff, back when he was six years old, was diagnosed with brain cancer. And on a Friday afternoon, we found ourselves not caring about wealth and only caring about health. And thank God we were prepared from a financial perspective. But you can't prepare yourself for what, five years of going around the country and being on pediatric cancer floors, you can't prepare yourself for that. But it did put in perspective that wealth really is important, but not the most important and a focus on health. And gosh, as we went through that, I didn't focus on my health as much as I probably should have. But I tell that story a lot because there's a lots of beauty and goodness and all that. But it does kind of share an experience that when we condense time, we tend to make better decisions about our wealth and our health. You know, if we have 30, 40 years in a Monte Carlo or retirement sustainability analysis, it's tough to see the priority that we need to go work out today or we need to spend money or time on our health. And so I tell that one. But also because, you know, just for whatever reason, 20 or 30 clients within the last several years have lived the American dream. They've sold their business, they've reached that retirement pinnacle. And then next thing you know, there's a diagnosis. Right. Or next thing you know, there's a parent that needs all of their time. And, and it doesn't quite work out the way they expected at the time they expected it. And so, you know, being able, I think, as an advisor, help people realize that we can do it while we're working. Right. We, but we, that we do need to spend some time and wealth on our health because that's the one thing that can take it all away or make it completely meaningless. You know, so talk a lot about it.
- [08:22]
A
I love that. And I think that as you, you know, so many advisors we work with and talk with, they've got a comfort level in leaning into that. Right. Leaning in and sort of raising those questions or having that conversation. But you also have to build up to that. You have to build up that confidence. You have to build up that knowledge. And so it seems like there's a learning opportunity, particularly for the next generation of advisors as they're coming along. Like, how do you. And you know, there's a. We're going to talk about this a little bit later. Like, what's that fine line too? Right. Like you're, you're asking questions and now are you really over your, no pun intended, Richard, Are you over your skis on that? But so was there a time where at tfo you, you all said, wait a second, we need to be purposeful, we need to be structured about this. A we see value or don't see value. I'm assuming you see value. And so what are we going to do to actually make this more really just a part of the organization?
- [09:15]
B
Yeah, it became evident just listening to clients in meetings and understanding what they really wanted to talk about, the things that were. They were most concerned about. Oftentimes wasn't the Performance of small value.
- [09:27]
A
Yeah. What?
- [09:30]
B
And it wasn't the investment chart. It was talking about their family, their worries, their concerns, their health issue that did pop up and how that could affect their plan. And we started to have these deeper conversations, and we're fortunate to have a team of advisors where not everybody has the same experience I did with Jack or I did with these clients.
- [09:48]
A
Sure.
- [09:49]
B
So we had to find purposeful time to teach each other and share those stories. We just did it yesterday where then they can just use my stories, you know, and my experience and likewise use theirs.
- [09:58]
A
So we're big fans of storytelling here at Dimensional, that's for sure.
- [10:01]
B
Script, story, sketches.
- [10:02]
A
You got it.
- [10:03]
B
There's another one in there.
- [10:03]
A
There's another one that I can supplements.
- [10:05]
B
Thank you.
- [10:07]
A
We'll edit this part out or I'll get a phone call. Richard, for, you know, and you touched on this that, you know, certainly within the. Within Norway, within the Scandinavian region, there's really a lot of this part of the life. It's very built in.
- [10:22]
C
Yeah. And when I was thinking about this conversation today, I was thinking about, you know, looking at quality of life, and I think what all of these elements pull together in terms of quality of life. And in Scandinavia, regularly, countries in the Scandinavian region are rated as having some of the highest quality of life measures anywhere. And I. I think it also has a lot to do with things like Maslow's hierarchy of needs and looking at what people actually set store by in their lives. You know, how much is enough? What are people going to be content with in their lives? And asking all sorts of questions about values. What do they see in their life? What do they want to experience? If you look at different countries, you can see different dynamics in how people, you know, what they're aiming for. And I think that's. That's an important distinction. So I don't think this conversation is going to be the same for everybody across countries. I think it very much has a flavor to it that is, you know, based upon the region that you're in.
- [11:34]
A
Yeah. With that said, I'm curious. You know, certainly an area that we know is coming up for many advisors as clients, and really just science is. Is sort of putting out there, hey, you know, this is not about your life being over. When you're 90 or maybe in a hunt, you might even want to live past 100. And what's the quality of living into your 90s, into your hundreds, and what that could potentially look like now. Nice, because you could have many more years of financial Planning for those clients to do. But how does that show up in any of the conversations, Richard, with your clients?
- [12:10]
C
I think it's looking at the planning and talking to people about what are the things they want to do, what are the things they want to experience. It's going into sort of the ideas that George kinder has talked about and, you know, saying to somebody, you know, you've got five years left. What are you going to do? Who are you going to be with? What are the things you want to experience? And then shortening that time frame, but then also talking about when people actually get into retirement and the ability to be able to do certain things, the ability to be able to travel, the ability to be able to experience things might be limited based upon your physical condition.
- [12:51]
A
Yeah.
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C
And at a certain point, you might not want to travel as much. You might not want to do, you know, be as active as you perhaps were.
- [13:00]
A
I had an advisor say this idea of, you know, clients that have said, I want to be around for my great grandchildren. And the advisor said, how about we think about your ability to, like, pick up those great grandchildren, Right? Like that physical. Like, it's one thing to be around and see them, but to actually, you know, be in a place of health that you're really engaging. I thought that was an interesting way to talk about that.
- [13:22]
B
Yeah. So many people can answer the questions about how they achieve their success from a wealth perspective. You know, we set goals, we met annually. We, you know, and had a team, built a business. You know, they go through all that. But it's like, well, what do you do for your health? You know, do you hire a personal trainer? Do you have the right people around you? Chef, whatever it is, to eat healthy? You know, what are the things you're doing that achieved that such great success to make sure that your health is doing that too. And I think a lot of times there just isn't that focus, it's reactive.
- [13:55]
C
And I think also building on from that, there's. There's an appreciation that life isn't controllable and things happen. The example with your son is. Is an example of that. My father, another example. This guy was as fit as a fiddle. He. His resting pulse was, you know, under 55, well into his 70s. He was a former footballer, soccer player to you guys. But then he suffered from dementia for the last seven or eight years of his life. And so he saw the quality of his experience diminish as time went on. And thank heavens he and my mum had actually taken the opportunity to Travel earlier in retirement, you know, whilst he was still able to.
- [14:45]
A
And I could see where some of those things absolutely have an impact on, you know, when is wealth going to transfer? What will that look like? You know, how do you make sure to plan for and anticipate knowing? As you just said, Richard, you just don't know there. It's absolutely. And you know, this is not about creating a fear based approach with clients, it's about living your fullest life. But is there an actual impact? Certainly here in the US as we look at estate planning and tax considerations, but what you know, as, as wealth actually, you know, begins to move, if you will, what does that need to look like?
- [15:20]
B
Well, how can I bring them joy? Yeah, right. I mean, if we're doing it, just.
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A
Take it with you when you go.
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B
Well, and if we're doing it just for taxes, what's the fun in that?
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A
Right.
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B
And so trying to change the conversation around, you know, money can be a tool for learning. You know, if they are going to inherit a bunch of money and we give them 18,000 now let's use it as a tool and let's find some joy in it. And if it isn't, if it creates stress and regardless of the tax, we gotta think about it differently.
- [15:47]
A
Yeah, I think one of the reasons why this is such an important topic for us as a practice management team, we look at the data in our global investor study which just cleared about 100,000 end clients. So lots of data which makes us very happy here at Dimensional. We love our data and we look at what clients say they value and what they look for in their relationship with their advisor. And on the surface you could say, well, there's nothing necessarily revolutionary about this. But we still do see organizations that are not working to build trust. And when you have that trust with an advisor where you can have a candid conversation with them, you can ask them these straightforward questions, that is the game changer. And we know from the data that the clients that are particularly engaged, that sense of security, peace of mind. So again, this isn't about creating a fear based conversation, but more, as you said, living the fullest life you possibly can. You know, we haven't really talked about your people within your organization, like what's the impact even from a cultural standpoint on your own business as you think about this more holistically with your clients, it's definitely one area. Brady, I know you've mentioned the impact or the influence that the Fulfillment Index has had on, on some of the ways that tfo is thinking about that. Can you share a little bit of that?
- [17:02]
B
Yeah. So, you know, I think several years ago we found the Williams group study that at the said 97% of families fail to transfer their wealth down to the third generation. Right. Shirt sleeves to shirt sleeves. I think it's up to 90% now, thank goodness, right before the exemption goes away. But at the time we said what do the 3% of families do? And we found out in studying that was discover they did deep discovery of what mattered the most to them. They captured it and then they talked about how they transfer that because transferring the wealth was easy. And so we had to create a discovery tool that allowed the advisors to go deeper with their clients. And so we have two. One's called Wealth 4 and one's called this Fulfillment Index, which is a three minute questionnaire that we provide to our clients in advance to really help score them on the four key areas of life. And this came from the book Die with zero. Right? Your time, your health, your wealth and kind of the purpose or experiences, relationships that you want to have. And it's very interesting when a husband and wife answer that, how far off they can be or how mirrored they can be. And it's fun to talk about the successes in certain areas and lower, lower scores that are worse, what we can do to take those same things and make them better. But designing their plan around something that is custom for them, that was discovered out of good questions. In that example, it's a three minute questionnaire, but the advisors can then elaborate on those questions. Has been a game changer for us to go deeper, have deeper relationships and connect. I mean it's amazing how I think I saw the other day, 55% of people find their purpose and fulfillment in their work. And for us and business owners it's even higher. And that's kind of our niche and.
- [18:39]
A
It'S way higher for the practice management team.
- [18:43]
B
But we think about a life transition, retiring, selling your business, a major life transition, no different than death, divorce or anything else. Oftentimes they have this crisis of identity, like they've lost their identity. Everything that brought them joy and purpose left. And it's crazy. I mean the number of divorces over the age of 65 are three times higher since 1990. Accumulating wealth, accumulating wealth, maybe ignoring the purpose, the relationships, the things that helped us get there. And then maybe a health issue pops up and it's everything we planned is changed. And so it's one of those things we've tended to Focus on most recently, really as another way we can go deeper with our clients and draw information out to help us craft a better plan that's custom for them.
- [19:31]
A
Richard, as you think about maybe the result with clients of taking this approach, really building that trusted relationship, that candid conversation that can happen, how has that shown up? What's been sort of. Are there some examples or stories of where you can see, wow, because we did this.
- [19:50]
C
I mean, the one that I really want to talk about is not from my own business, but it's from my father's business. It was at my. It was awake after my father's funeral. And I'm getting choked up talking about this. I can tell now one of the people who was there came up to me and he said, richard, I just wanted to tell you what a difference your father's advice has made for me and my family. And he said, we will be eternally grateful for what he did for us. Now, as an advisor, if you need, you don't need any more motivation than that to see the impact that good advice can have. And it wasn't just one generation, it was the next generation as well. And you see that when you're connecting with multiple generations of a family and that, you know, the message is sort of passed down from one generation to the next. You need to work with so and so just listen to what they say, listen to what they suggest, go with it because it works and it makes a difference. And there was. You started off with a quote, and I got one from William James. And it was particularly appropriate to this situation. I think it's valid for all advisors who genuinely care about their clients. And it was act as if what you do makes a difference. It does.
- [21:26]
A
What a gift for that to happen. Really. Yeah. That's powerful. And boy, that's the ultimate feedback from clients that we talk about. Right. It's awesome. And yeah, I love that. But if I can ask the gift of that direct experience with your father and the client as you come back into your business and you've got talent and colleagues and coworkers that you want this to very much be a part of what you want every client to feel like that at some point, how do you talk about it or drive that within the organization with your team? It's a question for both of you.
- [22:06]
B
Sure.
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C
I mean, we talk about that, these sorts of things within the team. We talk openly about the conversations we have with the clients. We try and involve the younger team members, those people who are moving into the advisor type role in the meetings, they're part of that intimate conversation. They're part of the values conversation with clients. They're part of getting to know the clients. And it's not always about the discussions over the finances. It's about just getting to know people. It's about opening up. And I think a lot of it has to do with being prepared to be vulnerable yourself, being prepared to talk about your own experiences and history and the impact that certain actions have maybe had on your own life and the lives of those people close to you.
- [22:58]
A
Yeah.
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C
And that allows people to connect.
- [23:00]
A
Yeah. Brady. And you mentioned, you know, even the ability for others to sort of borrow the stories from others until they have their own stories maybe to tell. What does that look like? Within the culture and climate of tfo?
- [23:15]
B
We have a core value that is maybe not a typical core value. It's just called be more. Right. We have to be more proactive, be more available, be more responsive. Just be more. We want to be the phone call. And I doubt not knowing, maybe your father's advice wasn't about a specific stock. That's not why they were telling you that story. Right. So, you know, I think if.
- [23:34]
A
Although if it was, feel free to pass.
- [23:38]
B
But, you know, I think that the idea for us is that we have to be more for our clients. And as leadership, we have to be more for our colleagues. Right. And we want them to stay with us, and we want to be a destination. Employer is our term for that, where if we can be more for our colleagues, they're going to be more for our clients. And so we kind of just try to drive that through the organization. We measure our day by how many families we helped. I mean, oftentimes as we go out to dinner as partners or with colleagues, we'll go around the table and say, how'd you help a family today?
- [24:08]
A
Yeah.
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B
We didn't say if you got more aus or.
- [24:11]
A
Yeah.
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B
Did our revenue go up. It's, did you help a family? How'd you help a family? We tell those stories over and over.
- [24:17]
A
Is there a line you try not to cross? Or have you had situations where maybe a client did, in fact, share something that was like, oh, I almost wish I didn't know that. You know, I'm being a little facetious here, but there's risk to this, right? There's a little bit of risk. The initial risk is your comfort level, your confidence, your ability to rehab the conversation. But I'm curious from both of you if there's sort of that. If you've got Even a soft line in the sand.
- [24:42]
B
Yeah, I think it's, it's always hard to draw a line, especially for us as we are a multi family office. You know, it's hard to draw a line. I mean, you know, we've picked up Bob from his oil change and I always joke a little bit like, you know, we do everything but walk their dog, but we would if they ask, but, but not true. I mean, you know, when, when it goes outside of our professional capabilities. I think one of the things that we've done to help our younger advisors kind of spin out of that type of situation is we've created something we call a connected solution. So maybe not as serious of an example as you gave, but we do have a psychotherapist trained coach on our, on our staff that we can refer out situations to where we can have our advisors call and get information on how they handled that and get better next time. And you know, of course, if there's little things like private aviation or concierge medical or cybersecurity, you know, we've developed relationships with those trusted contacts. So we're still being more for them. We're still the single point of context. And maybe giving them that advice like your dad did, even if we're using others, that's great.
- [25:42]
A
I do believe you still, for all intents and purposes, you kind of get the win. Even if you're, even if your role is to get them connected with another. Someone who's an expert in that space. Yeah, I absolutely do.
- [25:54]
C
I've got to respond to the bit about walking the dog.
- [25:58]
A
I feel a good dog walking story coming up.
- [26:00]
C
It's very difficult, I think, to know where to draw the line because in certain circumstances you become the key person they go to. I've had situations where clients have said, if anything happens to me, my other half knows that one of the first phone calls is to you because you know where everything is, you know how everything is organized. And I mean, it's a privilege to be in that position of trust, an absolute privilege. And it's, it's one of the things that makes this job so rewarding that the people put that much faith and trust in you. It also makes you incredibly connected to people and sometimes those relationships spill over into friendships over time. You deal with people over such a long period of time, you get to know one another, you know, through the ups and downs of life.
- [27:01]
A
Yeah.
- [27:02]
C
So I think it's very difficult. I think it has to be up to the individual advisor. And certainly I think that I would hope that any of my team who felt uncomfortable in a certain situation would feel free to come to myself or one of my business partners and say, look, I've got this situation. How do I deal with it? Can I bring you in on this situation?
- [27:24]
A
Yeah. At the end of the day, both of you are also. You're running businesses, and there's client profitability and there's capacity, and there are capacity constraints for a lot of the businesses we're working with. There's also just, you know, how do you create a client experience that differentiates you? So as we think about this area and this idea of whether somewhat formally or really formally engaging with clients around health and wellness, how do you think about that as it relates to. I'm running a business like we do have to. We want to be profitable. We want to make sure where we spend our time. Time is efficient. We want to scale. Do you believe that these areas lend themselves to that, or is it. Well, it's kind of a lost leader or we don't really know, but if we don't do it, someone else is going to fill that gap. Maybe those aren't the only two options, but I'm curious where each of you land on that.
- [28:19]
B
Yeah, I mean, I think if it allows you to. Richard's point. Connect deeper with the client, create that relationship, turn clients into friends. I think all of those things, this is just one avenue to do that. And I think we're talking about it today because we think that people want to have that connection, that intersection.
- [28:37]
A
Right? Yeah.
- [28:39]
B
Can I tell the story about the firm of the future?
- [28:41]
A
You can.
- [28:42]
B
Okay. So, you know, I think one of the things that we did. Gosh, I think we talked about maybe it was April of 2016, somewhere around there, Right?
- [28:52]
A
Yeah. Everyone looked a lot younger in the picture.
- [28:54]
B
That's all.
- [28:54]
A
I know. I know I had more hair.
- [28:57]
B
But we sat around and kind of had this exact conversation. We were just over a billion doll at the time. So we were privileged to have Bryce Scaff come and Scott Bosworth come, and they led us in a retreat to think about what we were going to look like five years from now, ten years from now. And we were very typically throwing things up on these big pieces of paper that hung around the walls. Like, you know, we wanted to be 5 billion of AUM. We wanted to have X number of clients, X number of revenue. Right. Very typical things. And we were working backwards to figure out exactly how that could happen. And it just seemed real, and it was just typical answers. Remember Our partner, Cleaves Delp, at the time founder of our firm, stood up and was like, you guys got it all wrong. If he could have erased it, he would have erased it. But I think he literally unstuck it and stuck it somewhere else, ripping paper off the wall. And it was this blank sheet of paper all of a sudden. And he said, we have to be unrecognizable. And a lot of us couldn't think about what that meant at the time because. So there was this moment of silence. And Bryce and Scott were up there ready to write down the next things we said, but. But it was this moment of silence. And he challenged us to think, what do our clients really want? What do they really need? And if we would listen to them and determine that or maybe even get ahead of it and fill that unmet need. Referrals, aum, revenue growth, profitability, all the stuff you just mentioned, that would take care of itself. And so we started to measure our day on helping families and just help them in any way that we could. But we started to dream up things like, oh, we ought to have a trust company, how to do bill pay. We ought to create a financial literacy tool to educate the next generation. You know, we named all these different things that were just nowhere near what we were doing at the time. And we just built it. We just started building it. But it wasn't because of our ideas. It was what the clients really wanted. And I think now we're hearing that just health meets every day popping up. This person, that person, they want to know how that's going to affect their plan. And we have to have tools and be open and vulnerable enough to share our experiences, as you said. Show them we really care, as you said to, you know, have that conversation and be trained.
- [31:06]
A
Yeah.
- [31:07]
B
In order to have that conversation and ultimately connect it back to the plan.
- [31:11]
A
Yes.
- [31:11]
B
Right. That we've put in place for them, but to give them that confidence that they can take the trip.
- [31:16]
A
Yeah.
- [31:16]
B
They can do the thing, whatever it is they want to do. Super important.
- [31:20]
C
So, yeah, I think also from the point of view of advisors owning the firm, you also have to have this discussion amongst yourselves about what's enough for us as owners and operators of a business. It's something I've given thought to over the last few years in terms of male life, what is enough? And there are challenges with growing a business to a certain size. And you have to ask yourself, am I prepared for the responsibilities for what that entails for me, or do I need to bring in other people to help us scale the business to that level. To enable me to continue to do what I do best.
- [32:11]
A
Yeah.
- [32:12]
C
And to be really realistic about that thinking.
- [32:16]
B
And without knowing enough, we may really sacrifice our health or the time that we have left chasing an amount that we don't even need.
- [32:24]
C
Correct.
- [32:24]
B
Right.
- [32:24]
C
So, yeah.
- [32:25]
B
And so many do it. And I think that's.
- [32:27]
C
Yeah. This endless chasing after more, more, more. Whereas one of my. One of my things is I like to read a bit of stoic wisdom every day. And this idea of contentment, not necessarily happiness per se, but contentment with where you are, what you have, learning to live within what you have. And I think those sorts of lessons are always useful just to reflect on. And particularly when we're growing businesses, it's easy to get caught up in the push to build.
- [33:04]
A
It would seem to me that by taking yourselves through that process as you were just describing, whether it's a solo endeavor or across a leadership team or even across an entire organization, that your ability to then being just even all the more authentic with clients when you go down this particular road, that just seems like that just raises that. Because you really are speaking from a place of, you know, we're not sitting across the table from you. I've actually sat in this seat. There's maybe the stories to tell. But having an understanding, because that can actually be a painful process. It could be a time consuming process, maybe something that you start on and have to step away from because other things in life. So having that understanding about what that looks like, particularly if a client's like, I've never really thought about that. Let me go away and think about that. That can be really powerful. It seems like.
- [33:53]
C
Yeah. I think the authenticity just being who you are. My two business partners are very different personalities and that works well. There's a dynamic in terms of clients who fit with one advisor as opposed to another. But I think just actually being really authentic with people, they get to know you, they get to appreciate you, or you get an understanding for a potential client will perhaps fit better with another advisor. And you know, going with that and saying no, actually, I think their skill set, I think their mindset, the way that they are with people will perhaps work better.
- [34:31]
A
Yeah. So I'd love both of you to share your thoughts. You know, if an advisor or business owner is listening to this today and you know, we'll start sort of on the competency piece, they're feeling really great about their investment acumen, their financial planning acumen. They've got Great clients, but maybe they really want to get a little bit more purposeful in bringing this to the surface with clients and really helping them see the connectivity, that intersection we've talked about between health and wellness. I'd love to hear from both of you on what you would be a first step on that direction.
- [35:08]
B
It's a must. Yeah. I mean, if you're thinking about it, do it.
- [35:11]
A
Commit.
- [35:11]
B
Right, yeah, commit. Because, you know, I think that there's, there's going to be benefits for the clients, certainly the, the deepening of the relationship, changing the dynamic of the meeting. I mean, they may not talk about investment returns much longer, you know.
- [35:24]
A
Right.
- [35:25]
B
But on the flip side of that, I think it's going to be super rewarding for them in a way that they can't even imagine to fill their cup talking about things that matter and to be able to change and help a family in that way. I think it's going to reinvigorate a lot of careers. I think it's going to help people be better advisors. I think they'll get more referrals because it'll be genuine and true and all of those types of things, and people will be able to tell that. But you have to be able to share your experiences. You have to be vulnerable enough to be able to do that. And I think it'll change their career. I think it'll fill them up as much as it fills up the clients when they walk out of that room and say that that was a good meeting. Especially the non CFO spouse that might walk out of there saying, I actually got a lot out of that. I actually understood that.
- [36:09]
A
Right.
- [36:10]
B
You know, and it was, I saw why we were giving this money or why we were saving this because of that, you know, So I think it's a must. That's what I would say.
- [36:19]
C
I mean, I hate saying this in a dimensional podcast, but the longer I'm in this business, the less I talk about investment, for sure. I mean, I, I, I love it.
- [36:29]
A
It's okay. Just as long as when you do.
- [36:33]
C
I, I could talk for hours, you know, and people who know me know that I can get into the nerdy details of how these things work. But the more I spend time with people, the more the conversations are about life. They're about the quality of life, they're about their aims, you know, their, their values, what makes them tick, what are the things they'd love to do. And I share some of the things I'd love to do that. Okay, what if I had you Know X amount of time left. I can tell you now, here are the things I'm going to do and I will give them those examples. Say, you won't see me for dust because I'll be off to the Alps, skiing if there's snow on the mountains or things like that. But actually being genuine and making sure that your conversations get away from the formality that very often risk questionnaires, those sorts of things lead us down and actually being prepared to put that to one side and just have a conversation, get to know somebody, ask them the questions, get to know who they are as people.
- [37:38]
A
And I would say make time for it. You know, I think about, for example, like in the medical profession where, you know, doctors are, look, you got seven minutes with each patient sort of a thing. Like it's really a line them up, run them through sort of mentality. And so as a result, I really appreciate when I can tell that the doctor is literally stopped, turned away from the computer, looking me in the eye. We're having a conversation. But making. Making that time and. And in the medical field, I think about that as all of you are so busy. We know capacity constraint is a very real challenge with so many organizations for different reasons. But how do you just make sure you make that time in those client meetings, in those interactions, and like you said, you know, be able to then be very authentic about it? I think. I think creating time for that and maybe even being willing to have a meeting, go a little longer than 60 minutes or a little longer than 90 minutes because you're having a really good conversation, I think that's important.
- [38:32]
C
We laugh about this internally, the different styles. My other founding partner, Niels, quite often his initial client meetings will go on quite a bit longer than mine, but that's just different communication styles. But actually, I think when you show that willingness to use time with people.
- [38:52]
A
Yeah.
- [38:52]
C
They recognize that's your most valuable resource as a business operator. And when you're prepared to engage with them and say, oh, we're going to have this conversation set aside at least an hour and a half.
- [39:03]
B
Yeah, yeah. Telling them in advance, I think, helps with the success.
- [39:08]
C
It shows them how much value you're placing on that conversation, how important it is. I always say to people, we want to take time at the outset of this relationship to get to know you.
- [39:20]
A
Yeah.
- [39:21]
C
Get to know what's really important for you. And that time is always time that's well invested.
- [39:27]
B
Yeah. I think if we continue to try to do things the old way and we don't Change and evolve and slow down or even speed up a bit with some demographics. Right. I mean, I saw a stat the other day. $84 trillion is going to pass down in the next 20 years and over 30% of that's going to be controlled by women. You know, we've gained a lot of insight from our female advisors, our female partners in our business, to communication strategies and meeting material that's different to speak to the female that's in the room. And I think that's super important. But also a big chunk of that's going to be controlled by next Gen X. I think millennial, whatever it is, that are used to seeing, you know, great audio podcasts like this and YouTube style videos. And so how can we also adapt and communicate in a different way for them? I think this softer side of everything, this deep discovery, 90% of the time goes really well. But we also have to know we can't force it. Yeah, Some people just aren't ready yet. And you can't do it too soon. In a relationship.
- [40:26]
A
Yes.
- [40:28]
B
Where they are there for investments, they are there for certain things. But. But we definitely talk about it. We try to weave it in, but there's been times where the guy is like, I'm not doing this. I'm like, could you just take one? Pick one. No.
- [40:39]
A
Yeah, yeah.
- [40:40]
B
You got to be able to adapt and get out. But. But you can't force it. You know, I think there's the right time and place and then you got to jump all in even if you miss that next meeting.
- [40:49]
A
But hopefully you're also introducing the concepts, for lack of a better way to put it, even when they're prospects.
- [40:55]
B
Yes.
- [40:55]
A
Right. And then of course, knowing that some advisors grow predominantly through client referrals, so when that client has that kind of a valuable experience with you, then they really do start thinking about, you know, who do I know that would, you know, benefit from working? I just. The goodness kind of builds from there, if you will. There is absolutely an element here, certainly here in the US from a regulatory or risk management standpoint, topics such as diminished capacity and things like that are really kicking up and we have to be very careful about all of that. And so even if you're listening today and you're thinking, maybe I need to lean in on this a little bit just so that I can make sure, from a risk management standpoint, or from just making sure that I'm doing what I need to be doing as a fiduciary and a good steward, know my client, that sort of thing. But I think at the end of the day, to really get to that deep level and really move the needle, as both of you are describing it, is about that authentic, very genuine willingness to engage with clients. That's the difference there.
- [41:47]
C
And sometimes it's something else. My dad always said to me, he said, if you do the right thing by people, you'll never need to worry about business. But it was the right thing, not necessarily the easy thing or what the client thinks is the right thing for them. Sometimes your advice is going to have to go in a direction that the client might not want to hear, but you've got to be prepared to do that because you know from your experience that it is the right thing for them, that they need to go in a slightly different direction or they need to stop doing something that I think is just as important as knowing, you know, how to move with them.
- [42:35]
A
We're all nodding our heads.
- [42:36]
B
Yeah. I'm just picturing the day maybe someone comes up and tells you, do you have kids, Rich? Yeah. They're gonna tell your kids that the advice you gave them made an impact on their life. That's what I'm seeing right now, the way you're stating this.
- [42:49]
C
You know, that's the legacy piece, isn't it?
- [42:52]
B
It is.
- [42:53]
C
That's the pinnacle of what we can achieve as advisors.
- [42:56]
B
Yeah.
- [42:57]
A
Well, I think that's the perfect spot to go ahead. And as much as I would love to just continue, we could talk for another hour on this. But I wanna thank both of you for the generosity of your time and your candidness, your perspective on this. Really powerful. For those of you listening, you can absolutely find Richard and Brady on LinkedIn. You can check them out on their corporate sites as well, too. And if you're interested in learning more about how Dimensional works with and engages with advisors and investment professionals, you can find us@dimensional.com and with that, thank you both. And for the audience, we'll see you next time.
- [43:31]
D
Thank you for joining us for Dimensional Fund Advisors Managing youg Practice podcast. For more information, please visit www.dimensional.com. dimensional Fund Advisors LP is an investment advisor registered with the securities and Exchange Commission. The views, information or opinions expressed during this podcast are solely those of the individuals involved and do not necessarily represent those of Dimensional or its affiliates. Dimensional is not responsible for and does not not verify for accuracy any of the information contained in the podcast. All expressions, information and opinions are subject to change. This podcast is distributed for informational purposes and it is not to be construed as an offer, solicitation, recommendation, or endorsement of any particular security, products or services. Please consult with qualified legal or tax professionals regarding your individual circumstances. Investing involves risks. Risks include loss of principal and fluctuating value. This podcast is available for private, non commercial use only. You may not edit, modify, or redistribute this podcast without the express written consent of Dimensional. Dimensional assumes no liability for any activities in connection with this podcast or for use in connection with any other website, computer, or playing device.
- [44:54]
C
Sam.