People always view the world from their own perspective and sometimes it is hard to get them to think critically and see the other side of the coin. There is a lack of critical thinking in the financial services industry today and we need to right the ship.
Today, there is rapid change going on right now and
unfortunately, there is no shortage of opinions about winners and
losers. Sometimes, it is best to express an opinion through the use of an analogy.
Let us look at two imaginary baseball coaches. Coach John is a very successful college baseball coach. His goal in life has been to further his career. He started out coaching kids, quickly jumped to high school baseball and ended up as a college baseball coach. Coach John's style is to recruit the best and win at all costs. When he was coaching kids, he was brutal. He didn't want bad players as he quickly ran them off. At the high school level, he was figuring out how to get the best baseball players to move to his district by convincing their families to move, so their kid could play for him. His high school baseball team soon after won multiple state championships and it didn't take long before major colleges started calling. Coach John took his skills to a major college and recruited the best high school players to come to his college. He only recruited the best. Of course, since he was successful at recruiting, his college teams were also successful. Coach John's goal all along was to be a successful baseball coach and he achieved that goal.
Coach David on the other hand was also a coach of young kids, high school players and college players too, but with a major difference. When he coached young kids, instead of dispensing with the players who were not star athletes, he encouraged them and taught them the game of baseball. He took the time to teach every player on his team the game of baseball. He taught them how to throw a baseball. He taught them how to stand in the batters box. He taught them how to hit and how to bunt. He taught them how to catch a ground ball. He taught them how to catch a fly ball. He taught them how to run the bases and he taught them how to be a team player. Coach David carried this same coaching philosophy on to his high school and finally college coaching career where he too was a success.
Coach John was all about Coach John. He looked at the world from his viewpoint that he wanted to be a successful coach and that what was most important to him. Coach David on the other hand, looked at each individual player on his teams and his goal was to teach these players the game of baseball, how to handle disappointment and challenges in life and be a team player, so that they would go on in life with the skill set they needed to succeed.
Which coach would you rather have played for?
In the financial industry today, we have a lot of people who act like Coach John. They are all about their own egos, building the biggest business, becoming a thought leader, speaking at industry conferences, making the most money they can and stepping on and over anyone in their way. The do not mind calling out the compensation models of other advisors from their "ivory towers". They look at the world from their "pure as the wind driven snow" perspective. They think everyone else is overcharging investors while they have the "best" method of compensation. A lot of times, these Coach John people in our industry have somehow convinced enough people in the industry to be a "thought leader". This gives them the audience and the platform to continue to preach and talk down to other financial industry professionals. At the same time, they do not even realize the effect they are having on the young "players" just coming into the profession.
The Coach David people in our industry are critical thinkers. They see a rapidly changing industry. They see a huge unfilled market of young investors that would not get to open an account with Coach John. You see, Coach John only wants people who pay him according to his "pristine" business model. Kind of like the baseball Coach John who only wanted the best players to reach his personal goals and was not concerned with teaching anyone anything. After all, if you only recruit the best players (people with money), then why do you need to teach them anything? They are already great players (successful people).
The Coach Davids see fee commoditization. They see zero commissions on trading from the major custodians of RIA firms. They see the threats to mutual fund and ETF companies from direct indexing and the move to fractional shares. They see this huge unmet need of younger investors, so these Coach Davids choose to educate and encourage these young investors (players.) Coach David would never show these young investors the door. He believes in giving them the skill set they need to be successful in life.
Coach John also has a problem with the Coach Davids of the world. He routinely calls them out as overcharging clients, ripping off these young investors and criticizing their compensation models. In reality though, the Coach Davids of the world are the ones who are encouraging the young black woman to get into our industry. He is the one who is encouraging the Indian-American to get into our industry. He is the one encouraging the young black man to get into our industry. He is the one encouraging more women to join our industry. Coach David is the one taking the time to teach young investors the best ways to plan for their future and charging a fair fee based on his valued teaching and coaching skills. Coach David is the one encouraging diversity at every opportunity and who is a mentor to young advisors who want to join our industry.
Coach John is all about Coach John. He doesn't encourage anyone unless it fulfills his pocketbook. He routinely beats up on other financial service industry professionals as ripping people off. Coach John is not a thought leader. Far from it. He is narcissistic. I feel sorry for Coach John's clients. Little do they know that he doesn't really care about their future. He only cares about making money from them, if they meet his "recruiting" criteria.
Personally, I do not think we need any more Coach Johns in our industry. I would rather see more Coach Davids. We need advisors like Coach David who not only encourage young investors, but also young advisors to get into our industry and help them determine how best to run their businesses. Coach David's value is immeasurable when it comes down to it, because he is having such an impact not only on young investors by teaching them financial planning strategies, but also helping young advisors from diverse backgrounds to join our industry and be the best advisors they can be.
I would rather be a Coach David any day. What type of coach are you?
https://www.firstcoastplanning.com and https://www.marianfs.com
