If you're going to be so transparent as to talk about "client investment profits," why not disclose the annualized return on what clients have invested? The $280 million figure is totally meaningless by itself. Clients as a group have deposited $580 million in aggregate. The current AUM is $850 million. Your firm has been registered since 1997, which is 27 years ago. If someone invested $580 and has $850 after 27 years, their annualized return has been 1.4%. If someone had invested $580 million in the S&P500 27 years ago, they'd have over $11 billion today, or more than 13x as much as Frazier's clients currently have. Obviously, Frazier's current clients didn't all come on board 27 years ago and invest $580 million upfront. And obviously, Frazier's clients have withdrawn money over the years. So they've almost certainly done a lot better than 1.4%. But why don't you tell us (or them) what their actual return has been, if you're so proud of it?
Probably because she has clients who have different risk profiles and needs. If conservative clients (think many clients in their late-50s now in their 80s who are fearful with low tolerance for risk) are in 45% Growth Assets, the return would be super average. Clients in 100% Growth Assets may have a return much closer to the market at higher levels of certainty with more risk diversified.
This is exactly where I am right now. I'm in New Zealand where Financial Planning isn't the focus yet - it's still very product focused. I'm building out a business process that pulls together George's Life Planning, Family Wealth Planning, and Traditional Financial Planning for Henrys. So build Version 0 (in private while I'm still employed) or Build In Public is definitely a big question on my mind. Thanks for this Michael and Carl.
Great episode. I do think it is possible to have all three. My bd is making it easier and more cost-effective to outsource administration, financial planning, and investment services as an example. Eventually, AI will also play a critical role in taking more of the menial tasks away from the day to day activities. A big focus of our firm is setting the floor for AUM and the size of client we work with. It allows us to create larger revenues servicing a smaller group of clients. Our client size is probably a third of the size of a firm that has similar AUM. Right now, we fit into the boutique model, but we are quickly transitioning to the enterprise model. I guess it will be TBD if I can keep my personal time high and not sacrifice so much.
Hello Michael, quick question. I would like to pursue a career in financial planning. Is it possible to obtain a ChFC designation without having a college degree? or is a 2 year degree a requirement for enrollment into the program? Thank you and great info on your videos. Any advice in terms of getting started in the field without a degree would be much appreciated!
Thanks Michael and Carl, really enjoyed this episode. Got me thinking. Would you agree that it is the "Grow Fast" element of those three practice dynamics (High Margins / Lifestyle Hours / Grow Fast) that is the most likely to disrupt either of the other two? I can't imagine Fast Growth and Lifestyle Hours or Fast Growth and High Margins, given the need to support the growth with additional staffing. Also interested in your take on the "Rule of 40" as being a reasonable objective, where Profitability + Growth is at least 40%? e.g. Profit (EBIT) of 30% and Growth (Revenue) of 10%.
@Rob I do think it's true to some extent that the choice to grow fast/expand fast is more of a driver, in that it's more of the decision that is in your control, and the other two have to adapt (at least to some extent) to the growth choice. But it's not the sole factor. You absolutely can have Fast Growth and Lifestyle Hours. But you have to sacrifice Margins (by hiring a lot of staff to handle the fast growth while you're life-styling!). That's the point. Similarly, you can have Fast Growth and High Margins... it just likely means you're working 70 hours/week to be able to sustain faster growth while you have less staff headcount (which is what keeps the margins up). The scenarios you're highlighting here DO illustrate the trade-offs well I think! In terms of Rule-of-40, it originated for SaaS technology businesses, not necessarily for advisory firms. But I actually do think it's a pretty good baseline for a recurring revenue advisory business as well. (With the caveat that you have to pay the founder/owner a 'normalized' salary to get an accurate reflection of EBIT to calculate the margins properly.)
@@MichaelKitces Yep ok, and you did say as much in the Episode, including what you mean by "High Growth" 8:55. Any thoughts on what level all three become achievable for the group of business owners you classify as "Enterprise Builders" 16:30 ? And do Enterprise Builders even WANT to work less hours in your experience?
@@RobPyne23 In my experience, Enterprise-Builders don't tend to want to work less. Doing the work of building the enterprise IS fun. Not that they want to blow out their work/life balance (at least not indefinitely, that gets tiring after a while :) ), but I find Lifestyle firms run as such because they intentionally prioritize non-work activities they enjoy more over growing the business (to create more-more money they don't actually need to do those things anyway), while Enterprise builders tend to prioritize the work activities of building the business because that IS what they enjoy doing in the first place!
I can see how on the other side of asking more of these questions are answers that lead to rapport and better understanding of the client’s world. Honestly, I find myself asking the safe questions that feel the most on topic.
Have been at Ameriprise for 9 years and have always been able to charge a fee just for advice and not necessary to sell a product. This video was 6 years ago and still makes sense but most novice programs dont force people to sell proprietary products other than the insurance firms. Love Michael's advice though. Have followed the blog for a long time.
I fear that you may be referring to a recent scammer who impersonated me on WhatsApp to scam people. I do not have a WhatsApp account, and do not run a stock recommendation group; our industry is highly regulated, and it would be a violation of my licenses to even try to do so. Any/all advice services regarding investments are provided by our advisory firm, and we manage portfolios on behalf of clients using primarily ETFs. I do not and never have made any individual stock recommendations. I'm sorry that this individual has been taking advantage of people. We have repeatedly reported this to WhatsApp as well, but would suggest that you report the imposter account to WhatsApp as well.
I fear that you may be referring to a recent scammer who impersonated me on WhatsApp to scam people. I do not have a WhatsApp account, and do not run a stock recommendation group; our industry is highly regulated, and it would be a violation of my licenses to even try to do so. Any/all advice services regarding investments are provided by our advisory firm, and we manage portfolios on behalf of clients using primarily ETFs. I do not and never have made any individual stock recommendations. I'm sorry that this individual has been taking advantage of people. We have repeatedly reported this to WhatsApp as well, but would suggest that you report the imposter account to WhatsApp as well.
Now send screenshots of all your positions and I will make a payout now 7:29 AM DaCK LOTS FUSE GRP HLDG INC FUST Price Change $0.90 -$0.69 (-43.26%) Updated: 04/24 09:52 AM EDT Short Term Qty Cost per Share 04/24/2024 500 $1.42 04/23/2024 1,500 $1.49 04/23/2024 1,000 $1.37 Long Term Qty Cost per Share No lots 7:30
A Michael fake his own dead to not take the responsibility off Now send screenshots of all your positions and I will make a payout now 7:29 AM DaCK LOTS FUSE GRP HLDG INC FUST Price Change $0.90 -$0.69 (-43.26%) Updated: 04/24 09:52 AM EDT Short Term Qty Cost per Share 04/24/2024 500 $1.42 04/23/2024 1,500 $1.49 04/23/2024 1,000 $1.37 Long Term Qty Cost per Share No lots 7:30 AN
I Now send screenshots of all your positions and I will make a payout now 7:29 AM DaCK LOTS FUSE GRP HLDG INC FUST Price Change $0.90 -$0.69 (-43.26%) Updated: 04/24 09:52 AM EDT Short Term Qty Cost per Share 04/24/2024 500 $1.42 04/23/2024 1,500 $1.49 04/23/2024 1,000 $1.37 Long Term Qty Cost per Share No lots 7:30 AN😅😅
I fear that you may be referring to a recent scammer who impersonated me on WhatsApp to scam people. I do not have a WhatsApp account, and do not run a stock recommendation group; our industry is highly regulated, and it would be a violation of my licenses to even try to do so. Any/all advice services regarding investments are provided by our advisory firm, and we manage portfolios on behalf of clients using primarily ETFs. I do not and never have made any individual stock recommendations. I'm sorry that this individual has been taking advantage of people. We have repeatedly reported this to WhatsApp as well, but would suggest that you report the imposter account to WhatsApp as well.
This is basically the concept of social proof. And in our industry, its pretty difficult to do that considering the regulations in place. But I’ve always thought about what are some ways I can communicate that social proof through media so that people might be inspired to realize they have more goals than just retirement/being rich. What are some of these other goals we need to factor into the plan, so that we are hitting all the things important to you.
Good stuff. I’m more or less a virtual advisor and don’t have a physical office. For now, I’ve marked “service based business” and I show up in the left panel list of financial advisor near me but not as a pin on the map. Google doesn’t allow for home addresses being used as business.
I wish it wouldve gone to the next level and looked at, in the cases where the advisor SAID they were providing the mentioned services, but it wasnt perceived, the commonalities of those advisors communications to clients. And on the other hand, the 20% of advisors who consistently offered what the clients perceived them to be offering, what specifically communicated that to the client. What was the PROOF that made those clients feel that they had received ample “tax planning” or “estate planning”. Thats a rabbit hole that would demonstrate to alot of advisors what we need to be communicating or where we need to emphasize/focus our efforts so that the client feels their time is being spent on the items they really want to achieve. Because literally everyone asks the client what their objectives are and we do needs based analysis, but clearly we’re getting lost in translation.
@flora I do not and have never had an account at WhatsApp. We only engage in investment and trading recommendations through our advisory firm (as required by law). That is unfortunately a fraudster who is impersonating me. :(
@flora I do not and have never had an account at WhatsApp. We only engage in investment and trading recommendations through our advisory firm (as required by law). That is unfortunately a fraudster who is impersonating me. :(
Thank you, I am in the process of a career shift from A/P support to financial planning. I have been taking classes in finance and now studying for the SIE. But I don't want to get bogged down in a sales job, I've lost too many years moving from one entry level position to the next. My end goal is a financial analyst for a specific industry segment. Any advice or mentoring would be most appreciated. 😊
