Introduction to the Fee Based Financial Planning Mastery Podcast | FEE000 – Transcript

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Scott PlaskettHey, everybody.  I’m just going to have a little chat with you about what’s new with me, I mean, what we’re doing here.  This is a podcast and I’m really excited about it because it’s giving me a chance to sort of give back to the CFP community, to the financial planning community.

It’s something that I’ve been always wanting to do and I really didn’t know how because, for the longest time, I was just working on an island by myself.  I got up in the morning and I would go to work and I would speak with my business partner, who is also my wife, and we would carry on throughout the day and we’d get the job done, we’d talk with our staff and that sort of thing, but it was all within those four walls and it was in kind of a confined space.

So I’m really excited about being able to talk to you today and be able to talk in this podcast about financial planning, how to run a fee based financial planning practice because it’s something that I’m very passionate about and it’s very near and dear to me.  I think the industry has really gone through some real changes and is constantly changing.  The industry is changing so rapidly that the old systems that really built the industry, we can’t rely on them any more.

Compliance number one is one of the main things that drove me to a lot of the decisions that I made in our practice.  Compliance is becoming more and more challenging.  We’ve heard it all before.  We’ve heard the stats in the past where years ago, the dollars spent on compliance was a small percentage of revenue that was coming in.  And now, the dollars spent on compliance are upwards of 30%, 40% of the revenue that firms are generating.  Compliance departments are absolutely huge.

When I first started in this industry, I started with one firm.  It was really just one person who was running the division of the company and she was really compliance.  We then moved to a different dealer, who had three people in total and those three people, one of them was really involved with sales, one of them was dealing with operations and one was more at admin so compliance was kind of really not a main concern although it was you wanted to make sure you were doing good business.

And one of the things I did appreciate with the firm that we’re still with today, I did appreciate the fact that they really did a lot of due diligence on the advisors that they took in to their dealer.  So I appreciated that so much.  It’s not happening as much any more.  I think now the dealers are just struggling to make ends meet and they’re just doing everything they can to find good producers, but in any event, compliance is really one of the big challenges.

Another challenge that we’ve got is that there’s more educated consumers.  Everybody with the Internet and with the — they’re that much more aware, they’re paying more attention and they’re just taking the time to learn a little bit more than they knew before.  Now the problem with that is that a little knowledge is a dangerous thing and so it becomes more and more frustrating from our side of the table.  We’re meeting with clients, who are prospective clients, who think they know a little bit and think they sometimes know more than we do and the reality is — sometimes they do, but the reality is, when you’re at the level that we’re at, they don’t know more than we do and they’re making it more and more difficult because they’re very sceptical.

The media is not helping at all.  We’ve had a lot of scandals in the recent past, market corrections.  The overall market turmoil has been very difficult so the media is really playing off of that and the media is sensationalizing a lot.  Now in some cases, it’s warranted because there have been some scandals, which are absolutely horrible and, rightly so, the people have been convicted and are put away in jail for the rest of their natural born life and so they should be because of the abuses that they took advantage of.

But the reality is that, as a result of that, there’s a lot more regulation and the consumers are a lot more jaded and it’s becoming more and more difficult for them to trust anybody.  And the regulators are stepping in and trying to help that, but what the regulators are doing is they’re making decisions and they’re not making the greatest decisions.

And so when the regulators are stepping in and, in some cases, they’re saying well, we’ll just going to put away with commissions completely and so everything’s got to have full disclosure, which I believe in full disclosure, but the reality is that the industry can’t change overnight and, for that to happen especially in Canada – I know it’s happened in the UK and it is changing very, very quickly there and the regulators in North America are paying attention to that to see how that’s working, but the reality is, it’s not going to happen overnight, but it is on the horizon.  And if we don’t incorporate some decisions now to make sure that we’re protected against that, we’re going to find ourselves sitting in a commission-based model, looking for where our next pay check’s going to come from.

So we do need to start making some changes and the reality is that, with the pace at which the industry’s changing, my hope is to take a podcast like we’ve got here and to explain to people, listen, this is what I’ve done, this is what I’m doing, this is what’s working, this is what’s not working and really just to help people make better decisions on how to move forward and to give them some confidence.  Maybe if there’s a decision that they’ve been putting off making because they just feel like they’re by themselves and they don’t know if it’s going to work.

Well, the reality is I’ve probably made that decision and that decision was probably not an easy one for me, but I did make the decision.  Sometimes it wasn’t the right decision, sometimes it was the right decision, but I’m going to share with you what decisions I have made and why I made them and what it’s done for me and how it’s allowed me to grow my practice, a very successful practice to a level that I’m quite happy with.  Now I am eagerly wanting to make it and take it to the next level, but the reality is that we’ve made the tough decisions, the toughest one being migrating our practice to a complete fee based model.

A lot of people are often asking me how did you do that, how did you do this and what are you doing in this area.  Well that’s what this podcast is all about.  We’re going to explain a lot of those decisions we’ve made and why we made them and the outcome of those decisions.

So I’m just going to give you now a little bit of background on my journey and this whole world.  I’ve been in the business for a long time.  The early ’90s is when I started in the business and I’ve been around for a while and I’ve been constantly practicing with the idea of financial planning always behind me.  I began working on my CFP designation while I was still enrolled at university and I was in an Honours Business program there and I became licensed in 1993 and I actually left university early.

I was at school for an Honours Business Degree, which was going to take me onto my MBA and everything was going to be the traditional academic route.  And then while I was there, I caught wind of this whole financial planning thing and it was very, very new at the time and not very many people were talking about it and I just, for whatever reason, it resonated with me and so I really, really wanted to take advantage of that.  So I actually started my CFP designation while I was at school fulltime.  So it was a pretty busy ride for me.

I always focused on financial planning and when I started in the business, in 1993, when I first sort of hung my shingle, I was a young guy, speaking with people who, at that point, had more money than I did.  At that point, I really embraced the whole financial planning concept.

Now, the comments I got were from other, at that point, commission-based advisors who were, man, they were churning out commissions like crazy.  Everything they could do to find the next deal, they were just so hungry for it and everything was about converting it over into a deferred sales charge system to get the upfront commission and then move on and they were just doing everything they could to follow that model.  But to me it was a sales approach and I understand there’s a level of sales that has to take place in this business, but the motivation wasn’t really — they were there to help clients and they were probably doing the best they could with the products that were available, but a lot of the products were commission-motivated.

And looking back in hindsight, a lot of the products that were sold really were horrible.  They didn’t do anything for clients.  Well, they didn’t nothing for clients other than make them feel like things were going in the right direction because the guys who were selling them had the sales techniques down.  So my branch manager, when I really focused on financial planning at the time, my branch manager at the time came to me and said, what are you doing?  Why are you wasting your time on this financial planning stuff?

And I said, well, understand people need to be advised properly and the only way we can do that is through understanding a lot more about them and the information that we’re gathering right now is really just superficial.  So we need to spend more time and really, really focus on that.  And the branch manager at the time said, whatever.  If that’s the business you want to build, go for it, but that’s not where the money is.  Well nowadays financial planning really is the business and more and more people are trying to find out how do I make that change, how do I bridge that gap from going from a commission-based model into a financial planning-based model.

So back in the early days, I was in there and I was focusing on financial planning and we were really building our brand in that regard and one day a new advisor walked into the office and I just couldn’t think of anything else.  That person became a business partner and we started working together and one thing led to another and basically that business partner became my wife.  So it was a wonderful experience.  It was a wonderful way to meet somebody who shared sort of the same ideals and what not.  I love her.  To be able to love your partner in business as much as you love your spouse, which in my case are the same, really gives you a huge sense of confidence.

Now it also makes it a little more challenging sometimes and we can get into reasons for that, but I’m sure you can appreciate that working with your spouse is not always the easiest things, but there are certain rules that we’ve put in place and certain things that we’ve done that I wouldn’t change for the world because when you know somebody’s got your back the way your spouse does in this business, it makes a big difference.

So we really started growing our practice and we recognized each other’s strengths and really started to capitalize on that.  I mean everybody shouldn’t be doing everything in the business.  Certain people are better at other things and so we kind of gravitated towards that.

So in 1996 we then moved to our flat-fee dealer at the time and that was revolutionary.  I mean that was where the flat-fee model for your dealer was unheard of and a lot of the dealers were saying that model’s not going to work, it’s not going to fly.  The costs are going to be too high, they’re not generating enough revenue and so on and so forth.  But the reality is we embraced that model early on because we just recognized that the dealers weren’t providing us the service that we needed to help build our business.  It really helped to build their business and it furthered their brand and it did everything in that regard, but what it didn’t do was it really didn’t give — what we were paying for through the override model that we were involved with, we weren’t getting the value from it.

So I just recognized that, you know what, I’m just going to play a flat fee and I’m going to build my business the way I want to build it with my brand and we’ve moved forward with that and we’ve been with that dealer ever since.  So we’ve had a really good success in moving with that dealer.

So early on we launched our trade mark financial planning process.  That was one of the biggest things that we did because now we had something to build on.  We had the concept and idea of financial planning, but we packaged it in such a way that it was uniquely ours.  Nobody else could take that away from us and it became a huge competitive advantage whenever we were speaking with somebody, apples to apples, they would look at two advisors and say well, what’s the difference between the two.  But with us, they would see us and say, well wait a minute, yeah, but they’ve got this financial planning process so yeah, that’s different.  They’re the only ones that have that and they’re the only ones that have license to that and they created it so they must know what they’re talking about.  So it became a really, really big competitive advantage by putting this financial planning process and launching it early on in our career.

Now, going on from that, what we then started was we started charging fees and we recognized early on that the advice should be — we shouldn’t be compensated on the advice by selling a product because, in some cases, the right advice meant not buying a product and I had a real challenge with the fact that we were giving away the advice, but we only got paid if we implemented something that generated a commission for us.

And so we started to look around for other solutions and that’s where a fee-based system came from.  And so we actually charge fees.  I always felt, from charging fees, that it put me on par with other professionals.  You go to your accountant, you go to your lawyer and what do you do?  You pay them a fee for their advice.  You pay them a fee for the time and effort they put in to working on your problems and challenges and helping you with their solutions.  So charging a fee just simply made sense to me because it allowed me to be on par with other professionals and, because there weren’t that many people doing it at the time, hardly any at the time, it really gave us another competitive advantage.  It gave us a uniqueness that set us apart from the competition.

Now we started out initially charging fees and we thought all the advice we’re giving away for free didn’t make sense so we’re going to charge a fee, but we got resistance and so we stopped charging fees.  Well why did we stop charging fees?  Well it was tough to create value using the traditional commission-based methods.  When you’re working from a commission-based process, the commission-based process was all about selling something.  And so when we started charging a fee, maybe it looked different, but it didn’t feel any different.  And so we then had to regroup and figure out how can we change things back again.

So we revamped everything.  The number of times we’ve changed our business process and how we do things and rewritten things and made it better, it’s really quite high and we finally settled down and got into a nice groove, but early on there were a lot of changes we made as we went through.  So we did start charging fees very, very quickly again because I just couldn’t — I mean we were making money on a commission‑based model, but again, the fees just seemed to be where it was at and to me just made the most sense.

So we started charging fees again and why did we do it?  What really motivated us to do it again?  Well, compliance made managing assets and, at the time, we had a bit of a focus on the investment side, compliance made managing assets a real ordeal.  Any time we wanted to make a change to a client’s account because we did a lot of asset allocation and rebalancing and what not, any time we made a change, that change then had to be documented in all these different places and we had to paper the file properly.

And the dealers started incorporating these trading systems that were monitoring the asset mixes of clients and, if the asset mix didn’t match the know your client form, the KYC form, if the assets didn’t match that perfectly then we suddenly got flagged and the trade that we put through got put on hold and we had to justify it and then we had to go and get the client to sign another document and it was just becoming more and more of a nightmare.

So compliance really encouraged us to move away from the actual managing of those assets, but we wanted to oversee them still so we started looking for other solutions with regards to that and we’ll start talking about those later on and in further episodes.

We also recognized that the clients felt more confident when we outsourced to the best in the business.  So from an investment standpoint, we began to realize when we were the ones that were making the adjustments on our system, our dealer was saying we need to be able to cover our behinds, the CYA cover their behinds on anything that was being done on the client accounts.  So that’s why we were having to repaper the file.  So I thought about it and said, okay, well what if I can find a solution where any adjustments didn’t happen on our system so that our dealer wouldn’t have to worry about the adjustments.  The compliance then was parlayed and put onto the other institution.

So we began to outsource that.  We began to look for solutions that would actively manage a client’s asset mix and account to keep it on target, but that those systems and solutions wouldn’t show up on our trading system.  And so we began to really incorporate and really embrace the whole idea of outsourcing to the best in the business.

That then allowed me to really be able to puff my chest up and say to a client, look, this is the best solution we’ve been able to find for you.  I’m not going to be managing the actual asset, the individual securities for myself.  I’m a boutique financial planner that I don’t have a chance to go meet with the managers and meet with the management teams and go and visit various companies and check out this and that and the other thing.  I just don’t have time or the resources to do that, but we’re going to outsource that to the firms that do and 100% of their business is all focused on managing the asset and they actually are now sitting on the same side of the desk because their revenue increases when your assets appreciate.  So it seemed to be a nice match.

So clients felt much more confident with that because, deep down when a client comes to see you, they recognize that if you are the best investment guy, well why are you meeting with them?  Their accounts, maybe they’ve got $100,000, $200,000, $300,000, $500,000, $1 million; even if they had $10 million, why are they just dealing with you?  Not to say that you’re not good, but if you were so good then why aren’t you managing a billion dollar pool or something like that.  So it just allowed us to be a little more on the level with clients and say, look, I recognize where my weaknesses are, but I also recognize my strengths and we’re going to go find the right teams for you and start to implement through the best solutions we can find.

So we did that.  We went out and found the best that we could.  We put them through our own screening process and narrowed down the groups and that did a few different things for us.  Number one, it really gave us a lot of the attention we got from those firms began to increase because when you start placing more and more of your business with fewer and fewer companies, you become more and more on their radar so they pay attention to you.  And what that means is that whenever you come up with any issues or things that need to be fixed for clients or something like that, they’re going to make sure that they keep you happy.  So by doing that, it just simply makes them pay more attention to you, which in return, gives you the ability to give better client service to your clients.

So from that, we were very committed to charging fees for our financial planning process and what we did was we carved out the financial planning from the implementation.  So we focused on creating value in the financial planning side of the business so that I’d really feel more comfortable charging the fees required to make that side of the business profitable.

So the reason why we were able to charge fees again is because we said, look, lets look at this and look at it from the standpoint that, if we were going to build our business solely on the financial planning side, what would we need to do in order to justify our fees and to be able to really add value?  And when you place that emphasis on that side of the business and ask yourself, if I’m charging $2,000, $3,000, $4,000, $5,000, $10,000 for this financial plan, what would it have to look like so that I would feel like it was valuable.  What would have to happen, what would I have to cover, what would be involved in that process so that I would really be comfortable with paying that fee?

So when you look at it from that standpoint, the whole concept of charging fees, I think, a positive by product that we got from charging fees was that it elevates your game.  It brings the whole process to a new level where, if you’re comfortable saying to a client I’m going to charge you $2,000 for the writing of your financial plan, knowing full well they’re going to get more than $2,000 in value, well now you’ve got something you can really start to build upon.

So we did that.  We created an overall financial planning process.  We talked about it earlier where we trade marked the process.  We named it.  now, the thing is, you’ve got to name it and it’s a little bit of a weird experience to go through that when you start naming your own process.  You kind of feel like Starbucks where they’ve renamed coffee, they’ve renamed the sizes of coffee.  It was weird at first.  It was like what the heck is a Venti, what the heck is a Grande?  I mean, I thought Grande was large, but then I realized that there was a Venti and it was even larger.  So they branded it and they created their own language, which people started to embrace and suddenly people started to use the language.

We found that as well.  By branding our financial planning process and naming it, people are now starting to use the terms back to us and identify the components of the financial plan with the names that we’ve given them.  So it feels really weird at first and we’ll go through it in much more detail and sort of a naming process and how you do it and how you come up with the proper name, but the reality is, if you haven’t done it, it will feel really weird at first.  But by naming your process, it does one thing.  It makes it uniquely yours and nobody else can touch it.  Nobody else can actually say they use that particular financial planning process because they don’t.  Only you do and so it’s definitely a competitive advantage.

So what we did there was we created different programs for clients at different financial stages.  So through the process, we ended up with a core financial planning process that we used as the core in general, but then we broke it off and had three different programs for people who were at different financial stages of their life and then we also parlayed that into a corporate version for business owners.  And by doing that, I found that the whole planning process, the closing ratios that we found for clients who were truly qualified for our services, and when I say truly qualified, not everybody is truly qualified for your financial planning service.  Not everybody should be your client.

You want to identify who do you work with the best and focus your financial planning process around that.  Then when you meet with somebody and you go through introducing your financial planning process to them, what you can do is you’ll begin to get a real clear sense of whether or not it makes sense for them and then, by putting a fee in front of them, it gets rid of the people that shouldn’t be there.  So when I say that our closing ratio went up, it did go up.  However, we started turning away people who we didn’t feel were qualified for our services.  But for the people who were qualified for the services, man, our closing ratio went through the roof.  And, as a result of that, because people were now paying for our advice, they implemented our recommendations and our implementation ratios, again, skyrocketed.

Client trust and confidence went way up.  Clients now came to us and they just absolutely loved us.  They loved the whole process.  They loved it because all of our recommendations were documented, were justified.  They could basically look at everything and say that that makes complete sense.  I have a real desire that whenever I’m coming up with a solution, I have to have a certain degree of logic behind that solution.

Now I understand that not all solutions are — people move forward with solutions not because of pure logic, but most of the time it’s emotion, but you’ve got to be able to speak to the logical side.  When you can go through and present in a logical fashion that says, well this is the solution, here’s the analysis that we’ve done to say why we think it’s the best solution, here’s what we were looking for and here’s what we found, clients look at that and go, yeah, okay, sign me up.  I totally want to implement that.

The other benefit is they don’t want to implement anywhere else because, for them to implement somewhere else means that they have to then find that person and then tell that person what they want.  Well, if you were an advisor and somebody came to you and said okay, this is what I want, unless you’re in the transaction business where you’re just basically there to take orders, you’re going to say, well wait a minute, I need to add some value to this.  Let me take a look at what you’ve got.  Well, clients have already paid for somebody to take a look at it.  So it’s a natural extension.  If you don’t have an implementation ability or division in your financial planning firm then clients are going to think that there’s something weird with that.

I’ve seen firms and other firms, fee-only firms and fee-based firms that kind of promote the fact that they don’t have any implementation, but the reality is they have some sort of a relationship with somebody, if they’re not generating the revenue, they’re referring it to somebody else, but the reality there is as well, it’s very, very difficult, in my mind, to generate enough — to do the work you need to do and generate enough revenue from that work without implementation revenue coming in.  It’s just very difficult.

Unless you’re completely able to strip out all of your fees and charge them separate even for the assets and what not and charge them high enough, it’s very difficult to do that.  So it’s easier many times to make sure you have the implementation services available, but also make sure that your fees are fully disclosed and they’re fully transparent on those implementation services.  So as I say, client trust went through the roof and it was fantastic.

We automated our entire process to streamline efficiency really, really early.  Now, as a financial planner, you do a ton.  That’s one of the reasons why the commission-based model, in my mind, people have held onto it so much because they know they really just need to do whatever it takes to get the product [is] to get it sold.  And once it’s sold, they receive their commission.  The reality is, when you start incorporating comprehensive financial planning into your practice, you’re going to be doing a lot more if you’re not charging a fee for nothing because a lot of the services that we provide, whether it be through our cash flow management or our debt consolidation strategies and what not, with the recommendations to pay down debt, well if you’re not getting paid for that recommendation, it’s the right thing to be recommending the client then you’re not making any revenue.

So you do need to make sure that you have that in your system and, because there’s so much involved, you really want to take a look at your workflow, you’re business processes so you can automate as much of your business processes as possible.  The reality is that, from a financial planning standpoint, when you’re putting together a comprehensive financial plan, you are going through a series of similar steps for every client.

Now the results are going to be different for every client, but the process you go through, which is why it’s important to document your process, the process you go through will actually provide you with the tools necessary to automate things.  So you can break your process up into different compartments and you can then start to assign different parts of your process to other staff members and so on or outsource it to whoever so that you don’t have to do it so that it frees you up because one of the challenges we found, starting out early on was we got right into it, we started getting clients and then writing a financial plan and then it all came to a grinding halt because now I was writing financial plans.

And then I would go through a period where I was bogged down with writing financial plans, I couldn’t meet with any new prospective clients and it really just slowed the whole process down.  Then I got to a point where I started meeting with a lot of new people, but then I wasn’t writing any financial plans because I was so busy on the sales side of trying to sell the financial planning process.  So you do have to make sure that you’ve got — the process is automated for the actual writing of the financial plans and we can go into that in much more detail and I’m definitely going to go into that in much more detail because it’s something that I’m working on right now is really trying to automate and streamline that whole process to make that as efficient as possible.

We also recognize the need to market our uniqueness.  So for the longest time we thought, yeah, we did a great job and everything we did was wonderful, but it was kind of like winking at somebody in the dark.  We knew we were doing it, but nobody else did.  So we needed to find a way of marketing our uniqueness.  So what we did was we tested seminars and we went out and we said, okay, we’ve got a unique process, we’re going to go out there and we’re going to start talking about financial planning, which was different than most because most people were talking about here’s the best investment solution or here’s the best insurance solution, but very few people were tying it all together with financial planning.  So we thought okay, well there’s an angle that we can start to really focus on and we can start to market our uniqueness.

So we tested seminars and they worked.  They worked really well, but they were costly and they were involved.  So what I have done then is I really began to look at ways of how do I take the information, the systems and processes that we’ve been using for our seminars because they worked well.  We were able to target our audience, we were able to fill the seats for every seminar.  We were able to get — not only just fill the seats, but we were able to fill the seats with people who qualified for our services and were part of our target market and our appointment booking ratio, we were getting anywhere from 30% to 50% of participants at the event, booking appointments for the coming weeks.

So we had some really good success with that, but all it took was a rainstorm or a snowstorm or inclement weather or something like that, or even really good weather.  All it took was some event to derail the process a little bit.  So we did have times when we have RSVP’d and have people all set to come to the seminar and then a rainstorm would happen and, yeah, the numbers went down and fortunately the numbers went up on the other side for the walk-ins that we got because we did get a lot of walk-ins, but the reality is that I believe that we could have had more so long as we had everything come together; a perfect day, a perfect time and all that sort of stuff.

And so the reality is sometimes it just doesn’t work out so I really looked for ways of solving that problem.  So along came social media.  So we’ve really gone for the last couple of decades now.  This is the process we’ve come to, but now we’ve really come along and social media is becoming more and more prevalent.  And so what I’ve done is I’ve embraced it.  I’ve embraced it in the terms of podcasting, blogging, Twitter, Facebook, YouTube, webinars.

Now, a lot of the financial community have embraced it, but they still don’t know what they’re doing with it.  They don’t have a goal, they don’t have an objective.  They don’t have a reason for what they’re doing.  I mean there are people who have Twitter accounts and they’re tweeting a lot and you think what the heck am I tweeting for?  Who’s following my tweets and what do I tweet about and I don’t have the time to tweet or Facebook, I don’t have the time to communicate with people on Facebook.

So what we’ve done is we’ve really recognized that there is a rationale for why you should be, on each one of these things, podcasting, blogging, Twitter, Facebook, YouTube and webinars, why you should be using each one, but don’t look at them individually.  Leverage your content creation so that it can really serve more than one purpose.

So we’ve put tighter a nice process where we’ve really embraced the social media.  We’ve solved the problem.  In our minds we’ve solved the problem for how to use that whole process to build credibility, generate leads and automate the whole process because, right now, if you’re following our Twitter feed and I encourage you to follow the Twitter account is feefpmastery.  So if you go, you can follow our Twitter feed there and you’ll start to see that it’s happening all the time and while I’ve been podcasting right now, I’m sure a couple of tweets have gone out and I’ve had it all automated.

So I’ll talk to you about automating it because the one thing I don’t want anybody to do is to get caught up in creating a new job for themselves.  Social media is not something that needs to replace financial planning.  Financial planning is your core business, but social media can really enhance that and so we’ve got solutions on how to make that work for you.

So really the goal of the podcast, this is episode zero.  Episode zero is there because we’re not really talking about solutions at this point.  I’m sort of sharing with you why I’m doing this and what I’m doing it for to encourage you to subscribe to the podcast and then every couple of weeks, really I think at this point, on the first and the 15th of every month, you’re going to get a new episode sent out to you and we’re going to be talking about certain topics that are affecting me right then and there, topics that are top of mind at that point in time, what we’re doing.  I’m going to share with you things that have worked and that haven’t.

Really, the goal of this podcast, I put it together because the one thing that I’ve been asked time and time again is how do you do what you’re doing?  You’ve got all those things set up and how is it possible that you run a firm that’s not a huge firm; we don’t have a lot of staff.  We’ve really pared it down, we’ve got systems in place that run our business, how do you do all that?  How have you been able to take so much time in the summer at your cottage?  How do you take time off and I’m not saying that because I want to brag about it, I’m saying it because we’ve got solutions in place that allow us to stay in touch with our clientele, service our clients and give me a life outside of that.

So everybody I think is really looking for that and so we feel we’ve cracked the code on that.  I’ve always been asked how do I do what I’m doing and, really, I’ve always kept it quiet and I’ve kept it sort of secret to myself, but the one thing I’ve noticed is that the CFP community, they’re willing to share.  A true CFP, people who are really in the business to help add value through financial planning, they’re a pretty unique group.

And so one of the reasons why I stopped going to industry conferences and to road shows and all these types of things is because I couldn’t stand the people I was meeting with.  I couldn’t stand sitting there just to overhear conversations of people bragging about the latest commission or the latest deal that they’ve done and it was just all — it just got all schmarmy and I just didn’t like it.  So I said screw it.  I’m not going to continue with that because I don’t like associating and speaking and whatnot with these people because I’ve got nothing to say to them and they’ve got really nothing to give me back so what’s the point.

Well that started to change when I started doing a lot more promotion for CFPs for promoting the financial planning ideas and I began to get in contact with other CFPs who also kind of embraced the idea that the promotion of financial planning was important.  And so building that tight community, I recognized that these are good people.  These are people that are not solely commission-generated, solely revenue focused.  These are people who want to do a good job for their clients and are putting solutions in place to do so.

So I started talking more and more with these people.  There are a few that I communicate with on a fairly frequent basis.  We get together once a quarter and just sort of talk about what’s working, talk about what’s not working and I recognize that there’s a lot of people out there and I live in a small town and there aren’t that many other CFPs around so it’s very difficult for me to have a community of CFPs that I can turn to.

So then the light went off and I thought well I can podcast about it and the CFPs, who really want to do what I’ve done and are looking to solve those challenges that they’re faced with of converting to a fee-based practice, this will attract them and hopefully it’s going to start to encourage them to comment and share their experiences on the blog at

So by working together and sharing what’s working and what’s not, the entire CFP industry will become a better place, a place where clients are less sceptical and more confident with their financial planner and the planners are more confident in that what they’re doing is right, but also in what they’re doing is profitable for them because you can’t do it unless you’re making profit.  You can’t do it unless you’re making revenue.  And so this is all designed to help further the industry, make it a better place, get rid of all the scepticism that’s out there, but also show people how you can do it and make a pretty good living at it as well.

So I’m going to be sharing with you exactly what I’m doing right now.  As the weeks and months go on, I’m going to be sharing with you things that have worked, things that haven’t worked, how we’re doing, what we’re doing because I’m recognizing that, of all the planners that I know, the CFPs that I know that are right in my community, not once have I ever come up against a competitive competition with them.

I’ve never been in competition with them and we share a lot about what’s working and what’s not working.  And everybody, every time I get together, I’ve got one group that I meet with on a quarterly basis, it’s a study group of other financial professionals, not once have I ever come into contact with any competition against any one of them and every one of them shares.  And what they communicate to me on is they say, when we get together for our quarterly session, often times we’ll bring speakers in and we’ll have different industry topics and what not, but it’s the conversation between the sessions that the value is actually had.  It’s the conversation between sessions where you glean those tidbits of information like, oh, that’s what I was working for.  That’s perfect.  It’s one idea.  It’s one topic, it’s one concept that could change everything.

So we just recognize that there really is no competition between planners and, especially in the fee-based space, I’ve got planners that I know that are 400 or 500 miles away and we communicate, what’s the harm in sharing our best practices and secrets with them.  I’m not going get ever any competition with them.  They’re 400 miles away.  So it allows you to really, really become the best of the best in a community of like-minded financial planners who are all there to help each other out.  And, by doing that, I think it’s going to make a really big impact and difference.

The regulators want to put an end to commissions.  They don’t like the commission-based model.  They don’t like the embedded commission-based model and they’re doing what they can to make those changes.  They’ve already started over in the UK.  They’ve made some decisions.  North America is watching to see how that works and we’re having industry discussions about whether or not can commissions and fees work in conjunction with one another?  The regulators really do want to put an end to commissions and they feel that that’s in the best interest of society, of investors in general, of people who are looking for financial solutions so it’s definitely something that’s on the horizon.

So in each episode, I’m going to highlight some of my business and explain how it’s working, both the good and the bad and hopefully spark an online conversation that we can all learn from.  So I’m not saying I have all the answers.  I’m definitely not a guru, but I’ve been there before.  I’ve been in the trenches, I’m currently in the trenches, I’m running my practice now and I’m building a fee-based financial planning practice that I feel that, if we can just get a group of others and a lot more other people embracing that concept then this is a group that’s not going to have to worry about the whole idea of losing commissions and what not.

We’ll be able to justify our fees and make sure that the clientele continue to get the valued service that they’re looking for.  So really what the point is here is lets work together and make it a better industry for our clients and ourselves.  So at the end of the day, what I really encourage you to do is go to now and click on the episode 00.  So that’s our first episode.  It’s the inaugural episode that we’re doing right now.

Click on that episode and there you can post any questions in the comments.  Tell me, first of all, do you like the podcast?  Secondly, do you have any questions or anything you want me to answer in future shows, any burning questions that you just don’t know who to ask and what not.  So what I’ll do is I’ll address those questions on future episodes.  And then make some comments if we talk about a concept or a topic that’s near and dear to you that you agree with or even don’t agree with, I want to know why.  I’m going to learn from a lot of that as well as you guys are.  By putting all that information online, it will simply allow us to build a better practice for ourselves, add more value to our clients and everybody, the whole industry will become a better place.

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Copyright © Scott E. Plaskett 2011 All Rights Reserved. No part of this document may be reproduced without Scott E. Plaskett’s written permission.

One Response to “Introduction to the Fee Based Financial Planning Mastery Podcast | FEE000 – Transcript”

  1. Thanks a lot for very useful information. I would like to ask if, in fee based service, you earn commission for cases that clients implement their plans via your firm i.e. buying insurance products?

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