Table of Contents
Title Page
Copyright Page
Looking on the Inside
The Soulful Financial Advisor
CHAPTER 1 - If These Walls Could Talk
A New Campaign
The Soul of the Matter
Working in Infected Walls
Your Client’s Bottom Line
CHAPTER 2 - Speedometers and Odometers
Running the Race
Wave of the Future?
Measuring Success with What?
CHAPTER 3 - The Warring Hand
Insights on the “Conversion” Process
Call 1
Call 2
Judas Has a New Public Relations Agent
Redefining the Soul of Advice
The Evolution of the Advisor
The Windfall of Sincerity
CHAPTER 4 - I’m a Numbers Guy
Numbers Do Matter—But Not in the Way You May Be Expecting: Shortchanged by Numbers
What Numbers Don’t Tell Us
New Numbers for Consideration
CHAPTER 5 - A New Level of Integrity Beyond Disclosure
Under the Surface
An Axe to the Roots
Your Value Proposition
Life in the Light
CHAPTER 6 - A New Value Proposition
A New Value Proposition
Running Out of Gas
Brown Can Do It for You
Enough about You—Let’s Talk about Them
How We Measure Progress
Understanding True Wealth
CHAPTER 7 - A New Standard for Practice
How to Become a World-Class Advisor
Edward Advisor, MD (Money Doctor)
The Practitioner’s Oath
CHAPTER 8 - The New Frontier
Right Turn Ahead
Turning the Inside Out
Seeking Brain-Damaged Clients
Financial Pitfalls
Nerves that Steal
Not Like Politics
CHAPTER 9 - Permanent Reference Points
A Blueprint for Success
Swimming in the Financial Gene Pool
Reference Point: The Last Market Downtown
Reference Point: Corporate and Industry Corruption
CHAPTER 10 - How We Measure Money
How the Industry Measures Money
An Empathic View
The Search for Meaning
A New Measure
CHAPTER 11 - Spinning Out of Control
When Spin and Orbit Rates Are Out of Sync
The Spoils of Success
Restoring Balance to the Life Portfolio
Your Desired Life Portfolio
Light Years Ahead
CHAPTER 12 - Protecting Your Clients From Halffluence
Getting Our Money’s Worth
Wake Me When It’s Time to Go
In Better Company
A New Way of Measuring Wealth
Measure What Money Can Buy
Making Clients Rich and Enriching Clients’ Lives
CHAPTER 13 - The End of Retirement as We Know It
Removing “Tired” from Retired
The Times, They Are a-Changin’
Living Well
Work with Me Here
Financing the Rewired Life
CHAPTER 14 - What Do Your Clients Want Their Money to Do?
What’s the Money For?
Settle the Big Picture
The Four Cornerstones of Life
Finding the Keys
CHAPTER 15 - The History Dialogue
Just the Facts
Discovery Forms and Forms of Discovery
The Advisor as Biographer
A Professional Approach
Buried Clues
CHAPTER 16 - Goals Are Overrated
What Was I Thinking?
Come Back from the Future
Five Years from Today
“Visioning” versus Goal Setting
CHAPTER 17 - Funding “Single Moments”
The Great Alaskan Highway Ride: Day One—Guns N’ Roses
Giving Your Clients Permission to Live
The Great Alaskan Highway Ride: Day Two—Saskatoon by Afternoon
A Day that Never Came
The Great Alaskan Highway Ride: Days Three and Four—Taking a Dip in Minus 20
Making Moments in Life
The Great Alaskan Highway Ride: Waving to Santa in North Pole, Alaska
CHAPTER 18 - The Parental Pension
Pocket Money
Starting the Dialogue
How Badly Do You Want to Learn?
A Little Goes a Long Way
CHAPTER 19 - By The Side of the Road
Helping Your Clients Do the Right Thing
The Persistence of a Caring Professional
An Example
Physician, Heal Thyself
Your Financial House and the Winds of Destruction
CHAPTER 20 - A 100 Percent Certainty
Exit Ramp 279
Mortality Combat
Your Own FEMA Crisis
A Different Sort of Dialogue
Best Intentions
CHAPTER 21 - The New Venture Philanthropy Dialogue
Bringing Meaning to Your Client’s Money
Philanthropy Trends
Becoming an Eye Witness to Your Own Goodness
CFOs for the New VPs
The Signature Statement of Wealth


This book is dedicated to Gil Weinreich,
editor par excellence for Research magazine whose
conscience is unfailing and whose pulse beats as
loudly and strongly as any man who has ever
loved this industry. He told me that I ought to
write from my heart to the heart of this industry.
What follows is the result of that invitation.

This is a book for aspirational financial advisors. It is for those who would earn their own living in the fertile fields of money and people and serve their clients from attitudes and altitudes of sacred trust and blessed stewardship. It is a book for those advisors whose hearts know that their client relationships are more than money. It is for those whose hearts’ cores grasp that this work engages the harvests of life, work and soul.
These worthies should know when their work is done right and that this means that their work engages relationships that are grounded in the compassion and wisdom required to meet the demands of modern life, most especially its financial demands. It is for those who recognize that money and the vagaries of life are inextricably tied.
Money connects the circumstances of our lives. Money serves as our primary access to both survival basics and fulfilled personal destinies. It enables us to keep our promises to others. It drives how we show up in the world and relate to those around us for whatever reasons. Our relationships with money and finance are complex. They require a particular type of financial advisor who sees beyond the numbers.
If you are that type of financial advisor or would like to be, this book is a gift from Mitch Anthony to you. It is the real deal. There is nothing “soft” or “froufrou” about it. If you are that type of financial advisor, it gives voice to those thoughts and notions you know to be both fundamental and true. These pages are the essence of thinking and acting like a financial planner.
Anthony tells you why. Then he tells you how. He tells you how to combine your best thoughts with your best work to make a positive difference in people’s lives. As a living bonus, he shows you how these best thoughts and best work also make for loyal clients and great business.
If, perchance, you are not that type of financial advisor, but would like to be, you might find inspiration here. Time and again, Anthony describes advisors who were soul sick from doing their work with the boiler room mentality. They did not know there was a different way. This book shows a different way. It puts real-life vitality into financial life planning processes.
It takes courage to work from one’s soul. Throughout his book, Anthony shares himself. Unlike many authors purporting to tackle matters of soul, he makes it fearlessly real. Knowing all too well that financial life planning is more than intellectual indulgence or replicable formulae, Anthony shares his own life and some of his own significant encounters. Perhaps most importantly, he shares the emotional bounty of his own work with personal financial advisors. For those called to it, he views this work as holy and sacred.
This stands in stark contrast to the raw sales mentalities of the boiler room. As we read about practitioners of good heart providing financial advice “done right,” the contrast with this way of thinking is very clear. It is curious. Why would anyone want to do business like that? Why would anyone want to do business with people who do business like that?
This is a book of wisdom and soul. It integrates art, craft, and wisdom with life, soul, and culture. It can serve as an operating manual for someone coming into the financial planning profession or as a source of personal inspiration for veteran financial advisors.
Be warned: This is not a “hard” book. It won’t help you pass the test or up your testosterone count. You won’t find charts, histories, or startling wealth enhancement strategies. As the title suggests, it is a book for living rooms, not ivory towers.
As with the uncommon virtue of common sense, it could be easy to take for granted the principles Anthony discusses. That would be a shame. With roots firmly planted in the financial services industries, the complexities of post-World War II money, and the urbanization of America, the role of financial advisor has emerged with difficulty over several decades. Grasping this book’s significance requires perspectives steeped in history and an understanding of where we have been.
We must appreciate the postwar economic environment, the nature of money, and the pressures these have placed upon the lives and decisions of ordinary folks.
The economic environment continued to reflect postwar prosperity and chaos. The world was changing politically, demographically, and economically. Migrations from farms to cities changed the economic facts of life. People were dependent on financial assets as never before in history.
The financial planning profession’s birth and “early childhood” in the 1970s came at a time of turmoil and financial chaos. The United States went off the gold standard. Not long after, we had the first oil crisis. Inflation ran at double digits; the stock market’s volatility was shocking to investors. Not since the Great Depression had so many lost so much so fast. Inflation hit the housing markets and the baby boomers tore through everything, including real estate and the job markets. Financial fraud was rampant in the savings-and-loan world. This was also the case in that murky world known as the “penny stock” market. Tax rates were astronomical—as high as 90 percent on incremental income. It is little wonder that the term tax shelter entered common language for deals ranging from aggressive to outright deception.
Before World War II, there were not a lot of folks providing personal financial advice, either as advisors or salespeople. In the 1950s and 1960s, it was all sales. These were the halcyon days of Glass-Steagall. Not only were these men dedicated salespeople (and back then they were all men), they all represented a particular industry sector. There were insurance salespeople, stockbrokers, and bankers. They were separate. They got paid to sell, not serve. Moreover, for the most part, they could sell only one thing at a time—no mixing of insurance, securities, savings, tax advice, employee benefit planning, or retirement planning.
Meanwhile, many of these people learned grotesquely manipulative sales tricks. The worst of the lot worked in churn ‘n’ burn shops known as boiler rooms. For them, the term penny stock was a misnomer. It was often worth less.
It is unfair to suggest that all financial advisors worked in the venal pits known as “boiler rooms.” However, we can accurately observe that the financial services industry was not client-centric. The best of this lot sold high-commission cash-value life insurance or high-commission securities. For all of them, the name of the game was production. Production meant sales—and only sales. It did not mean you had added to someone’s long-term security or helped them with wealth building or otherwise addressed their relationships with money or the money forces. Goals? Meaning? Happiness? Perish the thought. At the end of the day, if you did not move product, you simply were not a “producer.”
In the late 1960s, some farsighted folks thought this was nuts. They saw that individuals needed to coordinate their finances and get their advice from a single source. They thought that people deserved to get good financial product that would perform as described and promised when they put their money down. They used terms like due diligence and best interests of the client. They declared that there was a better way to work with individuals and their complex relationships with the money forces.
They were aspirational. Starting with just a handful of good souls, then growing into hundreds, then thousands, they founded professional associations and started an academic institution. They established standards of practice and codes of ethics. Spreading internationally by sheer force of will, common sense, and pure idealism, these individuals took on five of the strongest industries on the planet: insurance, securities, banking, law, and accounting. They broke from the restraints of law and custom to do their work in harmony with their souls and meet the needs of people desperate for comprehensive help.
Not that the rest of the financial services industry was much help. As cross-selling came of age and the term financial planning entered our vocabularies, these folks did not see improved client services. They saw “enhanced product delivery systems.” Psychology was about customer manipulation. Psychology served sales, not souls.
Financial advisors continued to ignore the interior. In its adolescence, financial planning was still mostly about sales or technical proficiency. Many made fun of the “touchy-feely” stuff. They called it “soft.” It was perceived as the functional equivalent of women’s work. Real men did the numbers. Meanwhile, the financial services industry missed few opportunities to tell aspiring financial planners that we were all “just salesmen” after all.
It was lonely for those visionaries who could see the connections between money and life. There were few exercises to help financial advisors get to know their clients better. Even those few pioneers who saw the relationships between money and soul lacked a viable vocabulary for their work. We did not have the words to describe replicable situations or practices. Now we can see. What we can see, we can name. We need the words this book provides.
It is hard to remember that the skills that seem so natural and right were virtually unknown not so very long ago. Yet, for perspective, we must remember that we have grown this garden from seed. We did not have the words. We did not have the exercises. We did not have the perspective. Though it can be thoughtfully argued that the best books on personal finance had been written 2,000 years ago, our resources were sparse nonetheless. Now we have books like this one.
Mitch Anthony gets it. He understands that our relationships with money are sacred. He realizes that our relationships with money are crucial to our qualities of life and the promises we have made. He comprehends that financial advisors are not just worthy of respect, but that they, in fact, occupy vital, critical positions of sacred trust in the lives of their clients. He knows that financial advice done right is critical to lives well lived and worth living. “Done right” means bringing a mixture of right brain, left brain, and a good heart. “Done right” means, wisdom, craft and understanding.
From the Boiler Room to the Living Room is a guide to doing this work right. It is a compendium of best practices. It enhances and expands financial planning’s garden of knowledge. It cultivates this garden’s bounty and makes it accessible. It makes the world a better place.
Richard B. Wagner, JD, CFP
Editor of InsideMoney.org

Iwould like to acknowledge Debbie, my wife, for her ever-present faith and editorial TLC; agent Cynthia Zigmund for her keen eye and high standards; and researchers Megan Stubbendeck and Molly Jo Nyman for their devoted passion and curiosity. To the many leaders in the industry—too many to name here—who “get it” and are doing their absolute best to help this industry evolve—you know who you are—I thank you for your encouragement in taking on a systemic dragon. To the many advisors who have approached me over the years and told me their stories of how they have changed their lives and businesses by taking a life-centered, relationship-centered approach, I wish to acknowledge your courage in leading the way.

You have to stop in order to change direction.
—Erich Fromm
The foundation of the new world must be laid by those who have the courage to change the old; by those whose arteries are still soft and clear, whose minds are still active and whose hearts are still generous.
—Earl Warren
For the past decade I have been a front-line eyewitness to the birth pangs of an industry being reborn. In shaking off its old skin and presenting itself anew, the industry has been wrestling with what it was, what it is, and what it must become to remain relevant in the culture it serves.
Metamorphosis is a very good word for what has been happening. The old, original model crawled—for the last decade it has been in various stages of cocooning and is just now beginning to emerge as a species capable of greater accomplishment.
The original model for this industry was cast from the boilerplate of the boiler room. The blueprint was designed by manufacturers and vendors who wanted to distribute product through various producers ; their first and foremost consideration was constantly increasing production.
In a sales culture, the emphasis is—for better or worse—on the provider’s bottom line, not the clients. What have you done for me lately; Smiling and dialing; Turn that conversation into a sale; and Get your numbers up are all motivational mantras from the boiler room archetype.
But a funny thing happened on the way to the top-producers club.
Products and processes were commoditized at an accelerated rate due to the proliferation of information on the Internet. Prices began to fall, never to recover, and product brokering value propositions were left flapping in the wind.
With an early recognition of the evolution from salesperson to professional advisor, many apt and conscientious providers began to identify the need for a better and more holistic process and, in their search, found their way to certified financial planner (CFP), certified insurance counselor (CIC), as well as various other courses of learning and distinction in order to raise their knowledge, increase their competency, and elevate their standing in society.
Industry scrutiny came with all the subtlety of a searchlight at midnight (some would say it was overdue and some would say it was overdone—perhaps both are right) and left an industry saddled with a labyrinth of paperwork, restrictions, and paranoia.
What began as a company-centric sales industry is now evolving, rather quickly, into a client-centric service industry. Products are still involved but they are no longer the primary point of conversation. Product pushers are flailing futilely at this change-up pitch, swinging far too early in the conversation, only to look foolish for doing so. The products now must complement the service, which is based largely on intellectual capital and relational competence, not on the product of the week. The “smilin’ and dialin,” aficionados are becoming dinosaurs, and nobody wants to follow in their tracks.
The money conversation began to change as well. People who were once simply expected to call clients with “investment ideas” were now expected to share solutions and strategies and engage in number-crunching processes. Then, out of the blue, they were suddenly expected to have “life-centered” conversations and to discover who their clients were and what mattered most to them. Who had time for this?
Many senior executives in this industry have articulated to me their recognition of this evolution and their frustration with trying to “teach old dogs new tricks” and in trying to figure out what type of person they should be recruiting for the future—the future being not yet clearly defined.
These are the birth pangs of an industry being reborn and recast—from the boiler room to the living room. The cocoon has already begun breaking. We are seeing glimpses of what will come forth. It will be a greater creature than what previously existed, but not without a struggle.
The difference between evolution (what naturally evolves over time) and revolution (what is forced to happen in a shorter time) lies largely with “volition”—that is, the will of the people to make it so.
The democratic system that our country enjoys was inevitable. Such was the opinion of our founding fathers who decided to force the issue. Why should men not be free to do with their lives as they wish without interference from the privileged few? This thought inspired a band of republicans to demand better and to settle for nothing less.
There is a strain of democratization at work in the current revolution that I see taking shape in financial services. People have a right to know exactly what is happening with their money, who is profiting from it, who is telling the truth, and who is playing games with their livelihood. They will no longer settle for being “sold” or manipulated for someone else’s gain.
If we were to draft a client bill of rights, it might help our policies meet the test of conscience and might include the following:
• A client has a right to advice that is advisory in nature and not a euphemism for the “product of the month.”
• A client has a right to a competent and concerned professional who respects the sacred nature of their hard-fought earnings.
• A client has a right to transparency around all fees and costs, up-front and back-end included.
• A client has a right to be understood as a person and not just as a number.
• A client has a right to trust that the custodian of their wealth will preserve and conscientiously protect that wealth for the sake of survival and living well.
There is work to do.
At a recent industry think tank with leaders present from a number of leading firms (manufacturers and retailers), I asked our discussion group how many could say that there was true alignment between the firm’s interests down to the individual advisor’s interest and extending to the best interest of the client.
The silence in the room was eerie.
Finally, a respected industry veteran said, “This silence is a sad statement.” And another chimed in, “I guess we’ve got some work to do.”

Looking on the Inside

Any person who has worked in the arena of personal financial planning for long knows that money is a complex topic. The complexity I am referring to, however, refers not to the allocation, placement, manipulation, or management and distribution of the assets, which indeed, are complex enough. These complexities are concerned with what could be called the external realities regarding money. External realities are what the financial services business is all about: How much do you have? Where is it? How could we do better? How much will you need? What are your goals?
It is this last question that has become a staple of discovery in the industry that has caused practitioners to cross unwittingly from the external to the internal aspects of finance. Soon, clients are revealing people and places and events that are important in their lives. Quite often, they begin talking, with a palpable amount of emotion, of how they would like to see their story evolve. It doesn’t take a clergyperson, psychoanalyst, or a philosopher to perceive that the topic of money, merely material and quantitative on the surface, has multiple layers of trust or distrust, emotion, history, meaning, feeling, and intention below that surface.
You are now in the realm of internal finance.
Very little has been written on the internal side of money. In the next decade we will begin to see a proliferation from this emerging field of study and observation, works that will explore the soulish side of money.
What does this money mean?
What price was paid to obtain it?
Whose lives will be impacted and how?
What are your greatest hopes and fears related to this money? How do you view money, and how are you most comfortable dealing with it?

The Soulful Financial Advisor

If you view yourself simply as a tactician or money mechanic, you may say to yourself, “I have no interest in such questions,” but I contend that, as a practitioner, you cannot avoid them for long. Someone in your organization needs to build meaningful relationships with clients in order to create a stable business. A meaningful relationship is just that—a relationship full of meaning. It would then follow that a meaningful relationship around money extends to understanding what this money means to someone’s life and future.
You are now squarely situated in the discussion of internal finance. Another way to frame the discussion is that, after mastering the left-brain side of money management, we are now being challenged to master the right-brain side of the business.
Until recently, the financial services industry was not ready to hear a message that delved into the emotional, meaningful, and soulful implications of the financial advisory business. But the confluence of 9/11, a sobering bear market and revelations of corruptive conflicts of interest has provided the perfect storm that has turned the industry’s focus back to building meaningful and lasting relationships with clients.
This is a time for turning things inside out, for examining the innermost soul of an industry that has held the hopes and dreams of hundreds of millions of people in its stewardship and has often failed in that stewardship.
I believe the financial services industry is being turned inside out for good reason. Too many games have been played with assets that represent people’s lives, hopes and dreams, and quality of life. We all understand that money is a serious topic, but too often the institutions that claim to know the seriousness of the topic have demonstrated otherwise in flippant, foolish, and even felonious fashion.
When trusted institutions and fraternal organizations are found to be exploiting their members and clients and self-serving at the trough of their clients’ travails the time has come for deep industry-wide soul searching. If, as Aristotle said, the unexamined life is worthless, how much more worthless is the unexamined industry. This industry has been duly examined from the exterior by the courts and the fourth estate, and now the time for internal examination arrives where a new and genuine to-the-core type of industry and professional can emerge and be recognized.
I believe the audience is ready. There is a philosophical hunger in the industry among mature practitioners and firms desiring to demonstrate new standards of integrity to build individual advisor- client relationships that will transcend market jitters, trying economic climates, and industry foibles.
Scores of firms are adapting to the themes and models I introduced for building client relationships in Storyselling for Financial Advisors, The New Retirementality, and Your Clients for Life. This book is the most soul-searching yet in terms of coming to grips with what it is going to take to restore and rebuild trust within each individual practice and for the industry at large.
From the Boiler Room to the Living Room explores the following issues:
• Where the industry has failed itself and its clients in the past and how to restore trust.
• Large-scale adjustments the industry must consider to meet the evolving needs ands demands of clients.
• How to gain a greater understanding of what money represents to your client’s life and well-being.
• How to develop dialogues that will build long-term trusting relationships.
My best intention for this book is that it will act as an introduction to the broad and deep territories and avenues of internal finance. I hope that through this series of discussions we can come to a place of comfort and understanding that what we see on the surface with money is just the beginning of the story, and that those with a seeing eye would raise their dialogues and relationships to a place of the highest integrity and empathy.
There are decisions that firms and individuals in this industry still need to make. At the end of each chapter I will offer a ReSOULution—a decision based on internal insight—that I sense is necessary to carry this revolution and industry transformation forward. Ultimately, it is left to each individual to accept nothing less than the best in order for the whole to be transformed.
The financial services ranks are filled with great thinkers and generous hearts that have seen the writing on the wall for some time. They have been doing their best to reshape, reform, and reframe their firms, their offerings, and their advisors’ value propositions. Many of these revolutionaries are fighting extreme uphill battles within their organizational cultures, which cannot perceive how to exist outside of the boiler room template. I have seen a few of these good men and women tire and leave the battle but know of many more who have dug in their heels and are determined to lead their firms in and through this metamorphosis period. Once the industry sheds this cocoon and realizes what it can be, we will all benefit: client, advisor, and firm alike.

Most of us are by now aware of what has been wrong in the financial services industry. Somewhere along the way the industry lost its way or, in some cases, never set out on the right path to start with, and has reached a dead end. This part is not about pointing fingers and pointing out the obvious, but rather about first examining why the industry’s value proposition and ultimate reputation ended up where it did; and, second, about offering a more lasting, more integral, and more perpetual value proposition that will benefit both client and industry, in that order.

If These Walls Could Talk
The most certain science is conscience.
—Viktor Frankl
Anthropologists studying peoples deep within the Amazon came across a tribe that had an unusually high mortality rate and short life expectancy. They studied the eating, drinking, medicinal, and health habits of the tribe and could find nothing to explain the phenomenon. Eventually, they found the problem in the very walls of the houses these people lived in.
The tribe built their homes from river mud, which contained a species of bug that carried a virus. By using this mud for the walls of their home, they were literally building houses of death. Upon discovering this, the anthropologists sat down with the elders of the tribe to reveal their findings. The elders dismissed the anthropologists so they could decide on the issue. They later told the anthropologists they had decided to do nothing—it would be too difficult to find a new way of building shelter. It was the only way the tribe knew.
This same story could be told about some investment firms as well: the dying stock/fund jockey and the diseased investment house that is infected in its very walls with a virus known as self-centeredness. This virus causes its landlords to believe that the client who enters the house exists only to meet the needs of the house and to serve its own interests. Some of the leaders in these houses are perplexed by the number of investment advisors falling by the wayside and the decline of worthwhile clients coming to visit. In declining markets many of these landlords blame the wayward attitude of the market rather than their own attitude and actions for this demise.
How do these same leaders explain away the fact that thousands of client-centered financial planning practices grow and maintain during the same market periods? Those financial professionals whose houses are built with the lasting materials of servitude and self-transcendence are flourishing as never before. The problem, as illustrated above with the Amazonian tribe, exists within the very walls of the infected investment firm office: Those who live within these walls breathe toxic air each and every day and, as a result, mortality rates are high.
The leader of the infected investment firm, whose team suffers the greatest mortality, most likely caught this virus through direct or secondary exposure to Ayn Rand’s philosophy of objectivism that seduces executives and managers into thinking that the greater good is ultimately met by pursuing one’s own self-interests. As the industry headlines of the last few years have demonstrated, this philosophy has been practiced in corporate corner offices to the point of their undoing. If Atlas is shrugging off anything these days, it is this blind and foolish philosophy that purports to help others while only helping oneself. Put another way, it would be like the pig saying his only motive for slurping at the trough is because he knows he will one day be man’s breakfast. The pig overeats jealously only because it is his nature to behave in a hoggish fashion.
The breadth and permeation of this virus has been brought to the public consciousness from the business page to the front page and—as a grave indicator of its endemic state—to the comics page, with Dilbert strips satirizing the selfish advisor. Online brokerage houses joined in the satire with the “Let’s put some lipstick on this pig” ads showing advisors acting like boiler room operators, and posterized human images lamenting how their brokers were ripping them off. These images and messages contributed as well to the heightened awareness by exploiting the techniques of exploitation. Some recent experiences have driven the point home even more.
A friend who is an executive for a mutual fund company called to tell me that his father, whose retirement assets have shrunk considerably, can no longer sleep by night nor relax by day. He joined his father on a trip to talk to his advisor. The first thing my friend noted about his father’s advisor was that he was unaware that his client had been retired for the last year and a half! Within 10 minutes he was trying to sell a new product to my friend’s father. My friend told me he had to muster all his restraint to keep from reaching across the desk and choking this advisor. He told me, “I’m in this business and I understand the need to sell products but, my God, this guy had no interest in my father’s life or dilemma whatsoever.
Why doesn’t this “advisor” know more or care more about his clients? Because the walls of the house are infected, and, as a result, so is he.
My accountant e-mailed to tell me that a client of his had come to see him because she had stopped receiving checks from her annuity and had visited her advisor and was confused about his “advice.” He had advised her to sell the annuity and buy into some bonds that would mature in 15 years. She wondered if that was a good idea given that she was 81 years old at present. The accountant told her he would look into it further. Upon review, he found that the recommended bond fund was almost identical to what she was allocated to within the annuity. The only advantage going was to the advisor, who would profit from the transaction.
Why would an advisor offer exploitative self-interest as advice? Because the walls of the house are infected, and, as a result, so is he.
Several years ago an advisor had recommended that I purchase sizeable stakes in two telecom stocks just before they began their precipitous fall. I wasn’t blaming the advisor for the recommendations (after all, I had agreed with his idea at the time), but I was bothered by the fact that I had not heard from him in almost a year as these investments plummeted to 10 percent of their original value. Not a single phone call. I decided to make the call to him. When he answered, he said, “Oh, I’m so glad you called. My company doesn’t allow us to call accounts anymore that have fallen below $__ in value.” I remarked on the irony of the fact that it was his company’s recommendations that caused my account to fall into their “not important” category. I transferred my account the next day.
Why would an advisor not care? Because the walls of the house are infected, and, as a result, so is he.

A New Campaign

An advisor working for a bank came up to me after a speech with his eyes filling up and said, “I had decided before this meeting that I just couldn’t do this anymore. If you can show me a way to center what I do around the life and needs of my client, I will have hope. I have turned down the volume on my conscience for the last time.”
One can breathe toxic air only so long. At some point, self-preservation kicks in.
You may have noticed that there has been a concerted effort of late to change the image of the house by advertising to reflect themes of client-centeredness and client concern.
As with all paradigm shifts, there are some genuine parties and efforts at work and there are pretenders. The genuine parties are focused on bringing assimilation between their ads and their advisors. The disingenuous and half-hearted simply spend money on the ads.
Do some of these houses believe that the problem is only with the sign on the house? Does it escape their notice that the problem is with the air one must breathe once we’re inside? How long will it take before the perceptions of the advertisements become the reality of the client? Is there a process in place to bridge the promise of the advertisement with the practice of the advisor? Is there any line or strategic process that connects the two? The advertisements may be different, but until the theme of the Monday morning “sales meeting” is different, the death toll will continue to rise.
Until company culture issues are addressed, the inveterate mistakes that have made headlines will prove incurable. Nothing gives away the careless conscience like talking out of two sides of one’s mouth: telling advisors to do their best to serve their clients, but also making sure you do your best with them pushing XYZ fund this week. If the mistakes of the last decade have not brought the issue of self-centeredness to the surface, what will it take? Exploitation continues as long as the virus is allowed to grow.
The selling of financial advice can be a noble trade. But it cannot be noble if it is simply a masquerade for a financial carnival act. There is a better way.
Good advisors can and do play heroic roles in the lives of their clients. Let’s assume that every product designed intends to solve a problem or meet a need. The product is good if the intention of the product is good and the price affixed is competitive. This product is designed to meet a real need, so where does the danger lie in bringing this solution to the public? There is really only one variable that opens the door to danger and keeps the selling of advice from being respectful and dignified. Every professional also knows appropriateness can be solved only through thorough and sincere discovery.
One size does not fit all. But pressure is applied by the landlords of the house to “move” that product, and as long as the message of moving products supersedes the message, this industry will be replete with advisors trying to cram size 11 feet into size 9 shoes.
Not too long ago, I witnessed a sales training session within the industry. The trainer commenced his training paradigm with this premise, “First, create a need.” I was dumbfounded. Create a need presupposes that there are no legitimate needs in the life of this client—therefore the advisor must manipulate his perceptions to act as a springboard for his sales presentation. I challenge any advisor to find any client conversation where, with enough effort to understand the client’s situation and goals, a real need would not appear that could be addressed with a product or process you now offer. It is a self-absorbed and lazy approach to think we must “create the need.”

The Soul of the Matter

Appropriateness is ultimately a question of conscience and soul: Am I trying to create the perception that this is needed to meet my own agenda, or am I trying to find the client’s real needs by offering the most appropriate fix for those needs? The first sign of recovery from this virus is that the advisor begins to take a much keener interest in the lives of his clients and becomes much more intrigued in the discovery part of the conversation than in product pushing. A strange paradox begins playing out in the practices of those recovering from the virus: the less time they spend pushing products and the more time they spend discovering the lives and hopes of their clients, the more products and services they end up distributing. But now all product sales are highly appropriate. Doing the right thing pays off.
Though many campaigns reflect a sincere desire to form better relationships, until the house is rebuilt with a different material, the core of the virus will not go away. It is not a media campaign that is needed but a conversion of the very soul of the business. Self-interest must give way to what philosopher Viktor Frankl called “self-transcendence,” more commonly known as “seeing past your own nose.” The industry can no longer afford shortsightedness, opportunism, or superficial relationships.