Tuesday, May 31, 2011
Almost 33 years ago, Diana Nyad was pulled from the waters of the Caribbean. After 42 hours in the water, and desperately off-course, she had failed in her attempt to complete the 103-mile swim from Cuba to Key West. Shivering and delirious from fatigue, with a tongue so badly swollen from seawater that made her words almost unintelligible, she weakly protested, “Can’t I keep going?”
After 1979, Diana Nyad stopped swimming altogether. Succumbing to “swimmer’s burnout” she didn’t swim a stroke for 31 years. She went into broadcasting… pursuing a career as a TV and radio journalist, e.g. Fox Sports News, “The Savvy Traveler”, etc.
Yet, two summers ago as she approached her 60th birthday, something happened. Life, she felt, “was screaming by like a hurricane. I blink and it’s April. I blink and I’m 61.” One day while driving in Los Angeles, she looked in the rearview mirror and asked herself what she regretted most. Her answer…the Cuba swim.
With renewed vigor, she jumped back into extreme training. Last summer, she completed a 24-hour marathon swim (She sang the theme from “Beverly Hillbillies" 2000 straight times to combat boredom.) She has assembled a support crew of 25 experts, many of whom are working gratis in support of her dream. Although she has found a partial sponsor in Secret deodorant, she is $350,000 short of her desired expense goal…and is self-funding the gap.
(Here's a nice article in the Washington Post, by Sally Jenkins, that describes this adventure in greater detail.)
If all goes well, some time in June or July (weather-permitting) Nyad will slip into the water on the northern Cuban coast, and head 103 miles through the shark-infested Florida Straits towards Key West. In addition to sharks, other hazards await… e.g. hypothermia, dehydration, man o’ war jellyfish, cardio-arrhythmia; not to mention the mind-numbing fatigue of 60 hours of continuous swimming.
However, in Nyad’s view, this is a risk that must be taken again…before it’s too late.
Her own words, say it best:
“I was experiencing what millions my age are feeling these days. Disenfranchised, no longer valued, terribly worried that my best days were behind me. Yet the business of life is to live large and you can dream at any age. To me the phrase “60 is the new 40” is not a joke. We baby boomers can put truth into those words. We are far from irrelevant at 60. We’re now emotionally mature, brimming with wisdom and calm, still physically strong. This should be the prime of our lives. Training for this swim has filled me with the heartening, empowering conviction that it’s never too late to chase your dream.”
Good luck, Diana Nyad.
by Chris Holman
Tuesday, May 24, 2011
For financial advisors who are targeting the 79 million individuals born between the years of 1946-1964 (How can you “target” 79 million people, by the way?), otherwise known as Baby Boomers, I wanted to recommend a really interesting new study, “Understanding the Accidental Investor: Baby Boomers on Retirement.” Published by Financial Engines, the organization co-founded by Bill Sharpe, “Understanding the Accidental Investor” explores the emotions, behaviors and needs of Baby Boomers entering retirement.
The observations in this report are based upon a three-year long study of Baby Boomers on the verge of retirement, and reveal a population that is rife with distress, fear, mistrust, and overall investment angst.
Reaching Accidental Investors
In addition to highlighting the emotions and corresponding behaviors of near-retirees and retirees, this white paper identified five common needs that, if met, could potentially help Baby Boomers overcome the strong emotional barriers that hinder their investment thinking.
Those needs include:
- Flexibility. Given the uncertainty of retirement, participants in the study expressed a need to have flexibility and control over their retirement investments. Participants had a high reluctance to be locked into an investment vehicle--especially early in retirement when uncertainties are at their highest.
- Safety. Due to fear of significant losses right before or in retirement, many participants wanted investments that lowered investment risk or that could provide a steady and reliable source of income over time, and potentially for life. Many participants desired both. In addition, many of the participants also wanted flexibility.
- Help from an Advisor. Many participants said that they wanted to work with a financial professional they could trust to help them create a plan and decide on the appropriate course of action. At the same time many said that they found it difficult to know who to trust with their life savings.
- Sponsor Evaluation. According to the Financial Engines' white paper, participants said that having their employer select and monitor independent retirement income providers made them more likely to accept professional retirement help.
- Fee Transparency. Finally, many participants demanded clear and easily understood fees. They said that they would not act unless they fully understood the fees associated with a given product or service.
As Mark Twain said, "All generalizations are false...including this one."
Even still, this study provides many valuable insights...and is worth a close look by investment professionals who desire to connect with Baby Boomers.
by Chris Holman
Thursday, May 19, 2011
Did you see this article in Investment News, "Rollover funds go a-begging"?
If you didn't, and you are a financial advisor who is interested in the rollover market, you should. Today in fact. Unless I am completely mistaken, this seems like it's an incredible educational and marketing opportunity.
In a recent Fidelity Investments Survey of individuals who have left a company retirement plan:
- 66% of individuals did NOT move assets from their former employer's plan within 4 months of leaving the company,
- 59% of those that left assets in the company plan did so because of: plan features, services, or access to a specific investment,
- 27% of those that stayed in the company plan said the money was still there because they "haven't got around to it yet."
However, if it's close to true, I would think that forward-thinking financial advisors would be inspired to educate and explain as to why leaving assets in a former employer's plan is a grotesque mistake that unnecessarily complicates one's financial life.
Just wanted to pass this on...
by Chris Holman
Tuesday, May 17, 2011
On June 1st 2011, Barry Salzberg ascends to the CEO spot of Deloitte Global, the largest of the “Big Four” consulting and accounting firms, with 170,000 employees worldwide in 150 countries.
Although Deloitte’s global headquarters on 1633 Broadway in midtown Manhattan is just a borough away from where Salzberg was born-and-raised in Brooklyn, it is worlds away from where he began in life. His father was a postal clerk who died when he was in high school, requiring young Barry to work to help support his family. Salzberg was only the second person in his family to attend college. In fact, his high school guidance counselor told him not to bother to go to college because "he couldn't handle the work." Salzberg applied to every publicly funded college in the city. He wasn't able to leave home because his mother was alone at the time, and he needed to work 25-40 hours a week to support them both.
Ultimately, Salzberg earned a Bachelor’s degree in accounting from Brooklyn College, a Juris Doctorate from Brooklyn Law School, and a Master of Laws degree in taxation from the New York University School of Law. It's not clear what the guidance counselor is doing today.
Joining Haskin & Sells in 1977, Salzberg got his first lesson in leadership…his 3rd day on the job. His first boss (who Salzberg subsequently named “Bosszilla”) asked him to xerox a tax ruling. Salzberg did so…and also took the initiative of including his own 2-page interpretation.
His boss’s blunt response? “Mr. Salzberg, I asked for a copy of the ruling, not your interpretation. One copy, stapled.”
Mr. Salzberg’s 34-year career at Deloitte, along with his bedrock learning on the streets of Brooklyn, has given him a fresh and unique perspective on how he defines leadership. He calls this principle, “No Ostriches. No Elephants.” This philosophy is predicated on four underlying tenets: Honesty, Respect, Appreciation, and Transparency.
Honesty: In Salzberg’s words, “No burying your head in the sand if there’s a problem, and no ignoring the elephant in the room. Much better to name and tame an issue, no matter how difficult it is. Making the truth told and discussed is the foundation of leadership. Without that, you can’t build trust.”
Respect: Salzberg’s attitude towards his colleagues is light-years away from the attitude of “Bosszilla.” In his view, today’s worker expects to be treated with complete respect, as an individual who can offer valued contributions to an organization. Moreover, workers tend to stay longer in jobs that are built around their own unique needs…not vice versa.
Appreciation: The Golden Rule applies…and don’t forget to say “Thanks!” Let your best people know how much they are valued…especially in tough times.
Transparency: No hidden agendas. According to Salzberg: the idea of a "ruling elite in the clouds of some bureaucratic Mount Olympus." In the past, it would have been unthinkable for the average employee to have direct contact with the CEO, he pointed out. Today, CEOs regularly host employee town halls, in which people are encouraged to ask and say anything. "Our people have to see if that if they disagree [with their boss], nothing will happen -- that there are no [negative] consequences to promotion or compensation."
For more on Barry Salzberg, check out this illuminating article at Knowledge@Wharton.
Ostrich Facts: The Ostrich is the largest living species of bird and lays the largest egg as well. Ostriches never actually bury their hands in the sand. Complete myth. Ostriches also have the ability to run at maximum speeds of about 97.5 kilometers per hour (60.6 mph), the top land speed of any bird. (See here.)
by Chris Holman
Thursday, May 12, 2011
Dr. Eric K. Clemons is a professor of operations and information management at Wharton, and a pioneer in the study of the transformational impacts of information on the strategy and practice of business.
Recently, Dr. Clemons weighed in on Microsoft's $8.5 billion takeout of Skype. Although ClientWise is an executive coaching firm, and not in the business of providing investment advice, we found Dr. Clemons' comments to be insightful and illuminating...and wanted to share this interview with our subscribers.
Besides...most guys who sport bow-ties these days are worth a listen.
by Chris Holman
Tuesday, May 10, 2011
There’s a pretty interesting interview with Chip Roame of Tiburon Strategic Advisors, who recently hosted the Tiburon CEO Summit, a semi-annual gathering of the renowned leaders and other muckety-mucks within the financial advisory industry.
Roame opines about some of the top industry trends:
Are the Wirehouses Alive, Dead, or Dying? (Alive and well, but how many advisors will they ultimately employ?)
Which Wirehouses are growing? (Of the four Wirehouses, only Wells Fargo has seen growth in advisor numbers. UBS America’s days seem numbered.)
Is the “Breakaway Broker” a real phenomenon? (Real…but not in mass numbers. Moreover, 80% of the advisors who leave the Wirehouses do so involuntarily.)
What’s the future of the independent broker-dealer? (LPL has lapped the field with 12,000+ advisors. For the smaller and mid-sized b/d’s, the future looks far less certain.)
What are the trends in consumer wealth? (Stocks have come back 50%+, housing prices haven’t.)
Is the advisory business generally healthy? (Extremely so. The trend is its friend.)
Speaking of the state of the industry, there was a somewhat engaging article in the April issue of Registered Representative, “The Myth of the Vanishing Advisor.” The article explores the health of the financial advisory industry from the standpoint of advisor population, i.e. given the demographic and retirement trends of the affluent, as well as the advisors themselves, will there be a shortage of financial advisors in the future?
One comment stood out for me. Stephen C. Winks, a Richmond, Va.-based management consultant for financial advisors, estimates that there are 17 million households with more than $100,000 in liquid investable assets. He goes on to say that if each advisor had about 200 clients, it would take about 85,000 advisors to serve the market, a fraction of the current population. (There are about 350,000 active financial advisors today.) “You can do the arithmetic very easily,” Winks says. “We've got way too many brokers.”
Not to quibble with Mr. Winks, but his calculations assume that all advisors, and advisory firms, have a homogeneity of skill sets and have been equally adept at staying current with some of the rapidly changing demands and expectations of the complicated financial lives of affluent investors.
From our vantage point, this is hardly the case.
by Chris Holman
Wednesday, May 4, 2011
Most advice is terrible. So says Dr. Heidi Grant Halvorson, author and motivational psychologist, in a recent blog post of hers, “The Difference Between Good Advice and Bad Advice.” Dr. Halvorson goes on to say, “Whether you get it (i.e. advice) from a best-selling author, your boss, or your neighbor, nine times out of ten it’s about as useful as a screen door on a submarine.”
Dr. Halvorson is also the author of Succeed: How We Can Reach Our Goals; which is also kinda funny when you think about it. (Ironic? Paradoxical? Nervy?) Presumably, she doesn’t include herself in the 90% of advice-givers who are “terrible.”
Advice-giving is really big business, and completely recession-proof too. It is estimated that when one tallies all of the self-improvement training and paraphernalia, e.g. books, authors, seminars, holistic institutes, infomercials, etc., the total self-help market is more than a $12 billion industry, and growing at 6%+ annually. Indeed, when one enters “self-help” in the search box on the Amazon website, you’ll find 129,706 different books that fall into this ever-increasing category. (By Dr. Halvorson’s calculus, 116,735 of these books are valueless!)
What separates good advice from bad advice? One of the challenges with getting advice from others is that the advice often comes with strings attached. When you think about it, it is really difficult for many advice-givers, even well-intentioned ones, to dissociate themselves from their own personal agenda when they dispense their advice. In this way, their advice is more about them, and less about you.
As Oscar Wilde has said, “The only thing to do with good advice is pass it on; it is never of any use to oneself.”
The other interesting thing is that when one gathers advice from others, solicited or not, there is a tendency to discount our own intuition and experiences. Not that we shouldn’t value the insights of others, but sometimes the best solution to a specific problem can be found in our own backyard…by virtue of using our own built-in tools and instincts. Although I am no psychologist, it seems that sometimes when we seek advice from others, what we really want is their approval.
I’m curious. When was the last good advice that you received? On the other hand, when was the last time that you came to a resolution…intuitive leap of understanding…or clarity of thought, by your own thinking efforts? My guess is that, for many of you, the last circumstance was much more recent than the first.
On the matter of giving advice, I have always appreciated this quote from Harry S. Truman, when he offers this guidance on how to advise one’s children:
“I have found the best way to give advice to your children is to find out what they want and then advise them to do it.”
Interestingly enough, “advising them how to do it” is still giving advice, and an indicator of how tricky it is to break the advice-giving habit.
by Chris Holman