Advisors weigh in on debt

As promised, in this column I will reveal the results of my very unscientific yet telling poll. If you read my last Advisor.ca article ’Ask Them Yourself’ you may have noticed the survey I created for advisors to answer. You may have even taken the time to follow the link and weigh in.

On top of the electronic votes from the readers of my blog, I also asked every advisor I knew to answer my survey.

Here is what I asked:

Are you willing to add debt and cash-flow management to your practice?

• Yes, but I would want training so I really knew my stuff and had tools to make it efficient.
• Yes, of course as long as it didn’t add massive demands to my time and I could be shown the value it would bring to my bottom line.
• No, not myself but would work with another advisor who could provide my client such a service.
• No, never. I don’t think it should be part of my practice.

The results are in. Drum roll please…

I tabulated the votes from all sources and the results were very encouraging and even just a little surprising. Only 4% of respondents said debt would never be part of their practice. Not one Advisor polled felt they’d work with another advisor who could provide cash-flow and debt management advice to their clients. That leaves the other 96%. So what did the rest of you say?

I’m thrilled to report that a resounding 43% would be up for the challenge of adding debt and cash-flow management to their practice, if they could have more education and training. This is exciting. It is my belief that we’ll never see the general advisor population take on a task for which there is no practical training widely available. Why would we n an industry where you can quickly find yourself in compliance hell over what can sometimes seem to be a minor issue?

Why would you add a layer of services for which you can’t get any training to back up that advice? Some advisors have expressed to me that they feel if this was indeed such an important issue than there would be training already. While others have told me that its better to stay silent and hope there is nothing to talk about in the first place. While even I can see the rationale of all of those “Yeah….buts” on the surface, these are unproven and to my mind an unreasonable and even dangerous forms of logic. You see the real risk from both a compliance and business perspective is not knowing about, and dealing with our clients’ asset eating liabilities.

Everything else we’ve learned to make our businesses successful was not absorbed by osmosis, or sprinkled on us in the form of pixie dust via the “knowledge fairies”. Rather what we know and do has been taught and practiced. Even if most of our learning has been self-study; at least there was something to study! It is my personal, professional mission to see that advisor education in the form of theoretical and practical training is available to every advisor who is willing to add debt and cash-flow management to their practice. Much of what is needed can’t be found in a text book. Rather this subject would be better served in practical discussion and real-life examples in more of a workshop style learning environment. Remember you’ll never get what you don’t ask for. So if you are with that 43% speak up and demand to receive education and training on debt and cash-flow management.

The other 53% of you said that you would indeed be willing to add this service to your practice but you would need to be shown the value and provided with ways to ensure that time costs would not outweigh that value. To me those who chose this response were really saying two things: One, they aren’t doing this now so some training would probably be necessary, two, they aren’t yet convinced of the feasibly of taking on the task but accept it is an important one.

The value is there without a doubt but I can understand the hesitation. This past week I got an email from a colleague (who works with advisors). He surmised that advisors just don’t want to “micro-manage” their clients finances. He’s right. That is the perception but I can assure you once you gain the skills involved it is more of a mole hill than a mountain. I gave him an analogy I use on myself whenever I find I’m faced with blowing a task out of proportion. I told him to think back to the first few times he drove a car. Do you remember learning to drive? I do. How many tasks did you have to think through before that metal monster moved? If you broke down each thought and each task involved in those first few drives it would make the undertaking of driving seem more like a chore than life enhancing skill; right?

I know that anything you learn you can master. Anything you can master you can streamline and make efficient. When it comes to protecting our clients from a risk greater than that of any stock market; you better believe that is one heck of a boost you, and your clients’ bottom line.

So, if you can see the value then speak up and don’t be silenced until you acquire this important skill. If you need some proof of value look no further than your attrition and referral rates because you’ll lose fewer and attract more new clients when you deal with the entire client.

If you don’t believe that you can indeed do this, just think back to that very first drive. The once overwhelming complexity of that task could have you had you turn tail and run in the other direction, but the value of that skill far outweighed the cost to conquer it. Just for today decide what you may see as a mountain just might be a molehill.

Thanks to all of those who voted, one step at a time the industry will rise to meet the challenge.