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Money in the Now
When I started Elements, I was responding to an initial pain that was born inside of my challenges starting a mid-market RIA, called Dentist Advisors. The average client age was 38, and they were skeptical validators who were trying to make decisions on whether hiring a human was really worth it. It was harder for other people I hired to sign clients, before Elements. Mostly because it was complicated to explain the value of "financial planning."
I wanted to turn these conversations I was having into something more intuitively valuable. Something that felt a bit more like a product.
I started brainstorming—what if financial planning was more about comparing present-day financial vital signs instead of forecasting toward retirement? Like what if my value proposition was, hey, would you mind if I did a financial health checkup? Wouldn't a value proposition, focused on the present moment, be more relevant to Gen XYZ?
In the past few years, this value proposition, both at Dentist Advisors and Elements, has been really incredible to witness. The value of planning for today, and aligned with what you want, now.
I'm confident, now, that most consumers are thinking a lot more about their next vacation, or the next app-based, battery-powered wine cooler than they are about retirement. Even the wealthier folks are a bit tired of financial planning only applying to the future.
What about today? What about now? Feeling an early 2000's ballad starting right now.
So I think advisors are really intent on creating a process that brings financial advice into the present moment. My process involved simplifying, and simplifying, and simplifying until I went from 30, 25, 20, 15, to only a dozen key performance indicators. Eliminating all of the non-essential topics so I could focus on the bare minimum required data set that would help me and my team navigate the very difficult job of providing an advanced standard, across dozens of employees.
Too often, in my experience, firms miss the opportunity to really help because they are trying to do too much, too soon, too early for most people. This drives up the cost of advice and naturally separates the professionals from the average consumer.
In my journey, I started to notice that sales conversions were better when we used these present-day ratios to come up with strong opinions that allowed us to compare people to best practices, norms, etc. Sometimes I still can't believe that there really isn't a universal standard for financial health. I'm sure Elements will play some role in helping usher in that future, even if our platform isn't the universal standard. It was cool to see how a universal standard of holistic financial health really did garner interest from a lot of people. Especially when I could actually get enough data to have credible comparisons among consumers. By leading with these credible, data-driven insights in public demand-gen marketing, we converted people a lot better than we were converting before. We had a specialization (dentists) and we had a proprietary data set. These two areas of focus were strong sales conversion tools for us.
Ultimately, the public seems to care a lot more about today than tomorrow. So let's not try and scare them into focusing on tomorrow and the future. Let's solve their today.
For example, let's imagine someone is objectively low on liquidity. An Lt Score of .25 yrs (3 months of total after-tax assets in their balance sheet). What's the best way to motivate them to save more and become more liquid?
Option 1 - Send them a simulation that projects some future set of scenarios that either depresses or comforts depending on the assumptions we make. Ugh. Icky.
Option 2 - Tell them that they appear to have a liquidity score that is rated "low." How does that feel to you? Do you feel uncomfortable right now?
Client: Yeah, a little, it's just scary to have all of these expenses and school to pay for, and life, and I dunno, yeah, I wish we had a little more savings.
Advisor: Cool, I think that will help you be a lot more present with your relationships and enjoy life a lot more too. Let's set a goal to build up that score to a .5 (6 months). That way we can enjoy our vacations and our life with confidence, knowing that we are OK.
Can you see the difference in framing there? No guilt, no shame, no fear. Just aspiration for a better life, NOW.
When I started Elements, I ended up landing on this mission statement, which has shifted slightly—but here's the original:
A world where millions of people have healthy finances so they can live their present lives to the fullest.
To design and uphold the universal standard for holistic financial health.
Not much has changed three years later, except now we have an army of over 500 rebel financial advisors who are leading with vision into a new future for the wealth management industry. I'm so honored to watch them have these critical conversations that truly make the lives of their clients so much better.
If you made it this far, thank you. I so appreciate all of your support and encouragement that keeps me writing. It's hard to sustain a regular practice and you have all been so generous and thoughtful with your ongoing email responses. If you felt anything about what I wrote, please don't hesitate to reply! I love hearing from each of you.