Latest / Only Fee-Only / #140 - We stopped undercharging and the business worked - Sean Gillespie

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#140 - We stopped undercharging and the business worked - Sean Gillespie · Only Fee-Only

• 0:04
  SPEAKER_02: How's it going everyone?
• 0:06
  SPEAKER_02: Welcome back.
• 0:06
  SPEAKER_02: This is the OnlyFeeling podcast.
• 0:08
  SPEAKER_02: Thanks for being here with us.
• 0:09
  SPEAKER_02: And for those of you that are return listeners, great to have you back.
• 0:13
  SPEAKER_02: In this episode, we talked to Sean Gillespie, who is the president of Redeployment Wealth Strategies.
• 0:21
  SPEAKER_02: And they have been around for the last seven years based out of Virginia Beach, Virginia.
• 0:27
  SPEAKER_02: This is Sean's second time on the podcast, and it's always a pleasure to be able to talk to him.
• 0:34
  SPEAKER_02: If you haven't listened to his first episode, check out the show notes for that episode as well.
• 0:39
  SPEAKER_02: And listen to that first so that you can hear how things have changed and how everything is going in his world.
• 0:46
  SPEAKER_02: So without further ado, enjoy this episode with Sean Gillespie on the Only Fee Only Podcast.
• 0:57
  SPEAKER_01: How's it going, everyone?
• 0:58
  SPEAKER_01: Welcome to another episode of the Only Fee Only Podcast.
• 1:03
  SPEAKER_01: I'm Peter Taravalo.
• 1:04
  SPEAKER_01: I'm here with my co-host Product Buckles, and today we're so excited to have Sean Gillespie on.
• 1:11
  SPEAKER_01: He is the founder and owner of Redeployment Wealth.
• 1:16
  SPEAKER_01: Really excited to have him back on, share his story, and see what's going on with his firm.
• 1:21
  SPEAKER_01: So, Sean, welcome back to the show, man.
• 1:24
  SPEAKER_00: Good to be back.
• 1:25
  SPEAKER_00: How are you guys doing?
• 1:26
  SPEAKER_00: Stay out of trouble?
• 1:27
  SPEAKER_01: Staying out of trouble.
• 1:30
  SPEAKER_01: Yeah.
• 1:30
  SPEAKER_01: We love it.
• 1:31
  SPEAKER_01: Um so for those who don't know who you are and the work that you guys are doing at RWS, do you want to give a quick overview to the listeners?
• 1:42
  SPEAKER_00: Sure.
• 1:43
  SPEAKER_00: So uh so this is actually my second time on this podcast.
• 1:46
  SPEAKER_02: I don't remember when the last time was.
• 1:47
  SPEAKER_02: I can tell you right now.
• 1:48
  SPEAKER_02: April 12th, 2023, episode number 44, serving military families and hiring people, not positions.
• 1:56
  SPEAKER_00: There you go.
• 1:57
  SPEAKER_00: All right.
• 1:58
  SPEAKER_00: Uh none of that has changed.
• 2:00
  SPEAKER_00: Uh, you know, the the at least the the the firm the firm RWS, redeployment wealth strategies, uh is is still on exactly that footing.
• 2:08
  SPEAKER_00: Um we uh you know we've had a couple of changes over the last couple of years that we'll talk about a little bit, but uh but yeah, the the the focus of the firm hasn't changed at all.
• 2:18
  SPEAKER_00: Still a field only firm, still serving most of the military families, um, you know, still uh growing uh you know, basically an internal succession plan.
• 2:27
  SPEAKER_00: Um, you know, so that uh, you know, one day, whenever it's time for me to leave, right, that the firm just keeps on doing what we're doing.
• 2:37
  SPEAKER_00: Um, you know, that that we don't leave a bunch of homeless clients on our way.
• 2:41
  SPEAKER_02: Right.
• 2:42
  SPEAKER_02: That is important not to do.
• 2:44
  SPEAKER_02: Uh so so for you guys, man.
• 2:46
  SPEAKER_02: I mean, I know there have been some changes, and obviously, like when we talked about the structure in the first episode, because I would encourage everyone to listen to the first episode before you listen to this episode, so you have some background.
• 2:57
  SPEAKER_02: Um, but what has kind of changed?
• 3:00
  SPEAKER_02: Obviously, we know and we've gotten the chance to catch up with you, um, but but in the ever uh evolving and changing world of fee-only financial planning firms, there's always something going on.
• 3:11
  SPEAKER_02: So what's what's the same, what's different, and what are you guys up to?
• 3:17
  SPEAKER_00: Well, the same as the is the the the focus of the firm, right?
• 3:20
  SPEAKER_00: It's it's the the you know, we've retained the focus of on serving military families, we've retained a focus on developing uh developing our succession plan, our team, uh internally, and and pretty much from scratch.
• 3:35
  SPEAKER_00: Like um, you know, when Paul and I launched the firm seven years ago, uh, you know, we were you know, we were obviously we were the only folks at the time.
• 3:44
  SPEAKER_00: Everybody we've brought aboard the team, this is the first position, this is the first job they've ever held inside inside the personal finance industry.
• 3:54
  SPEAKER_00: Um you know, that's been on purpose.
• 3:56
  SPEAKER_00: Um I don't know that it's a thing that'll necessarily be a for everything, but um but one of the things that we knew up front was that we would much rather hire for uh you know for culture and for character um than for experience, right?
• 4:15
  SPEAKER_00: Uh, you know, all of the things that get done inside personal finance, whether it's insurance or investments or you know, the the overall planning, I mean, all of that stuff can be can be taught.
• 4:26
  SPEAKER_00: Um it's really, really difficult uh, you know, to teach insurance guys to just sell what the client needs.
• 4:36
  SPEAKER_00: Right?
• 4:37
  SPEAKER_00: It's really difficult.
• 4:39
  SPEAKER_00: Uh, you know, like if they you know, if they grew up in a firm that encourages, you know, selling exotic products for higher commissions and and stuff like that.
• 4:48
  SPEAKER_00: Um, you know, so I don't know, you know, I couldn't teach you guys anything about that.
• 4:52
  SPEAKER_00: Like you guys built your firm around that ethos, around, hey, we're just gonna do what the client needs, right?
• 4:58
  SPEAKER_00: Um, and you know, it's and it's why, you know, it was such a natural partnership when when we found you guys to to be able to do this stuff.
• 5:05
  SPEAKER_00: Um, you know, it's it's the same in financial planning or or investment advice.
• 5:11
  SPEAKER_00: Um, you know, when when uh when I'm looking at a guy who has grown up in, you know, in in in any of the bigs, right?
• 5:19
  SPEAKER_00: It's it's not unique to like we've all got our favorite people we like to to to badmouth, but but it's the industry.
• 5:26
  SPEAKER_00: I mean, the industry is is built primarily on an assets under management chassis, and and you know, I think it's shifting, and I think the shift is accelerating, you know, toward planning.
• 5:38
  SPEAKER_00: Um, you know, but you know, most of the industry still runs on a on an investment management and and charging for assets under management chassis.
• 5:47
  SPEAKER_00: Um and so, you know, our our view of it was we would we preferred to to hire people, first off from you know, within the military tribe, um, you know, who we didn't have to teach anything about military.
• 6:00
  SPEAKER_00: That's that's much harder to teach to somebody who hasn't lived it.
• 6:04
  SPEAKER_00: Um you know, but also people that we weren't gonna have to to try to to get them to unlearn everything they learned at certain name of large firm here.
• 6:17
  SPEAKER_00: You know.
• 6:18
  SPEAKER_00: Um, to to just orient people right out of the gate to, you know, the the you know, it's not that that investment management is not valuable.
• 6:27
  SPEAKER_00: Um you know, we just don't think that it's the most valuable or the most important thing that we do.
• 6:32
  SPEAKER_00: That's that's always been the plan and the planning.
• 6:35
  SPEAKER_00: Um you know, and the investment management is just a is just a byproduct of that activity.
• 6:42
  SPEAKER_01: Did you have something, Pete?
• 6:44
  SPEAKER_01: Yeah, I mean, so you know, with being in the business now for six, seven years, right?
• 6:50
  SPEAKER_01: I mean, what have been just some of the general difficulties?
• 6:53
  SPEAKER_01: Um and I mean, what are maybe some other tips that you would give to other firm owners who are not as far along in the process as you?
• 7:02
  SPEAKER_00: Uh I can just about guarantee folks uh who've been in business three years or fewer that you're not charging enough.
• 7:10
  SPEAKER_00: Um, because we found that out the hard way in our first three or four years.
• 7:14
  SPEAKER_00: Um, you know, those um, you know, those impulses uh they come from good and decent and honorable places.
• 7:22
  SPEAKER_00: Um, you know, and and you know, quite a lot of us who get into this line of work, you know, with a focus on planning, with a focus on service, um, you know, a lot of us tend to be accidental entrepreneurs.
• 7:36
  SPEAKER_00: And so the business is the last thing that we think about and not necessarily the first thing.
• 7:40
  SPEAKER_00: Um, so there's an element of you know, you've got to get serious about the business piece of it, you know, sooner than you think.
• 7:47
  SPEAKER_00: Um, you know, immediately would be a good place to start.
• 7:50
  SPEAKER_00: Um and and a reality of that is just making sure that you're charging enough for what you do that that what you do winds up being sustainable.
• 7:58
  SPEAKER_00: Like we, you know, when we launched in 2018, you know, we basically hit uh a pretty dramatic growth spur right at the beginning of 2020.
• 8:08
  SPEAKER_00: Um and and and you know, we went from three dozen clients to 50 clients in three months.
• 8:16
  SPEAKER_00: Um and and and that was when we figured out I was like, okay, gosh, we definitely need more people here, right?
• 8:22
  SPEAKER_00: And you know, so over the course of the the subsequent, you know, two, two and a half years from there, you know, we would add more people and like, okay, so we've added more people so we can keep up with the work, right?
• 8:34
  SPEAKER_00: But now we need to add more clients.
• 8:36
  SPEAKER_00: We were always in this tail chase, right?
• 8:37
  SPEAKER_00: To you know, add more people to the team, add more clients, add more people to the team, add more clients.
• 8:43
  SPEAKER_00: And and and you know, at no point in in the the you know, the conception of the firm when Paul and I put it together, um, did we make profitability a priority, right?
• 8:56
  SPEAKER_00: And and so even if your main reason, even if your only reason for having a firm is to serve people, um, you know, that profitability piece matters because because sooner or later we are all getting out of this line of work, right?
• 9:15
  SPEAKER_00: And and if uh if you do not have an exit plan um you know mapped out, then that exit plan might not be any more complicated than, okay, you know, I'm gonna remain a solo forever.
• 9:29
  SPEAKER_00: Um, and when it's time for me to to to call it quits on this career, um, you know, then I'll just sell to a firm owner who has a similar, you know, similar mindset, similar focus on service to what I've got.
• 9:42
  SPEAKER_00: But I mean, if you don't have a profitable firm, if you don't have a firm that's paying you, um you're gonna have a real difficult time finding buyers.
• 9:51
  SPEAKER_00: Right.
• 9:52
  SPEAKER_00: So, you know, maintaining that continuity of care for your clients, um, as weird as it sounds, right, at some point it comes back to just being profitable.
• 10:01
  SPEAKER_00: Yeah, no, that's a really good point.
• 10:04
  SPEAKER_00: If you don't have that, you got a hobby.
• 10:05
  SPEAKER_00: Yeah, you got a hobby that comes with regulators.
• 10:09
  SPEAKER_00: Um like I don't know, I don't know why anybody wants a hobby with regulators, but but you know, but some folks have that.
• 10:16
  SPEAKER_00: And you know almost none of us have it on purpose.
• 10:18
  SPEAKER_00: It's a casual friendship with the SEC.
• 10:20
  SPEAKER_02: Yeah.
• 10:21
  unknown: Yeah.
• 10:22
  SPEAKER_01: So what's some data maybe?
• 10:24
  SPEAKER_01: Like what were you charging that wasn't enough?
• 10:27
  SPEAKER_01: And like how many hours you were you putting towards the client?
• 10:30
  SPEAKER_01: Like what was kind of some of the math that you were like, hey, you know what?
• 10:33
  SPEAKER_01: Like this isn't profitable.
• 10:35
  SPEAKER_01: You know, we you know, we're bringing on more people and we're making less money.
• 10:39
  SPEAKER_01: Yeah.
• 10:40
  SPEAKER_01: Yeah.
• 10:41
  SPEAKER_00: We had uh when we launched, we had a uh a minimum uh annual fee of$1,200 a year or$100 a month, right?
• 10:49
  SPEAKER_00: And it was a fee that we calculated based on net worth and complexity.
• 10:53
  SPEAKER_00: We still do that.
• 10:54
  SPEAKER_00: How we do that has changed a little bit.
• 10:56
  SPEAKER_00: Not hasn't changed much since the last time we were on.
• 10:59
  SPEAKER_00: Um but um, you know, and I'll I just got that number from a Bob Veras podcast once, or you know, Veris, you know, envisioned, hey, this firm of the future will do things on a you know on more of a level feature as we still do.
• 11:14
  SPEAKER_00: We embraced that from the from the beginning.
• 11:17
  SPEAKER_00: Um, but his conception of it when I attended that podcast was you know, there'll be a firm uh that you know that offers service for uh about what a gym membership would cost.
• 11:35
  unknown: Right.
• 11:35
  SPEAKER_00: So that was all that was.
• 11:36
  SPEAKER_00: Like that was where we there was no research or anything that went into that number.
• 11:40
  SPEAKER_00: What we knew uh was that we wanted to build a firm not just that specialized in serving military families, but but where the service was accessible to was affordable for the staff sergeants and the second lieutenants, right?
• 11:55
  SPEAKER_00: It was accessible to the youngins.
• 11:57
  SPEAKER_00: Um, and and so you know, a$500,000 account minimum or a$5,000 a year minimum annual fee, right, wasn't gonna make a whole lot of sense to that 30-year-old uh, you know, non-commissioned officer who already had a couple of kids.
• 12:16
  SPEAKER_00: Um, you know, it wasn't gonna make a lot of sense to the 23-year-old who just graduated from college and and and now they're uh you know the juniorest of the junior officers.
• 12:25
  SPEAKER_00: Um that was where that number came from.
• 12:28
  SPEAKER_00: Um and uh you know, the service model that we put together was was intentionally, you know, high touch, uh, you know, a lot of hand holding because you know the staff sergeants and the second lieutenants were typically brand new to this stuff.
• 12:42
  SPEAKER_00: Uh so fast forward a couple of years, and we took a look at our like all of our clients, and we had this minimum fee that we had built uh for staff sergeants and second lieutenants, and about 75% of the people that were paying that minimum fee were retiring or retired lieutenant colonels and colonels, right?
• 13:00
  SPEAKER_00: So people who had a you know a 20-year career behind them already, right?
• 13:04
  SPEAKER_00: They're in their mid, you know, early to mid-40s, right?
• 13:07
  SPEAKER_00: And they were paying that minimum fee because they hadn't gotten started on their retirement yet.
• 13:12
  SPEAKER_00: Well, they required a whole lot more hand-holding, right?
• 13:15
  SPEAKER_00: They also had income, right, that would much more reasonably support a higher minimum fee.
• 13:21
  SPEAKER_00: Right.
• 13:21
  SPEAKER_00: So, so yeah, that minimum fee is now$200 a month, and that's only for ongoing service.
• 13:27
  SPEAKER_00: I mean, the first year of service uh in the vast majority of cases costs more like uh$4,000, uh$4,000 to$4,500 or so for that first year, depending on depending on decisions the client makes about whether or not to have us manage accounts or not.
• 13:42
  SPEAKER_00: So, you know, we've got a service model that accommodates you know over-the-shoulder management for the people who you know want to stay at Vanguard or Fidelity, for example.
• 13:50
  SPEAKER_00: Right.
• 13:50
  SPEAKER_02: Um, I mean, basically it's like in the beginning, you're saying, hey, we're doing a lot more heavy lifting.
• 13:57
  SPEAKER_02: We might be untangling things, trying to figure out, you know, what you've done, where you're at up to this point.
• 14:02
  SPEAKER_02: We're gonna be giving a lot more advice, right?
• 14:05
  SPEAKER_02: Maybe you don't have the right type of insurance, you're getting out in the next year, your VGLI or your SGLI is gonna run out.
• 14:11
  SPEAKER_02: Like there's just different things we've got to figure out.
• 14:14
  SPEAKER_02: And then year two, assuming that we consider working together, there's gonna be a lot less to think about, although we do need to have those check-ins and touch points.
• 14:23
  SPEAKER_02: Interesting.
• 14:24
  SPEAKER_02: Okay.
• 14:25
  SPEAKER_02: Yeah.
• 14:25
  SPEAKER_02: Now that that's awesome.
• 14:27
  SPEAKER_02: I I haven't heard of a lot of people doing it that way.
• 14:29
  SPEAKER_02: Maybe they do, but I I think that's a really cool idea because you really are charging for the level of service that people get.
• 14:35
  SPEAKER_02: And then, and and I think there's also a level to kind of feeling out the client and the person that you're gonna work with.
• 14:42
  SPEAKER_02: And if they're willing to pay for that fee, they're probably serious about the planning and that they're going to you know take the recommendations and and likely be easier to work with long term too.
• 14:53
  SPEAKER_02: Yeah, yeah, yeah, for sure.
• 14:55
  SPEAKER_02: Yeah.
• 14:56
  SPEAKER_02: So um, let's talk about how the organization has changed a little bit, man.
• 15:00
  SPEAKER_02: I I know that you're you're you're at the top, um, and you know, you've had some people come and go.
• 15:06
  SPEAKER_02: So, you know, within the parameters that you want to share, kind of what does that look like and and what are you guys doing now versus kind of what it looked like before, and how did you navigate all of that?
• 15:17
  SPEAKER_00: Yeah.
• 15:18
  SPEAKER_00: Well, so uh we had two uh well, three team members depart last year.
• 15:22
  SPEAKER_00: One of them, one of them was Paul.
• 15:24
  SPEAKER_00: Uh so Paul and I agreed uh to, you know, he he bought me out of the tax firm that we both owned uh jointly.
• 15:32
  SPEAKER_00: Uh I bought him out of this firm and and and we uh you know started uh managing the two firms separately.
• 15:38
  SPEAKER_00: We still work pretty closely together with a lot of common clients, um, but but basically determined that that running one company was hard enough to try to run two companies uh you know tied at the hip together was even was even more difficult.
• 15:52
  SPEAKER_00: Sure.
• 15:53
  SPEAKER_00: Um you know so he you know he put his total focus on the on the tax firm um you know and I put my total focus on on RWS.
• 16:02
  SPEAKER_00: Um we did have two uh two of our planners uh departed uh last year as well.
• 16:07
  SPEAKER_00: Uh Becky Noss uh toward the you know it was I guess like right at the end of January of last year, uh, you know, decided to go hang hang her own shingle.
• 16:17
  SPEAKER_00: Uh and and we knew we would probably see some of this at some point.
• 16:19
  SPEAKER_00: She just happened to be the first one to do it.
• 16:21
  SPEAKER_00: Sure.
• 16:22
  SPEAKER_00: Um and then uh late last year, uh Chex Roach uh figured out that uh that it wasn't really investment management and um and and you know full spectrum, you know, holistic financial planning that she wanted to be doing.
• 16:39
  SPEAKER_00: She was uh more jazzed about uh the work that that that she does now as a coach, um, you know, helping people with budgeting and cash flow, like the the real basic basics.
• 16:52
  SPEAKER_00: Um, you know, stuff that stuff that a client uh you know a financial planning firm has typically already mastered, right?
• 17:00
  SPEAKER_00: Um you know, uh, but you know, basically uh you know, one of those building blocks uh you know to help people put together that uh you know that set of good habits that then puts them on the track to you know to having that first you know 500,000, first you know, million or so.
• 17:15
  SPEAKER_00: And and so yeah, so uh uh Becky in particular, uh, you know, she got her own firm now, um Healthy Wealth.
• 17:26
  SPEAKER_00: Um for anybody who's listened to this podcast, I think you guys have already met Becky.
• 17:31
  SPEAKER_00: I like if if you guys know anybody smarter uh about like you know analytically how to put this stuff together, I want to meet them.
• 17:38
  SPEAKER_02: Yeah.
• 17:38
  SPEAKER_02: Yeah.
• 17:39
  SPEAKER_00: Um she's very sharp.
• 17:41
  SPEAKER_00: Becky's uh, yeah, like waterline mutant smart.
• 17:44
  SPEAKER_00: Um, you know, so but uh, you know, over the past, you know, over that same time, uh, you know, Angela Clode joined the team uh about halfway through last year.
• 17:54
  SPEAKER_00: Uh Angela at the time was a retiring uh Navy Chief Petty Officer.
• 17:59
  SPEAKER_00: Um and she was with us for four months on a Skillbridge internship.
• 18:04
  SPEAKER_00: So that's uh you know basically a transition program that the DOD has for retiring service members.
• 18:09
  SPEAKER_00: Um and then, you know, basically the first day we were allowed to put her on the payroll uh in October, um, you know, she joined the team, you know, officially at that point.
• 18:18
  SPEAKER_00: Um and she's been doing gagbusters.
• 18:21
  SPEAKER_00: Uh she took to it like a duck to water.
• 18:23
  SPEAKER_00: Um, you know, the the stuff that like all the routines and and you know workflows and task templates and all the stuff that Izzy and the rest of the team had built uh over the the four years before Angela got here.
• 18:37
  SPEAKER_00: Um, you know, she was able to just fall in right on that and just jump in like she'd been doing it all her life.
• 18:43
  SPEAKER_00: That's awesome.
• 18:44
  SPEAKER_00: So that was Angela and then Leo, uh Leo Sumera uh started at the beginning of this year also on a skillbridge internship as he was retiring uh from his own Air Force career.
• 18:54
  SPEAKER_00: Um and um you know, did his internship through uh like April, uh, took a couple months off.
• 19:01
  SPEAKER_00: He became a monk uh to study for his CFP exam, uh, which he just passed uh in July.
• 19:08
  SPEAKER_00: Uh took a little bit of time off to dunk his toes uh in a in a swimming pool somewhere in Lisbon for a couple weeks.
• 19:15
  SPEAKER_00: Nice and uh and just got back to the office this week.
• 19:18
  SPEAKER_01: So very nice.
• 19:21
  SPEAKER_01: Yeah.
• 19:22
  SPEAKER_01: That's great.
• 19:22
  SPEAKER_01: So I mean, with all that, so we're charging more.
• 19:26
  SPEAKER_01: Um we have some new team members about the same size.
• 19:30
  SPEAKER_01: So I mean, what's kind of the goal in the future?
• 19:33
  SPEAKER_01: Where do you see RWS going?
• 19:36
  SPEAKER_00: Well, same, same as it's always been in terms of uh, you know, building toward an internal succession.
• 19:41
  SPEAKER_00: Um, we've you know recently kind of taken stock of you know, you know, revenue, what do our revenue goals need to be longer term?
• 19:50
  SPEAKER_00: Uh you know, I had a very brief uh flirtation with a business coach uh last week, and and we'll probably come back around to her in a couple months.
• 19:58
  SPEAKER_00: And um, you know, it basically is a productive conversation, you know, mainly along the lines of of understanding um, you know, that our revenue goals probably needed to be a lot larger than they are.
• 20:10
  SPEAKER_00: Um and um, you know, the short version is like, you know, for those of you who are not familiar with the book, 10x is easier than 2x.
• 20:20
  SPEAKER_00: Uh the upshot of it, I'm like all of one chapter in so far.
• 20:23
  SPEAKER_00: The upshot of it is if you think your goals are achievable, they're not big enough.
• 20:27
  SPEAKER_00: Uh and and so that was, you know, that was kind of my big takeaway from that initial conversation.
• 20:34
  SPEAKER_00: Uh and um, you know, and so so the you know, the big part of that moving forward from here then is is you know, I don't envision our minimum fee changing much uh over time from here, uh, except to index for inflation.
• 20:52
  SPEAKER_00: Um, you know, and and primarily because, you know, we want the you know the service to continue to be accessible um you know to the to the youngins, right, to the the the junior NCOs and the junior officers.
• 21:07
  SPEAKER_00: Um we've also built out some other service offerings that that don't rely on that ongoing comprehensive planning um you know for the folks, for example, who just need a little bit of over-the-shoulder inside their thrift savings plan, uh, you know, who you know they don't really want to manage their own, you know, Roth IRAs or stuff like that.
• 21:29
  SPEAKER_00: So, so you know, just just lower priced stuff that doesn't require as much you know attention, you know, ongoing the year.
• 21:38
  SPEAKER_00: Um but um but in terms of you know like whom we target, uh, you know, basically, you know, adjusting our marketing efforts to to to speak a little bit more to to those you know lieutenant colonels and colonels who are late in their career, um, you know, and who are just looking for help.
• 21:57
  SPEAKER_00: Right.
• 21:58
  SPEAKER_00: Bottom bottom line with this stuff, I mean you know, I sat with with some some guys uh a month or so ago, um, just people that that we were looking at for you know doing doing some of our IT.
• 22:11
  SPEAKER_00: Um and uh the the the team of three that I sat down with lunch, one of the one of the three guys on the team, he didn't do a whole lot of talking, um, but he asked the best question um that that any of the three guys asked me um during lunch, and he said, Who's your who's your biggest competitor?
• 22:32
  SPEAKER_00: And I said, Well, you know, seven years ago when Paul and I launched this firm, I would have told you it was first command, right?
• 22:38
  SPEAKER_00: So first command, for those who are not familiar, is a firm that does a lot of life insurance and they do a lot of investment uh management, you know, uh for for military folks.
• 22:50
  SPEAKER_00: Um and I've gotten to the point where I don't I don't think of first command as my biggest competitor.
• 22:56
  SPEAKER_00: My biggest competitor competitor at this point is Google.
• 23:00
  SPEAKER_00: Right.
• 23:01
  SPEAKER_00: Is you know, for people who have the time and the you know the mental capacity, you know, to basically, you know, do the reading and sort, you know, because you know can you can read a lot of garbage on Google, but to sort out like what's quality stuff from what's not, you know, a lot of those folks are just gonna be DIYers for a long, long time.
• 23:26
  SPEAKER_00: Right.
• 23:26
  SPEAKER_00: And they may never be clients here, right?
• 23:30
  SPEAKER_00: The people who become clients uh at a firm, at least like a firm like the one I've been building, uh, are the people who appreciate having somebody doing the planning, right?
• 23:42
  SPEAKER_00: Somebody uh, you know, who's kind of a consultative thinking partner, somebody who has a financial plan that's serving a life plan, um, you know, and just appreciate knowing that okay, like if I have a thing that something that pops up that I could just pick up the phone and run it by him and figure out, hey, does you know, could the plan accommodate this?
• 24:06
  SPEAKER_00: Um perfect example of this last week.
• 24:08
  SPEAKER_00: We had a client who's he was driving cross country.
• 24:12
  SPEAKER_00: Like the day he called us, he was in like Iowa somewhere, I think.
• 24:16
  SPEAKER_00: Um on his way from the East Coast to the West Coast, right?
• 24:20
  SPEAKER_00: So he's he's executing a military move from Maryland to Washington.
• 24:25
  SPEAKER_00: And um and it had come to his and his wife's attention that a vacation property on the New Jersey beachfront, right next door to the one that her parents already owned, had come up on the market, was available.
• 24:41
  SPEAKER_00: And he's like, hey, can we do this?
• 24:42
  SPEAKER_00: And I mean, it wasn't even like a one-minute look at like what they were doing, because you know, we're attuned enough to what uh you know, what their financial life looks like and and you know, where can they accept a little risk and where you know the bottom line is like, yeah, it's like yeah, this isn't even a question of if to me, it's just a question of how we do it.
• 25:03
  SPEAKER_00: Like, you know, if you need if you need a couple hundred thousand dollars to make a down payment on a thing, I already know where we're gonna go get it.
• 25:09
  SPEAKER_00: Right.
• 25:10
  SPEAKER_00: So so like you know, as soon as you and I are done talking, right, hang up the phone and call your realtor and tell them we're gonna move.
• 25:17
  SPEAKER_00: Yeah.
• 25:19
  SPEAKER_02: I love that detail.
• 25:20
  SPEAKER_02: Yeah.
• 25:21
  SPEAKER_02: I love and that's one of the things that like even my financial planner, like when my wife and I were moving at our house, like people underestimate that, right?
• 25:28
  SPEAKER_02: They think of a lot of times the financial planners as, you know, is you guys gonna do my investments, or maybe we'll like check on budgeting every once in a while.
• 25:36
  SPEAKER_02: But the cool thing is that, you know, your clients can rely on you for every piece of their financial lives and then go into that experience, in this case, the home buying experience, knowing that they can feel good about it and knowing that they can be excited and they have the right to feel excited about it, and they can go make that call when they get off, knowing that you're dotting the I's and crossing the T's.
• 25:58
  SPEAKER_02: And I think, you know, the general perception of financial planning sometimes out there among the general populace is not what you guys actually do.
• 26:08
  SPEAKER_02: So I I love the way that you frame that story, man.
• 26:44
  SPEAKER_00: Uh that that very same client, uh, you know, they onboarded a couple of years ago.
• 26:49
  SPEAKER_00: Um, and when he came aboard, he was he was already a client of one of the bigs.
• 26:53
  SPEAKER_00: I don't remember which one it was.
• 26:54
  SPEAKER_00: It was not first command.
• 26:56
  SPEAKER_00: Um but one of his questions when he onboarded was he's like, so I've you know, right now I've got my accounts at this other joint.
• 27:03
  SPEAKER_00: And and I, you know, described, I was like, hey, I got this, this, this, this little, you know, this little really persistent team of people, right?
• 27:13
  SPEAKER_00: It's not just me you're getting, you're getting six or seven of us.
• 27:15
  SPEAKER_00: And he said, well, at this other joint where I'm already at, they got a battalion of people.
• 27:19
  SPEAKER_00: They got back office, they've got research, they've got da-da-da-da-da-da-da-da-da-da.
• 27:24
  SPEAKER_00: Right.
• 27:24
  SPEAKER_00: All with the you know, their sole mission in life is making me money.
• 27:29
  SPEAKER_00: And he said, How are you competing with that?
• 27:31
  SPEAKER_00: And I said, Well, the short answer is I'm not.
• 27:35
  SPEAKER_00: Right.
• 27:35
  SPEAKER_00: The the first thing is they're not making you money, the market is, but only if you're in it.
• 27:39
  SPEAKER_00: Right.
• 27:40
  SPEAKER_00: Um and then beyond that, right, you know, the the just the the focus, you know, like I already said, the focus here is gonna be planning, right?
• 27:48
  SPEAKER_00: Um, you know, if if we you know, if we get you allocated right, the market will take care of that piece.
• 27:53
  SPEAKER_00: Right.
• 27:54
  SPEAKER_00: Right.
• 27:55
  SPEAKER_00: But but making it very specific, um, you know, when we had that first conversation, um if you're hiring us thinking that you're gonna get investment performance, you should probably not hire us.
• 28:10
  SPEAKER_00: Right.
• 28:10
  SPEAKER_00: And it's not that it's not that you know, we don't care about investment returns, it's just that we don't have any control over it.
• 28:17
  SPEAKER_00: Um and and so, you know, and and just a I mean a business reality for other advisors out there listening to this is uh, you know, if you think you're gonna get hired for performance, it's like that's fine, but sooner or later it's just a matter of time before you get fired for it, too.
• 28:32
  SPEAKER_02: Yeah.
• 28:33
  SPEAKER_02: It's kind of live by the sword, die by the sword thing, right?
• 28:36
  SPEAKER_02: It's like if that's what your pitch is, and and that's why all the best advisors that I've talked to, like my biggest value add is not returns that I'm giving people, right?
• 28:46
  SPEAKER_02: It's like the service and the value outside of that and how we actually have a relationship with you and how when you're nervous about those things, we can have conversations and sit down and explain to you that the market is a volatile thing.
• 28:58
  SPEAKER_02: But at the end of the day, there's so many more things that go into what you guys do as planners than just investment management.
• 29:06
  SPEAKER_00: Yeah.
• 29:07
  SPEAKER_00: Yeah, and and I mean the investment management matters for sure.
• 29:10
  SPEAKER_00: Uh, you know, I I don't make any bones about it with people.
• 29:13
  SPEAKER_00: It's like, look, you know, Mr.
• 29:14
  SPEAKER_00: and Mrs.
• 29:15
  SPEAKER_00: Consumer, I'm probably gonna do this better than you will.
• 29:18
  SPEAKER_00: Right.
• 29:18
  SPEAKER_00: The, the, you know, one of the frequent misconceptions is that we're gonna somehow do it better than the market.
• 29:24
  SPEAKER_00: Well, the market is nothing more than all of us, right?
• 29:26
  SPEAKER_00: And so, you know, I mean, every year, you know, about one out of every four money managers outperforms, you know, their index or their benchmark.
• 29:33
  SPEAKER_00: Sure.
• 29:34
  SPEAKER_00: Right.
• 29:35
  SPEAKER_00: Most years they're in the three out of four who don't.
• 29:38
  SPEAKER_00: Right.
• 29:39
  SPEAKER_00: Um, and and so, you know, we don't we don't engage in a like a pure indexing approach.
• 29:44
  SPEAKER_00: It's you know, for the really nerdy folks, uh Fun La French is pretty close to indexing.
• 29:49
  SPEAKER_00: Um, it's still, you know, way more passive than active, but but it's it's not just buying the index, right?
• 29:57
  SPEAKER_00: Pretty close to it though.
• 29:59
  SPEAKER_00: Um but yeah, I mean, uh, you know, if if you propose to run a shop where you're gonna outperform something, uh with and and if you think you're gonna reliably outperform something without essentially cherry picking the something that you're outperforming, um you know, getting fired for performance is is not a question of if it's gonna be a win.
• 30:21
  unknown: Yeah.
• 30:22
  SPEAKER_00: For sure.
• 30:23
  SPEAKER_00: For sure.
• 30:25
  SPEAKER_02: Well, man, what other things, or is there anything before we brought you on um that you wanted to make sure you got out there in the world or any Any last thoughts that you have around people that are getting up and running or things that you want to throw out there?
• 30:39
  SPEAKER_00: Well, certainly for the youngins, uh, you know, that stuff hasn't changed much from the last time that we had this conversation.
• 30:46
  SPEAKER_00: Um, you know, my my calendar on Fridays, I keep clear specifically to talk to, you know, advisors that are that are getting ready to launch.
• 30:54
  SPEAKER_00: And, you know, certainly uh, you know, if I can if I can share one of my mistakes and help, you know, anybody else avoid at least one of them, I'm always game for that.
• 31:04
  SPEAKER_00: Um, you know, a couple months after after we were on the podcast, you know, last, um, Paul, my co-founder at RWS, uh, Adrian Ross and I uh all pitched in together to form uh now an SEC registered RIA.
• 31:22
  SPEAKER_00: Uh wherein uh you know, I continue to run RWS independently.
• 31:27
  SPEAKER_00: Adrian, uh along with her partner Becky Meets, runs Clear Insight independently inside Apforia.
• 31:34
  SPEAKER_00: Um basically, uh, you know, we and we've since brought you know four other firms inside the tent, uh uh again, all of which operate independently inside the RIA.
• 31:43
  SPEAKER_00: But basically we do the compliance and the registration uh for everybody.
• 31:47
  SPEAKER_00: We do that under the S uh under SEC registration now.
• 31:51
  SPEAKER_00: That was that was the the main reason for for creating it uh was to just simplify that that regulation and compliance aspect of it.
• 31:59
  SPEAKER_00: Um, we were at the time RWS was uh registered or registering in seven different states.
• 32:07
  SPEAKER_00: Um Adrian uh had Clear Insight registered in Washington and a couple other states, but Washington was enough of a pain uh all by itself uh to merit you know SEC registration.
• 32:18
  SPEAKER_00: So we figured out, you know, basically uh, you know, between the two of us at the time, we had enough states uh to register with SEC.
• 32:26
  SPEAKER_00: We're uh we're a little bit shy of a registration threshold in terms of uh AUM, so so we're still counting states for a little bit longer.
• 32:33
  SPEAKER_00: Um but but we're you know we're within a stone's throw of that hundred million and uh and unless unless SEC changed that that threshold.
• 32:41
  SPEAKER_00: I know they've they've talked about you know pumping it higher.
• 32:44
  SPEAKER_00: There's there's not a lot of specifics out there on on what that higher number is gonna be yet.
• 32:51
  SPEAKER_00: Um but uh that's already not our ticket in.
• 32:55
  SPEAKER_00: Our ticket in is already 15 states.
• 32:57
  SPEAKER_00: So uh but yeah, we I mean we created that uh you know, knowing uh you know, long term that what we wanted to create was the uh the ability for for smaller firms, right, either startups or you know, or a firm that was just bumping up against some of the regulatory complexity that we were starting to experience uh to be able to affiliate with an SDC registered RIA uh and and simplify their compliance and and and and and spend more time focusing on serving the clients.
• 33:29
  SPEAKER_01: Yeah, it makes perfect sense.
• 33:31
  SPEAKER_01: Very cool.
• 33:31
  SPEAKER_01: Thank you for sharing that.
• 33:32
  SPEAKER_01: And uh before we let you go, Sean, what's the best way advisors can reach out or follow along either you personally or RWS, the firm?
• 33:42
  SPEAKER_00: Well, so so we're always uh findable on the web on the website uh is uh redeploymentwealth.com.
• 33:49
  SPEAKER_00: Uh real soon you'll see that as uh a much shorter domain name, rwsfp.com.
• 33:57
  SPEAKER_00: Um so that's to find uh the you know the firm that serves the clients.
• 34:01
  SPEAKER_00: Uh you know, for the advisors that are looking for aphoria, uh who are who are interested in exploring that SEC registration angle, um, that's uh www.apphoria.com, just uh A-P-F-O-R-I-A.
• 34:17
  SPEAKER_00: Perfect.
• 34:17
  SPEAKER_01: Well, Sean, thank you so much for your time today.
• 34:20
  SPEAKER_01: Always appreciate your knowledge and uh look forward to seeing you at XYPN next month.
• 34:25
  SPEAKER_00: Oh yeah.
• 34:26
  SPEAKER_00: Yeah, that's always good.
• 34:27
  SPEAKER_00: So yeah.
• 34:28
  SPEAKER_00: And and uh, you know, for those of you who've not had the uh the good fortune to attend a BC brokerage uh hosted function at one of these conferences, uh get your get your ass to Austin this year.
• 34:41
  SPEAKER_02: Absolutely.
• 34:42
  SPEAKER_02: Corinne Patty on the 26th from at least seven to ten.
• 34:46
  SPEAKER_02: So thanks for the shout out, man.
• 34:48
  SPEAKER_00: All right, yeah, yeah.
• 34:49
  SPEAKER_00: Thanks, guys.
• 34:50
  SPEAKER_00: Good seeing y'all again.
• 34:51
  SPEAKER_02: Thank you, Sean.