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Accelerating Your Firm’s Evolution with Stephanie Bogan

The break out expansion of the financial planning industry has resulted in even boutique-sized RIA firms wondering if they should expand. That answer is personal to each firm owner. Do you want to take on the challenges that come with growth? Does finding the right hires make you anxious? Are you already in survival mode and can’t imagine adding on the tasks it takes to scale?

Reese Harper’s guest on this episode of the Elementality podcast, Stephanie Bogan, answers those questions and more. An RIA entrepreneur, she offers advice from her many experiences on how you can smooth through your own growth challenges. Stephanie and Reese talk about why she is so confident that a successful small start can lead to much greater success—and what you need to do to clear those first hurdles to growth.

Show Notes
https://limitlessfa.life/

 


Podcast Transcript

Stephanie Bogan:
Our biggest issue is that we are muddled in terms of what we really want for many of the reasons that you mentioned. I can’t, I don’t want to, and I don’t know how are the three biggest things I hear and none of them are viable in my world. I mean, we’re not asking you to jump off a building and not die, right?

Stephanie Bogan:
I’m saying you can double your income and your time off no question, period, end of story. It can absolutely be done. The question is, are you clear on the outcome that you want to create and are you in a head space where you can make those choices in a way that moves you forward?

Abby Morton:
Welcome to Elementality. I’m Abby Morton, CFP and Producer of our podcast here at Elements. I love being a financial planner, but I know it’s a challenging profession as well. That’s why the number one goal of our show is to help you prosper as an advisor as you better connect with your clients. We know your time is very valuable. Plan on a good return when you spend it here with us.

Reese Harper:
Hey, everybody. Welcome to Elementality. I’m your host, Reese Harper here on another special episode, guest interview with advisor, coach, someone I have known for probably 10 plus years, but we’ve had only a few interactions and I thought, what better time to bring on this guest for a topic that I want to talk to you today? I’d like to welcome Stephanie Bogan to the show. Hey Stephanie.

Stephanie Bogan:
Hey Reese, how are you? So happy to be here today.

Reese Harper:
Our relationship has been more digital and phone call. We’ve never actually done a face-to-face because I remember it was like right when I was… I don’t know if I had started to pick out the niche of dentists or not. Do you remember at all? Because I don’t think I had, I think I was just trying to figure out how to like cross my T’s, dot my I’s and figure out some basics. And I remember being internally conflicted about it.

Stephanie Bogan:
That was the whole point of retiring a few years ago was that I’m retired to part-time, right? I work 20, 25 hours a week, but I really, you and I could talk about this, but I went off and really kind of was really looking for just some space to clear my own head and think about what I wanted to do next.

Stephanie Bogan:
And I had, as everyone’s heard the story, young kids and had done great things at Genworth and United, but it was just really time for me to get some clarity about what I needed to do next. And that really for the next few years was just to spend time with my family. I had been like most entrepreneurs, very driven and grounded out and done all the hard work and obviously worked out in the end.

Stephanie Bogan:
And I didn’t walk away the next day. It wasn’t like I made the money and then bailed. I was around for the next four or five years because I genuinely loved the work. And I just got to a place where I needed that clarity of what was going to be next for me in terms of where I went and the work I was doing at United was incredible.

Stephanie Bogan:
We just built out the advice model, which has now become kind of the basis for the work they’re doing after the acquisition of Goldman Sachs. So it’s some of the best work that I’ve done in my career. I feel so proud of it. But we got our third round of funding in $40 million. And I signed off on every single deal that we did.

Stephanie Bogan:
Where it had been kind of balanced to that point, I knew very clearly it was going to be a rocket ship to the moon. I’ve done this a couple of times. I remember Joe was like, [inaudible 00:03:29]. And I was like, yeah, it’ll be five to seven. And literally it was seven years to the day or something.

Reese Harper:
That’s good of you to admit like that. It’s like you have preferences for how do you want to spend your time and anyone who’s been in a high, intense environment like that for, especially if it’s technology development, knows that it’s… Growing a service business and a consulting practice is very different than how it feels when you’re in the grind of a high-growth, expensive software or technology operation. I have been awakened to that in a way that I never realized.

Stephanie Bogan:
Well, they’re very different business and what I’ll call operating models, both from a mindset and from just from a culture, right? I mean, you could build things slowly over time and pace it out. You really could. But most of the time people are investing large sums of capital in an idea that they’re really excited about.

Stephanie Bogan:
So there’s a certain urgency that comes with that that is just different than running a planning firm. That urgency exists when you’re starting out and you have to pay your rent and you have no money in the bank. It’s that same kind of drive.

Stephanie Bogan:
But the difference is in a service business, this is where you end up with SAS and other things is recurring revenue is a really nice business model. And so the price of, I tell people, the price of entry in this profession is if you can get to 500,000 in revenue, you can do anything.

Stephanie Bogan:
A lot of people can hang out in. It’s not a bad place to hang out. I have advisors that have incredible lives, right? They’re taking home three, $400,000 a year. They work 30 hours a week. They have great clients in a niche that they love.

Stephanie Bogan:
And there are other people that really have ambitions to grow and do other things. And it’s for all of us, it’s about how we strike. How do we strike that balance? And that-

Reese Harper:
What drives you? As a person when you look at your values and the way you want to spend your time, what actually motivates you and keeps you feeling for me, feeling centered, happy content, peaceful? Those are all really important values I have. So when I’m saying, what keeps you there, I’m talking about comfortable, peaceful, loving your life, right? For some people that is different. What’s that for you?

Stephanie Bogan:
I think it’s about clarity on, I have this thing that I… This is of when I unretired, I sort of… There’s a story. Bob Barris had reached out to me and was talking to me about an issue that Angie Hebrews was going through. This is public, she’s talked about it on a podcast.

Stephanie Bogan:
And so he had reached out to me about talking with her, coaching with her through that. And we had a great conversation. And then he was really like, hey, I think you should unretire. And I was like, I would be happy to unretire truly. I can only run the PTA so many hours a day.

Stephanie Bogan:
It’s been four years. I could use my brain right now, but the things that I’m really interested in talking about, I’m not sure everyone is ready to hear me talk about. I was like, look, I went off and I had to get really clear on what my success was all about.

Stephanie Bogan:
And because it is that grind and the drive, and yes, tech is different than advice, but at the end of the day, we all have that inner wheel that’s calm and peaceful or grinding and driven or somewhere in between. And it’s not an all the time thing. It’s like a thermometer that moves up and down.

Stephanie Bogan:
And when you start an advice business, if you can get to the 500,000 mark, you can build a million dollar firm of $5 million. Because you’re proving that you can organize yourself, deliver good advice, put the bones of a business in place and get people to trust you with their money and then deliver some value around that.

Stephanie Bogan:
And you can do really well at two or three or 400,000, but that’s where most people tend to hit that first growth hurdle. And so that’s where a lot of advisors will typically stay under that 300, 350,000 mark.

Reese Harper:
When you say that growth hurdle, are we talking about… Is there something that comes to mind? Because when I hear you say that I’m thinking on my own experience back to that point in time going the hurdle was can I get someone else to deliver advice besides me? That felt like the hurdle. Is it or is it that? Is that one of them, or?

Stephanie Bogan:
It really is. And I think it just goes back to kind of where we started, which is the motivation for me is people ideas and experience in a way that really has impact. And so what I got really clear on was that the success that I had built was while very good, was also limiting.

Stephanie Bogan:
In that I hadn’t brought the sort of the most expanded mindset I had, right? So I really learned that for me, success was a form of striving. And that the way we think about our business and the decisions, choosing a niche, not a hard decision Reese. No, seriously, everyone, it’s not a hard decision.

Stephanie Bogan:
The business case for it is overwhelmingly clear. Niche practices grow two to three X faster. I have multiple dozens of cases that Evan literally, you can get to a half a million or a million dollars, 50 or 60% EBAC and work 30 hours a week and take months off. I have example after example after example, and many of them are built on niches.

Stephanie Bogan:
The reason that we don’t do the niche or hire that first service advisor to your point around the hurdle is because of the voices in our head. They create the crisis of confidence that shrinks us. Every decision that you ever made was what I call above the line, right? You’re in a positive powered in can do vision state.

Stephanie Bogan:
Everything is figureoutable, I’m going to make this happen. Everything else is below the line. It’s negative. It’s frustrating. It’s fear, uncertainty, doubt. A prospect challenges you on a fee, you’re either approaching that from an above the line place, I’m clear on my value.

Stephanie Bogan:
No, we don’t discount our fee because we don’t discount the quality of service or advice that we deliver. If someone needs another advisor, then that’s okay with us. That’s not the position of most advisors. There’s no business case for discounting your fee. There’s no business case for keeping a staff person that isn’t performing.

Stephanie Bogan:
There’s no business case for not having a niche if you want that kind of growth and income and time off. And yet it’s the voices in our head, right? It’s the invisible inkling as I like to call it in our head space that keeps us from the clarity that we need to make good decisions that align our businesses with our lives.

Stephanie Bogan:
And I say this a lot, but it’s really true. When your vision is clear, your decisions are easy. I didn’t say they’re comfortable or without capital or without time and effort, but the decision itself is easy. Let’s use your example. The first hurdle, I get to 300 or 350,000. I’m the average advisor.

Stephanie Bogan:
I’ve come in, I’ve decided I’m going to do this work. I’m going to add real value however I’ve chosen to do that. I go out and I find clients and then I start to find clients and I have to service those clients and I have to figure out how to service those clients.

Stephanie Bogan:
So I’ve got to do the work of servicing them and I have to be my own assistant and my own admin. And I do all the very unproductive things that people do. I check my email 17 times a day. I’m not focused. I work with anyone that has a pulse. So I’ve got a Roth conversion over here and an exit question over here and a 529 plan over here.

Stephanie Bogan:
And I’m meeting with people all year long. So I’m constantly turning through meetings. So as soon as I get marginally successful enough to pay my rent, I have generally laid myself with 30 or 40 or $50 an hour admin work and I don’t have a hyper efficient model for defining my services.

Stephanie Bogan:
Even if you have multiple types of clients, you can have a general service model. Here’s everything every client gets, a specialized service model. Here’s what retirees, little old ladies and business owners get. And then a personal service model. We were talking about this pre-call like, what does Bob need to hear from me?

Stephanie Bogan:
And most people never get to that because they’re too busy scrambling in a reactive way to provide that first level of service. And they’re frustrated with themselves because they know they can and should do better.

Reese Harper:
There is actually, for those of you who may not be familiar with, this there’s the… I don’t know where this originated. I think it was in Australia or something, but you made the comment about above the line below the line. A lot of people don’t really realize that that’s like a formal kind of thing that’s been studied.

Reese Harper:
And I just thought it’s so important when I asked what’s valuable to you, you said success is striving, but you quickly went to talking about above the line, below the line. Because I think when let’s just take this advisor, first hurdle they get to that below the line versus above the line thinking. I’m going to give you guys some examples.

Reese Harper:
Just go Google above the line, below the line. You’ll see like tons of diagrams on it. But below the line would be like, you see a problem when you’re at 400,000 of revenue and that problem is no one’s going to be able to be me. I’m the only me that could ever exist.

Reese Harper:
And so how could I possibly duplicate me because everyone likes me? Well, the truth is that’s true, but people like people and you’re just a person and you’re not the only person on the planet.

Reese Harper:
And so above the line thinker, right, there might go, I’m going to see… Instead of seeing a problem and seeing a failure in that scenario, they might see, well, if I put someone else in front of a client and I was really supportive and I really was encouraging, and I found a highly qualified person that I vetted its candidate and I give them enough at bats-

Stephanie Bogan:
I have to interrupt you right there because I and the voices in someone’s head are never going to let them get that far. So this is what I literally didn’t know this is what I was retiring to learn. It just so happened it’s what I retired to learn.

Stephanie Bogan:
I was like, I’m just going to go be a nobody on the beach and see what happens. And this is what happened, which is I picked up a book. I picked up a number of books and the thing that became very clear from neuroscience and just lots of Harvard body mind institute is that our consciousness, we are literally driven by our subconscious 90 to 95% of the time.

Stephanie Bogan:
We have 60 to 80,000 thoughts a day. Literally on average, about 60 thoughts, a day, 60,000 thoughts a day. 80% of them are subconscious. We don’t even know that we’re having them, but they know we’re having them. 80% of those are largely negative and 95% of those are on a continuous wheel. They just repeat and repeat.

Stephanie Bogan:
And you know it’s true. You feel like an imposter. There’s never enough time. I was on the phone with a client the other day. You want to know why he hasn’t grown? Because in his head growth equals complexity, time away from his family and stuff he doesn’t want.

Reese Harper:
Lifestyle is going to be out of control-

Stephanie Bogan:
And no joke, this was the actual conversation. So if we hire another person, it’s going to create the yes. We hired a person last year. Yes, what happened? My productivity went through the roof. We made this decision last year.

Stephanie Bogan:
Literally the three things that his brain, his subconscious just rattled off these are the things I’m afraid of, were all three things he had already done in phase one of our work and rocked. And all I got him to do was say them out loud. He was like, well, I hired the assistant last year and that was a total game changer.

Stephanie Bogan:
Yes, I guess hiring… So I call it reframing. And it’s because what I said is that, I call it living behind the curtain, is that our subconscious, our whatever fears, uncertainties, doubts, anxieties, or stresses, it’s usually not the happy voices in our head. They’re not your friends.

Stephanie Bogan:
They’re always there running the show until you are aware of them, can surface them, and then they cannot shrink you anymore. So most of advisors or entrepreneurs lack of success or the struggles that they get to have that balance and the harmony and the income and all those things we talked about, it’s not that it’s an impossible task.

Stephanie Bogan:
It’s that we don’t have the quality of thinking that will engender that kind of outcome. The tongue in our mouth and the tongue in our shoes are not moving in the same direction. If they were, I can make a really simple business case to your point for, oh right, when you get to that point, you should no longer be doing $50 an hour work.

Stephanie Bogan:
Can we agree on that? Yes. So then carve out even if it’s an hour or two hours a day, because I’m practical. I’m not the consultant of the podium that just goes and gives you theories that can’t actually be implemented. I’ve done all this stuff a gazillion times successfully.

Stephanie Bogan:
It works. Which is you carve out an hour or two in your day to be your admin. Instead of doing it 17 times when you’re in the email and you’re doing it this way, and you’re doing it that way, and you put all those stuff in a folder called admin. And then during that hour or two a day, you act as your admin.

Stephanie Bogan:
You contain the $50 an hour work while you financially are required to if that is in fact the case. And then as soon as you get to a place, as soon as you pass the rent and ramen stage, as soon as you pass rent and ramen, right? You can pay your rent and you can eat some ramen, you invest in not doing the $50 an hour work.

Stephanie Bogan:
If that means you hire a virtual assistant five hours a week, then that’s what you mean. Because if the goal is to have a practice that allows you to do things and leave, someone has to be manning the phone, right? Someone has to be doing the paperwork. So we have this whole thing around energy, creating revenue, producing activities. That’s what I want my clients doing everything else.

Stephanie Bogan:
The entourage needs to handle. The entourage can be a part-time person, five hours a week, depending on how you build the practice. But ultimately those are the first hurdles is you get to the place where you have to decide, am I going to people, process and platform? So you can get through packaging. I know billion dollar firms that don’t have a-

Reese Harper:
Wait, hold on. You’re going to a new concept. Let’s just tie the button on the old one of… So this is above the line below the line, thinking the summary, we’re going to kind of put a bow on this is… I’m going to say what I think it is and you restate what you think it is maybe in your own words.

Reese Harper:
So above the line for me is where people stay open and curious and they listen and they try new things and they continue to say, will this be possible? Maybe I can, maybe I can, maybe I can. And below the line is it won’t work because, it won’t work because, it won’t work because, or that’s broken. That’s kind of how I frame it. What would you add to that?

Stephanie Bogan:
If you take a piece of paper and you draw a line left to right across it and you draw plus above it, right? That’s your positive, what I call your success state. Positive can do empowered. The key word in this state, one word is empowered. When you are empowered, everything is figureoutable.

Stephanie Bogan:
You will find a way or you will make one. When you were empowered with the vision, like you went off and you figured it out, people come up with money out of nowhere. They find time out. They work till 11. When you are empowered, you will always find a way to make one. The problem is that we spend on average, and this is what the study shows, 70 to 80% of our days in a stress state, every one of us.

Stephanie Bogan:
That means that 70% of the time, your brain is being flooded with adrenaline, noradrenaline, cortisol, not good for cognitive thinking. It shuts down your conscious prefrontal cortex, the thinking part of your brain. It puts you truly in survival state.

Stephanie Bogan:
If you’re one of those people that’s feeling overwhelmed and you go to work, feeling frustrated and you get up and your brain starts spinning, whether you know it or not, you are living in survival state. Nothing great happens here, nothing. All your best ideas, all your problems that got solved happened in that success state.

Stephanie Bogan:
So people come to me for strategies all the time, and they wonder how I get these fabulous hockey stick results. We’re just going to skyrocket. And I’m like, it was very simple. I start by elevating people’s thinking. If you can get yourself into that positive can-do state, which requires that you understand that what’s holding you down, are those limiting, I call them BS, belief systems stories.

Stephanie Bogan:
I’m not good enough. I can’t charge that. My clients will leave me. If I tell the prospect no to the discount, the COI will never… I’ve solved every one of those problems a thousand times successfully. No one has ever come back to me and said, Stephanie, that didn’t work. It was awful. It just doesn’t happen because we know what success leaves us.

Stephanie Bogan:
So our job is to get into that success state, which means getting really clear on when you are below the line. Here’s how you know. You don’t feel good. You just don’t feel good. It’s so simple. And we’re so caught up in the spin that we miss it.

Stephanie Bogan:
When you’re sitting there feeling overwhelmed and you’re in email for the 16th time of day, the email checking and the overwhelmed feeling, both of them are below the line. Your mindset and your methods are below the line.

Reese Harper:
I think that’s really great summary. And that’s probably, to me it’s so valuable to spend a little bit of time on the psychology of building a company, right? Building an advisory firm is mostly a mental kind of battle of personal evolution and growth, right? And it’s less some of the quick fixes that you think it might be, right?

Stephanie Bogan:
I’m going to say this in a way that is not intended to sound trivial, but this is what I love about business. It’s a game. It’s a chess game. Everyone listening to this phone call, to this podcast has access to the same information, the same resources, the same financial service providers, the same coaches, the same clients, the same staff.

Stephanie Bogan:
If you don’t like it, you can move. There are no real reasons for someone else to be more successful than you, except that they did things you weren’t willing to do, right? They made different choices. And the biggest things that hold us back aren’t how we execute. It’s the choices that we make that lead to what we execute around, right?

Stephanie Bogan:
The number of people that have clients with discounts, 10, 20, 30, $40,000 a year that they’re giving up in revenue. So it’s really about clarity of what do you want to create with your practice? If you want a lifestyle practice, that’s different than adding a service advisor and building a small ensemble, which is different than building a big ensemble.

Stephanie Bogan:
And so to your point, we hit those hurdles along the way. And the only thing that stops us from evolving, and evolving doesn’t have to mean more revenue and AUM. And that’s one of the disservices of our space. Evolving can mean working with those 80 or 100 clients really deeply and taking half the time off to raise your six kids, like one of our advisors is doing.

Stephanie Bogan:
So it’s really about what is a wildly successful practice and a life that you love? And then can you flip the switch? And instead of spending 70 or 80% of the time in a stress state where you’re overwhelmed and you’re anxious and you’re not feeling good enough and you’re uncertain and you’re in the, oh, this is so hard.

Stephanie Bogan:
Can you flip that switch and spend 70% of your time above the line, or at least bring that thinking to more of your decision-making? And the results are radical Reese. When you get in an above the line state, you have a lot more clarity about what’s happening really. Not just, hey, this is the circumstance. It’s not a prospect asking for discount.

Stephanie Bogan:
It’s a prospect who doesn’t have value alignment, and I need to be clear on mine. And when you get that around every aspect of the business, man, the results they tend to show.

Abby Morton:
I know one of your biggest challenges is delivering a consistent financial planning experience to your clients on an ongoing basis. You get off to a good start onboarding a client, and then what? There just doesn’t seem to be a good process for nurturing the new relationship.

Abby Morton:
The Elements financial planning system can help you easily organize and evaluate client financial data. Then based on key indicators of their financial health, deliver timely insights to your clients. Using our system gives you the structure you need for ongoing planning. To learn more, schedule a time to talk to us today by going to getelements.com/meet.

Stephanie Bogan:
It’s really interesting when I was a United and we used money guide pro, right? So I built that process around a score, right? Like you pick your score, build thermometer, right? Green, yellow, red. And it was just because I wanted them to have a bogey that they looked at and they went I’m okay, all good.

Stephanie Bogan:
I’m not okay, what do I need to? What’s my advisor need to be talking to me about? So we called that the funding, right? You’re funded. And then we use that as the bogey. So basically built the client engagement process into an interactive model, essentially what you’re doing via the phone app. But the idea was to take the entirety of the plan.

Stephanie Bogan:
We can have some really interesting conversations about what you could do with this app because I built it all in my head. I’ve built the backend of it. And then right after I left the team that I had in place, we took everything that we had built and then they built out what is now the tech version of money mind on his conversations, the guidebook.

Stephanie Bogan:
All of that was baked in. But I was talking with Jason Wink at Altruist, and that was one of the ideas that I gave him. Another one, I was like, dude, I don’t understand someone should just do this. I will get this idea. Why don’t I own my data? Why don’t I have a box? Why don’t I have a personal box?

Stephanie Bogan:
Why have mot someone created a website where I just put in all my data once? I own that data. And then I give you permission so that when I go to my bank or I go to my lender or I go to my financial advisor, I go to my accountant and they’re like, hey, we need your K1s and we need your this. Here you go, it’s all in my vault.

Stephanie Bogan:
I’ve given you access to the vault with my tax returns. I’ve turned on the data points that populate your CRM and your uploaded financial planning intake form. And it’s the simplest thing on the planet. But when someone figures it out, that is the game changer. People are not going to be okay, passing their data off.

Stephanie Bogan:
The only reason that we’re okay with it is no one has presented us with an alternative. No one has said, here’s a box, you put all your data in. And when you’re financial advisor and we’ve auto-populated the data points in our system that should go to your financial advisor and you just accept or decline, and then you can turn on or off that separate account from your brother-in-law that you don’t want them to know.

Stephanie Bogan:
So easy. We’re in this messy, middle period where people want their data and they want their privacy, but they haven’t decided what they’re willing to do for it, right? Like right now they’ll complain about privacy, but they say yes to every cookie on the phone. And they’re like, well, whatever they’re doing with it, I want them to market to me.

Stephanie Bogan:
So we’re in that space of learning. So that’s the thing. It’s a frontier idea. So just acknowledge that it’s a frontier idea and other players in this space are going to help move that needle because ultimately it’s inevitable. It’s a choice function, right? You’re seeing the work that they’re doing. DuckDuckGo is a web browser.

Stephanie Bogan:
I was on something the other day. I can’t remember what it was. And it was do you want to allow us to use this data to gather information on you and give you things that you might want? I mean, it’s a fair point, right? Maybe I want you to send me all the best dresses that fit my style. But what we’re moving into is an era of intentional choice.

Stephanie Bogan:
And so you’ve got a solution that’s just ahead of the market, but the people who set the trend, everybody knows, they need this. Every time someone goes to their accountant and they ask for information or we’re buying the house that we’re in. And I’m just like, oh my God, why does [inaudible 00:27:13].

Stephanie Bogan:
So the demand for privacy and figuring out what to do that we’re still in that stage where we’re figuring it out. But we are going to emerge unquestionably on the other side of people wanting to own their data or we’re moving into a society where people give up all control. And I’m not sure I want to be part of that society.

Reese Harper:
Yeah, I don’t think they’ll go there. I think you’re right. It takes a lot of time to educate the consumer on financial issues. And I think most people want it free. And so we built mobile first to answer your question because that’s where clients live and that’s where they want to be. And financial advisors need engagement from clients. They need engagement and you can’t get engagement through the web. No one’s on no one’s using their desktop.

Stephanie Bogan:
No one stands to their computer. They barely do. I mean, I can’t tell you though, aside from work, I can’t tell you the last time that I sat down on a computer to check my personal email.

Reese Harper:
Yeah, exactly. And advisors are sending emails to clients and saying, can you do this for me? Clients are getting those emails usually on their phone, opening it and going, yeah, I’ll do that at some point when I get back to the computer and then it’s just like out of sight, out of mind. And what we’re trying to do is have a good push notification system that’s really thoughtful, text integrated so that, hey, is this value correct? Just hit the green button.

Stephanie Bogan:
Have you built in any kind of client… Can you do client communications? Like, hey, it’s time for your upcoming…

Reese Harper:
Not personalized. Right now, all the advisors that join have to adopt the entire system. And there is client communications on quarterly reviews. There’s client communications on reminders. There’s a prompt engine that pings clients based on data points. The AI that we’re building is pretty sophisticated and it just recognizes net worth and fields and data and says, we need to bring this prompt in the highest priority order to this client.

Stephanie Bogan:
We do a lot of work with Karl Richardson, our coaching group. And I’m working with him on the business side of things, his strategy and IP and stuff. And we were just having this conversation with our advisors. I was like, look, the problem is with servicing and client meetings.

Stephanie Bogan:
And just the advice delivery process is that we tell people, we want people to understand that financial planning is a process, not an event. But nothing in the way that we engage with clients says that. We literally sit them down once, maybe twice a stick a bunch of paper and file them. And like, let’s get through this and then we can check the box and you can get on with your life.

Stephanie Bogan:
That is going to get you the kind of… What we’ve done in our coaching based on that model is that one, it’s a one-page financial plan. And by that, I mean, it’s like, what’s important to you. What are we focused on right now? Because that’s the focal point of all client meetings is not my agenda. Your agenda.

Stephanie Bogan:
My agenda, some systems should be telling me what is on the agenda. So what we’ve done in our model, the coaches are building their own because they don’t have a software platform, but this is where it could get interesting. We have basically taught them to, with radical success, we are redefining the advice model. I’m kind of about that.

Stephanie Bogan:
So literally our coaches are talking to clients about client stuff in the meetings, and the planning is happening on a quarterly, monthly basis. Like January, we have Roth Tobar, right? So every October we call them value adds. So instead of sitting down in a meeting and cramming it all in with the client was just like, we got to talk about this and your taxes and your insurance.

Stephanie Bogan:
You don’t get to what really matters to them, is we put down on a schedule, which is, hey, for this kind of client retirees, right, in January, you’re going to send this kind of a piece. And they basically build a system inside their CRM that implements that serve. We can get it down with the CRM.

Stephanie Bogan:
You will probably be able to do the same thing. Because I’ve done this in private client relationships before where I can print out the agenda and have things highlighted in terms of like, these are the things that we need to talk about or that are missing. You can then build the service model so that depending on the type of client and their life cycle.

Stephanie Bogan:
You’re an early career dentist versus late career dentist. You can layer into that service model, touchpoints, value adds, personal professional. So the idea is the tech system is you literally have the system know this is a dentist in late stage with these interests. And when that pops up in the system, it’s like, oh, July is for this type of client.

Stephanie Bogan:
July is a personal touch. And the system has decided that these are options that you can choose from. Would you like to send one of these articles or this? You’re not going to start there, but you can ultimately get it so higher ecosystem, including the personalized specialized part is governed by the tech.

Reese Harper:
Okay, a couple more questions before we wrap up here. What’s the main challenge from a human capital perspective? The main human capital challenge that presents advisors from scaling.

Stephanie Bogan:
Trust and delegation.

Reese Harper:
So it’s a psychological. Your response leans towards this mindset.

Stephanie Bogan:
Let me reframe it for you and then you can tell me what the problem is. So advisor comes to me, this is pretty typical. Literally true story. I’m not making this stuff up. I’ve had someone on my team for almost three years. So we’re doing a practice audit where we go and I assess everything, right? Wingtip to wingtip.

Stephanie Bogan:
And then we come back and we’re like, hey, to get to the next level, so you’ve got to stop doing. Here’s what you need to start doing, the skinny of it. So we have this meeting and I say, we really need to realign our staffing strategy and what we’re doing. And he’s kind of, I’ve had this person and she’s been with me almost three years.

Stephanie Bogan:
And it’s just not working. I can’t get it to work. And I was like, okay, just want to be clear on a couple of things, yeah. Did you hire this person? Yes, I did. Did you train this person? Yes, I did. Who’s been managing this person for the last three years? I have.

Stephanie Bogan:
So you hire this person, you train this person and you’ve managed this person while knowingly having problems for three years? Yes. Have you had a lot of conversations about that? Well, I mean, when things go wrong, she knows I get frustrated. I was like, so you take the, I roll my eyeballs approach. And he was like, well, I guess, yeah.

Stephanie Bogan:
And things kind of said, okay, so you hired this person, you train this person and you manage this person and you still think this person is the problem. And he was like, yeah, when you put it that way. I was like, okay, did we hire the right person? Probably not. Did we train them in a way that gave them the best chance of success?

Stephanie Bogan:
Now we put them in the chair, let them click their heels together three times, spun them around. Said there’s no place like home and told them to go figure it out. And then we want them to be mind readers and get it done without standards or systems.

Stephanie Bogan:
We just want them to know and deliver excellence just like we would, except we don’t want them to have that same risk reward relationship. We want to pay peanuts and get monkeys, but we want them to act like managing directors and to get the same kind of results that we would when we struggled to get those same results if we’re being really honest.

Stephanie Bogan:
And so, I could do this all day long. Not to beat anybody up, this is just the nature of how most advisors manage people. It’s not their great love. And we really just want to say, hey, do this and make it work for me. And there are ways to make that easier and better and there are ways not to. And you also have to know who you are.

Stephanie Bogan:
Some people really don’t want to manage people. Virtual staff are really good resources for those people because the management quotient is less, but you give up things and that you don’t have someone there. You don’t have one person doing everything you can.

Stephanie Bogan:
So there’s just a lot of variables, but honestly, I think it comes with, I hate to… I mean, I there’s always the methods, but it’s the mindset behind the methods. We tend to hire in a rush. We tend to interview and that’s the worst possible hiring screening process ever, right? We don’t have good processes.

Stephanie Bogan:
We don’t have good questions. We talk more than they do in the interviews. And then we end up with people that we manage in usually not the most productive ways and then we get really frustrated at them. And honestly, that’s not leadership.

Stephanie Bogan:
So being a solo or a silo, you’ve got to really ask yourself what level of leadership do I want in my practice? And then that’s what you’ve got to be willing to take on if you’re going to hire service advisors and do those other things.

Reese Harper:
I’m kind of curious on your opinion around how much do you see the industry consolidating in financial services because of this dynamic, right? Usually consolidation happens when a big company comes around and says, I’m sharing this not for your benefit, Stephanie, but for the audience mostly, but consolidation occurs usually when these things are so hard to do on your own that a bigger company with more resources says, we’ll do all of that stuff.

Reese Harper:
You just come and do your part, talk to people, be the advisor, be the thoughtful listener, the coach. And I’ll tell you after having built an advisory firm and now being part of a software startup, it sounds really good a lot of days, right?

Reese Harper:
To just go sit in a chair, talk to people and then do nothing, but talk to them. I love that idea. And so I think a lot of people are going to be attracted. That problem is look at what happened in the past, Northwestern Mutual, Mass Mutual, Guardian, New York Life, all of these like institutions, Merrill Lynch and Smith Barney, and City.

Reese Harper:
People are leaving those large enterprises to go boutique, but it’s pretty hard to run your own shop. The RA market is growing like crazy, but it’s super hard, right? So what’s the future look like? And I kind of want to wrap with this, your painting of the future of the industry.

Stephanie Bogan:
So I will not say it’s easy because that would be really annoying, right? Like, oh, she’s done it. It’s great on the other side of the fence, right? What I will say is its way simpler than we let it be. And simple can be really hard because of when I talk about the behavior code that really works to create new levels of success is its mindset plus methods.

Stephanie Bogan:
It can’t just be philosophy. I spend 20% of my time talking about philosophy with clients and 80% of my time talking about strategy and methods, but that 20% really matters because you’ve got to know where you’re going and why and what you want to build. And the more clarity you have, the easier it becomes.

Stephanie Bogan:
Truly our biggest issue is that we are muddled in terms of what we really want for many of the reasons that you mentioned. I can’t, I don’t want to, and I don’t know how are the three biggest things I hear and none of them are viable in my world. I’m not asking you to jump off a building and not die, right?

Stephanie Bogan:
I’m saying you can double your income and your time off, no question, period, end of story. It can absolutely be done. The question is, are you clear on the outcome that you want to create? And are you in a head space where you can make those choices in a way that moves you forward? And I think this is really relevant to the industry and this space, right?

Stephanie Bogan:
I work with very large firms like Genworth United, Carson, right? Building the platforms of where it’s going. So I see and I know the ideas that we’re putting into that in terms of what’s possible and where the tech will go.

Stephanie Bogan:
It’s not something I’d really want to compete with if I didn’t have it, which is why I created limitless coaching and that whole coaching community was because there are groups of advisors that there are larger firms that, non wirehouses that you can join. But there’s a huge independence to this space and people want to do it their way.

Stephanie Bogan:
It’s why you created the app, right? So they had the latitude to do that outside of a larger firm that locks them into the rest of the ecosystem, right? Which is why it’s that. It’s got real legs as an idea.

Stephanie Bogan:
You’re taking a piece that’s really important and you’re not locking them into… You’re not putting them captured to the rest of the business and what investment models because it’s a series of decisions that you’re asking people to make when they join a firm or they build a tech and it’s changed and our brains hate to change.

Stephanie Bogan:
It actually registers that excitement and fear register exactly the same. And change registers way over on the fear, scale, even good change. So in terms of where the industry is going, I was just having a really, if you want to go Twitter me, I was having a really good social media debate with Jeff at Michael Keith’s office.

Stephanie Bogan:
It was a positive debate, but it was about whether or not planning is becoming commoditized. And I was making a strong, I thought, a very strong case that it is. And he was like, I don’t really think it’s commoditized yet. And I was like, if I laid down 50 financial plans, you couldn’t tell me the difference.

Stephanie Bogan:
And my client’s plans will actually be the finished on the table. And I hands down tell you that they’re going to be among the best advisors. At face value when you can’t tell the difference between A, B and C, it’s commoditized. Planning of in and of itself is I can go online and push a button and get plans and projections.

Stephanie Bogan:
The value is advice, not information. So whatever firms do, I think two things. One, I think unless you are a pure investment shop and want to stay that way, which is not typically where I spend a lot of my time, is advice is the cornerstone. You want to get really clear on who the target client is.

Stephanie Bogan:
If you can niche or at least specialize within your general practice, that is going to be very much to your advantage because what the market is moving towards is an experience economy. And this is the kicker. And this is the part that I don’t know that everyone always catches is look at the model for the future.

Stephanie Bogan:
Where was tech 10 years ago? Where was tech? What was your relationship with tech 20 years ago, 10 years ago, five years ago, today? Add the rate of acceleration, what’s it going to be like in five or 10 years? In order to succeed, I do believe, I don’t believe you have to get swallowed up or bought or that you’re going to get crushed.

Stephanie Bogan:
I think that you’re going to suffocate from service compression, which is you’re going to have to keep adding more and more value to keep up with all the clients that I’m working with and that the big firms are working with building all this deep value at scale. So you’re going to have to do more and more, and you’re not going to be able to charge for it.

Stephanie Bogan:
I think you’re going to see that more than you’re going to see pricing compression and you’re going to see that experience quotient. People are now very clear that an advisor who specializes in them, and this is only going to increase, two states away, but who only works with dental practices and knows me cold.

Stephanie Bogan:
I can hear him and be like, oh my God, he’s in my mail, is not going to compete the same as Bob Smith down the road because he’s down the road. Because Bob Smith’s general practice and his meeting and showing up and being like, oh, you had a kid, I guess we should do a 529 plan. No, that should have been started the second I mentioned it.

Stephanie Bogan:
You should have sent me the paperwork because your system told you to. So the advisors that are smaller do not have to go away, but you really need to specialize your business model and your client model and your systems, your service model so that you have what I call a bionic business.

Stephanie Bogan:
I’m dating myself, but if you remember the bionic man episode and the bionic woman, right, where they had the artificial limb, tech is not an option. I told you before, I love tech and I don’t want to be the person building it, managing it or maintaining it. I just know that it is the equivalent of people in the future.

Stephanie Bogan:
We need people, but 80% of what we’re doing doesn’t require that. We just haven’t embedded it in the system in a thoughtful, intentional way. And we can. So when people tell me this is hard, I’m like no, making the commitment is hard because it means so much to you. Nothing is good or bad. It’s just the story that we tell ourselves.

Stephanie Bogan:
If I do this, the voices in your head say it will mean some form of fear, uncertainty, doubt, anxiety, or stress that feeds the story I already have. I’m not good enough, I can’t, I don’t want to. So all those things that you said, you’re absolutely right, but I’m going to challenge every one of them, which is if someone says to me, well, I can’t do that because.

Stephanie Bogan:
I’m going to say you can’t do that because you haven’t made up your mind to, because people who’ve made up their mind to have done it time and time again. That it might mean that you don’t want to. Maybe you’re 65 and you’re like, it’s just not worth it. Don’t do it.

Stephanie Bogan:
I’m not going to tell you, you have to, but what I am going to do is tell you what your possibilities are and I’m going to do it without in any way shrinking away from talking about the pain points that are holding you back. And if you can get clear on those and get honest about what to do with them, you can create really radical changes in success in your business.

Reese Harper:
Well, Stephanie, thanks so much. It’s been a blast catching up again. I feel like me and you could definitely go for a few rounds of this. We didn’t even get to all of our questions today, but I just really appreciate your focus in your own life on an industry that you’ve kind of really tried to specialize in yourself, right?

Reese Harper:
I think there’s a lot of coaches and consultants that do very broad business consulting. And you’re a good example of someone who’s really carved out that niche in the industry and tried to really add a ton of value outside of the standard kind of business protocols that are normally in place to give people coaching.

Reese Harper:
So thank you for all you’re doing, thanks for your energy and passion for the industry. And I just look forward to having you back on. I’ll let you leave with the last word today.

Stephanie Bogan:
Well, the thing I’d just like to leave with people is that you really can build a wildly successful business and a life that you love, right? It’s just about you start by elevating your thinking and that will absolutely elevate the experience that you have.

Stephanie Bogan:
If you can master your mindset and your methods, that’s where you really can get that hockey stick effect. So just remember that life is now in session and your job is to make the absolute most of it, whatever that means to you.

Reese Harper:
Thanks, Stephanie. We look forward to catching up again soon.

Stephanie Bogan:
My pleasure.

Abby Morton:
Next time on Elementality.

Reese Harper:
Half of your clients will nod with you and pretend like they know what you’re talking about. Even if you put a nice, robust financial statement in front of them with dozens of asset classes and groupings, they’ll nod and pretend like they know what you’re talking about, but they don’t. They do not know what you’re talking about.

Reese Harper:
And you’re advanced way beyond where they’re at, and you’ve done things so many times that they have never seen that what you think is obvious, to them is like Greek.

Abby Morton:
You can learn more about the Elements financial planning system at getelements.com/meet and schedule a time to speak with one of our friendly financial planning experts. Elementality’s executive creators are Reese Harper and Chad Jardine. Elementality is produced by Abby Morton and directed by Jordan Haynes. Have a good one.

 

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