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#11 Brendan Frazier – Transcript

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SUMMARY KEYWORDS

client, people, thinking, money, advisors, questions, financial planning, product, spending, behavior, psychology, advice, human, life, retire, planning, guests, industry, financial, essentialism

SPEAKERS

Brendan Frazer, Louis van der Merwe

 

Louis van der Merwe 

Welcome to another episode of financial planners, South Africa. I’m really excited today to have someone that I’ve been listening to a lot. And you know, it feels like I really know you random. It’s Brendan Frasier from the human side of money. If that doesn’t sound familiar to you, please check out his podcast. We’ll talk about it on today’s show. We’ll talk a little bit about how he got into the industry, what’s broken, you know, how and how he’s making a change across the globe. Brendon. Thanks so much for joining me today.

 

Brendan Frazer 

Yeah, thanks for having me on. I’m excited for what you’re doing. And happy to be here and get a chance to spread the message about the human side of money, like you said, around the globe. And honestly, it’s one of the coolest parts about this experience has been just getting to see how there’s a lot of there may be differences as far as like, you know, well, first of all, the name of money worldwide, right? Like the currencies are different. Maybe some of the technical skills are different, but people are people, whether you’re in the US, you’re in the UK, you’re in Australia, South Africa, that people are people, and you’re dealing with an emotionally charged topic of money. And so that concept that that seems to translate well around the globe.

 

Louis van der Merwe 

Absolutely. I was listening to Kim potgieter yesterday, and she’s quite forward thinking in terms of your money and your relationship. And she was saying that the first history or your first memory of money comes in at about the age of seven. I mean, that’s, that’s crazy. And oftentimes, we don’t even realize that.

 

Brendan Frazer 

Yeah, we had somebody on the show that pointed that out to me as well, which blew my mind. And as a parent of two young boys just thought to myself, wow, no pressure, you know, like, there will probably be some moment when we’re sitting there like at dinner or you know, interacting where I say something or do something that’ll forever impact the relationship that they have with money. I’ve heard the term one term called financial Flashpoint. So it’s a point in your life where you don’t even really realize it, but it’s so it’s a point in your life that forever shapes the way that you think, feel and behave around money, and they mostly happen. And early on in your childhood, I mean, no pressure at all you parents out there,

 

Louis van der Merwe 

you’re in the same boat as if we feel that pressure if you’re a parent and a financial planner, and you’re worried about these things. Yeah. As if worrying about clients is not enough. That’s right. So you started this podcast a year and a half ago, right? And you’re getting all the big names across the globe? Like, what started this process? And you know, how did you take that first step?

 

Brendan Frazer 

Yeah. So we’re, I think the best way to explain it is to go back and talk about a meeting that I was in about four years ago, maybe five years ago now. So I used to consult with financial advisors. So the cool thing is, I get to consult with 1000s of advisors, which means you get to see a lot of the best of the best, you get to see some of the not so great things that do we all know, exist that’s out there. But I also got to sit in on a lot of client meetings. So I got to be a part of like seeing how these advisors were working with their clients. And we’re just I’m not going to go into the details, because it doesn’t make for great audio. But it was one meeting where this advisor had been working with these clients for is at least 10 years. And so ever since they started working together, the whole goal was to get this couple to the point where their husband could retire. So they could, you know, do the things that everybody says they want to do when they retire. So this meeting was because that he was finally to a point where he is going to be able to retire, right? So they were coming in, we put together this income plan for him to show him how he could live the rest of his life off of the money he had saved and he could retire didn’t have to work anymore. And so he comes in, and he sits down he’s across the advisor and I are on one side, he and his wife are on the other and we put up on the screen the the financial planning software at the projection that shows hey, here’s if you do these things, you can retire, you’re going to live off of your investments that you’ve been saving up for this is the moment you’ve been waiting for your whole life, right? So if we look up there it was I think it was like a 93% probability of success that he could never outlive his money and live and retire and then be happy. And so in that moment, I remember thinking like, as I looked across the table, that should be a couple that’s filled with joy or relief or happiness, or, you know, this is the moment they’ve been planning for and they on the screen they saw a successful picture they’d always envision Alright, so here we are. Look across the table. And it wasn’t joy that was painted on his face. It was it was an image of fear. But it just just straight fear and it was obvious it was palpable. So he the adviser asked, you know, kind of like, Hey, you know, you don’t seem to be he seemed a little bit hesitant or something that’s not really clicking here. And he said, He’s like, I get I get this, I get that I can do it. But I can’t stomach my money being invested in the market when it’s the money that I have to live off of the fund my lifestyle. And so the advisor said, Okay, well let’s look at what it would look like if we didn’t invest your money, right? If you wanted to feel safe, feel more comfortable, what would that look like? So he changes the allocation reruns the scenario puts it up on the screen and all of a sudden, the probability of success drops down to the mid 70s. Alright, so that if there was ever a moment where facts and numbers and visual should prevail, where you would think that you can make the best decision based off of numbers alone, that would be it, right? Like, if you want to retire this option, option one gives you a 93% probability of success. Option two gives you 75. Clearly, there’s a best option, right? Well, he didn’t he didn’t go with that option. He said, I can’t stomach it, I can’t do it, I get the numbers say that it was this clear moment of, you know, logics, no match for emotion. And so I remember thinking in that moment, it didn’t matter what he did, that advisor did from a technical standpoint, from building the plan, the portfolio, none of that was going to give the client the life that he’d wanted it what that advisor needed was a completely different skill set to be able to guide the client through what he was thinking and feeling in order to make the best decision. And so that was an eye opening moment for me. And then so I started asking, after that, I started asking these advisors when I would meet with them, you know, like, what, how much of your time do you feel like is spent learning how to deal with the human side of things, right? Like their psychology, behavior and emotions, because I would hear all the time, you know, Britain, and sometimes I feel like I’m more of a psychologist than I am a financial planner, or sometimes I wish I had a degree in psychology instead of a degree in finance or economics. So I just kind of started asking him, how, like, what are you doing? Or what do you do to get better at the human side, essentially, and everybody would just say, like, wow, I mean, I know it’s important, but we don’t really get any training, we don’t really have any resources to get better at it. So it was this moment of like, okay, hang on, wait a minute. There. We everybody. Most people admit that it’s unnecessary or admit that it’s important that it’s crucial that it helps in the relationship, but nobody knows where to go, to get the resources to do it. So that’s kind of where the idea was born was a out of a need. And it’d be out of my weird, oddly strange passion for human behavior in psychology, I’ve always kind of enjoyed it anyways. And so I heard the camp to wrap this up here, I was having this thought already. And then I’m walking my dog one day, and I hear a podcast for this guy says, if all we needed was more information, we’d be billionaires with six packs, you may have heard me say before, because I say it all the time. And I just remember that sinking in like he’s right, we don’t need more information, we don’t need the best technical knowledge, we need somebody to change behavior. So that’s kind of where this the we’re wired planning in the podcast was born was there’s a gap here that exists where there’s information and knowledge out there, there’s people out there that know, that are experts on psychology, behavior, and behavioral finance. But we need to translate those concepts into practical application for financial advisors, so they can turn around and use it with their clients. And so the podcast was just simply meant to be a bridge between those experts, and then the financial advice community. So we have these guests on that are great at what they do. They are great at those dimensions of behavior, psychology, communication, emotion, and basically just have them on and talk to us about what we need to know, as advisors to better work with our clients to get better outcomes to date to grow our practice,

 

Louis van der Merwe 

young. What I love about the human side of money is that you make it so practical, you know, these worksheets that you can download, you can literally the next day, say okay, I’m going to implement this with my clients. The best part is also that you know, you’re doing this day to day as well. So you’ve got a group of clients that you serve as well. How’s your relationship with those clients change since you started doing this podcast?

 

Brendan Frazer 

Oh, that’s, that’s a really good question. Nobody’s asked me that before. So. Yeah, I mean, I think that’s probably changed. I’ve always believed in the importance of like, mapping your money to meaning and using money to fund the life that you want to live and being able to help somebody identify, not just the fact that they want to retire, but like, what does that look like? vividly And clearly, by think what it’s really done is probably just helped me take it to a whole new level as far as like maybe I thought that I had done an effective job at like helping somebody really clarify their vision. Maybe I thought that I that I was doing a good job listening, right. Maybe I thought that you know that I was helping that I was getting somebody to where they wanted to go but all it’s done is open my eyes to the fact that there’s a lot more that I don’t know. So, as far as like it, I think the main thing I’ve done is probably just learn how to change my process in a way that’s more human centered, and less what the industry or the classic way of doing things, right. It’s less about the product. It’s less about just churning people through To get numbers, it’s less about putting together a great financial plan and expecting the client to follow through on it. It’s more about thinking through the human element at every step, for example, like, Okay, I know a lot of us struggle with this. This is one of the common things I hear and get questions about is data gathering, right? A gathering client documents gathering your data, it always takes longer than expected your there’s always a follow up process, but instead of like, thinking through it from the lens of like, Matt, well, yeah, if they’re serious about this, they’re going to get it to me, like taking a step back and going, Okay, what is it that they’re thinking and feeling in that moment, that may be preventing them from getting us what we need? And then where are our systems and processes? Where are they layered with friction that we don’t even notice? Right? So like, just looking at it from more of a human centered lens and saying, These are real people, that we probably have friction in our process, if they’re not getting it to us, like the way that they’re supposed to, there’s ways to make it better. So it’s more of a just an eye, you know, the phrase there the whole idea of the more you know, the more you don’t know, that’s kind of what it’s done. For me. It’s just kind of show me like, as much as I thought that I knew there’s a lot that I really don’t know.

 

Louis van der Merwe 

Yeah, that conscious incompetence, saying, Oh, we thought you were doing this, this really well. But actually, there’s a better way and our clients become the guinea pigs, hey, of the these these different ways? Yeah, it was one set at a at a presentation for a coaching course, and the presenter was pitching the score saying, turn to the guy next to you and, and greet him, and then tell him how much you earn. Right, and everyone pushed back. And now we can relate that to our clients. And you know, these these people coming into a first meeting and actually having to open up their whole lives without us building that trust and creating a comfort, safe space for them. Yeah, what are the practical steps that you take to make it easier, you know, like in those first couple of meetings, just to ease people and kind of get them to say, Okay, let’s start this process, and I feel comfortable moving forward.

 

Brendan Frazer 

Yeah, that’s really great question, because i and this is something where whenever I first started out, I wrote about it in one of the articles, but like, I think this is an area where we can also look to other fields to think through like, hey, how do we truly get somebody to open up and tell us some of the things that they don’t often tell really eat most other people in their lives? Right. And I think it’s important to also recognize that, like, we’re asking people to talk to us about things that they just don’t talk to many other people about. And much, I mean, they probably don’t even talk to their best friends about when they’ve had two or three bottles of wine, in fact, so the question is, yeah, what can we how can we facilitate that, and I think there’s something to be said about, when somebody comes in there, they’re more willing to talk about the more open to talk about it, because they know that in order to get the result that they want, they have to open up a little bit. Right, but but there’s still an art to being able to get somebody from just regurgitating or throwing out their financial data, to actually talking about something that’s truly emotional to him. And not to mention the fact that some people can come in and think, Hey, you know, you’re a financial advisor, you’re not a therapist, right? There’s always this fear of like, Am I gonna wonder why I’m trying to ask about what they what they want, they’re, what their family values are, for example, right? So there’s one thing that I think right out of a gay, it’s important to think through what is it that goes through somebody’s mind when they come into that first meeting, or a discovery meeting, where you’re trying to uncover as much valuable information as you can from somebody, and they come in wanting two things, their brain needs to know two things? What can I can I trust this person? Do I like this person? That’s actually one do I like and trust them. And number two, is they want certainty, the certainty and the peace of mind to know that you are the person that’s fully equipped and able to solve their problems. They don’t care about your as Carl Richard said, they don’t care about your solutions. They care about their problems, and they want the certainty when they walk out in the clarity to know that you’re the best person to do that. So there’s a study done. This was several years ago, where they had two groups of people. And there are 1000s of conversations had in two separate groups. And on one hand, there was a group where they were given 15 minutes to people that didn’t know each other. So that cross from a table given 15 minutes in that group, first group is instructed to ask nine questions in a 15 minute period. group number two had the same 15 minutes, but they could ask no more than four questions over a 15 minute period. So group one, nine questions in 15 minutes, group two for questions, and 15 minutes. So after 1000s of those conversations, the researchers go back they do the research that they do there. They look through their studies, and they asked the participants what the result like what they felt, what they learn. And their findings were twofold. One, that the people that asked nine questions were both more liked and trusted, and that they felt more heard and understood. And so if your job in that first meeting, is to get somebody to like and trust you and to create the certainty that they want to know that you can do what they want done, and they want to, they want to make sure that you have the information that you need to do it. And then questions are a superpower to accomplishing both of those things. Now, that being said, in one of our episodes, we had a guest on Samantha llama. She’s a behavioral researcher at Morningstar. And she said that when she went into a meet with an advisor for the first time, she and she’s in the industry, she goes in, she sits down, the advisor asks her within two minutes. So what are your goals? And she and it kind of makes sense. But just hearing her say, it was interesting how she said that it kind of she felt taken aback as if like, you know, I just met you, I thought, why am I talking about these goals? So I say that to say, you’ve got to earn your right, to get the information that you want, you have to earn your right to ask the more vulnerable question. So as a follow up to that study, what there’s another study done about questions, or they put two people together, they didn’t know each other. And they’ve had in one of the groups, they had them ask a structured, ordered set of questions where they escalated and intensity and vulnerability. And those those the people that had that conversation reported being more well liked. And were gaining more valuable information than those that just randomly ask questions that they came about. So I say that to say this questions are the superpower to getting people to open up to get them talking. But you can’t just ask the question. You can’t just go right out of the gate guns blazing, saying, Hey, tell me about your most, your most the worst financial decision you’ve ever made, you have to earn your right to get there by ordering instruction, your questions in a way that warm them up. So like on the on the podcast, for example, it’s very intentional, the beginning of every episode is asking somebody asking the guests to tell us about their journey, from where they are from where they were, and where they are today, how they got to this intersection of behavior and finance, or psychology and money, right? It’s very intentional, because you’re asking somebody to do something that does two things, it’s a story that they know, and they’re comfortable telling. So it gets them in a state of like revealing and talking, so they get comfortable talking. And then it’s a positive emotion and a positive experience. So you’re creating this positive flow right out of the gate that says sets the table lays the foundation for the rest of the conversation. So if you can do that, that’s going to eventually yield more information as you go. And then one last thing, I would say that’s probably the, I’m gonna say maybe the most important, it’s just this the concept that the most powerful question you can ask any client, a friend or colleague, your spouse, as a follow up question? Not basically. Because if you think about it, when somebody is talking to you, they’re always wondering, do they care? Are they listening? Should I keep going? And what follow up questions do is they immediately signal to the other person, that you are interested that you do care, and that you want to know more. So just simply asking follow up questions to clarify what somebody said, is going to open the floodgates of information, maybe more so than anything else that you can do.

 

Louis van der Merwe 

Can uncouple that with, you know, being present? Because you can’t ask a really good follow up question. If your mind is wandering, or you’re not actively engaged. And like you said, it has to be human centered. It’s human centered advice. Yeah, a big pushback, we always get around the kind of, you know, coaching human side of money approaches that, oh, this will take way longer. And my clients don’t care about these. They just want a product solution. What is your response to that? I’d love to hear it from the man that does this. Yeah, I

 

Brendan Frazer 

mean, okay, so I think it’s twofold. What so one, I asked George kynar, the same question. So for those of you that, I guess most people probably know George Kennan, if you don’t know, George, you know, George ginder. He’s the father of life planning. And so that’s what I wanted to ask him, right was like, because he’s been doing this for 30 years. So I have my thoughts. I’m happy to share him. I asked him the same thing. I thought, you know, that one of the things one of the hesitations I’ve heard around this idea of with life planning anyways, are getting deep and understanding somebody and their values and their emotions is that it’s not scalable, like, how can I it’s not scalable? How do I do this? it because it takes more time. And basically what he said was like, when you have a process of how to do it, it may take a little bit more time, but it’s not going to take that much more time. It’s just about having a process and a system and being used to it and getting comfortable with it. But ultimately, let’s say cuz I think it does take more time, right? selling a product is always going to take less time than truly transforming somebody’s life. I think you really have to ask yourself, what is it that you do for your clients and you If you want to just sell a product, that’s, that’s fine. You’re probably not the type of person it’s gonna get. It’s gonna want to know what somebody’s clear, vivid vision is for the life that they want to live, what their values are and what their emotions are, their what their beliefs are. Because it does, quite frankly, it does take longer than I think it should take longer. But here’s the thing. You have to you also have to ask yourself, What are you in this for? Right? Are you in this game, if you’re thinking about, you want to build a practice where you can transform lives, and you get to work with clients and retain clients for a long period of time, their client that there’s a there’s a Harvard Business Review study that says emotionally connected clients are six times more likely to consolidate assets, emotionally connected, clients refer more, they follow through on your advice more, and they consolidate assets more often. So is it more work? Yes. I don’t think that I can’t figure out a way around that. Does it take more time? Certainly. But does it yield results both in the clients lives and in your business in a way that just selling a product? Never can? Yeah, absolutely.

 

Louis van der Merwe 

So it’s, it might take longer, but the effect of that work that you’re putting in scales rapidly, right? Yeah, well, yeah, I

 

Brendan Frazer 

would say it scales. It may not feel rapid, though, right? Like if you’re thinking about, and a lot of it’s intangible, too, right? Like, how are you It’s hard. It’s hard to tie the fact that you spent more time with somebody to the fact that you got a referral from their friend, or it’s hard to tie the fact that you’ve spent more time uncovering somebody’s vision to the fact that they’re better at following through on your advice than the person that doesn’t have that same that same vision, right. So that’s the that’s the challenge of this whole. This the human side of money in humans, devices, a lot of it’s not quantifiable, it’s this, it’s an intangible benefit that those of us that have experienced it know, but it’s really hard to quantify it for an industry that’s very numbers oriented.

 

Louis van der Merwe 

Yeah, that shifts happening rapidly, you know, people saying, Oh, this feels like a much better approach. And I feel more comfortable, and I can build a lifestyle business. And before the call, you mentioned a couple of things that you want to combination in, I still have a balance in life. When you started out building your practice, like, how did you decide on how much time you’re going to be allocating on working with clients versus doing other things like your podcast and creating content?

 

Brendan Frazer 

Yeah, I wish that I had just like the prototype, great, you know, write a book about this answer to that. But I don’t think that I do. And the other funny thing that I questioned myself on all the time as I started both of them, right is we’re about to have our first child. And now we have two kids. And so it’s like two businesses with two kids under three. So it’s just, it’s, it’s, it’s fun, but you know, it’s a challenge at the same time. And of course, as most people know, when you’re when you’re launching your business, right, like, a lot of you, when you think about how to allocate your time, a lot of it’s just allocating towards prospecting, towards talking to people meeting people spreading the message, because that’s what you have a lot of time to do at that point. So I’ve had to just I’ve had to learn the importance of of, like, being super, it’s nothing, this isn’t sexy advice, by any means. There’s nothing like you, there’s no hack in here. It’s just truly like looking at my, my week in my day, every single day and thinking like, well, these are the things that I need to get done that I have to get done, what can I eliminate that keeps me from that. And then just prioritizing it and getting it done. I mean, and and but at the same time, like wanting to be, you know, a great dad and a great spouse and present at home and I don’t have a perfect solution, nor by any means do i do it perfectly. It’s really, I think the biggest piece of advice I can give us read the book essentialism, which basically helps you think through like how to prioritize your life. And then just basically going in everyday thinking, you know, what are my what are the things what are the most what’s the highest and best use of my time and it’s meant that I’ve been able to do less, you know, I used to just I love to sit around watching sports and reading about sports and you know, I used to every night I would go to go get coffee with anybody and everybody wanted to get coffee and I’m having to truly start thinking about like hey, you know, I’ve got to I’ve got to look at my time a lot more intentionally than I ever did before I think Yeah, me kids are a big piece of that but yes, I that there’s no I’m not sure that I have the magic bullet or the you know, the bullet proof formula there but it I think the main thing I try to stress to people all the time too because I work with a lot of parents that run businesses or and so we always have these conversations around. How do we best allocate our time if our focus is on being the best ad the best parent, you know that the best business owner around our activities, lining up to that do our is at the top, we were out allocating our time, does it indicate that and so I guess I’ll say this kind of as a final thought that I’ve stolen from somebody else, I think so important. So good is if you truly want to see somebody or somebody’s actions and intentions lie, all you have to do is open up their calendar and their checkbook, right and see where they’re spending their time and spending their money. And that’ll tell you what you’re at what your intentions truly are. So if you think that it’s really important to you to be a great dad, a great parent, and a great business owner, go look and see, based on your calendar, where you’re spending your time is that where your energy is flowing? It can be a humbling realization, too. Don’t get me wrong. But that was that’s a good piece of advice, I got a while back to that’s been helpful.

 

Louis van der Merwe 

That’s so true. And what strikes me is the part that, you know, oftentimes, we’ll look at a client spending, and we’ll see where their money is going, and they can’t really hide. But I’ve never asked a client to Hey, print out your calendar and show us what you’ve spent your time and Okay, how does that align to your values? And that might be a really worthwhile discussion to have with the client to say, actually, if I’m going to be your accountability coach, and partly talk about, you know, getting you to live the best life that you want to live it talk about how you spend your time, and you know, are you have energy to, to live on that?

 

 

Yeah, yeah, no,

 

Brendan Frazer 

that’s a running thought that I’ve had while running before. Right is like, I feel like if you can, there must be maybe there’s a way I don’t know this for sure. Like, we can see how people spend their money, right? We know that part. But what if we also like as a part of a gap data gathering process got an inventory of how they spent their time, or even helped them don’t have to spend their time because I mean, that’s, you’re helping them live the best life they want to live money is one way, one way to accomplish that. But like, you can have all the money in the world. But if you’re not spending your time in alignment with your values, it doesn’t matter. So anyways, I don’t know. I haven’t done that. I don’t there may be somebody that does. I’m sure there probably is actually. But I’m with you. I think that’d be a fascinating way thing to do,

 

Louis van der Merwe 

like a time resource audit. Yeah, yeah. And I want to echo that book. essentialism, I think Maura summers also spoke about it on your on your call, saying she reads it annually, and it just helps her refocus. And if you don’t know who Moira summers is to get advice that sticks. It’s probably one of their financial planning books. And I’m guessing you’re also a super avid reader, because one of your questions in your shows always like trying to find out what clients are reading or what your guests are reading. What’s on your stack. I’m assuming it’s on a Kindle or on a kind of shelf at the moment, like, what are you consuming at the moment.

 

Brendan Frazer 

So I’m one of those weird people. And this is not I’m kind of like a dying breed where like, if I get if I’m going to read a book, I’m reading it in hand like the Kindle, I, first of all, I know I should use a Kindle, just I can’t do it. And part of the reason is because I want a library in my house one day. Another part of the reason is because you can like something about holding in my hand, I comprehend it better. But so I just finished essentialism, which for those of you so for the longest time, I thought in my mind, like I said, essentially so I get the concept, right, do the things you’re supposed to do. Don’t do the things you’re not It seems pretty simple. So for the longest time, I didn’t read it because I kind of figured like, Oh, I get it. Well, it did. If you’ve ever thought that just read it, you’ll be glad that you did. I just how to change by Katie Millman. So she’s a professor at Penn University, Penn, she just wrote the book How to change and being interested in fascinated by human behavior and changing behavior. That one obviously went to the top of the list. There’s a book called flip the script by Oren klaff. So it’s about how to communicate how to basically wire somebody’s brain so that it’s ready to receive the message that you’re going to give, and specific ways to do that, which I which is really interesting. And then a book called, it’s actually I’ve got to read over here. So I’m looking at it, it’s called sprint, solve big problems and test new ideas in just five days. So essentially, it’s, well, that pretty much sums it up. But it’s the guy it’s from a group at Google who would implement the sprint process where they take five day periods and go from nothing to prototype and know if it was going to be effective or not. So just from, you know, a we’re working on some courses and some coaching, some coaching and some online courses, wire planning. And so I’m kind of using that as a way to think through how to best design these for wood advisors one what they’ll use,

 

Louis van der Merwe 

oh, and I just talking about the courses and the content. And what we’re talking about reminds me of the change in the CFP board’s allocation to the psychology of money I think they they named it

 

Brendan Frazer 

and your psychology, your financial planning, yes, psychology

 

Louis van der Merwe 

or financial planning. And it feels like you’re kind of 100% aligned with this wave of people saying, hey, I need to be listening to the bread and the TED clauses of the world and studying incorporating psychology. So how far do we push the human side of money into psychology and maybe even financial therapy. Is there a limit in your mind? And and what is that?

 

Brendan Frazer 

Yeah, I don’t know, I really don’t. And I’m never afraid to say I don’t know, if I really don’t know the answer to that question. I think that’s kind of what I’m experimenting with as well are trying to figure out as well as like, where How far do we go? I mean, here’s what I think we know for sure. Is that this the industry that we’re in, if you go back, technology’s always been evolving and adapting in a way that’s forced us to change and shift our value proposition. Right. So you could want at once may have been stockbrokers because nobody had access to the stock markets. Well, technology gave them access technologies, given them information technologies, given them a robo advisor who can who can build a portfolio and manage it at a lower cost with more liability, and it does it a little bit faster, right. So not saying that not demeaning the value of investment advice. But what I am saying is that if you look out there, historically, technology is always shifted our value. And what we’ve what we’ve tried to do is continue to run away from it by the pursuit of more technical knowledge, right? So the most recent example is okay, robo advisors come out, investment management starting to become more commoditized, we realize that nobody can really beat the market, and it’s just a low cost index funds are oftentimes the most, the most cost efficient and return efficient way to invest money. So what’s our next pivot? Well, we’re gonna go into comprehensive wealth management and financial planning, right? So we can’t do investments, let’s at least do financial planning and look at somebody’s life as a whole. And give them the point. Well, now you’ve got technology coming along, that’s doing financial planning, and it’s free and available to the masses. So Bank of America big bank here, in its first six months in existence with its free financial planning software had 3 million users, right. So that’s 6 million for the year, it’s only going to keep growing. So now financial planning is available to the masses. So I say that to say not that, I don’t think that well, we could all be wrong. I don’t think the technology is going to replace the value of technical knowledge completely. What I do think, is that it’s shifting the value moreso to the human side of advice and human side of money than I think than it is right now. So it’s certainly going to keep shifting that way, right. So if a computer can do what you do, at a lower cost at a faster speed, and more reliably, those things that you do that I can do better, it’s time to kind of start thinking about Alright, should I let the computer do that, for lack of better term technology, the computer do that? And then what does that mean, I should do? Well, the next natural step in transition is to take the to do what a computer can’t do, and that what a computer can’t do is sit down and talk through somebody with their about their values and emotions around it. They can’t replicate that.

 

Louis van der Merwe 

Yeah, that marginal value that you’re adding, you know, are you adding value in the right area of that someone’s life? And is it worth spending the time and energy and resources in crafting those skills? And it feels like you’re almost looking 10 or 20 years down the road saying, hey, what are the skills that we would need, then? And let’s start working on it today. And here’s, here’s the resources that you need to start doing that.

 

Brendan Frazer 

Yeah, I mean, I would argue that there shows that you need now I just think they’re going to become more critical in the future. Right? So if you’re, if you’re already if you’re ahead of the game, doing it now you’re, you’re, you’re already separating yourself and adapting for the future where those were, those skills are much more critical than they are now. Yeah,

 

Louis van der Merwe 

so the product implementation component, specifically in South Africa is often lead with the product, which is commissioned based. Yeah. So yeah, you know, someone would work for another insurance business, distributing product. And then, you know, they would add on financial planning, and maybe a little bit of coaching to that, or do we have to approach it through the component saying, Hey, we require independent advice, and it kind of that fiduciary first component? Or is there is there a role for coaching and the human side of money in the product distribution side of the world? Yeah, I

 

Brendan Frazer 

think there’s still a role. And I say that, because I know there’s, there’s people, there’s models here in the US that are similar, where it’s product focused product based product forward with like, the advice or the plan kind of sprinkled in afterwards. But I still think at the end of the day, if you’re selling a product even so let’s not talk about what the best way is to go about it to truly transform somebody’s finances in their life. But is it possible to do it through the product route? I think the answers are I mean, I know the answer is yes, because you’re still working with an emotional human on their emotionally charged topic of money. And even when you’re selling a product, you still have to connect with somebody, you still have to be able to build trust, build credibility, create some certainty like we were talking about earlier. So it’s still important, it’s still relevant. And we can even look at it through this lens tos. Like a lot of what we talk about with advisors all the time is not just like the plan itself, but the implementation and the follow through. So that applies to the product side, too, is but just better understanding how to get somebody to apply or to buy in to purchase the product, not just know that they need it, but to actually purchase it Now, again, the conversation around is it let me say this? I think there’s a way that’s more effective. I think it’s I don’t think it’s the product route. But I know that that sometimes you can’t help what you’re doing. If you’re there to sell a product, you’re selling a product. What if you’re truly in the business of uncovering clients values and emotions around money, you want to guide them through the process and change their behavior for the better? help them live the life that they want to live? There’s a better the product routes? Probably not the way to do that. But is there still a human behavioral psychological side that’s applicable? Where you can help people? Certainly,

 

Louis van der Merwe 

yeah, that’s a great point. Because oftentimes, we want to postpone working on these things until we get another piece, right in the business saying, I have to do this first, before I can start working on this. And what you’re saying is, hey, actually, you need to you need to be using this, if you want to make a difference in people’s lives and actually get them to take action. Yeah, and a lot of your episodes are around, you know, someone moving from that, hey, I’m not ready. I haven’t been thinking about action, that kind of pre contemplative stage to actually moving closer to, you know, taking action in your kind of framework of how you approach things like how do you guide your clients through getting to a point where they’re ready to take action?

 

Brendan Frazer 

Yeah, so let me first give a shout out to Meghan lurtz. Do you know Megan, have you read her work?

 

Louis van der Merwe 

Big fan?

 

Brendan Frazer 

Okay. Yeah, so I think she’s do I’m on record as saying, I think she’s putting out some of the absolute best content in the industry right now on just the human side of money is what I guess what I’m familiar with calling it but just how to get people to change how to deal with human beings. So she writes for kitsis, comm nerds I view in every week, I look. And there’s a new article out and I’m looking at it going, how does she do this? This is unreal. And if you’re if you’re interested in hearing from her, we had her on the show Episode 10, talking about how to bridge the gap between your current and future self. So that I really liked that question, because that’s one that we think through think through with a lot with advisors is where do you How can you implement this in your process in your practice in your process, to get people to move and change behavior. So the first thing you have to do is start with what we call the friction and fuel assessment. So start thinking through where in your process where in your practice, you experience, the most friction, or maybe another way to think of it as this is, what if you could remove one part of your process? At any point, you’re, at any point working with clients, you get to move one part, and it would make the rest of it infinitely easier? What would it be? So the three areas where we hear that most often are data gathering, or no sorry, backup, going from prospect to client, then once they use get them to silence their client going from client to data gathering, getting them to actually send you all their documents, which is not only a hard task, but also an emotional one, because they’re opening up their financial life for you. And then after that is the actual implementation of the advice that you give, right. And so there, there’s a number of things you can do, like tactically small things, you can do it for each of those, what I would say is this, we’re looking for just one thing you can do, that makes the biggest difference to spur and ignite behavior change at any point at all three points in the process. It’s getting somebody to be clear and vivid and in touch with their why their values and their visions and understanding why they’re doing it and what you do for them. So for example, I use this example a lot. So if you’ve heard it before, I apologize. But I think it’s it’s relevant, it’s important. So if you want somebody to go from you have somebody in your office there, they’re a prospect or call it you want the you know, they’d be a good client, you want them to be a client, the best way to get them from potential client to client is to show them the fact that you can get them from where they are to this clear vision of where they want to be. You can transport them, you transform them into that result that they want. Right. So that doesn’t mean that nobody gets excited about hey, you know, you Brendan’s gonna be the guy that gets me to retirement like that doesn’t fire anybody. But what will fire somebody up as if they think to themselves, if you get if, you know, if you help them get to the point where they know it’s not just retirement, it’s the fact that I get to go two times a year to Disney World with my Two kids and four grandkids where we’re going to stay at the swan and dolphin and spend this time together go into these parks have very vivid real description. That’s just one example. And it’s one that I give a lot because it’s I’ve seen it in practice so many times. But that, but that, but just uncovering the fact that that’s their vision, that’s what they really want, which is hard to do, by the way, and then also acknowledging through that, that what they really want isn’t to retire, they want to spend more time with their family, the people they love the most, don’t show them how to go from a chart, don’t show them the path to where they are to retirement, show them the path from where they are, to this exact life that they want to live that they just described to you, they just told you about. Alright. And then once you do that, they and they have the certainty that you’re the person to give them that result. Because you’ve had the conversation within it sounds nothing like any the conversation they’ve had with anybody else, then now you’ve got the prospect the client, all of a sudden when they’re a client, and you need to gather all their documents and all their data, which is a cumbersome task. There, they’ve got the back when I said the fuel friction and fuel thing, this is the fuel part. So give them the fuel to become a client. And then once they know what they’re working towards, they’ve got the fuel to gather the documents, they are more motivated to do it. And it’s not just about motivation, this isn’t a foolproof solution. But it certainly ignites behavior change in a way very few other things can. And then once they get the documents, because they’ve got this vision of why they’re doing it, the actual implementation of the advice, maybe it’s, hey, you’re gonna get there in five years. But to do that, you’ve got to start putting away $1,000 a month to get there. All of a sudden, putting away $1,000 a month isn’t as painful if you know the vivid reason why you’re doing In fact, there’s Morningstar did a study that showed that the number one predictor determinant of savings behavior isn’t income, it’s not age, it’s not gender, it’s not education, it’s truly their vivid color, their clarity and vividness around their future self. So there’s it without trying without getting into too many things I want to give one thing you can do that impacts the most friction, heavy areas of the process. And that’s, and that’s just one thing, again, it doesn’t just automatically make everything a seamless move from one at one end to the next. But it’s something that makes a big difference in every phase.

 

Louis van der Merwe 

It feels like you’re engaging all sensors, you know, when they’re creating this picture of what it is that they can be achieving. And someone once said about, you know, reflecting back on that once you’ve achieved it, like what changes for you, and how do you feel? And now I can just imagine how great that conversation must be when someone realizes, oh, it’s not the retirement, you know, it’s spending time with my grandkids, you know, experiencing Disney World and having these great experiences? Yeah, yeah, it’s

 

Brendan Frazer 

kind of funny to think about this, like, you would think that most people would know that, you think that they would make that connection. But the reality is, they just haven’t really taken the time for giving yourself the space to understand that that’s really what it’s about, which is why there’s value in you having the conversation to open their eyes to the fact that to make that connection. And again, like I said a second ago, I can assure you from having worked with all these advisors, at least in the states anyway, I guess I’ve maybe it’s different elsewhere. But I can assure you that if you’re having that conversation, you’re gonna sound a lot different than 99% of the other advisors out there if you’re in a competitive situation.

 

Louis van der Merwe 

Yeah, yeah. What strikes me is that, you know, you mentioned that clients are going from from prospects and then client and then you start working with him, when South Africans often you know, if you don’t take this advice, and you don’t implement it, you don’t become a client. So does it work different? Do someone actually commit saying, Okay, now I’m going to work with you. And then it’s a matter of do we start this process unopposed to win with here, it’s a you have to implement the advice, otherwise, you don’t become a client.

 

Brendan Frazer 

So we I mean, we have both models to I guess it, I keep speaking to what I’ve come to believe and philosophically think is the best way to do it. Right. But that doesn’t mean that everybody does it that way. And I get that. So to your point, but I think no matter how you structure it, like, you still have to convince a person to become a client, whether it’s through implementation, or just the fact that you can give them the advice that they need. So in my example of prospect to data gathering, to implementation, yeah, I mean, you could probably the concept still applies, maybe you just break down the data gathering wall, and it’s, you’re going, Okay, I want this prospect to become to implement the product that I have that I want to use, but to do that, but you’re still battling, going from prospects earning somebody’s trust, right. This is ultimately what becoming a prospect to client as they become a client by implementing, if you give them the fuel for what they’re doing it for They’re going to go from prospect to client, they’re going to implement a lot faster than if they just think they’re doing it because it’s going to give them a better return.

 

Louis van der Merwe 

Yeah, yeah. And and it sounds like they’re almost committing to that saying, hey, let’s work together, let’s figure this out. And then there might be a financial product or, you know, in the future they might not be.

 

Brendan Frazer 

That’s exactly right. I mean, if nothing else, at the end of the day, you’ve connected with them, you’ve created a relationship with somebody that’s unlike what they’ve seen and heard from most other financial professionals, so that they have more needs later on. If you ever get into if you ever transition out and get into a more or less product centric, industry or job, you’ve still got the relationship and the connection with somebody, because of the fact that you did these things in the beginning.

 

Louis van der Merwe 

Yeah, yeah. And bring away is it that you see this industry going? You know, is it completely removed from product where we change? You know, our roles are what we do? Or is there always going to be kind of a link to these? Are there going to be different structures? Yeah, I’m just wondering how you see future financial planning?

 

Brendan Frazer 

Yeah. So first of all, I love that question. Second of all, whatever I say is guaranteed to be wrong, right. But there’s anything I know, it’s that, you know, if there’s anything I’ve learned from this industry, it’s that future forecasts and trying to predict what’s going to happen is pretty much you know, an exercise in being wrong. But if so, this is what I like to think through it like this. And this is the what I call the Amazon principle. So and some people may have heard of this before, but when they asked Jeff Bezos, CEO of Amazon, like, what is he going to? What are they working on? 10 years from now? What are they working on in the future? What are they working towards? What are they evolving towards? His answer was, everybody wants to know what we’re going to do differently? And what we’re going to change what’s going to happen that we need to be ready for, he says, I focus on the things that I know that aren’t going to change. So what are what are things that are gonna change? People want low cost, and they want things delivered quickly? And he knows he’s like, we know that’s not gonna change. Are there other ways that we can distribute? Yeah, the pricing model is going to change maybe. But if we focus on the things, we know that we aren’t going to change the low costs and fast delivery, we’re always going to be successful. And I think that’s a powerful way to look at the future of this industry. And the way that it’s evolving as far as how to position yourself as we can sit here and try to predict what technology is going to look like in 10 years. But you know, it speaking of behavioral biases, there’s this thing called the planning fallacy where we’re terrible planners, we never think your things ever happen as fast as we think they’re going to end. So in my mind in 10 or 20 years, it’ll be an industry that’s just strictly based on giving financial advice without any products, or you’re doing financial plans, and there’s a focus on the human side of money. Is that gonna happen? Probably not. So let’s think there, what are the things that don’t change? What are the what are the core pillars of like of money, and people in finance that we can think about that don’t change to position for it, one thing we know that doesn’t change is that information doesn’t yield results, right? If all we needed, if all we needed was information, we’d be billionaires with six packs, we wouldn’t have failing businesses failing marriages, we wouldn’t people wouldn’t be obese, we know how to do these things. That’s never gonna change when information is never going to give us results. Because it’s not an information problem. It’s an execution problem, which means there’s always going to be value and helping to change somebody’s behavior for the better. And so if you can, if you want to think about how to where it’s going, and where we want to focus our time, efforts and energy to be best positioned for the future of financial planning. That’s why I mean, I’m biased certainly don’t get me wrong. But that’s why I’m so passionate about this message of the human side of money is because when I look at it from a business standpoint, even think through like your my business, 10 and 20 years from now, I think I could be wrong. But I think that’s still going to be valuable in 10 or 20 years there. And that’s still going to be something that people are going to want 10 to 20 years from now, as somebody that can sit down, understand their values, their emotions, help them uncover those things, and then change their behavior for the better.

 

Louis van der Merwe 

Yeah, that God that God someone through life transitions and just, you know, being there to support them. Yeah.

 

Brendan Frazer 

Yeah, I mean, absolutely. I that could change. I mean, I suppose it could just seems like if it does, it’ll probably be a while.

 

Louis van der Merwe 

And wide planning is leading that change.

 

Brendan Frazer 

Yeah. Well, it that’s the goal, right? Yeah. That’s the goal. Brilliant. Brendon.

 

Louis van der Merwe 

This has been a ton of fun. I’m really looking forward to watching your presentation. Next Gen. Coming out. Yeah, shortly and continuing just to consume these world class thought leaders in the human side of money. I have to ask you, like, how do you approach your guests like do you just shoot them a message and say, Hey, I need you to come on. And have you had many kickbacks?

 

Brendan Frazer 

So, essentially, the answer to that is yes. What I this is out of the gate. This is just by accident. What I did was I put so I’m on Twitter and LinkedIn, if anybody’s on Twitter and LinkedIn, you follow me on there, come find me on there, say, hey, it’s what I did was I put out this question to the VIN twit, and then the LinkedIn, financial, Twitter and everything on the LinkedIn community, and then the financial Twitter community, and just said, Hey, if you could have a roundtable discussion, it’s a question I asked on the podcast now, but I asked it before, if you could have a roundtable discussion of anybody to talk about behavior, psychology and money. who would it be? So I got a long list of all these possible answers. And then people are tagged in the in the responses, right? So that I just went to a couple people and said, like, hey, the people want to hear from you would you want to come on the show. And that’s kind of how it sort of how it started, was just reaching out that way, via sometimes on social media, sometimes on on email. But then now, it’s kind of cool when I mean it, you’ll see this too. But now it’s to the point where you have people that are reaching out to you that want to come on, or you reach out to a guest, and they know that you’re aware of it, or they see that you’ve had other guests on that they that they’re in circles with that they sort of associate themselves with, so they’d sort of this shortcut in their mind that it’s a, you know, this is a good use of my time. So that being said, I have to thank the guests that I’ve had on. Because it’s mean without them, it’s there’s no show, there’s no there’s very little value to be had. And so they’ve been awesome, and they’re a big reason for the success that I’ve had. So I try to thank them every chance I can get.

 

Louis van der Merwe 

I love that social nudge that you’ve used just to get them in hated disappoint your fans.

 

Brendan Frazer 

Well, this that was I wish I could say that that was intentional. But the reality is that I it was sort of by accident.

 

Louis van der Merwe 

Well, it’s a extremely valuable resource. So if you haven’t listened to the show, you know, please check out the human side of money. And subscribe to the newsletter. It definitely is one of the most valuable resources in the industry. So you’re not kidding that wrong. Brendan, you mentioned people can get hold of you on LinkedIn and Twitter is there anywhere else they need to have a look at?

 

Brendan Frazer 

Well, if you’re if you like podcasts, you’re listening to this, you probably do, check out the human side of money, see what you think. And then, like you mentioned, we’ve got the monster month we sent out a newsletter to advisors, it’s basically roundup of behavior, psychology, communication with some nuggets about how to apply it to your practice and get great feedback on that. So you can go to the website, wire, plenti.com, elite, nothing else, you can go there and kind of check out the mission, what we’re doing, and then you can sign up for that newsletter there. Or check out the podcast, follow me on LinkedIn or Twitter. I tell everybody that I learn the most and get the best ideas for content and guests and what to be talking about from the conversations and interactions that I have with advisors. So that’s invaluable, so don’t hesitate, reach out. I love interacting. And Lynne learned a ton from it.

 

Louis van der Merwe 

Brilliant. And we’ll wrap the day. Thank you so much. Right? Yeah,

 

Brendan Frazer 

thanks for having me on. I really appreciate it.

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