RPF-0065-Financial_Planning_Designation_for_my_own_Knowledge

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00:00:14.600 | Radical Personal Finance podcast live today from the country financial stage

00:00:21.240 | in downtown New Orleans, Louisiana at FinCon 2014.

00:00:27.040 | Welcome to the Radical Personal Finance podcast. My name is Joshua Sheets and I'm your host. Thank

00:00:48.240 | you for being here. Today's show is a little bit different. I'm looking out at a crowded

00:00:52.200 | lobby full of people. Never done this before. Gonna do some live podcasting talking about

00:00:59.200 | how should I set up a plan for personal financial education. Hope you enjoy it.

00:01:05.640 | It's kind of interesting to be here in downtown New Orleans, Louisiana. It's kind of interesting,

00:01:20.360 | kind of weird to be looking at a crowd of faces of people looking at me. Never had the

00:01:24.640 | opportunity to do that before. But it should be a fun show. Today I'm gonna handle a question

00:01:30.200 | from a listener. I knew that I was gonna be doing a show here in front of a room full

00:01:34.600 | of people that are interested, have an above average interest in personal finance. And

00:01:40.640 | as I thought about what would be interesting, I thought of a question that I received from

00:01:45.160 | an audience member named Jeff who had sent me an email. And Jeff had emailed me a question

00:01:49.120 | and he said, "Joshua, I've been listening to your podcast ever since I found them a

00:01:53.000 | few weeks ago. Here's my question. Do you think that I should pursue earning a financial

00:01:57.920 | planning or retirement planning certificate just for the sake of learning? I have no interest

00:02:02.760 | in becoming a financial or retirement planner, but have been learning as much as I can for

00:02:06.640 | the last few years, books, podcasts, blogs, Boglehead forums, et cetera. I've learned

00:02:12.440 | a lot about investing, retirement planning, tax planning, estate planning, personal finance,

00:02:17.600 | et cetera. I guess I don't know what I don't know. What should I consider when deciding

00:02:23.000 | whether or not to earn a certification? Thanks, Jeff." And when Jeff sent me that email, I

00:02:28.440 | just started thinking about it and I thought, what an intelligent question. And it covers

00:02:33.600 | some things that I personally am a huge fan of. Because A, it's financial education. I

00:02:41.000 | guess I should say A, it's finance, and B, it's education. I know that I personally am

00:02:45.480 | not moderately obsessed with education. It also covers something that I'm probably -- I

00:02:49.320 | hate to beat my own drum, but I probably am uniquely qualified to talk about and share

00:02:54.360 | with people. If you're not familiar, I think I have CFP, CLU, CHFC, CASL, CAP, RHU, REBC.

00:03:03.960 | So I've gone through seven courses of study for financial certifications and financial

00:03:08.840 | designations and I'm actually this next week going up to Pennsylvania to finish a master's

00:03:13.860 | degree in financial planning. So I've had the unique opportunity to kind of see both

00:03:17.960 | sides and talk about both sides of the fence to understand, you know, really what really

00:03:22.560 | works and what doesn't work. I'm also a former personal finance junkie, so I can really relate

00:03:26.760 | with what Jeff talks about and I can relate with his question. Because one of the biggest

00:03:33.060 | things that I've learned, I learned when I became a financial advisor, is that the personal

00:03:36.680 | finance world got me really far, but there was an entirely different level that I never

00:03:42.680 | would have had a peek into if I hadn't had the opportunity to study financial planning

00:03:46.440 | formally. So before I get into specifics in answer to Jeff's question, what I'd like to

00:03:53.080 | do is just start with just some conversation about education. And where I would begin is

00:03:58.120 | basically to start with why would you do anything? Why would you set out on a path of education

00:04:05.880 | or certification? The reality is, is that we really do have a limited amount of time.

00:04:12.560 | And for every choice that we choose to make, there is an opportunity cost. And the opportunity

00:04:16.440 | cost is what we give up. So if you're going to spend your time studying financial planning

00:04:20.720 | education, you're going to spend your time studying, you know, CFP curriculum or CFA

00:04:25.920 | curriculum or whatever it is that you're doing, that means that that's time you're not spending

00:04:29.520 | on other things. And you've really got to, before you commit that time, before you commit

00:04:33.040 | time to reading a book, before you commit time to anything like that, you really got

00:04:38.380 | to understand why you're doing it. One of the first things, there's a great classic

00:04:42.880 | book by a guy named Mortimer Adler, who was actually the chief editor for the, not Wikipedia,

00:04:48.200 | the Encyclopedia Britannica encyclopedia for years. And he wrote a phenomenal book

00:04:52.760 | called How to Read a Book. And I'm going off the top of my head from having read the book

00:04:57.720 | probably, I don't know, 15 years ago. So correct me if I'm wrong. But basically where he started

00:05:01.680 | with is anytime you're going to read a book, start with saying, what is my actual purpose

00:05:04.960 | for reading the book? What do I want to get out of it? And that will help you to guide

00:05:08.680 | your reading. It's unlikely that if you're reading a novel that you're going to sit there

00:05:12.160 | with a highlighter in hand, with an index card and a notebook to record important points.

00:05:16.980 | But if you're reading a textbook, you're probably not going to be reading it kicked back on

00:05:20.320 | your, on a pillow with your knees in the air. So the first thing I would start with in answer

00:05:25.660 | to your question, Jeff, is do you want an education or do you want a certification?

00:05:33.280 | And there's a major difference. I think of certification as being external proof for

00:05:40.760 | people who don't have knowledge in a subject matter. And here's what I mean. What's the

00:05:45.360 | point of college certification? Is it about education or is it about certification? Now,

00:05:50.160 | I think it probably originally began with being about education. But in today's world,

00:05:54.740 | it's much more a form of certification. And it's basically the whole college collegiate

00:05:59.940 | study system that we have is a form of distributed trust. So if you are in a general studies

00:06:07.100 | degree, then if an employer says college degree required, they're basically trying to pass

00:06:12.240 | on some amount of their trust from themselves over to the college organization. And it's

00:06:18.920 | a form of distributed trust. And they're hoping that if you've been able to succeed at getting

00:06:22.900 | your college degree, that you have a certain basic level of knowledge and a certain basic

00:06:26.740 | level of commitment. So you're the kind of person that they would be likely to hire.

00:06:30.940 | Or if you have a college degree, maybe in a more technical subject, so something like

00:06:34.700 | engineering, maybe you have an engineering degree. Well, in that situation, then there

00:06:37.660 | is a basic course of study. And the college degree certifies that you've completed the

00:06:41.840 | basic level of study. Another good example of a distributed trust system would be the

00:06:48.660 | credit scoring system. So if you look in the United States and most Western economies,

00:06:53.680 | we have a fairly established form of credit monitoring and credit reporting. And so what

00:06:57.980 | that actually does for people is that offers for them the opportunity to not have to know

00:07:02.780 | the debtor firsthand. And that can be a real benefit because then you don't have to only

00:07:08.700 | borrow money from people that know you. You can have a much bigger system where you can

00:07:12.540 | borrow money from a credit card company on the other side of the country or from a mortgage

00:07:15.760 | company on this side of the country. And there's this system to where basically of certification

00:07:20.780 | that this person is a good debtor, this person is a worthy loan. Certification is valuable.

00:07:29.620 | Even in -- so let's go into the financial world. What function do certification programs

00:07:34.700 | serve in the financial world? And there are dozens of them. And we'll come to that in

00:07:39.420 | just a moment as far as talking more. But there are dozens and dozens of credentials

00:07:43.140 | and designations and things that you could pursue. Primarily, in my opinion, certification

00:07:48.820 | in the financial world solves two basic problems. Number one is it solves -- it indicates a

00:07:54.300 | basic level of competence for financial people. So if you don't know somebody, if you don't

00:07:58.660 | know a financial advisor and you're sitting there talking on an initial basis trying to

00:08:02.480 | get an idea of whether or not they're going to be able to serve you in some way, then

00:08:06.880 | if they have a basic certification, then that gives you, okay, this person should be at

00:08:11.580 | least somewhat competent. Now, it doesn't actually -- it doesn't actually mean that

00:08:17.620 | the most competent people have the most designations. Oftentimes the person with the most designations

00:08:22.860 | just simply has a lot of test-taking ability or spent a lot of time studying. There are

00:08:28.540 | planners that are worlds better than me who have zero formal designations. And there are

00:08:35.140 | planners that are just amazing because they have knowledge. But you have to know them.

00:08:40.020 | Or you have to trust a professional that refers you to them in order for you to -- in order

00:08:45.980 | for you to be confident that in their abilities without that external certification. The second

00:08:51.420 | function that certification basically provides in the financial planning world is it provides

00:08:57.380 | a function, a course of study. It outlines a course of study for a new person who's interested.

00:09:02.100 | And this is basically what you are -- what you are focusing on. So if you were -- if

00:09:07.860 | you told me in your e-mail, you said, Joshua, you know, I really love finance. And I really

00:09:12.300 | want to help people. I want to just do some part-time financial planning. Then in that

00:09:17.740 | situation I would say, yes, definitely pursue a certification. But what you described is

00:09:23.380 | not that. You described wanting education. And education is not something that you can

00:09:28.940 | buy. It's one of the biggest mistakes. And I don't want to get into talking about education

00:09:33.460 | today but too much. But education is not something you buy. Education is something that you basically

00:09:38.400 | have to do for yourself, hopefully with the help of good teachers and good materials.

00:09:45.540 | Education is for you. Certification is for other people. So I would say start with your

00:09:50.460 | goals. You know, frankly, if you're that interested in personal finance, if you don't want to

00:09:55.060 | practice in the area, if you're that interested in personal finance, even with your interest

00:09:58.980 | level, it's going to be far more efficient for you to simply hire somebody if you have

00:10:03.540 | a question, hire someone to do the work for you in most in-depth financial planning questions.

00:10:08.380 | If you consider the amount of time and the amount of work it is to really develop the

00:10:12.780 | knowledge, it's far cheaper for you to pay someone 400 bucks an hour, hire a good planner

00:10:17.860 | and be done with it. But in order to be able to effectively hire that person and to be

00:10:26.740 | able to ask good questions, you're going to need that base of knowledge. So are you trying

00:10:31.980 | to become a knowledgeable person or are you trying to improve your situation? One of the

00:10:36.820 | problems with financial planning education is financial planning education, the formal

00:10:40.580 | degree program. I don't know which one to really focus on, but let's pick CFP. CFP is

00:10:46.620 | probably one of the more popular designations. The CFP board and the American College always

00:10:53.500 | fight with each other over who's got the better designation, whether you're going to do CFP

00:10:56.900 | or CHFC. And it's this battle that goes on. It's a stupid battle. But anyway, it is a

00:11:00.900 | battle that goes on. Let's use CFP. The problem with the CFP curriculum is none of it is tailored

00:11:05.060 | to you. It's much more designed to be an available course of study to help somebody basically

00:11:13.740 | help clients. You would probably be far better served to look at your situation and say,

00:11:18.940 | where are my skills and where is my knowledge base weak? That would be a big focus for me

00:11:26.380 | as I would try to start with, what am I actually trying to do? And so if you have a need that

00:11:31.860 | you're trying to fulfill, then set out an educational plan for yourself. And the problem

00:11:36.020 | is that we're not really trained in this way. In the schooling system, what we're trained

00:11:41.060 | to do is just simply to expect that education is something that happens to us while we sit

00:11:46.700 | in school. And so we don't know generally how to sit down and design a course of study

00:11:50.780 | for ourselves. Because if you've gone through the government schooling system, the course

00:11:54.900 | of study that you're going to follow has been outlined for you all the way through already.

00:12:01.540 | But I would start with simply saying, what is my desired outcome? What need am I trying

00:12:06.460 | to fulfill? Because then once you address that need, then you can start and you can

00:12:12.820 | build out a plan for yourself that's going to address that need. So I'll give you some

00:12:20.020 | examples. I'm pretty much sick and tired of studying financial planning stuff. Done with

00:12:26.660 | it, been there, done that, too much. I'm tired of it. After next week, I'm not going to read

00:12:31.540 | any financial planning books for a while. But there are some things that I'm really

00:12:35.060 | focusing hard on increasing my education in. So for example, right now I have a one-year-old

00:12:40.220 | son and I am really, really interested in education because I'm feeling the responsibility

00:12:44.980 | heavily to provide for his education. And so I've been thinking a lot about the theory,

00:12:51.260 | researching a lot about the history, about theories, about different approaches, looking

00:12:54.460 | at people who are doing it, who are looking at doing it well, looking at people who have

00:12:57.860 | results that I admire. And I've been reading a lot about education. But I don't -- I'm

00:13:04.620 | not going to waste the time to go out and pursue a teaching certificate. That has no

00:13:08.620 | value to me. I'm more interested in just a generalized knowledge and then a specific

00:13:13.080 | knowledge in the things that I'm into. Other things I'm really interested in right now,

00:13:17.700 | I'm interested in sustainable design and permaculture. I'm interested in architecture. So I've been

00:13:22.260 | reading some books on architecture. I'm really interested in communication. I've been working

00:13:26.660 | hard at my communication skills to really be able to enhance the podcast, to be able

00:13:32.680 | to be more clear, more direct, to be a better communicator. So I've been reading a lot on

00:13:36.940 | that, studying that, practicing, trying new things to learn in that. But again, that applies

00:13:42.100 | to my job. Probably the best example that I could give you is I'm interested right now

00:13:47.960 | in the field of law. Now, I have no desire ever to practice law. It seems to me like

00:13:53.740 | that is not a business that I would want to practice in. But I'm really interested in

00:13:58.780 | understanding more about it because it governs our entire lives. I'm interested in the theory.

00:14:02.720 | What is the moral foundation for laws? What is the background? What is the theory? How

00:14:08.060 | does the legal system work? And so I've sketched out for myself a rudimentary kind of self-education

00:14:16.620 | plan, which basically is a bunch of books that I've seen, a bunch of different textbooks.

00:14:23.300 | And I don't know when I'm going to get around to working through these things. I got way

00:14:25.860 | more balls in the air than I can actually handle. But working through just this long

00:14:30.020 | history of options all around the field of law. But it's specifically about things I'm

00:14:36.140 | interested in. So I'm far more interested in business law and in international law than

00:14:42.220 | I am in something very specific like medical law. I don't have any interest in medical

00:14:46.540 | law because it's not just so I'm not going to spend much time reading on things like

00:14:51.180 | that. But still, the skill of sitting simply sitting down and saying, what are my goals?

00:14:57.740 | What is the educational program that I'm trying to accomplish? That can be so valuable if

00:15:02.340 | you sit down and do that for yourself. So I'd encourage you to start there. In my opinion,

00:15:08.980 | trying to get a financial planning designation, trying to sit for the CFP exam to care for

00:15:13.540 | your own finance would be similar to the idea of trying to get a medical degree because

00:15:20.020 | you're concerned about your kid being sick. It's a very inefficient way to approach things.

00:15:24.980 | It's far more efficient to simply maybe take an emergency first aid class because maybe

00:15:29.140 | there would be some life or death situation with a sick child that you would want to know

00:15:33.260 | how to stop the bleeding or how to do CPR. And then to supplement that with simply saying,

00:15:38.940 | well, I've got WebMD and I've got a smartphone and I've got a phone to call an emergency

00:15:43.740 | professional and have a nurse on the hotline than it would be to say, I'm going to sit

00:15:47.300 | down and get a medical degree. It's just very inefficient. So apply the same exact thing

00:15:51.660 | to your own situation is that if you're interested in learning, make sure you're not learning

00:15:55.020 | about some course of study that's predicated based upon preparing a financial planner who's

00:16:03.140 | going to face hundreds and hundreds of different situations. Design a course of study that

00:16:07.260 | actually applies to your situation. Now, I would learn from the sources of curriculum

00:16:14.660 | that you can have. And so here would be what I would caution you against. The resources

00:16:18.980 | that you mentioned, whether it's personal finance books or personal finance podcasts

00:16:22.420 | or personal, you know, your favorite forum online, that's great. Up to a point. But the

00:16:27.180 | problem is that you are oftentimes not learning from the experts. You're oftentimes learning

00:16:31.860 | from your peers. And that has a phenomenal, phenomenal, phenomenal value because you can

00:16:36.980 | follow the path of somebody else. So if you're working your way out of debt, one of the most

00:16:43.180 | powerful voices in your life may be somebody else who's working their way out of debt or

00:16:47.340 | who has some encouragement for you. But that doesn't necessarily mean that that person

00:16:52.380 | is going to be the one to instruct you on advanced estate planning. And so I would recommend

00:16:56.580 | to you that you learn from the programs of from the degree programs that somebody has

00:17:02.500 | laid out already. Now, there's a big difference between different designations. And I actually

00:17:10.140 | I have a beef to pick with the financial industry because there are hundreds, hundreds of various

00:17:15.980 | designations that you can pursue. There are so many of them. It is it's obnoxious. Now,

00:17:22.260 | I personally think they all should be certainly allowed to exist. I am not calling for any

00:17:27.140 | kind of rules or any kind of legislation that would govern that. I think let the market

00:17:32.980 | sort it out. But there is a huge difference between somebody who is a CFA, a chartered

00:17:39.620 | financial analyst, versus somebody who is I don't even know what to use. I guess I'll

00:17:45.580 | use a CLTC, certified in long term care planning. CLTC, that was the first designation I ever

00:17:51.580 | got. Two days, two days of class, really valuable on a very narrow subject. CFA, you have to

00:17:57.940 | commit years of your life to studying for it. So you would have to start with what degree

00:18:03.660 | to actually use to design your course of curriculum. I would probably take a look at the CFP degree

00:18:10.460 | or excuse me, the CFP designation. And I would take a look at the educational sections for

00:18:15.300 | it. But I would pick and choose what parts of the books I actually read. Probably the

00:18:20.380 | most helpful thing for me that I've studied has actually been the MSFS program I'm just

00:18:24.220 | finishing up. And the curriculum, if I could list out all the books, I'm not going to do

00:18:28.980 | that. But if I could list out all the books and you go buy those books, I mean, they're

00:18:32.660 | so, so valuable. But don't just start with the CFP. I mean, give an example. If you're

00:18:40.620 | going to sit for the CFP exam, you've got to know estate planning. And I pick on that

00:18:46.620 | because it's the thing that intimidates people the most. So you've got to be able to intelligently

00:18:51.100 | discuss the difference between a grat and a crat and a crut and a clat and a clut and

00:18:56.820 | all of this nonsense. That has zero value to you in your daily life, unless you're a

00:19:01.940 | multi-billionaire, in which case you're far better served to simply help somebody else

00:19:07.140 | and hire somebody else to do it for you. There's no reason for you to spend all the time necessary

00:19:13.980 | to grasp the ins and outs of it. I wouldn't even trust myself if I were planning my own

00:19:19.060 | estate. I would hire a team of attorneys who works in that every day, because even though

00:19:24.660 | I had the general knowledge, I would never do that. I would never set it up myself. And

00:19:29.580 | so unless you practice in something day after day after day, you cannot possibly get good

00:19:35.060 | enough at it for it to make a difference. Now, there are some huge benefits to following

00:19:40.460 | a curriculum. So one example I'll use is one of the biggest benefits would be if you followed

00:19:46.620 | a curriculum is that you would have a comprehensive survey, which is kind of what I heard in your

00:19:51.620 | question. You would have a comprehensive survey of a subject matter that you'd be able to

00:19:55.660 | sit down and say, "You know what? This is somebody who's an expert. They've sat down,

00:19:59.740 | they've designed this course of knowledge. They've laid out the six or eight or 28 different

00:20:06.460 | topics that they think would be of value to somebody in this situation. They have surveyed

00:20:11.820 | the marketplace and chosen the best books." And so you would get a very broad view of

00:20:18.820 | the marketplace. And that can be incredibly helpful, because then you can make sure, "Okay,

00:20:24.940 | I'm not missing anything there." Another huge benefit to at least reviewing the curriculum

00:20:31.460 | is I would say, "Look for the more academic books." So for example, you mentioned the

00:20:35.380 | Bogoheads Forum. Bogoheads Forum is an awesome forum, one of the most knowledgeable. I'm

00:20:41.500 | not registered in the forum. I don't spend much time there, but from time to time, I

00:20:45.420 | do wind up in there taking a look. And some of the most knowledgeable, well-intentioned,

00:20:50.900 | well-meaning people online. But you're going to get one specific point of view. And I may

00:20:57.900 | tick some people off, but it's rare that you're going to find a participant in that forum

00:21:02.820 | who's going to be able to effectively give all of the arguments against their point of

00:21:06.820 | view. So one of the benefits that you might look for is switch your reading from the books

00:21:12.460 | that have a specific agenda to some of the textbook approach, where they more... What

00:21:17.460 | would be the right way to say it? Where they more broadly lay out the situation, where

00:21:24.460 | they more accurately represent the pros and cons, without necessarily trying to lead you

00:21:29.500 | in an agenda. Now, I don't think that necessarily reading textbooks is the best way to do it.

00:21:35.340 | Textbooks have their place. I have a love-hate relationship with textbooks. It seems like

00:21:40.140 | in many subjects to me, some of the worst inventions ever made. That there are so many

00:21:45.260 | other ways that would be better for people to study and to learn than through the use

00:21:50.660 | of a textbook. But for some subjects, especially for a technical subject, it can be incredibly

00:21:57.140 | valuable for you to have a textbook that is written by an expert who is laying out an

00:22:03.540 | entire course of study. If you want to go a little bit deeper with personal finance,

00:22:09.100 | I wouldn't start at Barnes & Noble. This is one of the most actionable things that I could

00:22:13.100 | give you. Don't start at Barnes & Noble. The problem is that when you are getting your

00:22:18.860 | books from a source like that, you're getting a more mainstream approach. It's going to

00:22:24.500 | more appeal to a mainstream audience. So you get maybe some awesome personal finance books,

00:22:30.180 | but it sounds like you're a little bit beyond that. I would, I'll give you two of my secrets.

00:22:36.140 | Number one is I would check out, I particularly like John Wiley Publishers. So if you spend

00:22:42.860 | some time, if you want to get some deeper books, A, you got to get some more expensive

00:22:46.700 | books, and I would check out some of the publishers' websites. Sometimes you can find publishers

00:22:52.700 | that specialize in a certain area, and I'm sure there are other good ones. I've always

00:22:56.460 | just had good luck with reading off of John Wiley Publishers since I've found they published

00:23:01.360 | a few that I really hugely benefited from. The one that was my favorite was, there's

00:23:06.100 | a book called The Fund Industry by Teresa Hamacher and Robert Pozen, I think are the

00:23:12.420 | authors. I don't know if I'm saying their names right. But it is an amazing book. If

00:23:16.100 | you want to have a realistic, comprehensive view of how, A, what investment companies

00:23:22.820 | are, investment companies commonly called mutual funds, all the different ways that

00:23:26.300 | they can be structured, the ins and outs of them, and you want to actually know some details

00:23:31.860 | on mutual funds that you will never find on a blog or never find on an article, I would

00:23:38.120 | recommend that book. It's an awesome book, and you'll learn more about the fund industry

00:23:41.900 | than you ever dreamed existed. If there's a subject that you're interested in, if you

00:23:47.140 | go to the publishers' website, I'll give you some examples. I pulled up in preparation

00:23:50.540 | for the show, I pulled up their website, and let me read you a few titles that I found.

00:23:54.660 | So if you're interested in bonds, here's a book, Bond Math, The Theory Behind the Formulas.

00:23:58.660 | It's 304 pages, and it goes through all of the details on calculating bonds. Well, that's

00:24:04.060 | the type of book, if you're interested in trading your own portfolio, that's the type

00:24:06.900 | of book that if you were working on Wall Street on a bond mutual fund, that's the book that

00:24:10.360 | you would be studying. Or here's another book called The Alpha Masters, and Unlocking the

00:24:17.620 | Genius of the World's Top Hedge Funds, 272 pages. These books are usually, this one's

00:24:21.980 | cheap, it's 20 bucks. A lot of these books are 40, 50, 100 bucks for the book. But if

00:24:27.380 | you want to actually read what you would be required to read if you were working in a

00:24:30.180 | mutual fund, if you were on a trade desk or something like that, that would be a good

00:24:36.940 | place to start. Another one that I would encourage you, so let's say that you are a committed

00:24:41.940 | bogel head, start with a book called Modern Portfolio Theory and Investment Analysis.

00:24:46.740 | This is a textbook. Now, it's going to cost you anywhere from 60 to 250 dollars, but you

00:24:52.260 | can buy it right from them, and you'll actually understand more of the background behind your

00:24:56.700 | investment philosophy than you've ever understood from blogs. So I would encourage you, if you

00:25:02.100 | want to go deeper, go there, but don't waste your time trying to become a medical doctor

00:25:07.740 | so that you can accurately diagnose your child's sicknesses. Another resource for you, where

00:25:16.620 | I usually send people, if people are interested in information, I send them to, on a specific

00:25:22.820 | subject, I send them to a company called NOLO, N-O-L-O, I don't remember what it stands for,

00:25:30.020 | but they have some of the most more consumer-friendly books that are actually really well-built for

00:25:37.100 | do-it-yourselfers. And so, they're a good in-between, it's a little bit more detailed

00:25:44.100 | than a Money Magazine article, but it's not quite as detailed as having to read a legal

00:25:47.700 | brief printed on that onion paper where it's 800 pages about Florida elder law. You can

00:25:54.100 | just simply read the NOLO book on retirement planning, or you can read the NOLO book on,

00:25:58.660 | what would be a good example, on setting up a living trust, something like that. I really

00:26:08.460 | wouldn't, I can't even imagine that I would spend time building out a certification. The

00:26:14.100 | last thing that I think you really got to focus on is what the cost is. So, certifications

00:26:21.380 | exist for the benefit of three people. They exist for the benefit of the person pursuing

00:26:26.020 | the designation and the certification, whether that's for their knowledge and for their pride.

00:26:31.100 | They also exist for the benefit of the public to have some general idea of somebody's personal

00:26:39.860 | ability, and they also exist for the benefit of the organization granting the designation.

00:26:46.820 | And the money that's involved that you have to pay simply to be certified, to sit and

00:26:51.020 | take the test, it's kind of like the college cartel. You have to pay the money to the college

00:26:56.180 | for them to certify you. It has nothing to do with how much you know. It has everything

00:27:00.940 | to do with the fact that you got to pay the fees for them to give you the certification.

00:27:04.300 | You could be the most learned person in the world, and you have to pay the money. It's

00:27:07.980 | not until you get to the point of an honorary doctorate, once you're at that level, where

00:27:11.580 | they'll actually acknowledge, "Okay, this person has education. We'll just simply grant

00:27:14.640 | the degree and not make them pay the fee." And that does exist, obviously, in the world

00:27:20.580 | of the honorary doctorate. So I would just simply say save the money on the certification

00:27:26.020 | and spend it focusing on the areas of study that are valuable to you.

00:27:36.900 | I would encourage you to talk to a professional, and this is one of the things -- I'll share

00:27:42.540 | a story with you that seems -- that to me was a good example. And this would be cheaper

00:27:47.340 | and easier -- in my opinion, this would be cheaper and easier. If you're worried just

00:27:50.220 | about your own situation, better for you to simply just pay a fee to an expert for a review.

00:27:57.140 | And that will save you hours of time and thousands of dollars, rather than trying to do all of

00:28:04.460 | your own financial planning approach. Now, there would be a difference -- let's

00:28:08.980 | say that you're focused on investing and you're saying, "I'm focusing on learning to trade

00:28:12.260 | my own portfolio." That's different than is financial planning. But your question sounds

00:28:15.500 | like very much generalized financial planning. Trading your portfolio and learning the skills,

00:28:20.180 | to be able to do that, is a very different scenario. And in that world, if you're actually

00:28:25.140 | actively continually pursuing that, then yes, learning deeply for your own knowledge is

00:28:29.260 | going to be incredibly valuable. But I'll give you a story. So when I was working

00:28:32.620 | as a financial planner, I met with a lot of people. And when you are working as a financial

00:28:37.940 | planner, there are a lot of -- I guess there's a lot of resistance. Because the job is largely

00:28:46.060 | involving sales. There's a lot of resistance from many people to talking to financial advisors.

00:28:53.940 | And you see this all the time when people say, "I'm going to go talk to the advisor

00:28:56.460 | and see what he's going to sell me." It's a fact of life.

00:29:00.780 | So I was used to experiencing that. And I'm a young planner. I think I've been doing it

00:29:05.060 | for about two years at that point in time. And as I'm going out and kind of surveying

00:29:09.460 | the marketplace, I'm talking with people and talking with people, and I'm used to kind

00:29:12.380 | of having to push through a certain level of resistance in order to get people to meet

00:29:16.020 | with me and talk with me. And one day I went out to a lunch. It was in

00:29:19.540 | Palm Beach. There was an organization that met. I can't remember what the name of it

00:29:23.340 | was, so I won't butcher it. But it was one of these organizations that was organized

00:29:28.500 | where they would have a famous speaker in, somebody from the island. It happened during

00:29:32.260 | the season. And they would have this whole room full of business people all gathered

00:29:35.220 | together. And all of them would come together and they would have a lunch. They would have

00:29:38.820 | the speaker and a fancy dinner. And this was their social club.

00:29:42.540 | And I got invited to it. And I figured, "Ah, this would be a great networking opportunity.

00:29:45.620 | I'll meet a lot of people. Maybe I'll have some potential clients. I'll make some friends."

00:29:48.540 | So I went to the lunch. And I loved it because everyone in the room was about -- probably

00:29:53.540 | the average age in the room was about 72 plus me. And that's my kind of crowd.

00:29:59.380 | And as I'm there, I sit at the table with this guy. And he finds out that I'm a financial

00:30:05.340 | advisor. And he's talking with me. And he says, right out of the blue, after we get

00:30:09.780 | to know each other a little bit and kind of have some chit-chat, I don't remember, mid

00:30:12.780 | towards the middle or towards the end of the lunch, he asked me, he says, "Hey, listen.

00:30:18.420 | Would you be willing to take a look at my stuff?"

00:30:22.420 | And I said to him, "Yeah. Yeah, of course. Absolutely." And I had to -- I think I did

00:30:27.700 | probably an okay job of hiding my absolute shock because that was the first time anybody

00:30:32.500 | had ever actually wanted to talk to a financial planner. But I said, "Yes, absolutely." So

00:30:38.020 | we set up a time. And he comes into the office. So he walks into the office. And when he gets

00:30:41.940 | into the office, he slides a sheet -- he sits down in my office and we chat for a minute.

00:30:46.700 | He slides a sheet of paper across the table. And on the paper, it has his -- just a one-page

00:30:52.500 | summary. It has his balance sheet, his cash flow statement, his -- and all of his details

00:30:59.260 | and kind of listing out what his goals are, what his desired level of income is, what

00:31:03.540 | he has, where it is, how it's invested, things like that. He's got a listing of his assets.

00:31:07.860 | He's got a listing of his insurance policies. And then he just starts telling me, he says,

00:31:12.100 | you know, real quick, let me give you a little background on my situation. I'm a widower.

00:31:16.060 | I have -- my kids are grown. I live here. I do this. I do that. This is kind of what

00:31:19.740 | my goals are. Here's what I'm trying to lay out for the future.

00:31:24.300 | And I sit and talk with him and I review just a couple of things. I look at the paper and

00:31:29.500 | I just kind of walk through it in my mind. I ask him some questions. And we chat for

00:31:35.340 | about 20 minutes. And at the end of that 20 minutes, I said to him, I said, you know,

00:31:40.900 | I think you're good. There's nothing that I can see that I would recommend that you

00:31:44.660 | change or update. And that was a new experience for me. Because I was so used to working with

00:31:52.300 | people who always needed something. I could always find something that was out of whack.

00:31:55.940 | And here I'm in a situation where I couldn't find anything that was out of whack. Now,

00:31:59.420 | this guy had money. He wasn't -- he wasn't the part of the glittering rich, as Tom Stanley

00:32:05.540 | would say. But he certainly had money. He certainly was financially comfortable.

00:32:12.320 | And he left my office. It was about a 40-minute appointment. And then he left my office. And

00:32:16.700 | I remember being so stunned just at his situation. At how great things were. And I was so stunned

00:32:25.580 | at how he had sought me out for advice. And it really revealed something to me. Because

00:32:33.780 | when I started working and going out and prospecting for clients and calling on people and getting

00:32:38.060 | referrals and calling people on the phone and asking them for an appointment, I was

00:32:41.540 | scared silly. And I had this idea that, you know, the poor people, the broke people would

00:32:47.380 | be the easy ones to talk to. They would be the ones who would just be desperate for my

00:32:51.100 | help. And the rich people would be the hard ones to get to. Because after all, they had

00:32:54.940 | all the money. They had all their advisors. Like, they had everything already all squared

00:32:58.820 | away and all taken care of. And it took me a few years. But I learned that it was exactly

00:33:03.040 | the opposite. Exactly the opposite. And the most difficult people to get an appointment

00:33:12.260 | with were those who most needed my help. Who most needed my advice and my encouragement

00:33:22.620 | and my insight. And the richest people, the people that had the most money, they were

00:33:27.340 | in many ways the easiest people to get together with. And yet, they were the ones who least

00:33:34.900 | needed my advice. And it took me a while to figure that out. And then I thought, wait

00:33:41.380 | a second. Maybe that's maybe there's a correlation there. Now, I don't know if it's causation

00:33:47.380 | or correlation. But there was at least a correlation there in my personal experience. And it really

00:33:53.060 | taught me a lesson. Because you never know where you might learn something and you never

00:33:57.540 | know what you might have. And I've gone on and I've seen that in other areas of life.

00:34:03.860 | It seems to me, I can't prove it to you. But it seems to me that the people who have the

00:34:10.980 | most wealth, and we'll stay focused on wealth for a moment. But the people who are the most

00:34:16.300 | successful probably, they're the ones who are always consulting with other people. I

00:34:22.420 | would guess that the Fortune 500 CEO is far more likely to have a life coach and a career

00:34:30.060 | coach and a speaking coach than is the entry level line worker, the entry level factory

00:34:37.820 | worker employed in their own organization. And I personally think there's a connection

00:34:46.180 | there. I personally think there's a correlation that makes a difference. So, I would just

00:34:52.280 | encourage you consider, there is a time and a place to be knowledgeable. And that's what

00:34:57.620 | the show is about. And I think a podcast format is a really great format to get a good general

00:35:01.180 | knowledge, hear a little bit about things to make sure you have a deeper knowledge without

00:35:07.940 | hopefully getting as bored as sitting down and reading a textbook. But I would encourage

00:35:13.180 | you that it's probably much more useful to consider hiring somebody and consulting somebody

00:35:21.300 | who actually knows what they're doing. Whether that's in health, weight, productivity, speaking,

00:35:31.140 | business. Some of the highest performers are the ones who ask for the most help. Now, there

00:35:39.580 | are a bunch of ways this can be structured. And probably there will be a change as time

00:35:43.700 | goes on. Probably there will be an unless I mean in the world of financial advice, unless

00:35:49.140 | your financial advisor is constantly upgrading their skills, there's probably going to be

00:35:53.340 | a need for you to there's just a change. You know, an advisor I think can grow with a client

00:36:01.780 | as long as the advisor is growing. But not all advisors are appropriate for all people.

00:36:06.920 | You may need a different level of advice. But the key point is seek out some of that.

00:36:11.100 | And that is a far more efficient use of your time than far more efficient use of your time

00:36:17.660 | than is trying to do it all yourself. Now, there are lots of other aspects to it. But

00:36:27.540 | you know, a financial planner's education is very different. Because what they're actually

00:36:30.680 | looking for is they're looking for somebody who is they need the broad-based knowledge.

00:36:37.460 | Because they never know what the next situation is going to be. But if you're not going to

00:36:40.620 | practice, I would say don't waste your time. Don't be a masochist and don't do that to

00:36:44.460 | yourself. Stay much more focused and targeted on what you actually need for your life and

00:36:50.500 | for your success. So that would be my answer to your question. I hope that's helpful. Just

00:36:55.020 | basically in summary, make sure that you're studying things that you actually care about.

00:37:00.260 | Make sure that you're studying something that is actually important to you instead of just

00:37:04.620 | what somebody else says should be important to them. So that's my show. Totally new experience.

00:37:11.340 | I've never done one of these, having a live audience, having people stare at me while

00:37:16.660 | I do it. It's really hard to stay focused the whole way through. But hey, it's a good

00:37:23.940 | growing experience. Get pushed out of my comfort zone. Jeff, I hope that was valuable for you.

00:37:27.980 | I'll make sure that you get this episode. Thank you for those of you who have been contacting

00:37:32.020 | me while I'm out of the office. Just a reminder, I'll be out of the office all this week and

00:37:36.820 | next week. Be back on the first Monday at the end of September. I will have a lengthy

00:37:44.540 | report for you at some point from FinCon. This has been awesome so far. And if any of

00:37:48.780 | you are listening to the show while you're here, I thank you for doing that. I really

00:37:53.180 | appreciate it and I look forward to talking with everybody. Have a great day.

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