RPF0162-Nathan_Harness

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00:00:15.360 | Radical Personal Finance is a listener funded project, but it's not without bribery.

00:00:20.800 | Well, I'm actually bribing you to fund the show. And if you'd like to know the details of my

00:00:27.600 | bribes, go to radicalpersonalfinance.com/patron. Today, let's dig into the topic of financial

00:00:38.240 | planning education and let's talk with an academic about it. I have an interview today with Dr. Nathan

00:00:45.760 | Harness, who runs a financial planning undergraduate program out in Texas.

00:01:01.360 | Welcome to the Radical Personal Finance podcast. My name is Joshua Sheets and today is Tuesday,

00:01:13.600 | March 3, 2015. I'm bringing you an interview with Dr. Nathan Harness from Texas A&M. He's got a

00:01:21.040 | fascinating story. He started as a practitioner and then moved over into the world of academia

00:01:26.080 | and now is in charge of preparing and enlightening young minds and hearts and sending them off into

00:01:32.720 | the financial planning business. This is an interview that I recorded when I was out in Texas

00:01:43.680 | a couple of weeks ago at the T3 Technology Tools for Today conference for financial advisors.

00:01:49.040 | It was a really fun interview. I had not met Dr. Harness prior to the conference, but I had been

00:01:55.360 | planning and looking to bring some more academics on the show. And so it was a fortuitous meeting

00:02:01.840 | and we wound up with a really interesting interview. I think you're going to really enjoy

00:02:05.520 | this. We talk a little bit about his experience and he's got a fascinating story to tell. If you

00:02:11.840 | don't listen to the whole thing, at least listen to the beginning about his story of his involvement

00:02:15.760 | with 9/11. It's absolutely fascinating. But we also talk a lot about the academic side of financial

00:02:21.040 | planning, the side of academic preparation, what's good about it, what's tough about it, the

00:02:26.240 | emerging role, what's involved in it. So I think you're really going to enjoy the interview.

00:02:30.240 | And I think I'm going to stop talking. Enjoy.

00:02:32.800 | So Dr. Nathan Harness, welcome to the show. I appreciate you being with me.

00:02:38.880 | Thank you.

00:02:39.760 | I have been looking forward to bringing on over time some academic, formal academic faculty,

00:02:47.360 | people who teach in financial planning. And so you're the guy, you're the guinea pig. You're

00:02:51.520 | the first of, you're the first guy out. So let's kick it off with what's your background and how

00:02:56.720 | did you wind up where you are today where you're actually teaching financial planning at the

00:03:01.280 | college level?

00:03:02.320 | Sure. I bet my story is not that much different than a lot of people entering this industry. My

00:03:08.080 | path just ended in academia. As an undergraduate student or backing up from there as a kid,

00:03:14.160 | I loved money. I loved the idea of making money. And that led me to-

00:03:19.040 | Go into teaching.

00:03:20.640 | Yes. Yeah, exactly.

00:03:21.680 | That was not a good move.

00:03:24.400 | No, that was a terrible move. That was later in life that I discovered there are more things

00:03:28.400 | than money. But yeah, as a kid, loved money, really enjoyed the process, the creation. And so

00:03:36.000 | started working in a bank even at the age of 16. I don't know why they gave me the keys to the bank.

00:03:42.480 | And I'm a 17 year old kid. I was actually transporting money around and I thought,

00:03:47.920 | man, this is a small town. How far was I going to get? I wasn't even going to make it to Mexico

00:03:52.640 | probably without cash. So I just had a head for it. And I loved the idea. I just didn't have a

00:04:00.960 | sense of direction. So I got my undergrad in finance, understood the mathematics of money,

00:04:10.080 | but did not understand the relational aspects. And so after going through that degree, became

00:04:18.560 | a stock broker, enjoyed that world to some extent and cut my teeth learning the hard way how to sell.

00:04:25.600 | Started off cold calling.

00:04:27.920 | As a matter of fact, very first day of work, I remember I was working for a firm

00:04:32.720 | and I went into my boss's office and I said, "All right, I'm ready for all these clients.

00:04:38.160 | Where are they?" And he picks up a phone book. Nobody uses phone books anyway. He picks up a

00:04:43.840 | phone book, he throws it down on my desk and he's like, "They're right there." And I called so many

00:04:48.800 | people. I had callous fingertips. I could tell you based off of last name, likelihood of phone

00:04:53.360 | being disconnected. I learned a lot. I learned how to think on my toes. I learned how to answer

00:05:01.440 | objections. So there were positives that came out of that. But I remember even at that time thinking

00:05:06.880 | this can't be the best way to do this. And so-

00:05:11.040 | What year was that?

00:05:12.960 | That would have been '99.

00:05:14.880 | So this was-

00:05:18.400 | No, I'm sorry. It was 2000.

00:05:19.680 | Was your firm, were you brokering a specific type of industry and-

00:05:24.560 | Yeah. So interestingly, my first job out was for American Express Financial Advisors.

00:05:31.200 | And then I migrated there to Morgan Stanley. So Morgan Stanley had a training program for

00:05:36.080 | brokers at that time where they would put you through a process, if you may. And they used

00:05:41.440 | to ship everybody to New York. So probably a much larger podcast. My second day on the job

00:05:46.880 | was in Tower Two of the World Trade Center. And the day was September 11th, 2001.

00:05:52.560 | Really?

00:05:53.120 | Yes. So talk about a way to start your career of-

00:05:56.880 | So were you in the building?

00:05:58.080 | Yeah, I was on the 61st floor. So my second day of work as a stockbroker entering this profession,

00:06:06.000 | I had worked for Amex before that. But really, my first entry point is me running down a stairwell.

00:06:11.840 | And I made it out with about 15 to 20 minutes to spare. And so that sets your career

00:06:19.280 | in a very unique way. It causes you to think-

00:06:23.360 | How would I imagine?

00:06:23.360 | Because I was, I don't know, 22 years old, 21 years old. It causes you to think about life

00:06:29.680 | in a very different way. And I guess the healthy aspect for me was coming out of there, going in,

00:06:37.600 | it was all about money. Coming out, it became much more relational to me. And me discovering

00:06:44.400 | myself that what I wanted in life maybe wasn't the way that I had centered my profession.

00:06:54.880 | Wow.

00:06:56.160 | Yeah. So it was a real interesting start to a career.

00:06:58.640 | Yeah. So that day you got out of the tower and

00:07:02.000 | did you evacuate on the boats? Or how did you get away?

00:07:06.320 | Yeah. So here's the crazy thing. So September 11th is a Tuesday. I got to New York on a Sunday.

00:07:14.560 | And so they were going to put us up in hotels. You go through about a one month training,

00:07:20.720 | and then you may or may not stay in New York, or you may get shipped out to a regional office.

00:07:24.080 | It was a centralized training system. And so I actually, it's funny, I have a picture of me,

00:07:31.120 | my ID card for Tower Two, and it just looks like this young little kid. It's so funny to look at.

00:07:38.160 | And so, yeah, when we evacuated, because our tower got hit second, but it fell first.

00:07:45.520 | Right.

00:07:46.160 | And so the way that we evacuated, I was going east and then north. And so I could still see

00:07:55.840 | Tower Two where I had exited when it started to fall.

00:07:59.200 | Wow.

00:07:59.680 | And so we start running in mass exodus, a bunch of rats running away from the fire. And

00:08:05.440 | so I ran for about a hundred blocks, give or take. And I remember I'd only been in New York two days.

00:08:12.640 | Wow.

00:08:13.680 | I was so shaken. I didn't remember the name of my hotel. And so I just find a random person

00:08:18.720 | on the street after running for a long period of time. And I say, "I just got out of the World

00:08:25.040 | Trade Center. I'm a young man. I don't know the name of my hotel." And it says a lot, I think,

00:08:33.200 | about the nature of people. This guy, I have no idea who he is, just starts walking me around.

00:08:40.960 | He's from New York and he says, "Tell me what it looks like." And I'm describing this hotel to him.

00:08:45.520 | And he ultimately, I was only about 20 blocks off. He walks me about 20 blocks,

00:08:49.120 | make it back to my hotel. And so I'm stuck in New York for two days because I just want to get back

00:08:55.840 | to what I called home, which was the town I grew up in just to be with family because I'm thinking

00:09:01.520 | into the world here. And so it took me a much longer story was just getting off New York.

00:09:08.080 | It took me, I went in the subway that connects Jersey and New York and was able to, on Thursday,

00:09:16.240 | to hitch a ride with a bunch of people that were coincidentally vacating and going in the same

00:09:21.760 | direction and ended up in Arkansas where I grew up. So yeah, kind of crazy.

00:09:26.320 | - So you went into that, you're probably a young, aggressive man saying, "I got to make a lot of

00:09:33.200 | money and I'm going to go cold call and work with Morgan Stanley." And then it kind of redefined how

00:09:37.760 | you thought about money. Tell me more. - It did. So on the onset, again,

00:09:42.080 | my desire was to be a multimillionaire at a very young age and do whatever you can to get there.

00:09:48.240 | And I think going through that experience, it took a little bit of time for that to settle

00:09:55.360 | because people would ask me, I did a lot of interviews and I don't know, give talks after

00:10:01.280 | that on those events. And people would ask me a lot of life change questions like, "So now what

00:10:06.320 | do you think?" Or, "How do you feel about the people that did this?" And I'm a slow processor.

00:10:11.280 | So it probably took me a solid year to just sit back and think through those events and how those

00:10:20.000 | unfolded to the decisions that I later made in life. So I really stayed in a holding pattern

00:10:25.360 | for about a year. And it was about at that year mark, I realized that life is a limited resource

00:10:34.080 | and you have to decide what it is you want during those timeframes. And so for me,

00:10:40.000 | money and time were those trade with each other. I decided that time was more important to me

00:10:49.200 | than money. And so now I had to come up with a way to switch those two. And so that's where I went

00:10:56.080 | back to school to figure that out. I didn't know exactly what that looked like. I just knew I

00:11:01.760 | needed to figure that out. So I went back to school and I'm like, "I don't know, maybe smarter people

00:11:05.200 | than I can tell me how I trade those two off." - Were you broke when you started as a financial

00:11:11.040 | advisor? - I was broke. So a broker or broke? - Did you start broke? - I started dead broke.

00:11:17.120 | - Now, what did you do for income during that time? Did Morgan Stanley pay you? Was it a

00:11:22.880 | commission? How does that actually work? - Yeah. So back then, there are still companies that do

00:11:27.680 | this, but it was a draw. So they would give you about $1,500 a month, something like that. So a

00:11:33.680 | livable wage, but you get about $1,500 a month and then you were expected to generate commissions

00:11:39.680 | that would offset that. And so they would draw on that all the way to a year out. So I had to start

00:11:46.560 | selling product. And that was new to me as well. I thought, "I'm going to sell my advice. People

00:11:52.000 | are going to want to come to me like they want to come to a lawyer because I have all this great

00:11:56.240 | knowledge." And then I realized, "Oh, wait, they're not coming to me for that." As a matter of fact,

00:12:00.960 | they're not coming to me at all, first part. And they're not coming to me for my advice.

00:12:05.920 | My company wants them to come to me so I can give them something, sell them something. And that was

00:12:12.240 | an awakening for me. It was a rude awakening at that time. So the industry that I entered, I felt

00:12:19.360 | like I didn't understand. It didn't make sense to me. And so I went on to... I thought, "You know

00:12:25.600 | what? This sucks. I don't want to do this." And so I wanted to be an analyst at that point, which I

00:12:30.640 | apparently did not understand the give and take in time and money because analysts work all the time

00:12:36.400 | and have plenty of money but no time to spend it. So I made it through my master's in finance.

00:12:43.520 | And then I was at Texas Tech and I stumbled onto this financial planning program. Somebody told me,

00:12:49.600 | "They teach these personal finance classes over there. You ought to go check this thing out."

00:12:54.240 | So I go over and I take a class and I fall in love instantly. I said, "This is what I've been

00:13:00.000 | wanting. The gospel that they're preaching over here is what in my mind I've been thinking this

00:13:06.800 | should look like. Why doesn't everybody know about this?" And so I stayed on, did my PhD at Texas

00:13:12.880 | Tech in financial planning. And really that is the story I don't want to keep hearing over and

00:13:19.120 | over again. What I want to hear going forward is that students don't take all these indirect routes

00:13:25.040 | to get to planning, that they can directly move through and into financial planning right out of

00:13:31.920 | college because it's very possible. I think this is definitely the new wave.

00:13:36.400 | Before we get to that, I want to ask one more question. Did Morgan Stanley pay you

00:13:40.240 | after you got get out of New York? I'm actually interested, did they just keep the draw going?

00:13:44.240 | They did. So they were kind of confused. We had about a million square feet, if I remember

00:13:50.160 | correctly, in the World Trade Center. We're one of the largest occupiers of the World Trade Center.

00:13:53.760 | And that was our headquarter. So all of our documents were there. Of course,

00:13:57.440 | they had them backed up offsite, but the company goes into chaos all of a sudden.

00:14:02.080 | It wasn't as bad as Cantor Fitzgerald, but it was a similar "what do we do" scenario.

00:14:08.240 | So they didn't really know what to do with this training class. It's like,

00:14:12.640 | these people have been through a lot. Do we send them to a new training program?

00:14:17.920 | And so they just kind of sat on us for a period of time. And that was probably part of my issue as

00:14:23.440 | well is I'm very confused now. I'm confused at what they want me to do. I'm confused at what

00:14:29.840 | this industry is. And so they sent us to a secondary training down in Texas, funny enough.

00:14:36.880 | And I went through training and it was a lot of "hoorah, let's get these people excited so

00:14:43.360 | they can go sell stuff." And there were financial planners inside the company

00:14:48.640 | that were doing planning. I just didn't know who they were.

00:14:51.520 | Tavis: I'm always fascinated. The reason I'm probing on that is I'm fascinated by

00:14:55.520 | strange periods in history and how financial planning

00:15:01.760 | adjusts during those times. I'm fascinated with things like World War II. And I often think,

00:15:07.840 | "Man, what if I were living in Europe during World War II? What would my life be like? And how would

00:15:12.400 | I apply the financial concepts that I think of today?" Because having lived and grown up in the

00:15:19.360 | United States of America, in many ways... How old are you at this point?

00:15:23.200 | Ben: I'm 36.

00:15:24.320 | Tavis: Okay. So I'm almost 30. So we're pretty similar as far as age in some way.

00:15:29.120 | We've pretty much lived in a bubble. And your bubble was burst with New York City, but

00:15:35.360 | mine wasn't. And certainly it affected our national society and culture, but it didn't

00:15:41.040 | affect us personally. And I'm fascinated by how do you pick your life up? And if you have to flee

00:15:47.680 | from Germany because you're a Jew, how do you pick your life up and move it to another place? Or

00:15:52.960 | how do you adjust during these times? And it's a real topic of interest to me.

00:15:58.320 | So when I've got a real life person sitting in front of me who's been through something like

00:16:02.160 | that, it really is interesting to me.

00:16:03.440 | Ben: It's crazy. My dad told me... Growing up, we didn't grow up with much money.

00:16:09.120 | My dad owned a small business, some off and on, and he actually grew up as a minister.

00:16:16.960 | And so we grew up in a large family, not a lot of money. And my dad never went to college,

00:16:24.240 | but he seemed to get the basic principles without anybody teaching them to him per se.

00:16:29.920 | And I remember him telling me something one time, it's really stuck with me. He said,

00:16:33.840 | "Son, don't ever let your stuff own you. You always need to be the owner of your stuff."

00:16:39.520 | And so it was those kind of Aesop's fables that stuck with me. Those little things that, again,

00:16:47.840 | it's not rocket science, but it's base principles that allowed me to think, no matter what the

00:16:55.360 | outcome, my grandfather was in World War II. He actually was a medic. He was in

00:16:59.920 | the beaches of Normandy and he was in Battle of the Bulge, both.

00:17:04.640 | So he survived. And his transcripts at the University of New Orleans,

00:17:08.960 | he shook for the rest of his life. He always had a shaking hand. He never really talked about it.

00:17:13.040 | I didn't even know about it. Had I, thank God, somebody transcripted his story or I wouldn't

00:17:18.560 | know it. And so I read his story and I read about him marching through the Arc de Triomphe in Paris

00:17:27.200 | and just his emotions and his feelings, all of his brothers are there. And I think back to living,

00:17:33.360 | he was a dairy farmer, my grandfather was. I think back to living at that time,

00:17:38.320 | what would be my principles? What would be the commodities that were important to me? Could I

00:17:44.160 | apply this exact knowledge in the exact same way? And I think the synthesis of information

00:17:52.160 | never really changes. The products sure do. My grandfather, to him,

00:17:56.160 | hard assets were much more important. His grandfather had lost money during the

00:18:03.040 | depression where banks just disappeared. He has a family story. We have a lot of family stories,

00:18:09.120 | but one of them was his little thousand, no, it was his little hundred. He had a hundred in the

00:18:13.920 | bank and it was just gone. It just disappeared. So your trust in banks, it would totally alter

00:18:20.640 | that thought process. So asset preferences, I think, change a lot across time. Even recently,

00:18:26.960 | as we see sort of this run on guns, that's another example. You've got people that see those as an

00:18:33.840 | asset or bullets or whatever it may be, and they want to store these things up because they see

00:18:38.480 | them as an oddball asset, even in today's time. So I think as we progress across time, our

00:18:44.880 | preferences and the way that we store resources, the concept doesn't change. What those assets are,

00:18:51.360 | are constantly changing. It really is true. And if you look, I know for me,

00:18:56.560 | one of the things that I had to struggle to overcome is because I was always interested

00:19:00.400 | in personal finance. When I was young, I had similar goals to you. I wanted to be rich. And

00:19:05.360 | so I always read these personal finance books. And what happened is I didn't have the maturity

00:19:10.480 | to be able to look back past what the individual doctrine that some writer would preach. They would

00:19:17.440 | say, "You must do this. Always do this. Always do that." I didn't have enough ability at a young age

00:19:23.280 | to look past that and see the principles behind it. And then it was after I worked as a financial

00:19:28.800 | planner for a while, and I kept always thinking, "Man, it is a heavy responsibility when you're

00:19:32.400 | responsible for other people's assets." I think if you take your role as a steward seriously,

00:19:38.880 | it's more difficult to care for other people's money than it is for your own.

00:19:43.040 | And so then I started just to really understand more of the principles. And what happened is,

00:19:48.400 | I have at this point come much farther. I've come back to try to understand the principles and look

00:19:59.760 | to see what's happening, whether it's in the depression. In the depression, if you had a farm

00:20:05.200 | and you had food and you had hard assets, that meant that your family didn't suffer as dreadfully

00:20:11.200 | as if you were a high-priced stockbroker and all of your investments were in paper stocks.

00:20:17.600 | That's representative of the value of a company, and the value of that company is dramatically

00:20:22.000 | changing. And so even though I grew up saying, "Oh, always own stocks, always own stocks," I

00:20:26.880 | realized, "Wait a second. That isn't always true." Same thing with, I think for whatever reason,

00:20:33.680 | I guess just because the horror of that era in history of World War II and the wholesale

00:20:39.680 | slaughter of the Jews is so horrific, it just drives deep. And I think, "Who were the people

00:20:45.760 | that came through?" No matter if all of your business interests were paper assets and it was

00:20:51.760 | representative of your ownership of these operations, and the German government comes

00:20:55.920 | in and strips you of your ownership rights, all you've got is the gems and the gold coins that

00:21:02.640 | you can sew into your coat and the knowledge in your head. And so you use that to bribe your way

00:21:08.320 | out of the country, and you use the knowledge and the work ethic and the principles that worked

00:21:12.000 | before to apply in a new era. And I think that it's easy to go to the point where you say, "Well,

00:21:19.760 | look, that happened there, so therefore it's happening here." And that can be very dangerous,

00:21:24.240 | because then you wind up saying, "Well, I'm not going to own any paper assets. I'm not going to

00:21:27.360 | have a dollar. All of my money is going to be gold and silver coins." That can be very dangerous

00:21:31.920 | when you're not in that era. But it can also be very dangerous to just say, "Well, I'm not even

00:21:37.600 | going to think about this. History's never happened. These things that have happened before

00:21:41.760 | are never going to happen again, so therefore I'm going to just ignore all of that and put all of my

00:21:46.720 | money in the bank, because now we have this modern system that works better." And one of the most

00:21:52.880 | challenging things I find about what I do now is trying to understand how can you understand

00:21:57.280 | these principles of history and apply them in a way that is careful and accurate in an individual

00:22:05.360 | context. And I find that so challenging. And I don't even know. I'm still trying to figure out

00:22:11.600 | where that balance is and where those decisions are, because everything has trade-offs. If you're

00:22:15.760 | wrong in one thing, then it means this loss. If you're wrong over here, it means that loss.

00:22:19.760 | I don't even, at this point, know how to teach it, because I'm still trying to figure it out.

00:22:24.560 | I think we all are. The downside to diversification is when you try to grab all of these ideas,

00:22:34.320 | principles, tangible assets, and you've thinned yourself out. When one thing really hits,

00:22:43.360 | the rest of your portfolio suffers. So diversification is a great... I remember

00:22:47.360 | reading an article called "Diversification." And when one area is really hitting, you look like

00:22:52.320 | a moron, because you have all these other areas where you've spread yourself thin.

00:22:59.280 | And yet, when chaos happens, you look like a genius, because you have just enough stored up

00:23:05.040 | in one place or another to bail yourself out. So it really comes down to how do you view the world?

00:23:11.920 | Do you view it as a relatively safe and consistent place, or do you view it as relatively safe and

00:23:20.160 | consistent with very long tails? And the tails of the distribution, when you look at the damage

00:23:27.280 | that those tails can do, it's innumerable. And I think we sort of experienced some of that in 2007,

00:23:33.120 | 2008, the tail risk. And so having... I don't know. Sometimes I sort of laugh at preppers,

00:23:41.120 | people that do the prepping. And then sometimes I think, "You know what? Maybe they're smarter

00:23:45.600 | than I am." I'll share with you the best I've come up. And I've never heard this. Feel free

00:23:50.240 | to steal it if you find it useful and insert it into academia. But I've never heard anyone

00:23:54.480 | talk about this, but I did a show on this some months ago about looking at life through the

00:23:58.720 | concept of what I think of as the lens of scale. And what I mean by that is, if you are broke,

00:24:06.480 | and you're 22 years old, and you're just getting ready to get a new job, and you're completely

00:24:12.000 | broke, do you need to be worrying about how to expatriate gold coins and own them in an anonymous

00:24:19.600 | bank account? That's a total waste of time. You don't need to, at that point in time,

00:24:23.760 | be worrying about what happens if there's a collapse of the dollar, what happens if there's

00:24:28.480 | a war, what happens... You don't have anything that's going to make a difference. All you have

00:24:33.520 | is your human capital, and your energy, and your skill, and your social network, and those other

00:24:39.440 | assets that aren't measured in clear ones and zeros of financial assets. And so your grandfather,

00:24:46.640 | your great-grandfather and great-grandfather, whichever, if your $100 is all you actually have,

00:24:53.680 | then, and it loses if the $100 is not a big number in the money of that day, you've not lost much,

00:24:59.840 | because the $100 didn't make a major difference in your standard of living. You still had to go out

00:25:04.240 | and hustle, and work, and hire yourself out, and figure out how to succeed within the context of

00:25:09.280 | that economy. Now, fast forward. You've got $1,000. Do you have enough money to diversify it? No,

00:25:15.280 | you don't. You need to get that money into productive assets, and there's different ways

00:25:19.120 | to look at that. Now, you've got $20 million. Is it foolish if you have $20 million to think about,

00:25:25.760 | "You know what? Having an extra $100,000 invested in this paper asset over here is not... The

00:25:33.440 | potential return is not nearly as impactful on my lifestyle as is protection from some of these so

00:25:40.080 | called black swan events." So in the same way, I can't imagine why anybody who's very wealthy

00:25:46.240 | wouldn't have a bunker and a ranch in some place in the world that's a safe place.

00:25:51.680 | But that doesn't mean that I, if I have $100,000, that I can afford to allocate my assets in that

00:25:56.720 | way, because we've got a very improbable but plausible scenario that you're planning for.

00:26:02.880 | But if I take all my $100,000, that's my seed capital to start a business, or buy the ownership

00:26:09.520 | in other businesses, or purchase income producing real estate, and I take it all and move it over

00:26:14.560 | here, I'm planning only for one possible but highly improbable scenario while ignoring all

00:26:22.480 | of these probable scenarios. But that doesn't mean that I shouldn't have a couple months of

00:26:26.480 | food in my pantry, because that has a low cost. I'm going to eat the food anyway. And hey, if I

00:26:33.360 | lose my job, I'm going to be useful. So it's just that balance of scale. Where am I at this stage

00:26:38.800 | in my life? And I can't go when I'm just getting started and say, "That's it. I'm going to get rid

00:26:44.640 | of all of my dollars and go buy a ranch in the hills with a bunker on it." But again, it doesn't

00:26:50.640 | mean that I can't say, "You know what, if the Jews in Germany who had made some foreign investments,

00:26:58.640 | or the..." I don't know what it was. What would be historical? Like the Persians or the...

00:27:03.520 | What's that movie with Thor? Do you remember which ancient civilizations were that?

00:27:08.960 | - Oh, I can't remember.

00:27:10.240 | - It doesn't matter. My point is, envision an ancient civilization. My ancient history is

00:27:15.760 | completely gone. It doesn't matter whether you were a shopkeeper in Babylon and you're saying,

00:27:22.320 | "What happens if the Babylonian invasion, or what happens if this empire collapses?" History

00:27:30.000 | changes. And so recognize that, but then at the end of the day, it comes down to my situation.

00:27:35.760 | What do I have to do where I am? So I think of that as the lens of scale. Focus on where I am.

00:27:41.760 | If I've got $1,000, don't put it in the stock market. Keep it in $100 bills in my house so that

00:27:46.320 | I can go and get a deal on a beater car by putting down $300 when the price is $750. That's a much

00:27:52.880 | bigger difference than my 10% return in the stock market. That's my point. I think of that as a lens

00:27:56.560 | of scale.

00:27:56.960 | - I think you hit it right on the head, too. One thing I picked up in what you just said as well

00:28:01.840 | was human capital. That is a movable investment. And it's one that I feel like, and I use that

00:28:09.680 | term very broadly. Let me give you an example that does not include any of my boring lectures.

00:28:14.240 | One of the pieces of human capital that I've picked up is I buy a new house and I have to

00:28:22.240 | make repairs to that house. I could pay somebody to do that. Or if I could directly trade my labor,

00:28:30.000 | let's say in theory, it costs me $10 an hour and I could earn $20 an hour. Well, yes, does it make

00:28:36.880 | sense for me to hire that person to do it? Of course it does. The reality though is I can't go

00:28:43.200 | and always replace an hour of time with an additional $20. It doesn't work that way in

00:28:48.400 | real life unless you're selling something, I guess. Plus, if I go to learn how to do that myself,

00:28:56.880 | now I have knowledge capital that I did not start with. So an example would be I now know how to do

00:29:03.520 | some basic plumbing. I now know how to do a little bit of wiring in my house. I know how to make

00:29:10.000 | improvements to my home that it would have cost me a lot of money when you net all those together

00:29:16.080 | to bring somebody in to do those things. I own some tools now because I invested in those and I

00:29:23.760 | can carry those throughout the rest of my life. So there are some moments that you come across

00:29:28.640 | where you make an investment that's very transferable and it's an asset that nobody

00:29:35.040 | can ever take away from you unless they hit you on the head hard enough, I guess. It's always up

00:29:39.120 | there. So learning how to think on your feet, learning how to synthesize and process and doing

00:29:46.800 | it outside of your traditional field as well is something that in any circumstance, no matter what

00:29:52.320 | comes down the road, you're going to be able to navigate the path that you need to go down.

00:29:58.480 | Some people have an unfair advantage. They have a high cognitive ability, right? So maybe we need

00:30:04.000 | to do some leveling, eliminate a couple of those people so that dummies like me have a chance.

00:30:08.480 | In that concept, in my mind, that is the cornerstone of where we should always start

00:30:14.560 | with finance. Teaching finance is the concept of when you are born, you're worth nothing from a

00:30:21.600 | financial perspective. You have no financial capital, but what you have is you have a large

00:30:26.080 | amount of human capital. It's this time-money parallel is exactly what it is. You have,

00:30:30.480 | hopefully, a long lifespan where it's expected. The time is what you have, but you don't have

00:30:35.280 | money. So there in your early age, your entire goal should be to enhance your human capital

00:30:42.640 | in a way that's valuable to the market. The way you do that is by bringing on additional skills

00:30:46.240 | and abilities. We live in an economy that's a very high division of labor economy. That's what

00:30:51.360 | structures. The whole idea of societal collapse that so many people fear, all that is is a collapse

00:30:57.920 | of the division of labor where all of a sudden you go from having this highly specialized,

00:31:02.000 | highly technical skill of I teach financial planning or me, hey, I produce this entertaining,

00:31:07.120 | hopefully, entertaining show. But now, we're both chopping wood in the backyard. Well,

00:31:14.640 | pretty quickly, that economy gets to reset because the division of labor is what we owe

00:31:19.200 | our economic abundance to, is this highly specialized field. So the key is we need to

00:31:26.240 | learn, all of us, how to enhance first our skills and enhance our human capital,

00:31:31.280 | both in a specialized way with backup areas in case our skills become obsolete.

00:31:36.480 | And then that translates into financial capital over time.

00:31:41.680 | So you hit my sales pitch right on the head. Whenever I'm going out and interacting with

00:31:47.120 | freshmen on campus, my first pitch is, look, why don't you take a little bit of life skills

00:31:53.120 | coursework? It's called financial planning. And this terrible byproduct of you minoring,

00:31:58.960 | let's say, in financial planning is you know how to manage your money life. What a horrible thing

00:32:03.760 | for you to come out and have that. You have a backup profession if that's what you're looking

00:32:08.400 | for. And so that's one of the sales pitches I hit with students is diversify your human capital,

00:32:13.680 | be able to do a multitude of things in case one of them doesn't work out. What is it? The statistic

00:32:17.520 | we change jobs seven times across our life or something like that. Be prepared to be able to

00:32:22.480 | make those shifts if you want or need to. Plus, you may find that what you're you think you're

00:32:27.520 | interested in isn't so interesting. Right. And so I think you're right. The ability to synthesize

00:32:33.840 | the ability to use very applied knowledge is huge. And that's what I love about financial

00:32:40.000 | planning. It's the application of these theoretical financial concepts and constructs.

00:32:45.760 | Right. So let's talk about the academic academics of financial planning. You

00:32:49.680 | finished a Ph.D. in finance planning at Texas Tech. And then did you go into practice or did

00:32:55.200 | you stay and go directly into academia? No, I went my first job out was working at

00:32:58.960 | the University of Georgia. And so I stayed directly in the field. So we have a unique

00:33:04.240 | utility model in academia. Our utility is derived in a research one institution,

00:33:11.120 | more from our research than probably anything else. So you spend a lot of your time trying to solve

00:33:19.440 | research problems and write papers that five people read.

00:33:22.400 | In boring academic speak. Exactly. Exactly. I cannot get through even the three first three

00:33:29.600 | pages of some of the papers that you guys write. Imagine how we feel writing these things.

00:33:34.080 | I believe it. So tell me about the development of financial planning as an academic area of focus,

00:33:43.760 | because this is a fairly recent phenomenon. It is. You're talking less than 25 years.

00:33:48.080 | It's an amalgamation of so many different areas. Think about financial planning. You have insurance

00:33:53.760 | over here. There are people who go to school just to learn insurance. You have retirement. You have

00:33:58.880 | investments or people who go to school just to learn investments. You have a state. You have

00:34:02.800 | taxation. You have all of these areas that fit together. And so it requires a very broad,

00:34:10.640 | maybe quarterbacking approach. That's what we're training these students to do is you can maybe

00:34:17.440 | specialize in one of these areas later if you want to. But today you need to have a general knowledge

00:34:23.760 | of how all of these work, how they all interact with each other and how you can make them

00:34:28.960 | efficient. So in the traditional model of academia, it fits in a lot of places. For example,

00:34:37.840 | we teach financial planning classes in a college of agriculture, which some people may think,

00:34:42.480 | "What the heck is that?" It's the applied side. I have tons of applied economists, agricultural

00:34:47.920 | economists that are solving very similar problems. It just turns out theirs are food-based or those

00:34:54.480 | are cattle-based. Now I'm taking that knowledge that they already have and saying, "Let's solve

00:34:59.680 | a new problem. It's a financial one." And I get some of the most incredible students,

00:35:04.240 | one, because they understand if you've been poor, you know what that feels like.

00:35:08.960 | There's a relatability there. That's why Mississippi always comes up as the state that

00:35:13.120 | tends to give to charity as a percentage-wise greater than any other state in the country.

00:35:17.600 | I didn't know that.

00:35:18.000 | Oh, absolutely. It's because they understand it. They get it. They know what it feels like.

00:35:22.240 | And so when you have these students that can relate, they become incredible students. They

00:35:28.560 | have less of the entitlement syndrome. They're really, really great students. So

00:35:35.520 | we take that knowledge that they already have in place with their micro and macro economy

00:35:41.040 | understandings. They understand the way the world works around. Now let's get inside this house

00:35:46.400 | and let's talk about some household issues, some very micro, micro, micro, I might call it,

00:35:52.880 | economics, which is the working with a family.

00:35:56.400 | So there are other colleges that are like us, Texas Tech, where I did my PhD,

00:36:00.880 | is actually in human sciences. And again, I think the core thought originally was all

00:36:05.920 | financial planning is going to be in a college of business. Sometimes the landscape, and my prior

00:36:12.160 | job was teaching in a college of business. Sometimes the landscape's a little bit difficult

00:36:16.000 | because of the regulating bodies and so many other complexities around housing this in different

00:36:21.600 | places. So if you look at universities across the country, you'll see agricultural economics,

00:36:25.920 | you'll see human sciences, you'll see departments of finance, departments of accounting.

00:36:30.400 | I mean, financial planning is still trying to figure out what it is, and it will for many

00:36:36.800 | years to come as we evolve to a profession. Are you seeing students that go to college

00:36:44.320 | to focus and study financial planning, what types of career decisions do they make coming

00:36:49.920 | out of college? Are you seeing a trend of a specific type of firm they go to or a specific

00:36:54.720 | way that they set their career up as compared to students who haven't studied in an undergraduate

00:36:59.920 | degree program? So the first statement there isn't true, and we don't see students come to college

00:37:06.160 | to go to financial planning. So I never got out of sales. I told you I tried to get out of this

00:37:11.520 | whole sales game. I just, I do it differently now. No, it's interesting. There's a study I read not

00:37:18.240 | too long ago, and it was out of the UK. I've not seen it produced in the United States. It'd be a

00:37:22.000 | great research study if anybody wants to do that. And what they looked at is K through 12,

00:37:28.560 | they interviewed focusing more on those close to graduation. They asked them, "When you grow up,

00:37:34.800 | what do you want to be? Would you like to enter financial services?" And the response rate,

00:37:40.080 | the positive response rate on that was 9%. Wow. 9%. And so then they started to drill down and say,

00:37:46.160 | "Why? What's going on here? Why would none of these students want to enter financial services

00:37:50.480 | as a profession?" And when they drilled down, what they were finding was their perception was off

00:37:57.200 | base. Because think about it. When we watch movies, when we watch television, what are

00:38:04.000 | they portraying? Wolf of Wall Street, Wall Street, Boiler Room, movie after movie after movie that

00:38:10.400 | makes this profession sound pretty dirty, especially if you don't really know what

00:38:14.240 | this profession is. You lump it all together. Secondly, when they go to mom and dad,

00:38:20.480 | mom and dad maybe have terrible experiences with their finances. So they say, "You don't want to

00:38:25.120 | do that. That's dry and it's boring." Then they go to their guidance counselor in high school,

00:38:29.840 | and their guidance counselor says, "I don't know. I haven't really dealt much with that."

00:38:34.240 | And so they received no guidance correcting the ill-conceived sort of perception that they have

00:38:41.280 | around this industry. And so when they were even interviewed and said, "I do this with my students,

00:38:46.080 | not those who are involved deep in the program, but new ones." I say, "When I say the word

00:38:52.240 | financial planning, what's the first thought that comes to your mind?" And some of them,

00:38:57.920 | unfortunately, have very negative thoughts. It's boring or it's numbers or it's greed or it's old

00:39:03.680 | white man or it's whatever it is. It's a very homogenous though thought process on what that

00:39:09.840 | person looks like that is in this profession. And so when I speak to, let's say females who are in

00:39:17.120 | college and I tell them, "Are you interested?" And they said, "Are there any females in financial

00:39:20.960 | planning?" I said, "No, but that's why we need you." So there's this perception that we've got to

00:39:29.040 | bust through. And I can't tell you how much of my time is spent correcting bad impressions of what

00:39:38.160 | we are. So we started at my university, for example, we started a video series and it's

00:39:45.040 | called This Is My Profession. And what I do is I've gone around and I've found some young planners,

00:39:50.480 | some old planners, some international planners, some African-American planners. And I just say,

00:39:56.480 | "Tell me how you got here and tell me why you love it." That's it. It's a one minute spot.

00:40:00.640 | What I'm trying to do is show the next generation that this is a valuable job. More than just the

00:40:08.560 | money it provides, you are changing people's lives. Step two, we're going to interview some

00:40:13.120 | clients as well and say, "How has your planner impacted you?" I want them to get involved and

00:40:18.960 | to see it and to get it because they don't right now. And so we spend so much time just showing

00:40:25.280 | them what the possibilities are that now I got to actually teach them how to do it.

00:40:30.240 | It's interesting. I need a tagline, a subtitle, a marketing slogan for radical personal finance.

00:40:38.800 | And I've really struggled to figure it out because I resist any of the advice that tells me, "Joshua,

00:40:46.000 | understand what your niche is and stay niche." And I'm like, "That's too boring to stay in a niche.

00:40:50.400 | I don't want to talk about this every day. I want to talk about everything."

00:40:53.920 | And as I've worked and worked to try to figure out what is the slogan of this show,

00:40:59.360 | one of the things, and it's a terrible marketing slogan, but it's true,

00:41:02.480 | is, and I can't figure out how to put it in words that make sense, but one of the things I think

00:41:07.680 | constantly about is practical goal attainment or taking goals from the ethereal to the practical.

00:41:14.960 | And that's what I think of financial planning. We'll have to talk later and you guys can write

00:41:19.440 | me a check and I'll be your advertising role for your financial planning program.

00:41:25.360 | Because I cannot think of anything that is more interesting than financial planning,

00:41:30.080 | because financial planning is what allows each and every individual person to accomplish their

00:41:35.680 | goals in life. And this is how I think of it. Every single goal you have in life involves money

00:41:43.440 | in some way, because money is the way that we have our lives structured. There is a certain

00:41:49.280 | cost to living. So if your goal is, "I'm going to take a year off and go hike the Appalachian Trail,"

00:41:55.840 | that is a clear financial planning objective that needs to be planned for.

00:41:59.920 | The question is, what expenses are you going to have on the road? What expenses do you need now?

00:42:03.840 | So you sit down and you figure out, "Well, I'm going to spend, I'm going to buy some gear,

00:42:07.520 | so I need a thousand dollars worth of fancy gear." Okay? That is an immediate cashflow need

00:42:12.480 | of a thousand dollars lump sum at a specific date. At what date are you going to go and hike

00:42:17.040 | the Appalachian Trail? Time value of money does help.

00:42:19.440 | Exactly. Now, we've got a date. I'm leaving on, well, you probably wouldn't leave January 1,

00:42:23.920 | spring, March 1, or whatever. I don't know when spring is. So I live in Florida. We don't have

00:42:29.040 | seasons. So let's say you're going to go on March 1. Well, March 1 of this year, I need a thousand

00:42:36.320 | dollars. These expenses. Now, I need monthly costs. I need a certain amount on an ongoing basis.

00:42:42.160 | What's that number and for how long? So now you've got your cashflow needs. So now we can calculate

00:42:47.600 | back from that to a present value need at this date, and you can figure out what you need to save.

00:42:52.480 | So there's all of the financial planning technical language that, "Oh, cashflow. I don't know how to

00:42:58.080 | do a future value and a present value and a discounted... This is intimidating." No, it's not.

00:43:02.800 | It's normal. It's intuitive. And so we can calculate, if you want to go hike the Appalachian

00:43:07.280 | Trail, that it needs a financial plan behind it. It's no different to calculate a 35-year

00:43:14.960 | retirement plan. It's just a little bit more numbers, a little more data. It's a little harder

00:43:20.000 | because we don't actually know over the course of 35 years as much as your one year hiking the trail,

00:43:25.920 | but it's no different. And so every single goal in life has a financial component.

00:43:31.440 | Raising kids has a financial component. Tell me about it. Yeah. Planning for... My wife,

00:43:37.520 | planning for when she... I get questions sometimes on the show about how do I plan for a spouse to

00:43:41.600 | stay home. So my wife, she was working outside the house. And then when we had our first son,

00:43:46.480 | then she came and she started working inside the house. Well, that's a financial plan. That's a

00:43:50.000 | goal. And so the key is to understand that it's all connected to financial planning.

00:43:57.680 | But what happens, I think, is people don't... It's like, why do I want to go and plan for 65

00:44:02.800 | when I'm old and boring? And I say, no, you don't have to do that. You want to plan to be

00:44:06.000 | financially independent at 30 and you're 20? I can plan that for you. Now, it's going to be

00:44:09.920 | different parameters and different constraints on the plan than if you want to be financially

00:44:13.120 | independent at 70. But financial planning is fun. It's exciting because it's how do I get from this

00:44:19.360 | ideal vision, this, "Oh, I did this fancy goal-setting exercise. This is so fun,"

00:44:23.600 | to actually, "What's the next action? What is the next action that I need to do today

00:44:28.400 | to get me to that goal?" So you said some things there that I think some people haven't thought

00:44:33.840 | through. You had some goals that you spit out. I think, unfortunately, with some clients that we

00:44:39.040 | come across, and especially with students that I come across, they've never even thought through

00:44:43.920 | a lot of goals. And so this idea of having a goal is almost new to them. And so I actually have to

00:44:49.760 | help them with goal discovery of just determining because they have this nebulous idea of, "I want

00:44:54.480 | to do stuff, but what is stuff equal to?" Then I can put dollar constraints on it. I mean, dollar

00:45:00.160 | is just a placeholder for time, essentially. So I can put dollars in it and I can associate that

00:45:06.720 | with those goals. But for them, I actually spend one of my introductory literacy classes, what I do

00:45:13.840 | is I just have them define some goals. I said, "10 years from now, you know what you would do

00:45:19.040 | with the client. 10 years from now, how would you define your success? What would that look like for

00:45:24.080 | you?" And so we spend some time just doing goal discovery. And even when I was in practice,

00:45:28.800 | and I would talk to people who were, let's say, approaching retirement, and they would tell me

00:45:32.560 | they wanted to retire. And I would say, "Why do you want to retire?" "I hate my job." "Well,

00:45:38.400 | that's probably a pretty good reason. But when do you want to retire?" "I don't know."

00:45:43.600 | And so we could back in and we could add the dollars in to equate to that. But I was finding

00:45:51.440 | that I was coming across people that would retire and I would ask them the question,

00:45:54.800 | "Why did you retire at this date?" And what I was finding is because their neighbor did.

00:46:01.840 | It was a proximity decision. Those things that were close to them made them make their decision

00:46:09.280 | rather than using a rational thought process that you're talking about, which is planning.

00:46:13.280 | Attaching dollars and time to that decision. It was just randomly based off of what was close to

00:46:20.960 | them and what it looked like. So that's how they made a decision. So what I love about financial

00:46:25.680 | planning, because I'm kind of organized in some ways, not my hair, but the rest of me,

00:46:30.320 | an organized guy that I like to have a plan of action. And it doesn't have to be a financial

00:46:36.160 | plan. It can be just a goal plan. Beginning of the year for my wife and I, how do we want to

00:46:40.800 | grow our relationship better? You can talk about that all day long, but if you don't really have

00:46:46.960 | serious communication about how you're going to do that, you drift apart. And next thing you know,

00:46:52.240 | you don't know each other anymore. So this planning concept, this idea of putting it on paper,

00:46:58.880 | making decisions in community with your planner or with your spouse or whatever that looks like,

00:47:07.120 | really impacts people's lives. It has a huge impact. And that's what I love. Maybe I'm making

00:47:13.680 | what we do sound better than it is because I'm involved in it. Don't we all do that? We build

00:47:17.360 | up how great our profession is. But I really think I've seen it. I've seen it firsthand,

00:47:22.320 | how people have come out the other side and said, "Whew." That exhale of, "All right,

00:47:28.560 | we're moving. We're doing something." Two weeks ago, I had a friend of mine call me.

00:47:35.360 | I do almost no financial planning. Every now and then, someone's able to get me because I'm

00:47:39.280 | 100% focused on building this show. But every now and then, someone's able to get me to have

00:47:44.000 | a conversation. And I watched, and this friend called me and I said, "Sure, I'll sit down and

00:47:50.560 | talk with you." And I told him I'd sit down and talk. They came into the conversation so incredibly

00:47:56.960 | stressed. The thing was they wanted to start a business, but they don't know where to get the

00:48:01.760 | money from and trying to say, "Do I get the money out of a 401k?" And so I sit down and we just have

00:48:07.200 | a chat. And I said, "What are your goals? What are you trying to do and where are you?" And figure

00:48:11.760 | out what's the income, what's the debt, what are the goals, what's actually needed for the business.

00:48:16.640 | And just a simple conversation took 45 minutes. And I could almost visibly see the stress levels

00:48:24.400 | just melt because I said, "Look, this isn't that tough. We can make this happen pretty quickly."

00:48:29.920 | It's so difficult for us when we're in the middle of life to know how to do this.

00:48:35.120 | Whereas somebody from the external who's not involved with the emotion of our life

00:48:40.960 | is able to basically shut everything out and just kind of calm things down.

00:48:44.640 | And this, in my experience of trying to teach financial planners, casually, I've only done it

00:48:51.280 | a little bit in kind of a formal setting, but this is one of those skills that has frustrated me to

00:48:56.000 | no end to try to teach financial planners and say, "The number one skill is very much about coaching

00:49:01.120 | and about this goal question." What often happens is financial planners say, "I'm supposed to ask

00:49:05.280 | about your goals. So let me have a kind of a cursory thing of what are your goals in five

00:49:09.280 | years, personally, professionally, and financially?" And I say, "No, stop. If you don't get past that

00:49:14.320 | question, it doesn't matter. And if you have an hour with a client and you spend time and I don't

00:49:19.600 | know how you teach students, but I stole Dan Sullivan's question. He runs a coaching organization

00:49:26.320 | called the Strategic Coach and he phrases his question and says, "If we're sitting down,

00:49:30.640 | pretend for a moment we're sitting here three years from today, what has to, looking back over

00:49:34.720 | the last three years," which is a great way to phrase a question, kind of rearward looking,

00:49:38.640 | "What has to happen for you personally, professionally, and financially for you to

00:49:42.160 | feel satisfied with your progress?" Now, I blew through that. But if you slow down and ask that

00:49:46.720 | question, if you spend an hour talking about the answer to that question and you as a planner,

00:49:51.520 | just write down those questions and then you leave, as far as I'm concerned, that's a successful

00:49:56.800 | appointment. Because you know what? I can email over a form and, "Listen, write down how much

00:50:00.400 | money you have. Write down this. Send me your tax returns. Send me your investment statements." I can

00:50:04.480 | do all that via email. But I can't, if I can get to shut the world out and just dream for a moment

00:50:11.120 | and then figure out where you actually want to go, we can make a plan. And I just see this as one of

00:50:16.400 | the biggest mistakes I see advisors making is they blow through that and say, "Well, I just got to

00:50:19.840 | get to the money." No. The money is easy if you know the goals. But if you don't know the goals

00:50:24.560 | and you can't connect the plan, then the money will always frustrate you. And no matter how, what,

00:50:29.520 | you know, no matter you know every security in the portfolio, you're doomed if you don't know

00:50:34.240 | what the goal is. Because the answer, if you know the goal is, "I want to take this trip around the

00:50:38.400 | world," you might need to just sell the portfolio today, put it all in cash, and plan for the trip

00:50:42.640 | around the world. So I think you could almost have a degree in client communication. Absolutely.

00:50:50.080 | Because that, and I'll lump my program in there as well. We always, again, start the beginning

00:50:57.440 | of the year looking at where we have strengths, where we have opportunities. And we don't like

00:51:02.720 | to use the word weaknesses. Of course not. Opportunities for us are in that communication

00:51:09.280 | area. I mean, I can only do so much as a faculty member, right? There's something about real

00:51:13.120 | experience too. Absolutely. Until you sit down with somebody, I mean, this is not, I don't usually

00:51:19.440 | walk up to people that I meet at a conference like we met and say, "Hey, Nathan, tell me about your

00:51:23.680 | goals." Like that's an unusual question. And so it's one of those things I think that has to be

00:51:29.920 | learned in practice. It does. And that's why we push internships. I would encourage people in

00:51:35.040 | any arena or avenue that they enter, no matter what you're studying, spend some time. We've lost

00:51:41.840 | the concept of being an apprentice. This seems like some old world idea of being out there and

00:51:47.200 | carving stones together or something. The idea of apprenticing under somebody, because we're always

00:51:51.840 | in such a hurry today. It's how do I get to where I want to be as fast and as efficient as possible?

00:51:56.960 | Sometimes getting to where you want to be requires you to slow down a little bit so you don't

00:52:01.680 | crash off the end of the road. And I found that whenever I, you can start out maybe with just

00:52:08.640 | this concept of a mentor. Just having somebody you can bounce questions off of. I force my students

00:52:14.000 | into that. And I say, "You got to do that." Taking that a step further towards maybe a internship,

00:52:20.480 | that's just critical elements because you learn the pieces, the nuances that I can't teach in the

00:52:26.560 | classroom. My dad, I brought him in a couple of times in some of his little sayings, but one of

00:52:32.320 | them is that knowledge comes from books, but true wisdom comes from experiences understood.

00:52:41.520 | And if you want to be wise in this profession, you have to have experiences that you draw on.

00:52:46.080 | So you either create those yourself or you go out and you find somebody that's experienced them,

00:52:51.120 | and they can share that cognitive capital with you. And so moving from an internship,

00:52:56.960 | even into a long-term, maybe an apprenticeship relationship where a student or somebody

00:53:03.040 | entering this profession works together with somebody and is willing to forego this monstrous

00:53:09.360 | salary and chasing after the big bucks. So they can truly learn some of the small pieces of how

00:53:17.760 | this whole puzzle fits together. Even for me, I'm learning all the time and I have my academic

00:53:24.640 | mentors and I apprentice under them. And then I have my financial planning mentors, the Harold

00:53:31.120 | Evenskis and the Dina Katz. So many names could come into play that they've been around and they've

00:53:37.200 | seen it and they've seen multiple market movements and they know people, they know the human element.

00:53:42.160 | Those nuances are incredible. And we need those things brought together because

00:53:47.200 | I think of people like Dr. Wade Fowl. Here's Dr. Wade Fowl up at the American College spending all

00:53:52.720 | his time researching. If he has to go out and meet with clients, I don't see any possible way that

00:53:58.480 | you can do great research and go meet with clients. But he completely misses, by being

00:54:04.800 | academic, he completely misses that side. You bring me any 60 or 70-year-old financial advisor

00:54:12.560 | who's been an advisor. I don't care the firm. I don't care the practice model. I don't care the

00:54:17.760 | fee structure. Give me that person and I'm going to make a pretty solid bet that they have built

00:54:24.400 | a stable of clients that love them. But they may not be technically proficient. And their clients,

00:54:30.320 | you know what? Their clients don't care that much that, "Oh, I could have returned this a

00:54:34.400 | little bit more." What they know is they have a plan that is meeting their goals. And I don't

00:54:38.080 | care whether they're a State Farm Financial Services rep or a Morgan Stanley rep or a Joshua

00:54:44.320 | Sheets independent financial advisor. You bring that person and bring that human experience.

00:54:51.520 | And both of those together for a student, man, what an amazing thing to learn from someone that

00:54:56.800 | says, "Sometimes you need to put the charts and graphs away and cry with your client. And sometimes

00:55:02.080 | you need to dream and just say, 'This is what you need to do and ignore the whole presentation.'"

00:55:06.880 | And then you bring sometimes the academic side because you, me as a practitioner, I've got to

00:55:11.600 | make sure that I know what's going on. I need to know the cutting edge science because that's my

00:55:14.720 | professional responsibility to my clients. But I don't have to tell them at all, all the time. I

00:55:19.600 | just need to make sure I know it. And we've got to bring those things together and gain on that

00:55:23.840 | human experience from someone who doesn't have the academic background and the academic.

00:55:28.160 | Well, that's the marriage that I think academia needs to grow towards. Everybody's always talked

00:55:32.880 | about the ivory tower and the arrows that academics shoot upon everyone else as they rain down terror

00:55:39.520 | on the masses of students. I think we've got to open the front door and especially in a field

00:55:45.280 | like financial planning. If we want to grow as a program, we have to stay innovative. That's part

00:55:50.640 | of the reason we come to conferences like the T3 conference with students. Students here are

00:55:55.600 | competing where they're doing a case challenge. They're competing where they are doing a quiz

00:56:02.240 | bowl. So they're learning some aspects, but they're also learning from the profession.

00:56:05.360 | Simultaneously, I as a professor am learning the latest technological trends. How do I introduce

00:56:11.600 | a specific software into my classroom? So the students come out ready to hit the ground

00:56:16.960 | running. So secondly, I think it's even in the pedagogy, the teaching aspect, that we cannot be

00:56:24.000 | this isolated island out there of teachers. The reality is like you said it, I don't practice

00:56:30.320 | full-time anymore. So I have some connection, but not the direct connection that some

00:56:36.400 | individuals that are out there doing it do. So introducing more of them into our programs from

00:56:45.280 | a research standpoint, I can come up with research ideas all day. That doesn't mean that they're

00:56:49.360 | practically applicable. So marriaging my research with what's going on in the industry to where we

00:56:58.640 | can even get to the point where we're neck and neck and we're leading out with some very practical

00:57:02.640 | research that's usable, that's usable in our practices. These are things that we have to

00:57:08.080 | open our doors up to. We have to be willing to change or these other methods are going to take

00:57:17.200 | over. We talked a little bit earlier about the concept of what does the university of the future

00:57:22.960 | look like. Right. I've been out of practice for seven months now. I've lost, I would say 10%

00:57:28.480 | of my sharpness in just in seven months and just my ability to connect because I'm out of practice.

00:57:34.240 | You're at Texas A&M, right? Do you have both an undergraduate and a master's degree program?

00:57:40.720 | We don't. At the moment, all we have is an undergraduate and we have what's called an

00:57:43.760 | extended learning. So when we sat down and decided what's our core values, what do we want to do?

00:57:49.040 | We wanted to change our campus and we wanted to change or provide an opportunity for career

00:57:54.480 | changers. So people who are out there in the field that are, either they just want the designation,

00:57:59.920 | they want to stay where they are, they want to get the CFP designation or they want to make a move

00:58:04.400 | or they just want to learn about these products or, I said the dirty word, these products.

00:58:09.760 | They want to learn about this profession. That's what we want to train.

00:58:17.040 | So what does an undergraduate financial planning degree look like? What does the course work? How

00:58:21.120 | is it structured over the course of the years of study? What does it look like?

00:58:24.320 | They come into their financial planning classes their junior, senior year. They're going to build

00:58:28.560 | out their other classes just like they would, core knowledge, English, world history. In Texas,

00:58:33.840 | we have about 50 Texas history courses that they have to take learning about how we were a country.

00:58:38.480 | The great republic of Texas.

00:58:40.080 | Then their junior year, they come in and we start to provide some of the financial planning

00:58:48.400 | curriculum. We're lucky that we already have great professors in place that are teaching

00:58:53.040 | sort of ancillary classes like sales. We have a sales course where they actually sell and they

00:58:59.600 | learn what that looks like, what that interaction looks like. I always tell my students, everyone

00:59:04.800 | in here will sell and they get real nervous. I'm like, if you've ever had a boyfriend or

00:59:08.640 | girlfriend, you have sold and some of you really had to sell hard.

00:59:13.760 | I'm glad you said that. The biggest thing I see and it bugs me to no end. I mean that in a nice

00:59:19.920 | way because I know listeners have emailed me and said, I don't want to sell. Are you kidding me?

00:59:24.560 | You're always selling.

00:59:25.520 | Everyone is always selling. If you're not selling, you are broke and bankrupt. We are all selling.

00:59:31.440 | The question is, for whom are we selling? If I'm the CEO of any company, I am constantly,

00:59:36.960 | my fiduciary duty is to be selling. I expect any person that I hire to be selling for my company.

00:59:43.680 | And for my business, we are all selling all the time. And that is good. Sales is good because

00:59:49.520 | it's the essence of the economic engine that provides the standard of living that we all

00:59:54.240 | just love so much is sales. And I love to be sold to professionally because a professional sales

01:00:01.520 | person is going to understand what I want. And then if their product or service or whatever is

01:00:05.920 | a fit, they're going to sell me like crazy. And sometimes they're going to press me right over

01:00:10.800 | that edge where I'm not so sure, do I really want this fancy thing or not? And sometimes I'm glad.

01:00:16.480 | I'm so glad that I'm sold and that they helped me. But that doesn't mean that we've got to be

01:00:21.760 | unprofessional where you're connecting people that are a bad fit with a product or service.

01:00:27.120 | That's what people hate. But any good, successful, professional sales person,

01:00:32.320 | I've never heard one say, well, this is what I do. I always just push people into

01:00:37.200 | things that are not right for them. Now, there is a slippery slope where it's easy to convince

01:00:42.160 | yourself that you're doing something right. So take whatever. And sometimes you have to just

01:00:47.440 | some people in some professions, I think, justify to themselves, well, what I'm doing is ultimately

01:00:52.640 | in the long run, good of this person. And you can kind of create this obstruction for yourself. But

01:00:58.560 | professional sales is a critical element. It's awesome. It is.

01:01:05.840 | Oh, no, it's great. And it's usable. It's knowledge that a student can transfer.

01:01:10.160 | You get your first job, you got to sell yourself. So in the interview, we teach sales. We have an

01:01:16.800 | entrepreneurship class where they actually build a business for my students. The last two built an

01:01:23.280 | RIA firm. So they get to go through those processes and they have that apprentice underneath somebody.

01:01:29.680 | It's a very short term project. It's a semester long project.

01:01:32.240 | Did they build a firm for themselves?

01:01:33.760 | They build a firm for themselves. So they build their own firm. They actually have to get

01:01:38.400 | fake funding, everything, all that you would do to lay out to build a firm up,

01:01:42.640 | have a business plan, everything is they're going to go sell to a bank to where in theory,

01:01:47.120 | if they really wanted to coming out, they could use that packet to begin to start a business.

01:01:53.200 | And then we go into a lot of the just core financial planning all the way from the introductory

01:01:58.800 | fundamentals course to the very end, we do capstone. And what I love about the capstone course

01:02:03.840 | is we're introducing them to clients. Last semester, it was actually last summer when I taught

01:02:08.640 | capstone, they had real clients. Now these clients understood the game. They understood the relationship,

01:02:15.840 | but they had real clients that they got to interact with. And it was a ton of teachable moments.

01:02:22.240 | It was a man and woman and the man tended to have more of a dominant personality, but the woman

01:02:28.720 | actually controlled a lot of the finances in their relationship.

01:02:32.000 | Welcome to normal families.

01:02:33.920 | So the students actually interacted with the clients online. And so as they're presenting

01:02:43.840 | the final plan to the clients, it was so intriguing to watch how even some of my female

01:02:51.120 | students spent all their time talking to the male and ignoring the female in the conversation.

01:02:56.720 | And it was a teachable moment where I'd say, let me stop you right here. And I want to explain

01:03:01.600 | what's going on because I'm in the room with the two clients. And I'm saying, let me explain

01:03:06.560 | the body language that you're not seeing. But many of you need to know this because when you go out

01:03:12.640 | and work for a firm, there'll be a percentage of clients that you interact with on the phone

01:03:16.720 | or via the internet. And you need to understand those relationships and what's going on.

01:03:24.000 | I said, you have not spent any time talking to the female who actually, because I know them,

01:03:30.480 | manages the money in this relationship. You just lost this client.

01:03:34.240 | Absolutely.

01:03:34.800 | So it was great. Teachable moments, soft place for them to interact for real with real people

01:03:40.880 | and get to feel that. So it was great.

01:03:44.720 | That was one. You learned that lesson as a new financial advisor very quickly because

01:03:49.680 | I always had a rule. It was okay on an initial appointment to meet with one of the spouses.

01:03:56.320 | But if you're married or there's any kind of significant relationship to where you manage

01:04:00.480 | money together, would never do a second appointment without both people present.

01:04:04.720 | And you've got to spend a massive amount of time at the beginning of that next appointment,

01:04:09.360 | making sure that everything that the one spouse or the one person, one partner

01:04:13.840 | described to you is consistent with the other one. Because in my family, I may be the spokesperson.

01:04:21.200 | I'm usually the public one, but I don't spend a dime. A dime is probably too expressive.

01:04:27.520 | I don't spend money without my wife's approval because I need that. I know. And I do that out

01:04:32.640 | of for my own personal safety and for the safety of our financial plan, because I'm the impulsive

01:04:37.440 | one. I'm the one that's, I'm the easy sell. I'm the impulsive one. She's the skeptical one.

01:04:42.400 | So she's my safety net to guard me from myself. And so one of the rules I have is I need her input

01:04:49.840 | on every decision. See, I think money is spent well in community. I think we were built to be

01:04:56.320 | communal beings. Whenever you have a backup for your craziness, man, it just is such a wonderful

01:05:03.360 | thing. I love, and I think that's in some ways what a financial planner provides too, is just

01:05:08.720 | that springboard to say, "We were thinking about buying a brand new Escalade, but we make $5,000

01:05:18.000 | a year. Does this make sense?" The car dealer told us it made sense. If you're living in Miami,

01:05:22.720 | it makes sense. That's what they do in Miami. I want to come back. And I asked you this question

01:05:30.240 | earlier, but I wasn't quite satisfied with your answer. So your students, have you been long

01:05:37.520 | enough to now where you've graduated students from your program? What types of jobs and positions

01:05:42.320 | have your students who've graduated with a degree in financial planning taken out of college so far?

01:05:47.360 | Sure. So I guess like any field, not every student is going to go directly into the field that they

01:05:53.120 | graduate from. I think that would be an irrational expectation for us to think that every student

01:05:57.680 | exited a degree and went specifically into that field. Our students are entering a myriad of

01:06:05.040 | firms. Some will go into more of the corp side into banking. So I have a number of students who

01:06:11.920 | have graduated that go into banking. The biggest bulk though, go directly into financial planning.

01:06:17.600 | My push at the moment is RIA firms. I do have some of them go to the larger TDs, Fidelities,

01:06:25.840 | because they can hire five students at a time. But the bulk of my students, the sales pitch that I

01:06:32.080 | have is this is your succession plan. And so I'll find RIAs at conferences all across the country,

01:06:38.960 | and I'll get to talking to them. And I realized they're 55 and they don't really have a plan out,

01:06:44.960 | but they know they don't want to be in business forever, but they can't afford to hire somebody.

01:06:49.120 | And my response is you can't afford not to hire somebody. And so I've built up a relationships

01:06:55.520 | with people in Texas and other states across the country where I say, let me tell you what

01:07:01.680 | your succession plan should look like. Millennials, what they're looking for, they seem to come across

01:07:07.680 | as very aggressive, but what they want in the end is a clear pathway to ownership. If you can show

01:07:15.040 | them this is where you can be and here's how you can get there, they're satisfied with that. They're

01:07:21.200 | not just vying for your job today. They just want to know how they can get there. And so what I tell

01:07:27.600 | them is here's an opportunity for you to build out a succession plan where somebody can come to work

01:07:32.960 | for you and in that process, buy out your firm. So we've got a number that are going into RIA firms

01:07:39.760 | where there's one person. Now they're the second add-on. We've got some that are going to mid-level

01:07:44.480 | firms where there's 15. I'd say the overwhelming majority though are hitting RIA firms or the

01:07:51.760 | TDs and Fidelities out there. We send a couple out to wire houses, and I'm not one of those that

01:08:00.160 | stop students from going anywhere. I don't feel like any company is, well, there are some evil

01:08:05.360 | companies. I don't feel like any company is necessarily a bad place. What I do is inform

01:08:12.640 | students and let them make their own choices of, hey, if this is what you want, I want you to

01:08:18.800 | understand what you're getting into by going to work at X company. And so just providing them,

01:08:23.600 | my job is not for them to have my opinion. It's for them to have information to inform themselves

01:08:27.840 | to make the right decision for them. And so I provide them with the different financial planning

01:08:32.080 | models and what I'm finding at the moment, just given what opportunities are available for

01:08:36.960 | students, they're trending towards mid-level RIA firms across our state and other states.

01:08:44.800 | Are you hearing frustration from some of your graduates or from their peers working in mid-level

01:08:51.840 | firms as a junior planner, where perhaps the founder or founders kind of cut their teeth in

01:08:58.160 | the stock brokerage world that you did? Are you getting that frustration?

01:09:02.400 | Yeah, we get some of that, of course, everyone does, because the emphasis is so high on

01:09:10.480 | you come in here and you've got to, planners, what some planners unfortunately want is for you

01:09:16.160 | to be cashflow positive instantly. You come in this door and you generate the money that equals

01:09:21.600 | to the salary that I just paid you, or you aren't worth my investment. And I think that's a backwards

01:09:26.480 | philosophy. I think that if you want to hire young, innovative talent, you've got to be,

01:09:32.800 | the key word is investment. You've got to be able to invest in them and it's a long-term process.

01:09:38.640 | And it's scary. If you're a small RIA, you can't afford to make the wrong hire. And so that's why

01:09:43.760 | they're looking for an instant return of capital. And those are the students that come back to me.

01:09:47.600 | They say, I just started for XYZ company and they wanted me to sell a large amount of product or

01:09:56.960 | plan or whatever it might be quickly. And I just didn't have the natural market for that. I just

01:10:02.000 | don't know enough people and they didn't provide me with a structure to get introductions into

01:10:07.840 | that world. So those are the people that would come back to me. Yeah.

01:10:10.720 | It's a bit of a nervous tension in this business right now, because I personally,

01:10:14.960 | and again, I'm not involved in every company, but I see this transition happening where

01:10:21.600 | in the past, simply there were no qualified financial planning graduates. People who had

01:10:29.920 | studied for at least, if let's say that the last two years of an undergraduate degree are

01:10:34.720 | specifically focused on financial planning. They're coming out quickly sitting for their CFP

01:10:39.120 | exam or other industry credentials. And that person is going to have a different expectation

01:10:45.120 | than I did when I started. And I'd never taken a financial planning class. I was just a personal

01:10:48.960 | finance junkie and I didn't have any industry credentials. And so I understood that I got to

01:10:54.000 | go and learn and I had to learn on the job, but I would have a different expectation if I had spent

01:10:58.880 | a lot of time focusing on it. And when I think about, even as I'm here at the conference,

01:11:04.800 | I'm staying with Alan Moore and another young man, both Alan Moore and this other young man,

01:11:11.600 | both of them have an undergraduate degree and a master's degree in either tax or financial

01:11:16.480 | planning. And so they wind up at this firm as a junior planner and it's like, there's no growth

01:11:25.840 | potential here. And I've spent enough time studying. You can't expect me to either just,

01:11:30.640 | A, sit in the back office and do plans or B, just get out and cut your teeth like you did 40 years

01:11:35.920 | ago. And it's so interesting. I read a lot of the research about millennials and there is a bit of

01:11:44.080 | a generational frustration because my experience, I don't think I don't have a sense of entitlement

01:11:50.320 | and I don't know many of my peers that have this sense of entitlement. Maybe we do, maybe I'm

01:11:54.320 | blinded to it. I don't know. And probably it's true. That's the sign of the disease. You don't

01:11:58.480 | realize you have it. It's probably true a little bit, but it's like, I don't mind hard work, but I

01:12:02.800 | want hard work with a purpose. And I think that it seems as though the generation of people

01:12:08.080 | graduating from college these days has a much greater understanding of that life balance idea.

01:12:13.920 | This idea that I don't just want to work and make money. I want my life to be integrated

01:12:19.040 | and I want to do work that matters. You see this constantly, you see companies, this introduction

01:12:24.480 | of the B Corporation, this development of social good and financial good, of everything integrated.

01:12:29.840 | It's the same thing with careers. We've been preached to do what you're passionate about,

01:12:34.160 | do what matters. They want to do what matters and do well by doing good. So there's a bit of

01:12:38.160 | nervousness in the industry. And it's interesting to me to watch and see people that can take it on.

01:12:44.400 | Because I think, yeah, if I were a mid-level firm, if you could hire somebody who's qualified from

01:12:49.360 | the technical side and maybe they don't have the life experience, but man, if you could start with

01:12:54.240 | the technical side and add life experience on, what an amazing growth that is. This is new. We

01:13:02.640 | don't have a lot of those students out. Even if you look at the number of programs there are across

01:13:07.280 | the United States and you try to fill the gap. So the 27% growth rate in financial services

01:13:13.120 | predicted for the next 10 years, that's a lot of jobs. A lot, a lot of jobs. We can't produce

01:13:19.600 | students fast enough for the fill of that gap to be students. It's not possible.

01:13:24.960 | Is that number based upon the-

01:13:26.800 | Bureau of Labor Statistics.

01:13:28.000 | But is that based upon the advisors that are retiring or is that based upon the growth of

01:13:31.440 | demand and then you add advisors retiring onto that?

01:13:34.160 | Both. It's the organic growth and it's also the retirement wave. If you look at CFPs,

01:13:38.560 | it's 5% to 6% are below the age of 30 and about 50% are above the age of 50. That's the breakdown.

01:13:45.200 | And so we've had this industry where it tended to be older individuals because they were the

01:13:51.360 | ones with the natural market. They knew people that had money and that was the whole industry.

01:13:55.040 | You transitioned in here later in life. It's changing now where, I mean, I've heard it in

01:14:00.800 | so many conference presentations, even this week on the amount of money that's being transferred

01:14:06.560 | into a younger age brackets. So that homogeneity and relatability of young to young makes a ton

01:14:14.960 | of sense. So entering those people into your practice, into your business makes a lot of sense.

01:14:19.120 | Things are evolving and they're changing quickly. The question is, how do you attract that solid

01:14:25.520 | talent? Especially if you are a small RIA firm that has a preconceived condition on how do we

01:14:34.160 | do business. You want to impart your identity onto that new hire, but you also want to give

01:14:39.840 | them some freedom. Their growth is your growth. So you want to come up with incentive mechanisms

01:14:47.200 | and ways in which you can encourage them to grow. Give them your wisdom and knowledge that you've

01:14:52.720 | captured, but also give them a little bit of rope. Let them go out. I'm not saying have them

01:14:58.400 | pick up the... You can't do the phone book cold calling anymore.

01:15:02.160 | Is there anybody that's still doing that?

01:15:05.200 | I hope not.

01:15:05.920 | I hope not too, but I got a feeling somebody's still trying it. But it

01:15:09.520 | seems like that business model is dead. Maybe not. Maybe it's been dead for a few years and

01:15:14.320 | now it's time to give it a comeback and somebody's doing it.

01:15:16.720 | Last question that I have and then I'll give you a chance. I want to just talk about...

01:15:20.960 | Give you some publicity here for your program because I'd love to see more people going into

01:15:25.680 | the formal programs. But last question. If somebody's interested in switching careers,

01:15:30.800 | I've received a number of emails from people who are a lot of them are accountants, working

01:15:34.960 | in auditors at big four. That seemed to be the one recently. I had several emails from auditors at

01:15:41.200 | big four accounting firms just saying, "I want to make a change." Someone's a career changer or

01:15:47.280 | they're just interested in financial planning. What do you see as a transition scheme? Do you see

01:15:51.680 | value in going back to the college level, pursuing a master's degree? Do you think from

01:15:56.880 | your perspective, just get the CFP and sit for that and get started? What do you think?

01:16:01.600 | There's several different ways to enter this. I'm probably a little bit biased towards

01:16:05.680 | getting the CFP and going and working underneath somebody. I think that's where your value play is.

01:16:11.280 | A master's... Boy, the university would kill me if I said this. But a master's degree today,

01:16:17.760 | there's so many of them out there. It becomes a net present value decision. Is this investment

01:16:23.840 | in human capital the right one for me just to make this transition in my career? If I come from an

01:16:30.960 | outside field, let's say my undergrad's in English, and I think financial planning might be the thing

01:16:36.560 | for me, I might suggest going and getting a master's in financial planning. But if you're an

01:16:40.640 | accountant or even a lawyer or... I actually had a neurosurgeon in classes one time. Talk about

01:16:46.160 | making you nervous. Interesting.

01:16:47.600 | So if you're in a field that's related, my personal opinion is that you go to a program.

01:16:57.120 | We have one, for example, an extended learner program where you can take the courses. Because

01:17:02.880 | the courses that you need for the CFP, if that's all you get, those are pretty good.

01:17:07.200 | They are. They're intense.

01:17:07.920 | Those are pretty good. And you're drinking through a fire hydrant. You're soaking up a ton of

01:17:15.200 | information. But it gives you that leveling I think you need to enter this practice. And then

01:17:20.960 | you go out there and do it. So that's my personal opinion. If you're in a related field, you go

01:17:26.960 | and you get the designation. And the pathway to that is there are a lot of us out there that are

01:17:33.280 | providing online education.

01:17:36.000 | A&M has online CFP classes.

01:17:37.040 | We have an online. Yeah. So we have an online extended learner program where students can come

01:17:41.440 | in from, you name it, wherever they are. And it is under a traditional academic model. So it's not

01:17:48.960 | asynchronous. It is synchronous. We run through semesters. And what we've found,

01:17:52.960 | it provides flexibility, but it also provides coaching. It's that I have a gym membership,

01:17:58.560 | but I have a personal trainer as well. So the professor comes in, for me, for example,

01:18:03.920 | I'll teach investments. It's run over a traditional semester, but you have things

01:18:09.120 | to complete each week. You have a live lecture or an online recorded lecture from a professor.

01:18:15.120 | We try to bring in now and again guests who would come in. Hey, here's an invitation for you.

01:18:20.640 | Thank you.

01:18:21.120 | Guests who would come in and talk about ancillary topics. We could even do that

01:18:24.480 | in an online setting. I mean, you could be wherever you want to be. And we also try to

01:18:28.960 | introduce still with our extended learners access to software, access to a lot of the

01:18:35.280 | financial planning things that they're going to be doing in business and practice.

01:18:38.640 | So that's what makes our program a little bit unique. But there are a lot of tons of

01:18:44.080 | great programs that are out there. I know you've come through the American College model.

01:18:48.000 | American College, right.

01:18:48.800 | Super, super intelligent professors that can offer, again, the courses that you need to

01:18:54.160 | migrate through to set for the CFP exam. Now you still have to have the experience

01:18:58.240 | to hold that designation.

01:18:59.440 | Right. I've thought, I mean, I think it's great to have variety. I liked self-study. I didn't

01:19:04.960 | do any of the, I did it all self-study. And I like that because I can't stand, like, if it's

01:19:09.600 | information, I just want to learn it. Like I don't go into classes and things like that. It wasn't a

01:19:17.040 | good fit for what I wanted. I'd rather just read the book. But I know that that's exactly the

01:19:21.600 | opposite of some other people. And it's like, I don't either don't have or don't want to

01:19:25.760 | discipline myself in that sense to get up every day and spend an hour studying this textbook.

01:19:30.960 | And so rather I need to go to class, I'd be there, I'd pay attention. I'm a verbal learner

01:19:35.600 | or auditory learner, and that helps. So I think there's a great need for.

01:19:39.440 | Absolutely. There's several models that are out there and there are some great ones. You

01:19:43.040 | just got to figure out, like you said, what fits your learning style well. Do you need a trainer?

01:19:48.480 | Do you need some, and then obviously cost matters too. You look at the cost of the product.

01:19:52.080 | That's financial planning 101. If you could be in Texas, then everything's better in Texas.

01:19:57.040 | That's right. We're bigger, we're better. Well, the great thing is in our online program,

01:20:00.480 | you can be wherever you want. So we have students in California, New York,

01:20:04.080 | even I think we have somebody from Florida. We allowed them in the program.

01:20:08.560 | Wow. That's shocking. Dr. Harness, thank you so much for coming on. This has been fun.

01:20:13.360 | What's interesting to me is in the science of financial planning, there is this

01:20:18.720 | nervous and uncomfortable growth and it takes time. The reality is the discipline of financial

01:20:24.800 | planning is much less mature than many other disciplines and many other types of,

01:20:30.640 | many other industries, I guess is the saying. It's a little bit less developed. So it's working

01:20:37.200 | hard to be developed. It's a big focus and a big press to provide more academic options.

01:20:41.600 | And the industry is changing. It really is. I'm telling you, when you have a financial

01:20:46.080 | planning student who comes out with years of study and experience, it's a big influence on

01:20:54.320 | the industry. And as far as where those students are finding opportunities and being absorbed,

01:21:00.080 | well, it's a bit uncomfortable right now. There's a lot of a change. And so it's very

01:21:04.880 | interesting to me to be involved in an industry that's in such flux. And I think there's a world

01:21:09.600 | of opportunities, though. The demand for financial planning services is massive. It's one of those

01:21:14.800 | job professions where there's a massive growth potential. But yet the barrier to entry is not

01:21:19.840 | low. So hopefully this can help you with some ideas and encouragement and inspiration and some

01:21:25.840 | background that will be helpful to you. So thank you so much for spending time with me today. I

01:21:31.680 | really appreciate it. If you've enjoyed this kind of content, this is a good example of the type of

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01:22:18.080 | [music]

01:22:40.080 | Thank you for listening to today's show. If you'd like to contact me personally,

01:22:44.720 | my email address is joshua@radicalpersonalfinance.com. You can also connect with the show on

01:22:51.280 | Twitter @radicalpf and at facebook.com/radicalpersonalfinance. This show is intended to provide

01:22:59.200 | entertainment, education, and financial enlightenment. But your situation is unique, and I cannot

01:23:07.040 | deliver any actionable advice without knowing anything about you. Please, develop a team of

01:23:14.160 | professional advisors who you find to be caring, competent, and trustworthy, and consult them

01:23:22.000 | because they are the ones who can understand your specific needs, your specific goals, and

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01:23:41.280 | said, please help me by coming to the show page and commenting so we can all learn together.

01:23:46.800 | Until tomorrow, thanks for being here.

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RPF0162-Nathan_Harness_Interview