Thoughts, ideas, suggestions and education from financial adviser Jim Ludwick, Founder of MainStreet Financial Planning, Inc. of Odenton, MD; Washington, DC; New York City, and Santa Barbara, CA

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Thursday, July 7, 2011

Why are you so smart, or are you just lucky?

The headline on this article is a nice question to ponder.  Although no client or prospect has outright asked me this question in my nine years of private practice, I suspect it was on their mind.

In reflecting on my own implementation of my personal financial decisions over this same time period, I have mixed results. In many cases, our clients have outperformed my own portfolios.  In fact, my wife takes great pride in the fact that her investment performance exceeds mine by several percentage points, and I manage her investments!

This piece seems to be taking on a confessional direction, but my purpose is to let readers know how I prepare to help them make better financial decisions. I would like to answer the question about being smart.  Answer: I have lots of smart help.

Having a mentor or mentors is very important. In our industry of personal financial advice, it’s relatively easy to have one since we tend to be a very giving profession. I found mine in Kansas via the internet. She wrote a book, formed a group and offered people like me the opportunity to put our experience and desire to work in a new delivery mechanism of personal financial advice by the hour, on an as-needed basis. Then she added consultants to our group to help us on a periodic basis via conference calls, and now webinars, along with an annual in-person retreat.
Consultants help me in marketing, compliance, and business planning. No man is an island. I’m wise to the ways of others though these experienced and focused experts who see the best of the best and pass it along to those of us who want to improve. I owe them a lot.

Money managers help me help our clients. Over the years we have helped clients select several top notch money managers since investment management is not a service we deliver directly. We watch what they do, read what they write, and pay attention to their advice, their decisions and their rationale.  It helps us develop a more dynamic perspective of active or passive investment management by seeing it happen in real time.  Real time to us is usually quarterly or annually, by the way.

Clients have ideas for us too. Over the years we have used several clients as sounding boards for new ideas and tools to deliver or expand our service.  They have been invaluable. In many cases, clients helped us avoid a mistake since we were enamored with an idea that had no place to go in our world.  They told us that in no uncertain terms. Thank you. You know you who are.

Colleagues have added to our tool chest in many different ways. We participate in two national discussion groups as part of our association memberships. Here no man is an island pops up again. We can’t possibly know it all, but a simple posting usually brings several suggestions in hours, if not minutes. Only yesterday, as I write this, I posted the referral need for a specialized business appraiser in the mid-Atlantic region. Within two hours, I had three potential providers as a solution to a client request.  I was in communication with two of the three referred providers before the end of the day.
Colleagues also write a lot of articles on the myriad of topics, close to a hundred, that certified financial planner practioners are expected to know and understand. They write magazine articles, blogs, and tweets. I pass along a lot of their ideas and suggestions by re-tweeting them to colleagues, clients, prospects and others who follow me on this social media platform called Twitter.

The financial news media is also a good source of information and ideas for me since they frequently report on what other advisors and consumers are doing and saying on all sorts of financial topics. I always seem to be looking at a stack of magazines on the bookshelf and emails in my inbox. I’m guilty of information overload and look forward to airplane and train rides to try and catch up.

Lastly, but by no means least, is my long time associate Anna Sergunina, and our relatively new assistant Holly, who lovingly bombard me with error correction suggestions, along with articles and tools they found to help our clients and our practice.

So now you know the answer. I’m smart because I associate with a lot of smart people who are willing to help me deliver the very best recommendations to our clients so they can make the best possible decisions about their financial lives, and sometimes just about their lives in general.

I’m also lucky to have the best wife, Carol,  family, friends, clients and colleagues imaginable.  Thanks for being in my life.

(Now, if you have an interest in what I read on a daily or periodic basis, I’ve posted an non-exhaustive list. Many can be viewed without a subscription. View the list by clicking here: )

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