As we start 2019 and reflect on the roller coaster ride that was 2018. It is easy to get lost in the many ways to justify poor results. Yes, poor results, performance, returns, yield, security or whatever you want to call it.
We live in a results driven world, period. When we do not get our desired result we look for change. Sometimes drastic, sometimes subtle and sometimes non existent. Take the New Years Resolution for example… This happens every year for some… why? I think it’s because they didn’t get their desired result in the first place... again why? The cycle continues…
Let’s compare this to your investments, or your finances in general. The one thing I think we can all agree on is that January can be a natural time for change, for anything. So with that in mind how do we go about “change”? Do we focus on the change we want to make, or do we focus on the end result we desire?
Ahhhh, what came first the chicken or the egg?
In this case for most of us the end result is retirement bliss with more money than you know what to do with… Ideally… Right? But what happens along the way. How many times have you had to change? What change do you make and how do you know it was correct? Is it when you reach retirement bliss?
I don’t think so. It is easy to imagine a perfect retirement but much harder to get there in a straight perfectly planned line.
This is where an advisor comes in. No I am not going to pontificate on what investors should do and how they should manage their own behaviour. I am going to talk about this from the advisor’s standpoint. Yes I am putting you into my shoes.
In this world change is hard, very hard, why? I think it involves being wrong. If a change is being recommended it usually means someone was wrong about the predicted result. Right? I think this is a big reason why clients get ignored, change isn’t made fast enough, relationships are ruined and poor long term results become the worst surprise.
Let’s look at the other side of the bitcoin. Let’s say the advisor takes action quickly, acknowledges the poor results, spends more time with the client, approaches a change objectively and without bias or emotion, and genuinely acts in the best interest of their client. Wouldn’t that build trust? Wouldn’t that help strengthen a relationship? It should definitely lead to ideal long term results, Right?
So why does this happen? Why do clients leave and go to other Advisor’s, silently?
It’s hard to admit when you are wrong. It’s hard to change.
So why is this important? This is where I will talk a little bit about investor behavior… because your retirement and financial future is dependent on it. Find an advisor that is going to have these hard conversations with you and not remain silent. Engage with your advisor and talk about everything. Build a relationship, build trust and hold each other accountable to a high standard.
Don’t ignore your advisor and don’t ignore your results. Make as many changes as you deem necessary until you have reached retirement bliss,