Benjamin Beck, CFP®At Beck Bode, we see fitness and finance as going hand in hand. You want to be financially prepared for a long life, but that requires you to be physically, emotionally, and mentally prepared for a long life, too. Which means tending to health and wellbeing in all aspects of our lives.
Over the years, out of my own interest in fitness – and specifically in CrossFit – I have connected with professional athletes, professional CrossFitters, and others who need financial guidance. Something that I have observed about this group is that they share certain traits.
Essential Traits of Ideal Financial Advisory Clients
Organizational Skills
They are tremendously organized with respect to their financial lives. This doesn’t imply that they have knowledge about personal finance, in that respect they are not much different from many other people who seek our advice. But what they do know is all their personal data: when they come in for a first meeting, they know their monthly expenses, everything is detailed out, down to the average amount they are spending on food. It makes sense that they are in touch with their stats, as this is a habit that is key to their success in their sport. It goes beyond household expenses; they also are aware of the costs associated with all their other lifestyle choices. Discipline and organization are characteristics that CrossFitters naturally demonstrate.
Coachability and Willingness to Learn
Another trait CrossFitters share is that they are tremendously coachable; they know they need help, they ask help, and when they receive help, they are gracious and thankful for whatever we share. Essentially, they are willing to do anything we suggest so that they may put themselves into a better financial situation down the road.
Goal-Oriented Mindset
Reflecting on my CrossFitter clients reminded me of a conversation we frequently have here about what an ideal client looks like. The professional athletes with whom I partner fall into the ideal client category in terms of behavioral characteristics, among other things. Using this group as an example, I would say that my ideal client is at least somewhat organized, has a sense of what they want to accomplish (meaning they have a goal in mind, or at least they are goal-oriented), and they appreciate receiving help. One thing they don’t do, is that once they are on board, they don’t stand in the way of what I am trying to do for them and with them. They are interested in supporting their own success.
The Unexpected Advantage of the Inexperienced Investor
In our industry, we have been led to believe that the person who is going to be the ideal client is the person with the big job at the major corporation, they meet the profile of “successful investor,” – from the outside, at least. Let’s call this person your fictitious “brother-in-law/sister-in-law with the big job at XY Company.” Contrast that with the CrossFitter in this story, who is totally green when it comes to money, lacks sophistication about the markets, and doesn't know a thing about where to invest.
If you were a betting person, you probably wouldn’t bet on the professional CrossFitter being the more successful investor. Not that I am a betting person, I am not. What I do know from experience is that the person with the big job at the major corporation is not always as open to receiving guidance as the first-time investor-athlete, who is willing to learn, willing to act on a plan, and willing to take a leap of faith to find out what is on the other side.
Discipline Over ‘Financial Smarts’
You know what the problem is with the person who has the great job at the big corporation? This person is too smart in some ways. Sometimes, they think they are smarter than me. They may withhold information from me, maybe not share all of the financial data that could be useful, maybe hold back during the discovery process. They may not share with me what they’re trying to accomplish because of all the insecurities they have. They may think that success has to do with being smart. They may not know that discipline makes up a good part of success, as does the ability to stay with a program, especially through the challenging parts.
In contrast, many of the CrossFitters I work with are an open book; “Ben, this is what’s going on in my life.. I don't have any idea what I'm doing, my parents never had any money.... I'm making more money as an athlete than anybody else in my family has ever made, and I'm afraid of losing it. I don't know what to do. And I know the biggest problem I have is how to handle my emotions. I need somebody like you to just show me the way.”
Small Clients, Big Impact: Recognizing the Potential for Growth and Success
Embracing Transparency
The CrossFitters in this story are transparent. They show a level of openness that is rare. These clients may not have the “smarts,” (meaning know-how) but what they do have is discipline, a long-term perspective, and humility to know that they do not have all the answers. Now tell me, how many corporate executives do you think would have this same conversation with me? It’s not that the corporate executives don’t share these feelings, they do. They just can’t speak about them as openly because they think that may come across as weak or insecure. In terms of outcome, and by outcome I mean the likelihood to follow through and complete their financial plan, I have more confidence in the CrossFitter client sticking with a plan, than a corporate executive.
The idea of speaking with a prospective client who is an athlete, someone who may not have a stable source of income, is counter to all that our industry teaches. Everything the industry teaches us is about investment minimums and client profiles that have set levels for household net worth, and investable assets, or whatever metric it is that indicates “financial success”; you’re told to not bother with clients who lack sophistication around the markets. Where is the training program that teaches financial advisors that values matter? Who tells advisors that it’s important to look for a client who is willing and able to take your advice, because it’s your advice? What about the sense of personal fulfillment you receive from working with someone you actually enjoy spending time with?
It’s absolutely true that as a financial advisor if you are going to build a financially successful book of business, you face the choice of holding on to a “smaller client” out of fear that they may one day turn into a bigger client, versus finding the clients who can already provide the kind of revenues that you need in order to stay in the business and to live your life, too. I am familiar with the fear of letting a smaller client go, lest they be the lottery ticket I accidentally lose – what if they suddenly come into wealth, or inherit something, sell their company or whatever? That’s just another fear, though.
When Are Advisor and Client A Good Match?
I have found in my own practice that I only have so much time to work with clients, we all only have so much time to do our work. Where we spend that time makes a difference in impact. I know that professional CrossFitters will likely not be the majority of my clients anytime soon (or ever), but I do really enjoy working with the athletes that I do have right now. They may not all be million-dollar clients today, but they have – through the characteristics that make them successful in their sport –exactly the traits that will help them succeed as investors. It’s fulfilling for me to know that I’m working with people who are not only willing to take my advice, but who can stick with a program for 5 or 10 or more years to take stock of the results.
Values over Metrics
The interaction with my CrossFit clients reminds me of the importance of working with people who share our values. At Beck Bode, we embrace discipline, long-term focus, and humility as core values. Not only are these values embedded in our investment strategies, but they are also values we aspire to every day. As we look for clients with whom we will work well, we have to use our values as a way of assessing fit. It has less to do with whether a prospective client is a CrossFitter or a corporate executive and more to do with their willingness and ability to share their hopes and their fears with us.
There is no shortage of opportunity in the world for us to have an impact as financial guides to people. People need our help, and they want our help. Our job is to find where our values align with those opportunities, so that we can invite the right people to join us as clients.
Ben Beck is Managing Partner & Chief Investment Officer at Beck Bode, a deliberately different wealth management firm with a unique view on investing, business and life.