With the news of the DOL rule, you may be considering your options and how life might be different if you were to choose a different business model. With the DOL rule there has never been a better time to transition your business practices. As you begin your journey to entrepreneurial freedom, what are some things you should consider before you start?
Transition your mindset from a salesman to an Entrepreneurial Advisor
Investors are in need of financial caregivers and consultants, not product driven salesman. The first step in transitioning from a product culture to an entrepreneurial financial advisor is acquiring a different mindset.
The problem with the product culture is that instead of training you to run a business based on the core issues that your clients have, such as emotional and behavioral conflicts, the industry focuses you more on product focused advice. Realizing that your firm focuses your attention on sales goals and payouts that grow with certain product placement instead of managing investors’ tendencies, biases, and their behaviors may open your mind to a reoccurring business model. Transitioning to a fee-only business model places you directly on your client’s side. As a fiduciary financial advisor, it’s easier to have conversations with your prospects and clients because they know that you have their best interest in mind. Your potential conflicts of interest have significantly decreased and now you have a reoccurring business model; one that doesn’t start at zero every January.
Before you start to operate your own entrepreneurial advisory business, ask yourself what types of clients do you most enjoy working with? What is the lifestyle, business culture, and your ideal client base? This is the perfect time to rebuild yourself as a financial advisor and to see yourself differently than you may have before.
News Ways Requires New Learning.
If you’ve been living in a world of production with an emphasis on sales only, you may want to consider focusing your energy on learning to increase your value proposition. I don’t mean focusing on market learning but rather learning and mastering people. You’re essentially transitioning from a salesman to a financial caregiver, consultant, and go to person for everything financial. The area I would encourage you to focus your learning is probably not what you’ve likely been spending your time and effort upon previously. I’m much less interested in your time being spent on all the financial articles of the day, (reading the Wall Street Journal from cover to cover) but instead focusing on psychology, sociology, human behavior, happiness, fear, and vulnerability.
Studying these “soft” sciences will help you to grow in your understanding of the human person; to become an expert on people and all that might influence us. Other ways to learn more about these topics are by taking courses at local colleges, attending community-based offerings, or even specific offerings from consulting and coaching firms.
Becoming and remaining an expert on the person is going to be your disruption insurance against changes in this industry.
The DOL rule and its implications are fast approaching. It’s never too early to start planning for the fiduciary law. By starting to focus your energy on how you can operate your own entrepreneurial financial advisory business, you can start to prepare for the DOL changes and work towards becoming a fiduciary financial advisor.
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