Aug 29, 2018
Well, hi everyone, welcome to another wealthy and wise Wednesday, glad you can join me today. As the summer draws to a close, kids back to school, hope your world going okay for you? And if you do have those youngster, I hope they are enjoying school? Because you know school is just an interesting thing. You know when I went to high school, I grew up in California, I went to a very unique high school and you know maybe I got a few friends out there listening to this podcast to remember this. I mean how could we forget? [00:00:42] So the high school ran on what is called modular scheduling and what it basically did is it broke the whole day down into modules and each module is 15 minutes, each class was about three modules or 45 minutes. What was interesting about the school is that you had a teacher and you had a classroom but you could go any time throughout the day. Well not quite exactly, every day you would make up a schedule as to when you are going to go through that particular class. So for instance, you go into the first 15 minutes of the day, you went into this group called ad in the sense what you will do is you will get a big legal size sheet of paper and every teacher at the school was listed on there and the list of the time at a day that the teacher was offering that class. [00:01:48] So you might have a teacher who offers the class 1-3, 4- 6, 7-9, so you would choose what time of the day you wanted to go to that class. So each day, you effectively could mix up your schedules. Maybe one day you start with English and you end with Math and the next day you start with Math and end with English. So you could just pretty much pick the time of the day as long as the teacher was offering the class during that particular time of the day. The other thing that was unique about it is we really didn't have classroom. You know how most high school, you walk down the hall and there is classroom on the left and the right and it is a closed off room. Well these were just huge open spaces and the classrooms were divided by essentially big dividers and if you can imagine having a huge room and then it has a divider that look kind of like a cross and then there were four classrooms in each big designated area, sometimes 8, depending on how big the area was. [00:03:05] So there wasn't really always classroom where everything was private, in fact, you could, you weren't supposed to but often times you had to walk through classrooms to get to yours and it was somewhat disruptive. Then what you did is each day that you went to the class, they had what was called the sign in sheet, so you would just sign your name and that verify that you were there for the day. Rules were very free and open school system as you could imagine and you could in some day you can walk around and just sign your names into classes and basically be counted, be in there for the day and not really even end up going. It was also a very open campus, so you can come and go as you please and a lot of kids drove cars, you could go to lunch, you can run home and grab a snack whatever you want to do because it was an open campus, no one was asking you about going in and out. [00:04:15] What was interesting about the whole school is that it gave you some independence and it gave you some free thinking, it also either make you very very rigid and self-disciplined or you are a little more of a slacker and look for ways to maybe get out of class because there was this thing call a conflict. A conflict arose when two teachers offered their classes at the same time and you couldn't get to both of them so you have a conflict and you have to end up not going to one versus the other. Now, if the teacher offers two or three times during a day, it was hard to have a conflict but kids tended to look for conflicts anytime they could. And then we have some really neat classes as well, we had a, I don't know if it is Olympic size but certainly a competition size swimming pool, so we had swimming, diving, we had sailing. Yes, I actually took sailing, you could learn to sail not so much in the pool, we kind of learn a few things in the pool but then we were taken to the lake where you actually could sail. [00:05:33] Oh, there was karate, there was volleyball, basketball, all the normal sport as well and Tennis was a big deal, Water pool was a big deal, so it was quite unique in how it was set-up. So if you have a conflict and maybe I don't know kind of like myself, you either like to swim or play basketball, you can spend a little more time in the pool or on the basketball court and maybe miss some of the more rigid classes if you will. Well, you know what it did for me, is it taught me a couple of things and the first thing I think it taught me is to ask a lot of questions as to how could things be done better. Because I didn't have a teacher looking over my shoulder or this rigid schedule, it gave me a time to kind of think how things could be better, how you could learn faster, quicker, I mean I would always try to figure out how I could get ahead so that I didn't have to go to class. [00:06:44] So it made it a little bit more innovative maybe, I guess it is a good word. But what it kind of ultimately did for me is when I got out into the real world, I realize I was not made for 8-5 a boss looking over my shoulder and this schedule of work and I found pretty quickly that I needed to be independent, that I needed to build and see if I can do things better. When I first started in this business in 1986, I started with a big firm and that big firm require me to be in certain places for training, it require me to kind of be there from 8-5 and there was a lot of structure. I remember when we learned about investing, when we learned about financial planning and all the different part that goes with this business. I always find my myself asking well, can it be done better? You know it is the way that this has being done for 10, 15, 20, 50 years, really the most accurate way. Or is it the most profitable way or is there a way to do it better? [00:08:06] And so I have always asked myself that question. In fact, as I was getting more involved in the big brokerage firm and how they run, you know I was asked to be put on the management track quite early in my career and within just about a year. They already wanted to push me into management but I can see right away that this was not going to work. It just has too many walls, too many perimeters and I kept asking, in fact, I remember one time we were talking about mutual funds and they were talking about what a growth mutual fund is. And I remember asking well how do we know that is a growth mutual fund and is there a way to do this better outside of mutual fund? And I was like oh, you know Dan, just quit asking questions, this is how we do it, this is how it is done and just throw your money into this mutual funds and let these professional managers take over and it is going to be alright. [00:09:23] And it just drives me crazy that I couldn't either get a good answer as to why what they were doing actually work. But more importantly was there a better way. So probably since I got into this business, I have always been asking myself is there a better way, is there a more efficient way, is there a way people can do this themselves without having to rely on an advisers all the time? Because advisers don't really know much more than you do, the only difference is they have a license and they have been indoctrinated into some of these financial planning, traditional financial planning ways of doing business but it doesn't necessary mean it is better. So it has been fun over the years as I have researched and look and try to find more practical, easier, more profitable ways of doing things. And so it took right away from the brokerage companies, in fact, I ended up within 18 months leaving the big firm, opening my own shop, an independent shop, a very independent shop. [00:10:35] Once again, I didn't just want to be told what product I had to sell, whether they were the best or not. I remember this really got me one day, I was looking through some financial periodicals, I don't know some kind of magazine and I was looking at some of the best performing stocks in mutual funds and everything like that. And as I look down that list, I realize, I couldn't sell a good portion of them, you see in a broker dealer community. The broker dealer basically tells you what you can and can't sell. So they have a list of a prude, what they call a prude product and if your, the products that you want to actually look at and work with and maybe even use for your client, if it is not on that list, you had a luck. And I notice that the things that were on most brokerage fund list were the things that made them the most money, it was either funds they created and high sales commission funds, high fee funds and lot of partnership, that you know I talked about this couple of weeks ago and how those partnerships just really, I just never found one that did anything good for clients. [00:12:04] Anyway, you had to work up this approved list, so when I left the brokerage firm, the first thing I want to do is be as an independent and as objectively as fast as I possibly can to find what work best, what had the best performance, what looked like would have the best long term outlook for a success. Anyway, I opened up my own shop, ended up growing from there, had 5 offices, had 60 reps, I mean we were moving and shaking. But I was still a bit frustrated, I was getting myself in this [00:12:43] and losing a lot of freedom and control because everything I had to do was to oversee these 60 guys and it was amazing to me how these some of these guys were magnum cum latte at their college, I mean great degrees but when it came to some of these financial stuff, they were dumber than a post. [00:13:13] And I was nervous for not only them but I was nervous for their client, I am like you are out there, you know helping people with their money and you don't even understand these small basic things. Some of the questions that I was asked where can we do this, how does this work? I am like oh my gosh and you are going to go with client money into this. So it was tough for me, so I ended up selling those offices, going really independent again and then spend years and just constantly researching looking for better ways to do things which drew me to this whole banking system and the reason why I liked it were exactly some of the reason why Warren Buffet does what he does and I tried to find and mimic some of the greatest investors out there and interestingly enough some of the greatest investors out there don't do tradition financial planning. They don't live in the box of broker dealers, they don't work with financial advisors on diversification and mutual funds and all that. [00:14:21] So I am like if these are the greatest investors ever and here in this professional word is how we are supposed to do it. Why are these not one and the same? Won't you think the professional world would be doing what some of the greatest investors were doing? It is just unfortunately isn't that way. So I will be really kind of grateful for how I went to high school, I can't say I handle that freedom all that well. And there were certainly things that I probably could have improved upon but what it did do is it made me think and it gave me an opportunity to think, it gave me an opportunity to look and see wow, is there a better way? And I think certainly some of the things we teach are definitely the better way. And I really appreciate that and I am not sure how I'd stayed in that box of the broker dealer community, if I ever would have learned some of the things that I have learned. And it has been a lot of fun and I enjoy this. [00:15:24] So, if you ask a little bit of a history as to how I got to where I am now and more importantly to give you a hope, a sense that you can do a lot of these stuff, you can learn this stuff, you can be your best financial advisor and if you could do that, you are going to have much more control. You are going to be able to make the decisions that are going to help you get where you want to be financially and that is where I would love to see all my clients eventually get. So that is about it, if you have any questions or thoughts or comments, please send them to questions@wisemoneytools.com and don't forget to subscribe, don't forget to tell your friends to subscribe. This build a huge base out there of people who can really learn and understand investing, money and how to do it better themselves. So I will talk to you next week, until then take care.