When I was 11 years old, I inherited two things from a 14-year-old neighbor kid named Bill:
- A parakeet named Clancy
- A newspaper route
Bill asked me to take over his bird and his route because he and his family were moving away. I never cared much for Bill. My friends and I called him “Pigeon-toed Monkey Vomit.” He was a scholarly type, wore glasses, and was an only child. (I regret not being more kind to him.)
Clancy seemed lonely and led to the acquisition of a second parakeet. They pretty much hated each other. Neither of them lived more than a few years under my care.
The paper route, on the other hand, set me up pretty well financially. I had 80 customers spread across two sprawling neighborhoods divided from one another by a highway named Winola Road.
The Scranton Tribune was the morning newspaper I delivered to these houses. It cost $1.10 per week back then. When it came time to collect the payments, I walked the same route, but instead of it being 5:00 AM when I started out each morning delivering papers, I showed up at dinner time when I knew most people would be home.
Many, if not all, customers tipped me. That was how I earned money. Rather than give me a dollar and look around for a dime, many customers just gave me two one-dollar bills.
At the end of my second year, at age 12, I had $2,500 in my personal account at First Federal Savings. Being twelve, I walked into their building one afternoon and demanded to see all my money, in cash (specifically in $20 bills, stacked five to a pile, and in 25 piles) on the counter. The first teller balked. And a second. Then finally someone with some clout stepped up and met my demands.
All of this seems other worldly, like part of a story that only exists in history books or fiction. Consider these anomalies from life as we know it today:
- Daily print newspaper, delivered by a young person walking alone in the predawn hours
- Six editions of a daily newspaper delivered to the door for only $1.10 per week
- Cash only transactions
- People exchanging dimes
- Commonplace savings and loan institutions
- Face-to-face banking
Point: Like all things, financial behaviors, commerce, and money matters inevitably, and unpredictably, change over time.
Uprooted
A colleague of mine is planning to purchase rural space in order to create a study center where individuals can reconnect to nature, the land, and to the significance of farming in human life. He describes people as being “deracinated.” This adjective is defined as “uprooted” from one’s natural world, home, culture, or similar environment. “Uprooted” means to be ripped out of place.
In a certain sense, if we live long enough, we are all deracinated from the way things used to be. (Think of my paper route example.)
I am acquainted with many people serving Ukrainian refugees who are dispersed throughout Eastern and Western Europe.
One such person, Donna, is caring for these dear souls currently living in Croatia. I enjoy receiving her newsletters. She empathizes with the refugees, saying of herself (and all of us) “We are all living in exile, trying to find meaning in a place other than home yet longing to return.”
Donna writes: “Exile is when you live in one land, and dream of another. It gives a discomforting disconnect between our memories and our fundamental sense of who we are and the reality of a new identity we have to construct.”
Independent Financial Professionals (IFPs) Serve the Uprooted
Anna Helhoski wrote an article for the web site Nerdwallet, published Mar 7, 2023, and entitled Pandemic at 3 Years: How Our Financial Lives Have Changed.1 Consider her observations:
- By August 2021, an estimated 2.4 million workers had retired early or unexpectedly since the pandemic began, according to research from the Federal Reserve Bank of St. Louis.
- Retirement didn’t last long for some. Among those who retired during the pandemic, 27 percent of people returned to work because they simply needed a bigger nest egg to get them through their golden years, according to a report from Joblist, an employment listings and research site; 21 percent said they specifically returned to the workforce in response to inflation and the rising cost of goods.
- Inflation peaked at 9.1 percent in June 2022—the highest rate in 40 years, according to Bureau of Labor Statistics data.
- The car market turned upside down. Supply chain problems caused new car production to plummet, pushing more car shoppers to buy used vehicles.
- The Fed raised the funds rate a whopping seven times in 2022.
- We changed the way we bought homes. As quarantines lifted and interest rates fell, investors and new buyers made big moves, even snapping up properties sight unseen. Many homeowners opted to refinance to historically low rates instead of putting their homes on the market. Competition for limited inventory heated up, and bidding wars, waived contingencies and cash offers became commonplace.
- While stuck at home, consumers weren’t spending the way they used to, and those who qualified received an infusion of cash via government stimulus checks. Those factors, combined with higher wage growth, led to historic levels of personal savings. Households accumulated $2.3 trillion in savings from 2020 through summer 2021, Federal Reserve data show.
- Rates on savings accounts and CDs skyrocketed. The inflation partly caused by pandemic-related supply chain disruptions led the Federal Reserve to increase its federal funds rate multiple times. Banks and credit unions took their cue to raise rates.
- Small businesses got a hand. From April 2020 to May 2021, over 11 million Paycheck Protection Program loans were issued to provide small businesses with emergency financial assistance, according to an October 2022 analysis of Small Business Administration data by NPR.
The financial lives of our clients no longer look like they did just a few years ago. Compared to when an independent financial professional (IFP) and a client historically met for the first time, almost nothing is what it was back then. Clients have literally been ripped out of place, uprooted, in terms of the physical location where they once worked, lived, traveled to, invested, bought cars, dined, or shopped.
In addition, if in a subtle way, people are even uprooted in how they view money. Today’s digital world influences how clients make financial decisions.
The increased use of electronic payments is changing how clients value money. The more removed they become from their money, the less they may think about how much they’re spending and saving.
Point: The IFP serves a clientele that, to a remarkable extent, works, spends, saves, and invests very differently than just a few years ago. They are financially deracinated.
Welcome the Antonym
For every word there are useful synonyms, other words that have the same, or similar meanings. Example: “Extirpated” is very similar to uprooted and deracinated.
On the other hand, for every word there are multiple words carrying the opposite meaning. These antonyms are the essence of how best to combat the impact of the word they oppose.
Here are some antonyms that are shared between “uproot” and “deracinate:”
- Build, create, establish
- Put in, help
- Ratify, remain, leave alone
- Welcome, plant, sow
IFPs Help Clients to Build, Create, Establish
Change is often unnoticeable. We roll into disruptions slowly, and pay little attention to what is different.
Post Pandemic there are many things that IFPs can help their clients to build or rebuild, including:
- Build a realistic post-pandemic, forward-looking budget. Cost of goods and services has changed. Incomes and interest rates have changed.
- Rebuild emergency savings. During the Pandemic many clients spent their emergency funds when their employment changed, they bought new houses because they were suddenly working from home, or they needed to find things to do outside (RVs, boats, ATVs, etc.).
- Re-start any savings goals that were paused, such as retirement or college savings.
- The old trends, frameworks, and financial objectives may no longer be applicable. An IFP can help clients create a renewed financial plan.
IFPs Can Put in, Help
IFPs are equipped to help clients take recovery one step at a time. The IFP can put the client in the right frame of mind. Oftentimes, the client has simply lost perspective. We know that primary-aged children experienced educational setbacks during the Pandemic. Similarly, small businesses, families, and individuals experienced financial setbacks. Fresh perspectives are required in order to:
- Reacclimate to higher interest rates.
- Properly assess the volatile stock market.
- Grasp the impact of gyrating real estate prices.
IFPs Can Ratify, Remain, Leave Alone
Whenever a person survives an upheaval, a perilous moment, or disruption, they emerge wondering what is the same, what needs to receive attention, and what can be left as is. Consider the clients who are wondering if:
- They still need the disability policies they own.
- The life insurance coverage they have still meets the need.
- The Last Will and Testament is up to date.
- The named gardians for the children are still the right choice.
By sitting down with a seasoned IFP, they can receive reassurance, ratification, and confidence that the insurance owned is still the right coverage, the beneficiaries are still the correct designation, and that executors and guardians remain the proper selection.
Professional IFPs Welcome, Plant, Sow
Spring follows Winter. Bare fields are again resown with fresh seeds in order to grow another crop. On the other hand, for sustainable farming, crops must be varied and rotated.
Clients often need to have their hands held if they are going to make fresh starts, major changes, or significant goal adjustments. The IFP can welcome the clients to new ways of seeing their lives in the context of their financial circumstances. For instance:
- After a period of no vacations or travel, and no eating out, many clients overspent in the period since the Pandemic in an attempt to make up for lost time. They need to contain the urge to splurge for that exact reason and get back to living and spending like they were prior to the Pandemic. They need to sow new spending habits. They need to rotate from spending to saving.
- IFPS can welcome clients back to the financial wisdom of thinking long term, spending less than they earn, and keeping an emergency fund.
Summary
The financial lives of our clients no longer look like they did just a few years ago. As an IFP you serve a clientele that, to a remarkable extent, works, spends, saves, and invests very differently than just a few years ago. These clients are financially deracinated.
The antidote is the antonym.
Thinking back to Donna working with Ukrainian refugees living now in Croatia. To combat the feelings of displacement, and uprootedness, Donna led the children in a new direction: “In Croatia, we have delightful times offering craft projects and playing with outside summer toys. For a group that has known deep trauma, toys such as frisbees, beach balls, bubbles, and water squirt guns brought great joy, and physical exercise.”
In their financial lives many clients have never experienced the rapid changes of the last several years. There is a whole spectrum of actions that the IFP can urge their clients to take, and the IFP can be creative. While some clients may face some very hard choices, the experienced IFP is equipped with the skills to combat the feelings of uprootedness.
“One can remain more sure-footed by taking small steps, but perhaps achieve greater speed by taking bigger steps. Of course, one also runs the risk of setting out in a completely erroneous direction. Surely the important thing isn’t the length of our steps, but that the objective is clear.” —Angela Merkel
The seasoned IFP can help clients regain their footing and reorient themselves to the proper objectives. All it takes is a handful of antonyms.
Footnotes:
1. https://www.nerdwallet.com/article/finance/what-did-the-pandemic-change.
Fine
“Fast is fine, but accuracy is everything.”—Wyatt Earp
“It is a fine thing to be honest, but it is also very important to be right.”—Winston Churchill
While reading in the Old Testament book of Exodus, my attention was riveted by the simple word, “fine.” For context, Moses successfully led the people of Israel out of Egypt, and they began their forty-year wanderings in the wilderness.
In Exodus 16, after one and a half months in the wilderness, the hungry, tired, and worn-out people of Israel began grumbling against their leaders: Moses, and Aaron. If you know this story, you are aware that God heard their complaints and began providing sporting fowl (quail) each evening, and something called “manna” each morning.
For us living 3400 years later it is hard to know what manna was like. Even back then it was a bit of a puzzle. “When the people of Israel saw it, they said to one another, ‘What is it?’ For they did not know what it was.”1
We read this description of manna: “In the morning, dew lay around the camp. And when the dew had gone up, there was on the face of the wilderness a fine, flake-like thing, fine as frost on the ground.”2
There it is. “Fine.” Repeated twice. The Hebrew word translated “fine” is Daq. It means a “very little thing, small, thin.”
Point: On occasion we benefit from taking a commonly used word and examining its application to our business practices, our personal character, and to the impact that we are having on others.
Financially Fine
How do we as independent financial professionals (IFPs) use the word “fine?”
I consulted a dictionary to learn the various meanings of the word. It is polysemous. (Like “run” or “bank” it has several meanings). Consider some of these various definitions of the word “fine:”3
Let’s ask ourselves three very fine questions:
“We’re Fine”
As an IFP, you want to know how your clients are doing. At. All. Times. But how?
Here are several ideas:
Point: Frequent, intentional, client-centered contact is the only way to know if your clients are fine.
“These Are Fine!”
An IFP delivers excellent service and products when the clients’ expectations are met or exceeded. How do we know when we have met that test?
Point: It is easy to delude ourselves that we are providing fine, excellent service and products. Our beliefs need verification.
“Fine Work!”
Nobody likes to have someone else look over their shoulder. Being inspected or audited is uncomfortable. The regulatory environment in which IFPs operate demands that we invite scrutiny. We need to know that our recommendations and financial reviews are both precise and accurate. Like scientists.
“Precision and accuracy are two ways that scientists think about error. Accuracy refers to how close a measurement is to the true or accepted value. Precision refers to how close measurements of the same item are to each other. Precision is independent of accuracy. That means it is possible to be very precise but not very accurate, and it is also possible to be accurate without being precise. The best quality scientific observations are both accurate and precise.”4
Think of the game of darts. The goal is to hit the bulls-eye (center) of a dartboard.
Point: Your service and the products that you recommend must be both precise and accurate. Your clients’ goals and objectives are the bulls-eye. Helping them reach their goals is the way to measure precision. Their risk tolerance, budget, and willingness to accept loss are each to be considered as a measure of accuracy.
Summary
When I checked where else in the Old Testament the Hebrew word Daq, translated “fine,” might appear, I was surprised and delighted with what I found.
In the book of 1 Kings, chapter 19, we find the prophet of God, Elijah, fleeing for his life. (He discovered that it is dangerous to criticize the King and Queen). He hid in a cave. God said to him, “What are you doing here, Elijah?”4 Then, “Go out and stand on the mount before the Lord.” And behold, the Lord passed by. Theophany can be startling because it is not what we would expect.
No, after the strong winds, earthquake, and fire, there came the sound of a low whisper. (Literally, a fine silence.) God showed His presence in near silence. As the story unfolds, however, fine Divine silence does not mean Divine inactivity.
As an IFP you need to keep the idea of fine silence, quiet presence in mind.
“Drawing on my fine command of the English language, I said nothing.”—Robert Benchley
If you are already exemplifying all of the above, I believe you are already a fine IFP!
Footnotes: