#78 Rob Macdonald – Transcript

Louis van der Merwe
Welcome to another episode of ensemble advice, South Africa. Today in the studio, I have with me Rob MacDonald. Rob is the head of strategic advisory services as fund house and has a very long LinkedIn bio. So I’m not going to go through all of the elements and all of the heads that Rob way. Rob, thank you so much for joining me today.

Rob Macdonald
Thanks very much. It’s great to be with you. Thank you.

Louis van der Merwe
I think we’re in for a treat today. Because, I mean, you wear so many hats in this industry. And yet you seem to tackle each of these elements with with so much intention and so much passion. But before we talk about these different ads that you’re wearing, I’m curious, how did you get into financial services we often do people just stumble upon this. And I’d love to hear your origin story, as we call it. Yeah.

Rob Macdonald
It’s probably a very good place to start. And then stumble is probably the right to engineers. But before I was at financial services, I was actually in academia. I was working at the Graduate School of Business at the University of Cape Town, and had been there for four or five years. And at the end of 1998, I’m giving my age away there. But at the end of 1998, I bought some during Magilla, dirt, I got approached by another person who’s married originally by us barrier mine, who was at the time of joining a sort of a startup business that was a business, which had braid as a shareholder and a business in Australia called IBEC. And that new business was, was going to be called the APAC, South Africa. So it was new. And Barry approached me pretty much out of the blue and said, would I be interested in joining this, this startup, and I didn’t know much about financial services at the time and had a coffee with him. And he explained to me what, what this business is going to be about and what was unique about it. And I think, in a sense, the story behind that business is really why I suppose I was sighted about getting into financial services, because it was basically going to try and transform how financial planning was done. You know, how financial advice was given. And, and the idea behind it was the concept members lifestyle financial planning, which you’ve probably hadn’t discussed on your podcast before. But a man’s Barry been on your podcast, during the drought.

Louis van der Merwe
You advocates of lifestyle financial planner, is probably the most vocal one.

Rob Macdonald
Exactly. Yeah. Yeah. So that I met Dirk in those days, smarter guy, but, but I think the point of the story was that I was excited to get involved with sort of effectively a startup business, it was coming out of Brett unit tests at the time, I think I was a 60 employee it was it was headed up by Andrew Bradley, who you also may have had on your podcast and had merch, that the point of the story was is that it was it, I did stumble onto the sense that I i am i didn’t plan to go to services, I’ve always knew a little bit about it. I’ll I had also been on the receiving end of financial advice myself AND, and OR, and my father, in fact, financial advice he had received and been interested. And so it was quite an easy to see why this concept of lasta Hydra planning was was a good thing. And and I’m sort of curious about the fact that it’s still seen as a relatively new concept 20 years later. And yeah, I had I suppose it’s just so much weakness leopard do in the industry to get past the legacy of what was being a sales based industry. But so what was interesting about that Babu was that I actually got recruited into an investment role. Within attacca, it was actually to hit up the investment research team and then to sort of do investment research and to run portfolios for financial planners. And you’d be very well positioned to ask me, Well, what do you know about investments? And I thought about it, I knew very little, but it was actually and again, I think this talks to some of the challenges we face in the industry. It was testament to I suppose the foresight and the wisdom of the chairman of OPEC at the time, a guy named Illuma Bay in Australia. He was the chairman, the Australian business who we wanted somebody to come into that role without any baggage without any history. Because you know, as an American, try To shift things and change things, it’s very hard to undo stuff much easier if somebody comes in with a clean slate so, so I came in with a clean slate, and was all starry eyed and, and excited about the prospect of lifestyle, financial planning, and of doing things differently than you think in financial planning industry as a whole. And yet, so that’s how I made the transition from academia to financial services.

Louis van der Merwe
Rob, I’m curious what the response was of your family, you’re saying, I’m going to quit this steady job in teaching? And I’m going to join a startup effectively, what was the conversation around the dinner table? Did you include your family? Or was it hey, I’ve already done this.

Rob Macdonald
So we will unfortunately at the time, I was still single. And so I didn’t have to consult my family who bother them with that. But even though it was a startup business, it had some backers. So. So in fact, the the, the transition wasn’t that uncomfortable. They’ve mentioned he said, so it wasn’t, it wasn’t like I was having to dip into my bond and pay myself a salary brightened attack where the fund is in the business time and, and so much so is repaired, et cetera,

Louis van der Merwe
rather than how would you approach that life transition? If you were to do that today, if this opportunity came about today, given where your life is now? Would you have approached that differently?

Rob Macdonald
Oh, yeah, definitely. I mean, I think, yeah, I mean, it’s, that’s an interesting question. It’s got three teenage children with a wife and two dogs in the home. And that it would be, it would be a very different conversation if it was going to jump into a startup, where the, perhaps the future is uncertain. But yeah, I mean, yeah. And I think your point is a good one is, and you’ve got to have your family on your on your side that you’re going to do something like that one. But no, I, I fortunately, at the time, was able to make the transition with most of the conversations, being with myself, rather than others and timing with God, if it was the right thing for my last video not turned me off. So that was and

Louis van der Merwe
they say, That’s the secret to an intelligent conversation. So thankfully, now, with perfect hindsight, we can say that it was a successful move, right. But there’s something to say about people taking that risk early on in their career, you know, I’ve spoken to a few career changers were, in their mid or late 50s have said, Hey, I’m going to change careers I’m going to change, we had Joe FANTIC icon, and that changed from being a full time musician to becoming a paraplanner. We’ve spoken to some people that were teachers, right policemen, these are all the roles that you heard traditionally, that moved into, let’s call it maybe the sales lead. Advice. Aside, is that still something we’ve seen today? Is it common for people to actually change careers and move into financial services later on?

Rob Macdonald
But I mean, I think I think the insane use the term there, sort of the sales mega, I think there is an appeal to that move. If you’re looking at it from a sales perspective, because this is somebody who comes into financial planning, and potentially is seen as a distributor of product, then the wall app experience and the more metrics they have, probably the greater potential they offer. What I’d like to think is that is that what we’re seeing more of, and maybe this is just the front end of advice, sort of, we have in the industry is more qualified people coming in? Who want to do things, right, so more accountants, MBAs, you know, who are saying, you know, that this financial planning is important stuff, and I want to do it right. And that’s why I’m coming in, rather than I think has happened historically. You know, as you mentioned, teachers from you know, we’re coming in with Korea, and others, and I think they were seen more as a as a funnel into into a network. I’d like to think that we are moving beyond that but are maybe a little bit idealistic metric art. But I did have a meeting last week with a financial planner, who here is, you know, electrical engineer, MBA, Rhodes Scholar, all of the credentials and sort of made a Korea and Japan sort of mid 40s, to, to, to chi strobist. And then for the reason they are to, to the Acropolis and so on. And I suppose I’m hoping that that, that becomes more the route that people follow to the an individual, or the profession.

Louis van der Merwe
And that’s fascinating you mentioned therefore, the reason to do it properly is that to deliver financial planning properly, but what was attractive for that person to, to move in, at that age in their life to financial services,

Rob Macdonald
that they were already in one arm, I’ve grown up cautious to that I don’t want to go to tourism, because I haven’t asked for the condition to share the story in veterans. But I think it’s the, I think the principle of it is, is that it was about seeing and I can talk to my own story as well, in this regard. And while I was quite fired up to take on, the challenge that barriers invitation gave me was what I had seen, and a number of people have read. And I have people who have done this with the same reason why I had seen all my father receive financial advice. Certainly if I think he was a, he was an engineer, he was professional, his whole life worked 40 odd years, was at a job that made one mistake, he kept moving from job to job and didn’t stay in one portlet for 14 years. So he worked for a number of different companies had an interesting career, and, and trusted his financial advice. And when he retired, his you know, he had a lot of these products of a particular color, which I won’t mention. And, and those products, the market to very little in terms of real asset value. And so my father’s sort of best investment because you know, full sans view, able to sort of provide some assistance to a theme and who’s violent or alive, but my mother is how not to to stay alive and, you know, to provide that assistance to them. So, point being is even an educated professional footballer employed for their whole life did not have enough money when he retired. And I think to go back to the advice I was talking about, I think he had seen similar, you know, scenarios play out with other people. So it’s about seeing bad advice been given? And virtually my father’s case, I would say no advice, I would say product has been assaulted him and trusting this and that he was that thought of depth of his, his adviser in inverted commas was doing the best thing for him. Just trusted.

Louis van der Merwe
Robin, in your opinion, what would you have said went wrong? The I mean, it sounds like your dad might have outsourced a lot of the decision making and saying, Hey, this, you need you need to make this decision on my behalf? Is that something that’s fair? You know, I know, that’s probably with, you know, hidden agendas as well and someone that had to sell additional products, but at the same time, how do we get our clients to also take a bit of responsibility, because ultimately, this is also their financial lives not to let you do them in but to say there’s a balance between taking on responsibilities that clients are ready to let go of, and also giving some of that back. I’m just curious to hear your take. And by no means is this reflection on what happened to your dad. But if we can, if we can learn from what happened there, I think it would be helpful

Rob Macdonald
for absolutely everybody, I think the can definitely learn from that in the sense that he was pretty relaxed about life and laid back. And so, you know, was happy just to trust? So I think you’re absolutely right, I think there’s definitely it’s incumbent upon our clients to, you know, to be advocates for their own financial health. You know, what physical health, the end of the day, we have to be advocates for our own physical health. And I think we have to be able to pursue an unnatural health. But I think that there are two elements to that. One is our lives. And I think that we are all the experts in our own lives, and we need help at times to to navigate what math throws at us all where we want to go. But in general, we really are responsible for the decisions we make in our life. But no financial planning is is about our life and our money. And so when it comes to the money, but you know, I think we need a financial planner to help us marry those two concepts together. And I would like my financial planner, to act as a sounding board to me or on my life issues and to act as a sounding board and an expert for me on my daddy issues. You know, so. So, to go back to your question, I do think that it’s the responsibility of agile planner to first of all enable their clients to to come to insights and decisions around their life. that’ll meaningful and help them to do that. But but those are the clients decisions. And then once a client’s have made those decisions, with your support that when it comes to now, okay, what are we going to do about the financial stuff that I can trust that you’re going to give me, you know, sound advice around how I can best achieve what I want to do my life with whatever money I have available and to have the future? And, and I suppose, for me what was missing in my father’s scenario is I don’t think there was a genuine interest in my father’s life and an interest in helping him get where he wanted. I think what it was was simply a case that, and this was, I think, a very, I’m going to use the word tragic legacy of our industry, about our profession and industry, is that the financial advisor simply saw the role as somebody who, because they got remunerated on condition or product being sold. That was the problem, focus, damage. And let’s just say that, you know, if my father had died and had some life policies that he had taken up, and that wouldn’t have been a wonderful thing that hadn’t placed. But the reality was, is that, you know, his border financial affairs weren’t properly the doctor. So I think it’s Yeah, I think it is about challenging clients to take responsibility for their, for their financial health, but then providing the sort of expert assistance to helping them achieve it.

Louis van der Merwe
It sounds like it’s more nuanced than just saying, Oh, the the financial planner failed, or the industry failed. Your dad at that point, it’s what you’re saying is this balance between your life and then also your finances? And I want to talk about that a little bit. You’re very involved in the coach training side, and wherever you look, probably for the last two or three years, you were hit over the head with the fact that financial planners need to learn coach training skills. Is there a place where we go too far, where financial planners only spend time on a client’s life yet neglect the actual real technical finances? Is that happening? Or do you see an alternative way? You know, we talk about this kind of linking up with robo advisors to become a cyborg advisor, which is a very interesting term, that I just love to hear Rob’s take on where this is going, because we’ve seen this back and forth in the industry around training and retraining. And then some people saying, Oh, you need higher technical skills as well. So I know, that’s a lot. But

Rob Macdonald
Ramona. So I mean, I think I mean, I think if we, if we, the way I look at it is I look at it to say that, that we need to start off with the the identity and role of the financial planner, and say, Well, what what is your identity? And what is your role? And I would start off to say the identity is financial planner firm. And the role is to help people and because the point of all make no matter where we go with Chet GBT, it all is that the clients or financial advisor was going to be Hudes. So we’re going to make that assumption. So, so the role of the financial planner is to help the human being make and implement decisions about their life and one. So that’s the role. And so, I do worry that, as you say, there’s been lots of talk about coaching and therapy and unnatural transition lists and, and, and, and different types of financial specializations. Whereas I think that ultimately, what clients need are financial planners, who are adept at with human skills, you know, because the, the robo advice piece is going to become more and more sophisticated. And I do think the future is one where, you know, you know, the equivalent of a lexer or Siri will sit in your office, and you will just, you know, sitting with a client, you will just throw any technical query you have into the ephah will just say, Alexa, you know, what’s, what was, Rob’s our contribution in 2022? And any top up? And that answer will just immediately be given to you. So, you will need to take your understanding, and all of that. And you need to know what, what cannot be done. But ultimately, you’re not going to have to sit on crunch numbers for very long, because Because Sheena is going to give you all the answers you need. So then what is your role? And I think you’re all designed to help me make decisions about my money and my life and, and because you’re getting so much help from Chet GBT at all. I think that it’s gonna never be me inevitable that you that you as an entrepreneur will finish but as Jim will are going to have to develop the human skills, but they’re still going to be financial planners and this is the part that I think it’s important to stress is that, you know, financial planners, not a psychologist and not a counselor is not a coach, when he says about your planner, can they use skills that therapy counselors coaches use? Absolutely. And will they enhance the way they do their work? Absolutely. And will the outcomes be better for clients? Absolutely. So, I know that answers the question, do you but I do, I do worry that we, you know, new hearing that people who now position themselves as a financial coach, even people who are now in the UK, probably more than Jabot, financial coaches who are not licensed to give advice, but they, they are helping people, like, sort of choices about money and life, but they’re not licensed to give, you know, and I think the key here is, is that financial planning is a profession that’s regulated, you’re helping people make very important decisions. And hopefully, you are enhancing that ability to do that with as many advanced human skills as you can get.

Louis van der Merwe
I really like how you position it, where we’re almost borrowing or being inspired from all these other helping professions, you know, that any of the professions that you think, maybe haven’t been under the spotlight, where we could learn from, to say, hey, like, what is that proficient doing, that we can bring into financial planning to make things a little bit better? You often hear about people saying, Take the example of going to a dentist and do the exact opposite. So it’s the there’s something similar that we can think about. And then at the same time, if I’m a paraplanner, I would be really worried. Because traditionally, the role of a paraplanner was this heavy lifting. Right? It’s the technical pieces around your financial plan to compile this to get this will integrate together. We where do they go from? Yeah,

Rob Macdonald
that’s a good, good point. And I’d be I’d be hesitant to give an answer to that. I mean, I think that’s unique, you know, because the other thing that we have learned about, for example, Chet GPT, is that it does get things wrong, you know, and so, and so you may still need our planners to make sure you know, that whatever is generated by the computers, is actually accurate and do some sense making. So I think, you know, the, you know, I don’t want to make a prediction around that. But I do think there’s needs to be human understanding of the technical and human application to the ticket, you know. But to go back to a question about other professions. I mean, it’s quite interesting. I’m reading a book at the moment called the the myths of normal by a medical doctor, man, Cabul Mater. And he’s written a few books around the medical profession, and his whole thrust is that the medical profession is missing out on the body mind connection. And it’s starting treating people hearing physically, as opposed to recognizing the impact that our context that our emotions, etc, have on our health. And, and even though in the medical profession, this has been recognized for various people over the last 100 years, that there is this connection, the mainstream medical profession, was not implementing that insight very effective. In other words, you go to the doctor, and he made some number of stories in this book about the fact that people who are ill get interrogated on the physical front, that don’t get interrogated about, you know, the potential, you know, psychosocial factors that could be influencing their health. And so what I would say, and what I’ve sort of seen that is, was more what can we learn from what they’re not doing? So you were you said about the dentist and do the opposite, but in a similar similar ways? Yeah, I think, I think that we, I like to say that, that as human beings, the longest relationship we have is with Matt. So before you’re born, you’re in the womb, and your mother has a relationship with money in some form or another, and depending on the level of stress of that relationship, will not will impact you in utero. And then we’re divorced, you’re born into a family went to environment with this money, and then after you die, you know, there’s still a relationship with money. There might be somebody left over, they may not be but that has implications. And I think that I think what we can learn from that, is that, that there are factors that influence how we interact with money and how we behave with money, that require greater understanding of the human being sitting across the table, you know, and so, my sense of it is is that this it’s it’s trying to do better than the medical profession and relies on a danger for self who might it does fit for sure. Add to that. I haven’t said anything incriminating. And I’m assuming you cut it if it is, but, but the point is, let’s, let’s try and but I think I think technology is going to force us to do this is to force us to, to keep that focus on the human and how we can help the human make those decisions. Because technology is, it’s so it’s so powerful. So it’s a long way around to say that there’s not, there’s nothing dramatic that I’m seeing. I mean, you know, obviously, they’re, you know, they’re things that we can learn. But I think people are doing that already things we can learn from other professions or other industries, you know, the power of visual, for example, that how people, you know, process pictures, well, that, you know, as opposed to words or numbers, yeah, the power of metaphor, you know, so we can learn something from how people tell stories, and how stories are very powerful. So there’s lots of things we can weave into it. And I think that’s what makes financial planning such an amazing profession is that it can draw on so much around, latch and make it relevant to treat clients,

Louis van der Merwe
I think it’s very worthwhile for us to talk a little bit about what you’re saying, in the medical field, where, if you listen to a lot of the mental health practitioners, they say, it’s not helpful to put a label on someone. In fact, we don’t even want to diagnose someone with a disorder, we’re going to treat the person, but in the same breath, we’re hearing people that are experiencing financial disorders. And I’m wondering, is it helpful to even start labeling these financial disorders, you know, money hoarders, and if you if you read any of the tedium, Brad Clontz, his work, they talk about the manuscripts, and invariably, it leads to, there’s something wrong with you, and we need to fix it. What you’re saying, Rob, is how do you treat the whole person? And for someone that’s passionate about the psychology side of money? How did you? How do you start treating someone and the money? When you look at the whole person, as opposed to the label that we can easily put on someone? Oh, that person is stingy. Oh, that person? Yeah, you name it,

Rob Macdonald
you’re sort of getting me to touch on one of my other other hobby horses. And that is this idea of neighborly good, I think I think we’re in started in the simplistic form, we’re labeling started in our industry or our profession, but I keep using those words interchangeably, because you know, we are heavily a professional within an industry. But we are where I think the labeling started is, is with the risk profile. So you know, you get a client and you’ve got do a risk profile, and you can label them as conservative or aggressive, moderate, and then you have the rational will, how they should invest in and, and that has now evolved to, as you mentioned, that clients but there are others. And there’s a lot of researchers or Africa, a number of other big institutions and are producing different profiles or clients, different profiles of advisors, and you all one of six, or one or four one. And I think my concern about that is is that it doesn’t recognize the complexity of us as human beings. And so I think that’s why financial planners are going to become so skilled, because each person sitting across the table from you, is unique. And yes, they may have a money script. But can you really give it a label? Because is it so? Are there only so many scripts that can be given that level? You know, I’m not sure. But what I can do is I can connect with that person. So I think what we’re offering as human beings is connection, because we are social beings and we we thrive in connection. So if we look at and it says some research came out the last couple of weeks has been quite widely publicized about people’s health and happiness in life. And the number one factor is relationships, you know, that relationships are the biggest indicator of how long people live a healthy level. And that’s because we essentially I’m so I think, I think we were looking for connection and for me and label always drives disconnection. Okay, losing your, your conservative, okay, now we know what you are now let’s decide, you know, but you have your box Jaqen Yeah. So, so I would rather be looking for things that are that are driving connection rather than disconnection, and and rather, you know, looking for ways for clients and and I think going back to my father’s story, looking ways for clients to take ownership of their financial luck. So, so, if you know, in a sense if I labeled you are disempowering you if I’m disempowering you I’m not expecting you to take ownership there. Whereas you know, if we treat you as A complex B, and we, you know, let’s talk about what money was like when you were young, when you were growing up? How was it? You know, and then that can start to inform, Okay, hang on, we maybe that’s why you’re nervous at the moment, you know, or maybe that’s why you’ve got too much money in cash, because you know, you have that experience when you’re young, blahdy blahdy, blah, and we can start sort of almost doing detective work together. You know, and I think, I think that’s the role of the financial planner increasingly is playing this collaborative role. You know, I like to talk about the fact that financial planners have three roles. The first role is that of a thinking partner. So we, we think together, and how do we think together, we think through conversation, so the more skillful our conversation is, the better we’ll think together. And then once we’ve done our thinking, and once we got a sense of where you would do the client to add, then we come to looking at, what are the choices that, that face you and so that I’ll actually talk about your second role as arch planners that have a choice orchid, with your help clients make choices. And then and then ask again, could ever do and you can’t, you can’t do that can’t play that role, without being collaborative. And then the last role, third role that I think financial planners play, and this is the one that’s been thrown around a lot, so cautious to say it, but I do think there is a behavioral coaching role that he plays. And somebody say that because, you know, more and more research shows that it’s the way people behave around money, that affects their outcomes more than anything else, you know, so it’s not, it’s not about where I invest my money that makes a difference. It’s about how often I save, you know, how consistent I am, you know, in doing that. And so, as a client, I need you to actually give me a kick up the backside and say, Rob, listen, you’re spending too much money. Come on, they were called me find a way for you to spend a lesson so and so they sort of see that sort of coaching role coming through. So I think, yeah, I’m not a fan of labeling. I’m other labeling that we’re seeing and read, and I actually saw business in the UK at the time are trying to help financial planners work out what buyers a client was suffering from, and the contracting that with some technology and etc, you know, and to try and work out, you know, whether you’ve got a recency bias or an availability bias or a status quo bias, and then to try and work out a technique to public that, you know, I think is a waste of, of energy. And again, it’s a label, you know, so our brands are, are geared for seeking certainty. And so the label gives us the certainty we seek, but I’m not sure that it’s helpful for optimal financial outcomes.

Louis van der Merwe
I want to share a story with you that happened last week, where we took clients through a process where there was some kind of risk profiling and was involved was a little bit more nuanced. And the client asked me, Is this about my financial life? Or is it about my personal life? And it was so interesting to see how people could just easily separate them and say, Oh, no, this is, I’m very conservative when it comes to money. But when it comes to my life, I like taking risks. And I like taking chances to see why do we have such a disconnect? Or how can we just compartmentalize money in such an easy way? Or would you argue that there’s maybe a disconnect between the two?

Rob Macdonald
Well, I mean, that’s an interesting, I mean, that’s better be an interesting question to ask that trying to what, you know, what, better, better, but I think, I think it’s, in a sense of, I’m, I’m the, I’m the opposite of that client, in the sense, so, so I’m on risk averse in my life, you know, I, I’m, I think I’ve shared you too, before, you know, riding a mountain bike, I’m very nervous. Being cautious doesn’t always help. And still have an accident, even if you’re cautious. But, you know, I’m not gonna go and jump off that bridge across the river or wherever it is, I’m not going to be doing any back to jumping. You know, so you could suggest them that I’m conservative, that when it comes to my man, he assures Well, sure, as hell need as much risk as possible. To get me to, to the financial goals that I have. And so I think, for me that maybe I was overly critical of labels, the one area label hubs is as a catalyst for conversation, you know, so, you know, so yes, okay. So then you’re conservative, and your client, you’re risking your life and you’re conservative in your money. What’s that about? What do you think it’s about? But I think, and it takes me back to where we began when, when, what excited me about livestock excited me about lifestyle, financial planning, and the way that I peck approached it at that time, was to talk about the fact that when clients invest money, historically, the industry and the profession have cheated and the regulator have said, you’ve got to do a risk profile of a client To enable them to investment fit appropriately. And your clients asked a great question, is this a risk profile on my iPhone my money? Either way, it doesn’t matter. It’s irrelevant, because what actually is important is, what risk do you need to take all your money to do the work that Ian has to do for you? And that’s the risk that we have to work out and that and actually, Rob, actually, you’ve got no idea what that risk is, I’m going to work it out for you as your financial plan, I’m going to tell you this is the risk, you got to take the we’ll have a conversation about whether you have the appetite for that risk or not. But until then, let’s not worry about it. You know, there’s not even I mean, we can just do a risk profile for the fun of having a conversation or acting as a catalyst. But let’s not take it too seriously. Because it’s not going to help Sydney in my case. And I think in many clients case, what can I help you get to my financial goals, or things? Because I would probably have all my money in cash if it followed the round of my life.

Louis van der Merwe
Rob, you mentioned there that it’s about the quality of the conversation. If financial planners are listening to this, and they’re wondering, like, how do we measure the quality of a conversation with our clients? What would you what would your response be to that?

Rob Macdonald
So the first thing I’d say is, ask your client for permission, and record your next client meeting. And listen to the recording, and listen to how much you speak and how much your client speaks. And if you know, if the 8020 rule applies, as I think it probably will, then I’m guessing that financial planners probably speak for 80% on the client speaks with 20%, on average. So that’s the first step, listen, and hear what goes on in the meeting. And, and the next step would then be to say, Okay, if I really want the client to work out what they need for their love, and what’s helped me understand the bid, I need to get them to talk more. So I’d be saying, try and shift that ratio, so that you as a financial planner, only speak for 20% and let your clients speak about it. But in order to do that requires some skill. And so the the sort of three skills that we need in a conversation, the first is a questioning skill. And so we need to be able to ask open ended questions because they force people to think and to talk, rather than closing expressions. The second thing we need to do is to listen and and I know it sounds trite, but we all know, we got to listen, and we all listen bad. And so the real practice there is how can I listen more effectively. And one of the ways obviously, is just to be present in the meeting, and to focus on what the client is saying, and try not to let all the thoughts in one’s head distract you. And also try not to think about what’s going to really know what your next question is what you want to say. And the one way that one can ensure that that happens is to allow more silence. So So talk lists allow more silence. The third thing is don’t ever interrupt your plot. So Nancy, Nancy line is pooled with my book called time to think and various other books, talks about the fact that that interruptions, or arrogance masquerading as masquerading as efficiency. So the reason that we interrupt is because we think we know what needs to be said mixed, and often an edge of planning might think that I know with what the client needs now, so let me just interrupt. And also, I want to be efficient in order to find my time. So don’t interrupt. So let’s ask open ended questions, allow silence, don’t interrupt. If you can just do those three things. I think the quality of a conversation will get better. And, and and obviously, the more you practice that, the better you’ll get it. Yeah,

Louis van der Merwe
that is such a wonderful way of summing up the work that you’re doing, and through the coach training, and maybe this is a good opportunity to share a little bit if someone has gone through that exercise. And they realize, hey, I need help with this. Where would where would they start? What are the kinds of things that that you would be able to assist them with in the work that you’re doing? Is there any new coach training sessions coming up that you might be involved in?

Rob Macdonald
Yeah, yeah. So yeah, I mean, I think I mean, I, I am involved with a program that’s beginning in, in May with Adam gray, which, no, which? I’m not sure, you know, we have the numbers off of that program at this point. I, you know, I’m currently running a couple of other programs, which are already in progress in progress. But I think if anyone is interested in having some training around this, welcome to get in touch with me. And, in fact, I mean, I think the point you’re making, which I think is an important point is that this this stuff that we do need to practice, you know, because we only put it in theory. It’s a bit like using analogy of playing tennis, you know, Rafael Nadal or Merrick jockey, which now they talk about she’s the number one player in the world is just the just broken Steffi Graf’s record of number of weeks at the number one spot, he has a coach, he has somebody who gives him feedback on how he hits the ball, he practices his backhand, his forehand pensive on go, even though he’s the best in the world, he continues to practice continues to get feedback. And I think, for me, that’s the lesson however you do it, whether you do it in a one on one coaching engagement with somebody, when you do it in a training program, it’s to recognize that these are skills that we do need to practice, you know, and I know it sounds cliched, but there is historically have been the the soft skills, but actually, they I think are the hard skills. And if they require a lot of practice, you know, I’m quite I’m guessing that, you know, that’s what I would hope, you know, financial planners listen to this, you see the merit of off of focusing on their human skills, hope will lessen the merit of doing some work on it, because I think that the scary thing is about the way we can educate is that we get all this technical stuff from a very young age, you know, we start doing maths when we were six or seven years taught him to read and that but but we don’t get trained in human engagement skills, you know, throughout our formal education, there’s no formal, and then we get the wide world. And, you know, no wonder we have things like wars and disputes, etc. Because we don’t know how to talk to each other.

Louis van der Merwe
Just the awareness alone is not going to fix that. Recently, in one of the meetings I installed crisp, which allows you to block out background noise. But one of the functions of crisp if you have an online meeting is it measures how much time you speak, and how much time the other person speak. I thought, oh, okay, I think and having been through some of this training and spending a bit of time on it, I would imagine that I’m slightly better than average, maybe it’s an overconfidence, bias, but I would have expected the score to be a little bit higher. And I was shocked, Rob, it came back that spoke more than 70% of the time. Not boring, this wasn’t a very deep conversation, but still almost felt so despondent or I felt so despondent, saying, Wow, I really need to track these things. Because my assumption was, the client is speaking maybe equal amount of time, maybe a little bit more yet with this data, and I’m really hoping it maybe it was very inaccurate. This data is telling me that that’s not the case. You know, we need this constant feedback. And that’s sticking out in my mind, because now I have a piece of information to address and to say, Okay, how do I, how do I adjust then? Where do I go from? Yeah,

Rob Macdonald
yeah, yeah, I think I mean, that’s a brilliant story of the rivets. So it’s very brave of you to share that story. But I think what’s one of the, you know, what, what, what really highlights for us, and what we so seldom do is, is on the programs of Iran, and in Houston, you will be familiar with Louisiana, we talk about this concept of action reflection, then, and that, that when we do something, if we’re going to get any better at it, we have to reflect on it, you know, and, and then in that reflection, as you are doing, are you reflecting and saying, hang on? Well, now, what can I do differently? What can I do? Yeah. And, and so it’s forcing that sort of learning piece, and that should to happen. The problem is, is that we get all of us get into this rut of action, action action doing doing doing, and we don’t take the time to reflect. And, and again, I mean, I think using the sporting analogy, again, you know, if there’s something we can learn from, from the sports people is that, you know, they will play a game, they are lucky because their games generally are televised, and then they will sit and watch it and reflect and learn from it, you know, and then see what they can do differently. And, and in an ideal world, you know, club meetings would be fun. So why don’t you can share and see what the verbal sort of analysis is, but also see what you’re doing with your eyes with your hands. You know, How hard are you really coming across as somebody who’s engaged or under looking over the client shoulder? Geez, outside.

Louis van der Merwe
Do you know of anyone that’s doing this? I got a university’s employing these tactics when they train young financial planners to have better quality conversations by recording it.

Rob Macdonald
I’m not aware of it. I mean, I think the only I think what I am here I’m not aware of it and when I speak Can the correction I mean, I think there’s an increasing recognition within financial planning circles of the importance of wonder where financial psychology is at the moment I’m, I’m one of five people who have the zine and beavering away to make a contribution to a book on financial psychology, which, as I understand will become a text for people doing the CFP. So, I think there’s a recognition that there is a need for this, I’m not aware of anybody, you know, to sort of doing that level of analysis and training other than obviously, to come on one of the catchy Brian was up, and he spoke about it earlier. But you know, that that, again, a coaching program is a finite event, you know, whether it’s 12 months or 16 months, it’s a fan out of it, the challenge is to keep paying, keep doing it, you know, having those reflections on that. Yeah, I would hope that in the same way that the therapeutic services, you know, have supervision, peer supervision, where they will meet, and share and discuss and deliberate, I would hope that that we, as a financial planning professional, we’ll move in that direction, where we can have not only peer supervision, but even we are likely to come and sit in on a meeting with a client. And I’d like you to give me the feedback of how you find my guide. In the same way that I would hope that professionals would review one another’s financial plans and say, actually, you know, would you have? Would you have done this this way? Or how would you have done it? And, and I know that that does happen within financial planning businesses where there are multiple advisors, there definitely is that sort of peer learning and peer support. But I think it could also happen in turbulence. So that makes the practice. So yeah.

Louis van der Merwe
We have a lot of work to do if we’re going to beat up the medical profession. Not only client experience, but in client impact. Because these things have the ability to change someone’s life for the better and change your family’s trajectory. So I mean, I’m really excited. Thank you so much for being on the show today. As a parting comment, Where would people be able to reach you if they want to find out a little bit more about what you’re doing or just engage in the work?

Rob Macdonald
Suppose isn’t bad place to admit that I’m terrible on social media. But I can be I can be found on LinkedIn. Otherwise, my email address rob@fundhouse.co.za is probably the easiest, and sounds a bit antiquated to talk about email address.

Louis van der Merwe
Absolutely. Wherever if you if if that works for you, and someone buys you a cup of coffee and in Cape Town, that might even be better. Yeah. All the best with the work you’re doing. And thank you so much for making a massive contribution in the work of our business and just in my expansion as well. You’ve been instrumental. So thank you so much for that and all the best.

Rob Macdonald
Thanks very much for being on the show. I really enjoyed it. Cheers.