This week on the Elite Advisor Blueprint, my good friend and world renowned financial expert, David Bach, is here to help you (the financial advisor) take your business and life to an entirely new level of success.
David Bach is one of America’s most trusted financial experts and bestselling financial authors of our time. He has written nine consecutive New York Times bestsellers with more than seven million books in print, translated in over 19 languages.
His runaway #1 bestseller The Automatic Millionaire spent 31 weeks on the New York Times bestseller list. He is one of the only business authors in history to have four books simultaneously on the New York Times, Wall Street Journal, BusinessWeek and USA Today bestseller lists.
Over the past 20 years David has touched tens of millions through his seminars, speeches and thousands of media appearances. He has been a contributor to NBC’s Today Show appearing more than 100 times, and a regular on The Oprah Winfrey Show, ABC, CBS, Fox, CNBC, CNN, Yahoo, The View, PBS, and many more.
Besides being a recognized national spokesperson on finance, he’s also spent many years in the financial advising trenches as he helped his dad and sister build The Bach group to over half a billion dollars of assets and also later served as the Vice Chairman at Edelman Financial Services where he partnered with Ric Edelman to help them grow to $13B of assets during his stay.
He’s most recently joined our team at AE Wealth as our Director of Investor Education and by the end of this conversation, it should be easy to see why!
Here are a few highlights from our conversation:
- Right out of the gates we get into David’s journey that led up to his first appearance on Oprah. We get into a really fun conversation on the behind the scenes steps it took just to get on the show and it’s not an easy process!
- Then we dig into the secret of managing assets and proper asset allocation to retain your clients and scale your business. David’s simple advice, also protects you from losing clients during the next market correction!
- Next we walk through the referral framework David used during his time at the Bach Group to double their annual referrals. What I love about it, it’s only 4 steps.
- From there, we dig into a common struggle in financial services. The tug of war with work/life balance and what David learned from a year long sabbatical he took to stay at home and be a dad. He also shares the 1 habit he took up during his break that changed his life for the better.
- We wrap on some rapid fire tips from David that he’s learned by giving public seminars to over 1 million people worldwide that advisors can use to create a better live event and more crowd engagement.
Already heard it once or twice? Please leave a short review here, and tell me which guests I should have on!
- Listen to it on iTunes.
- [03:58] David shares the “ah-ha” moment that led to defining a completely untapped market, writing 9 consecutive New York Times bestselling books, presenting at over 700 live seminars, and appearing on The Oprah Winfrey Show (not once, but six times) to share his strategies for living and finishing rich!
- [11:00] David’s secret ingredient that any financial advisor can use to land right kind of clients.
- [11:49] Find out how David finally made it on The Oprah Winfrey Show and the thoughts, feelings and emotions he had leading up to this MASSIVE opportunity.
- [15:00] David explains the “Latte Factor” and his method for turning complex information into simple and actionable ideas that people can relate to.
- [18:20] A proven strategy every financial advisor can model that has helped David retain clients for life and scale billion dollar businesses.
- [25:00] Why most advisors fail to reach assets under management in excess of $50 million and what you can do to create a trainable, scalable, and saleable business!
- [27:47] The art of the client referral and a systematized process for duplicating your best clients.
- [35:33] The importance of putting yourself first and taking care of your health so you can finish on top.
- [37:30] Find out why David decided to take 18 months off work in order to spend more time with his family and the life changing gift that keeps on giving.
- [46:03] Discover the biggest seminar mistakes made by financial advisors and what David does differently!
- [55:28] Find out why David’s wife is the person he thinks of when he hears the word “successful”.
- [56:36] David shares 2 of his all-time favorite books and his experience hanging out with one of the authors!
- [00:59:23] The 2 BIG problems that David hopes humanity will fix within the next 25 years.
- [01:02:57] The single most important factor that led to David’s success and his best advice to financial advisors who want to take their business and life to the next level.
SELECTED LINKS FROM THE EPISODE
- Connect with David Bach
- The Bach Group at Morgan Stanley
- Smart Women Finish Rich: 9 Steps to Achieving Financial Security and Funding Your Dreams
- The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich
- Smart Couples Finish Rich: 9 Steps to Creating a Rich Future for You and Your Partner
- AE Wealth Management
- Investor Education
- Edelman Financial
- Not Fade Away: A Short Life Well Lived
- The Alchemist
- How to Win Friends & Influence People
- Steve Jobs Biography
- Go Green, Live Rich: 50 Simple Ways to Save the Earth and Get Rich Trying
PEOPLE MENTIONED IN THE EPISODE
TRANSCRIPTSClick here to Read the Transcript
[00:00:23] Brad: In this episode, I talk with David Bach who if you spent any amount of time in financial services, that’s probably a familiar name. His resume includes nine consecutive New York Times bestsellers including the Automatic Millionaire, Smart Couples Finish Rich and Smart Women Finish Rich. David’s been featured in national media hundreds of times including over 100 appearances on NBC’s Today Show and as a guest on the Oprah Winfrey Show a half dozen times. Besides being a recognized national spokesperson on finance, he’s also spent many years in the financial advising trenches as he helped his dad and sister build the Bach Group to over half a billion dollars of assets. He also later served as the Vice Chairman at Edelman Financial Services where he partnered with Ric Edelman to help them grow to 13 billion of assets during his stay. He’s most recently joined our team at AE Wealth as our Director of Investor Education. And by the end of this conversation, it should be easy to see why.
Here are a few highlights from our conversation. Right out of the gates we get into David’s journey that led up to his first appearance on Oprah. We get into a really fun conversation on the behind the scenes steps that took just to get on the show and it is not an easy process. Then we dig into the secret of managing assets and proper asset allocation to retain your clients and scale your business. David’s simple advice also helps protect you from losing clients during the next market correction. From there, we dig into a common struggle on financial services. The tug of war with work-life balance and what David learned from a year-long sabbatical he took to stay at home and be a dad, and also the one habit he took up during the break that completely changed his life. We wrap on some rapid-fire tips from David that he’s learned from giving public seminars to over 1 million people worldwide that advisors can use to create a better live event and more crowd engagement.
Okay. Before we get to the conversation, this week’s free gift is hand’s down the coolest one we’ve ever offered. It’s actually the opportunity to fly out to AE headquarters and hang out with Dave Bach himself. He’ll be leading a training along with Bo Eason for those familiar with him and two of our top clients who each gathered over 60 million of new assets last year. Rarely do we ever do a training for non-clients. In fact, I think this is the first one we’ve done in two years. I just checked, we are down to three seats remaining. So, for qualified advisors we’re going to pick up the full cost including your flight. So, if you’d like to see if you qualify, we’d set up a simple application at BradleyJohnson.com/apply. Takes about five minutes to fill out. And it be fun to get the chance to meet some of you who have been listening in and after this conversation, my guess is those three seats will be gone. So, as always you can find links to books mentioned, people discussed, a full transcript of the show and everything else in the show notes at BradleyJohnson.com/21. Thanks for listening and without further delay, my conversation with David Bach.
[00:03:24] Brad: Welcome, everyone, to these week’s episode of the Elite Advisor Blueprint Podcast. I’m incredibly excited. I have my buddy, David Bach, here with us today. Welcome, David, to the show.
[00:03:34] David: Brad, thank you. It’s good to be with you buddy. Good to see you.
[00:03:37] Brad: You inspire me, man. I’ve had a chance now to see you two or three times live. You’ve done some private trainings for us and…
[00:03:43] David: Thank you.
[00:03:44] Brad: You always deliver. So, I expect awesome things from this conversation.
[00:03:48] David: You expect me to not suck right now.
[00:03:51] Brad: I know you won’t, right? I just know it can’t happen. With that in mind, let’s go ahead and hop into this because I think the one thing when you have a couple of things in your intro and it says nine-time consecutive New York Times bestseller, has appeared on Oprah Winfrey six times. I just hear right now in some financial advisor’s minds, there’s a little switch that just clicked off in their brain and they’re like, “Well this guy he was just born with this intuitive sense to write bestselling books and anytime you get a camera in front of him he’s just going to light up the crowd and they’re just going to be hanging on every word.” However, knowing a little bit of your back story and a little bit of your journey, I know that wasn’t necessarily the case. So, can you give us kind of your journey up until that very first Oprah Winfrey Show? I would just love to hear the story.
[00:04:39] David: The whole journey. Give me the whole thing.
[00:04:41] Brad: It can be the condensed version if you’d like.
[00:04:44] David: Okay. So, once upon a time when I was born – no. I mean, I know you’ve got all these financial advisors who watch your show, and first of all, thanks for having me on the podcast. It’s great to be with you. You just do such great work and it’s really a privilege to be here with you and I appreciate people tuning in and I hope we can give you guys some great advice today that you can use to grow to your business. I mean, that’s common goal here. I grew up in the investment business. My father was – they used to call them stock brokers, right, before they were financial advisors. So, I grew up in the business. I remember it’s take your son to work day tomorrow and I remember as a little kid going to my dad’s office and back in the day there were actual – most people who are going to watch this they’re not going to know what the hell I’m talking about but they were called the ticker tape. It was actually the stock came up in the ticker machine and I would go and peel off the stock quotes and bring them over to my dad’s office. That’s what I got to do on a father-son day. But my dad built his financial planning business through teaching seminars. And so, when I was like nine years old my mom wanted to have a week off and I started going to my dad’s investment classes and I’d sit in the back of the room and he’d dress me up the suit and tie and I hand out paperwork in front to the room and all his clients and prospects thought that was really cute, and they probably helped his conversion rate when he got the appointments because I was there. I would sit in the back of the room and by the time I was 12 I was teaching my friends parents why they should buy immunity bonds and they shouldn’t put their money in CDs because CDs stand for a certificate of depreciation. Everybody knows that, 12 years old, right?
So, I grew up in the business. I always swore, Brad, that I wasn’t going to go into the business. I actually thought what my dad did at the time was kind of boring and that’s just like the total truth. Like I thought that was cool what he did but it wasn’t what I was going to do and when I got out of college I was an entrepreneur. I went to real estate. Thought that was going to be my path, loved real estate and made a bunch of money in real estate and then found myself teaching all my real estate buddies how to invest. And my father kept saying to me, “Why don’t you just try this business for a year and see if you like it? I think you’d be really good at it.”
[00:06:44] David: And at the time I was literally looking to invest in a business and he convinced me over lunch, he showed me how much money he was making and he said, “I’m telling you, you would be a natural in this business. Just try it for a year.” And this was 1993 and so I did. So, in 1993 I went to the – at the time it was Dean Witter which became Morgan Stanley. I went through their training program. I went through an actually extended training program in Europe for about eight, nine months. I saw every part of the business and when I came back and started working in the office and kind of side-by-side with him, I started teaching investment classes like literally the first day side-by-side with him.
And in that first month of kind of working side-by-side with my father – my dad had built a really nice business. He had built the business which was over $100 million under management at the time but it was a solo practitioner business, he had one assistant. And I sort of saw the business until really like loved it, saw the opportunity to grow the business and started really growing it and the first thing I did to really start growing it was teaching investment classes for women. And quick background on how that happened is I sat in on multiple appointments with women who had lost their husbands who were widowed and we were teaching those women how to read the broker statements, know they were going to be okay financially and I just – my father had so much trust with his clients, I realize like I said to my dad, “We need to do something to get all of our women clients up to speed. Because the fact that you’re talking to the men because there are a lot of traditional families, there’s gotta be something that we can do to have the women equally involved with personal finances.” Because we have all these older clients, doing these meetings, they react, they’re like, “This doesn’t make any sense to me.” Well teaching them how to read a broker statements, how to write checks, how to know they’re going to be okay financially at the worst possible point of their life. And that was where I had my first lightbulb moment as I said on the Oprah Show where I’m like, “I’m going to try and teach a class for women and money.”
[00:08:44] David: And so, I created a class for women and money and these was the 90s. Nobody was doing it. We invited our clients and their friends to come to the first seminar. We had 225 women want to come to that first seminar. Look, I couldn’t fit them all in the hotel room and I got the local media to come and they wrote a feature story about me and they put on a cover of a newspaper and that really started me down the road of teaching classes for women and money and that’s where my passion for financial education really just exploded because I had this realization like my purpose I felt was to go out and teach a million of women about money. So, I created this massive goal. Even though I was growing this huge brokerage business and financial planning business, I had this bigger goal to go out and reach a million of women and that’s why I wrote the first book which was Smart Women Finish Rich and I haven’t even got the part one on Oprah but it took five books to get on Oprah. So, by the time you went up on Oprah, people were like, “Oh he’s an overnight success,” and I was, Brad. It just took ten years. It took ten years, five books, I think I did 700 live seminars before I was on Oprah and I had been on literally every single television show you could be on besides Oprah. I had traveled to every local market. I had started on college radio and cable television and been turned down by Oprah three times and had pitch letters going back to Oprah from 1994.
When I actually got on Oprah, it was 2001 and I got on it with a book called the Automatic Millionaire and then I became an overnight success. But really, I had four bestselling books before the Oprah Show. I knew with Oprah that book jumped to number one and then we had four books on the bestseller list. She had me write back again and then we went – she had me back and we did Smart Couples Finish Rich which we’re going to talk about in a second and that led to having four books on the bestseller list at one time which is I don’t think ever been done in the history of certainly nonfiction business books and that was an amazing year and it’s kind of been a rocket ship really ever since. It’s been a decade. It’s been a 15-year-long rocket ship.
[00:10:48] Brad: Well, it’s interesting. One of my friends who’s written a New York Times bestseller, Michael Hyatt, he says there’s life before the book and there’s life after the book but I have a new term now. There’s life before Oprah and life after Oprah, right?
[00:11:00] David: Yeah. And I think I always tell people, “Oprah’s an incredible platform,” but I’ve enjoyed teaching seminars with 12 people and I’ve enjoyed teaching the same seminar with up to 30,000 people and you’ve seen me in my past. My passion is the same. I love teaching people how to be smarter with money. I love teaching people how to live and finish rich. I’ve been doing it for 23 years. Some days I wake up and I’m like is this déjà vu? I’m saying the same thing I was saying 23 years ago but I still absolutely love the message. So, I think when you love what you do, it comes through and that attracts people to your message and what you’re doing and it’s the same thing for all the financial advisors. You show me a successful financial advisor, I will you show somebody who is deeply passionate about what they’re doing, they love what they do, it comes through and that’s what attracts clients to them.
[00:11:49] Brad: So, I want to unpack that Oprah comment from a little bit ago. What kept you going after three rejection letters? Like what are you telling yourself? I mean, first one I get it, let’s try again, second one but now you’ve had the third rejection letter. What…
[00:12:02] David: Actually, the first letter they don’t even respond. They weren’t rejection letters. Actually, you get it what’s called a tryout. I mean, I actually was called. We pitched Smart Women Finish Rich, didn’t get on. They did another show of woman and money that actually bond. We pitched Smart Couples Finish Rich. Ironically, didn’t get on. Then we did the Finish Rich workbook, didn’t get on but I had a couple of like what they call pre-interviews. They interview you and just nothing came from it and then with the Automatic Millionaire I got an interview and I was on the – I was totally nervous as you can imagine because this was a big deal.
[00:12:36] Brad: What was going through your head? I know there’s the audience and they’re sitting there. I’m sitting on Oprah’s couch. I mean, what was going through your head? Share it.
[00:12:43] David: Well, so the pre-interview of the Oprah Show, I mean, the pre-interview when I tried out for the show like when you’re on unpacking it, I thought, “I just deeply want it to go reach 10 million people.” We’d already again had four bestselling books and a huge financial advisor business. I just want to go reach 10 million more people and I knew the opportunity to share the message of the Automatic Millionaire. Paying yourself first, saving money automatically, buying a home, all these core financial planning messages, I knew if I could get it on Oprah, I could help a lot more people. When I did that interview, I was like so passionate and I had watched every show she’d ever done on personal finances so I was prepared. The producer Katy Davis was throwing everything at me. I got done with the interview. My wife said, “Well, how did it go?” I’m like, “I’m never going to get on this show. It’s just not going to happen.” Everything I’ve said she had a rebuttal for me and I was totally bummed and then the next morning my publisher calls me and they go, “I don’t know what you said on that interview but you are not only booked to go on Oprah, you are launching the book on Oprah. You are the first show of the New Year and this is going to be massive.”
So, then when I taped the show, you actually tape the show for Oprah. You tape the show because it’s not a show that airs live. You tape the show. You tape the show at the end of November. It was the last show of basically the season before they go on hiatus and they tell you, “Don’t tell anybody you’re doing it, you’re taping a show on Oprah because until your show airs, you never know, because sometimes they’ll tape a show and it doesn’t air. So, don’t go around telling everybody.” And so, I had to wait for six weeks to show these tapes and I just had to like wait, pulling my finger that the show is actually going to air and then, fortunately, knock on wood it did and then the show was so successful they immediately had me back and we did another show and that’s a women’s show on couples and money. So, it’s been fun. It’s been a really fun time.
[00:14:30] Brad: That is a cool story. Thank you for sharing that because I know – everybody that has kind of an intro and it’s like I’ve been on the Oprah Show. I think there’s always and everybody said they’re like, “What was this guy really thinking through that whole process?” So, thanks for…
[00:14:43] David: Not really because, oh my God, that was a really long answer like they’re 10 minutes into this podcast. We didn’t talk about the business yet. Sorry, everybody.
[00:14:51] Brad: No. This is fun stuff, man. This is stuff people wonder about. Trust me. So, let’s dig in on the business front a little bit. Obviously, this is a podcast for financial advisors. One of the things that you have a knack for doing is taking stuff that can be really complex and simplifying it and I love how you do it. So, I want to share this because I was taking some notes and you have something – I’m making sure I don’t butcher this here. It’s your asset allocation approach. It’s three words. They all start with the same letter. Do you mind sharing that and then digging into that a little bit because I think there’s so much in that thought process.
[00:15:26] David: Sure. So, I mean, asset allocation, the three words are boring, boring and boring. It’s funny. When you get out in front of a lot of people and you teach over and over and over again and I think anybody who’s watching who teaches classes has learned this. Now you have to take all this information and you have to bring it down to this and you have to make it really simple. It has to be simple, it has to be easy and needs to be – and is not being too intimidating. It needs to be actionable. And then ideally, you wrap it all up in a bow which is fun and if you can make what you teach people about money to be easy and simple and actionable and fun because fun is important because people are really scared when it comes to money. When we’re in a financial services story and we know this language – actually I wrote a dictionary. I wrote the Oxford dictionary of money. It’s a foreign language to people and when you don’t know the language and this money is like people are terrified of that lack of money and making the wrong decisions and not knowing what to do and feeling dumb because they don’t know the language.
The industry talks up here to people and really, it’s a turnoff and so I just kept chunking it down and making it simple, easy actionable and fun. And a lot of what I’ve taught has been taught before but I’ve made it even simple like I teach people to pay themselves first one hour a day of their income. People talk about percentages. You should save 10% or 12% or 15%. That goes right over people’s heads. When I was on Oprah and I’m like, “Look, one hour a day of your income, you go to work at 9 o’clock, you need to work from 9 to 10 for yourself,” they get it. It’s like oh of course. It’s like why wouldn’t I keep one hour a day of my income? When I talk about, I’m sipping my little espresso here right now, when I talk about the latte factor. This idea that $5 to $10 a day saving that money automatically can build compound interest but I don’t say compound interest. I say the latte factor. If you can cut out your latte and pay yourself first and put that into your retirement account, you can be wealthy, financially secure for life.
[00:17:26] David: I mean that went all over the world, latte factor, and because I took something and just created a metaphor that people can relate to and that’s what I love to do. Because when it’s simple and especially if it’s visual too like you see me do some things on stage that are visual which the financial advisors have heard everything but sometimes they will go, “God, that was so simple. I don’t know why I didn’t think about that,” and I’ve created these tools that advisors can go out and use. We’ve had thousands of financial advisors teach my seminars and now we’re going to have those available for all of our AE Wealth advisors and they’re just great powerful program that the advisors can go on and teach and then have the same success that I’ve had and have a success teaching their clients, teaching their prospects and they grow a business from it.
[00:18:10] Brad: Well let’s go back a little bit because on the boring, boring, boring section and granted you had an hour to explain this. We’ve got an hour total here today and we’re going to cover a lot of topics but I think oftentimes what I see in wealth management from my side dealing with financial advisors is they almost sell an asset manager like it’s a financial services product. And so here was the track record last 10 years of this asset manager and you spoke from the stage on a few things of how that can really blow up. When you have an under performer which none of us can predict the future of the market and if you’re looking to scale it, you’ve got to be able to train it, scale it and then be able to sell it, right? And one of the things from an asset allocation standpoint that I like that you dug into is you’re obviously not going to be able to sell any business that you can’t retain your clients. And so, when you go to boring, boring, boring one of the things that I’d love that you hit on is asset allocation should not be like super exciting and so now I’m running down to my Fox Business ticker each morning to where now my clients are like, “Hey, did they win or lose last night or yesterday in the market?” Can you talk to – I mean, you helped – well, number one, you grew your dad and your sister in your firm to over half a billion dollars and then you hopped on at Edelman so that’s a 13 billion so obviously, you have a knack for scaling and retaining clients. Can you unpack that a little bit? Because I see a lot of the opposite advice being taken in our industry by financial services guys.
[00:19:38] David: Yeah. So, I think, first of all, it’s just for those who doesn’t know it, the three words is trainable, scalable and saleable and the concept behind that is if you want to scale and sell anything, you want to build something that’s really big, you have to be able to train with it first because once you can train to it then you can scale it, and then if you scale it then you can grow it then if you grow it, you can ultimately sell it. And so, asset allocation is not even like when I say boring, boring, boring the reality is it’s investing should be boring. When I say, investing should be boring because your life should be interesting. So, like what happens is when you have an interesting financial plan, you usually end up having a scary life. So, a person who’s going to the cocktail party’s who’s got this great investment who’s bragging about that great investment but they’re never the ones that are then bragging about how poorly it did. And there are a lot of financial advisors who sell on sexy, who sell on performance and just the reality of life is when you sell on performance, you die on performance. It’s just inevitable.
So, when you look at the secret to businesses in financial planning that do really well like the Bach Group today, when I was at Bach Group we’re a little over $700 million in our management. Today the Bach Group is at a billion dollars. My sister runs it. My dad is retired. I retired in 2001 from that business. The whole secret is, first of all, the hardest thing in this business to do is bring in a client. Once you bring in a client, the single most important thing is you do a really good job for them. Doing a really good job for them is, number one, you educate them on the process. Because an educated client is a good client that will stay the course of time and we know that most investors don’t even come close to matching what the market does because they’re getting in and out of the market at the wrong times and so do a lot of financial advisors. Unfortunately, there are a lot of financial advisors more worse than their clients. They get scared. They chase performance. They panic when the markets go down. They duck and cover when these markets crash and they don’t call their clients and hold their hands. So, what does a good financial advisor do? If they’re smart, they do a really clean business.
[00:21:38] David: They don’t sell a bunch of garbage products. I know we’d just call a spade a spade. You run a really clean business. It’s highly diversified that’s in the client’s best interest that’s attached to a financial plan. You’re not selling a product. You’re selling a holistic based plan where you’ve engaged the client in a true holistic-based conversation around what are their most important values, what are their dreams, what are their goals, what are their fears and you play the role of a financial coach or a retirement coach. You’re really there to coach them on the future of their life being better than their past. It’s like you worked your whole life to be where you are today. You come to me at the age of 62 and these are going to be the best years of your life. Let me help you do the planning so that you don’t need to worry about money and we help all the goals that you got before it come true. The plans are part of it and the investments are part of it. If you’re chasing hot performance and you’re selling performance then as soon as things turn around and go the wrong direction, now a client either doesn’t trust you or doesn’t stay the course.
When you have a process with true diversification, the client doesn’t even need to understand every aspect of diversification. They don’t need to understand. When we build portfolios for clients and I know we’re building them now at AE Wealth as an example, you take a portfolio where the average portfolio has somewhere between 15 to 19 asset classes. There are over 12,000 positions between stocks and bonds. In over 40 to 60 countries, that’s a typical portfolio. The client doesn’t need to understand every single aspect of how much money – what percentages in small-cap and mid-cap and large-cap. They want to know that you know but in most cases, they just want to know, “All right. You sat down with me, you got to know my risk profile, you worked on my goals with me. You’ve got a system in place to really manage my money that’s professionally managed, it’s diversified and you’re overseeing this process.”
[00:23:38] David: And that’s what a good financial advisor does. When a good financial advisor who does that and they constantly stay in front of their client with financial education with the same message, “Stay the course, don’t time the market, we’re here, you got a question or problem, you call us,” those clients stay around for life and those clients will work for more business to you.
[00:23:55] Brad: Sound advice. So, let’s go back just a couple there. Actually, there’s a quote I just heard that I love. It was, ‘We can put a man on the moon but yet no one can accurately predict the future of the market to this point.” From a financial services perspective, there are certain advisors going back to that performance. Your clients not calling you up and high-fiving you if you beat your benchmark by 5%. However, on the backend you miss your mark, you underperform the benchmark by 10%, 15%, 20%, that’s where you’re losing clients. So, I love that approach and I wish I could just take that and download it into every financial advisor’s brain out there because they’d have happier clients, they’d do a better job for their clients and it’s not complicated.
[00:24:40] David: It’s not complicated. Financial advisors, unfortunately, a lot of advisors complicate their lives by making their business complicated. I mean look at the people who build great businesses? I mean Edelman’s a great example. I think they’re up to $16 billion now. It’s a very clean financial planning process. It’s a very clean asset management process. Most billion-dollar books to businesses, that’s what you’ll see and when you see, you know, there’s a reason why most advisors don’t get over $50 million, $60 million, $70 million under management. First of all, it’s assuming of complexity. They don’t know how to put teams in place because you can only do so much yourself and they often don’t really build a clean business and clean businesses only get so big and then they don’t last. And nobody wants to buy them. So, if you’re running a business and it’s a high commission business but you don’t have a clean business where there’s residualized income that somebody else can easily take over and run, that business is not salable.
So, one of the things I say to people, “Look,” it’s just when do these conferences. We go, “The average age in this business right now is about 59 years old.” That you’ve got a lot of people – as you’re a young guy, you’ve got a lot of younger guys who are probably coming onboard with you but if you call a spade a spade, this industry is getting older. Average advisor is 59 years old. Average advisor probably wants to retire before 70, right? I mean they’re helping their clients retire before 70. So, if you’re in the business and you’re planning on being in the business for five to ten years longer then you’ve got plenty of time left to clean the business, build it trainable, scalable and saleable and the best way to do that is to build a really well-managed, you know, a professionally managed business that has a team in place and has a duplicatable process and I would think on the investment side you really need to be using institutional level due diligence to build your portfolios. I see guys and they’re building their portfolios themselves with a yellow pad of paper, picking out some ETFs and calling an asset allocation model and I mean especially today with what’s going on, I don’t where the deal always going to end up but in this day and age with litigation I just don’t know why any individual advisor would be building their own portfolios.
[00:26:41] Brad: Yeah. So, to be clear here, I think I caught this but you and Ric Edelman did not have a Monday morning meeting where you picked the hot stock of the week just to do here.
[00:26:49] David: We did not have a Monday morning meeting. No. Purely diversified portfolio. We have about 18 asset classes and built around over 25, 30 countries and it’s just – and a real investment committee process with a true – somebody overseeing those portfolios and then those portfolios – we’re doing this on the AE Wealth side right now. Those portfolios are looked at daily. They’re automatically rebalanced daily if they need to be based on the criteria of the portfolio and they’re custom made. That’s the only thing. So…
[00:27:18] Brad: Well, I mean, I’ll definitely carve out some time because I just want to know, I’m curious, on what you’ve been cooking up for the special training event we’re doing with you in June. Before I get there though, I’ve got to have you at least high-level hit on this for a few minutes because it’s gold and once again it’s simple. That’s what I love about it. So, you have something called “the art of the client referral” and this was something – I want to make sure I’m not making this up. I believe you incorporated this back in the Bach Group originally.
[00:27:42] David: Right.
[00:27:43] Brad: Yeah. Okay. So, do you want to speak just high-level? And I’ll kick you off down the right path. It starts with the advice that you gave which was, “Bad clients aren’t fun, great clients are a joy,” and then you took it from there. So, can you give just a high-level framework that might be able to help some advisors out there?
[00:28:00] David: Yeah. Well, so before I go into the referral part, let me just go to that truth about this business. When you look at people who built really big businesses, the number one thing they do is they market, right? I mean so you show me typically a large financial advisor who’s got a business growing over 20% and the thing that they do is they got a marketing system. Now my personal belief is the best marketing system in this industry still to this day is seminar marketing which we should talk about that a little bit but financial – everybody said, you know, I’ve been hearing for 23 years that seminars don’t work and for 23 years, seminars worked for me and worked 20 years. It’s how I got in the business. So, they worked at the Bach Group, they worked at Edelman. Everybody I know who build good businesses does seminars and just…
[00:28:41] Brad: And I’ve done at least 20 calls this year digging into direct ROIs from some of the top-performing financial advisors in the company, double the ROIs on radio. So…
[00:28:53] David: Yeah. Well, and we were just…
[00:28:54] Brad: Public seminars.
[00:28:55] David: But radio, so now if I’m going to put them side-by-side, radio and seminars are one-two punch because radios fill seminars so they go really well together. So, the second part of this story is referrals. So, a lot of advisors when you meet them and you go, “What do you use for marketing system?” What they say is Brad, “Oh I don’t market, I get referrals. My whole business grows on referrals.” What that really means is they don’t have a marketing system. Because you can’t dial up referrals. You can’t tell me, “Well, I’m going to spend this much money this month and get these many referrals.” That’s the problem with referrals. Referrals are critical. They happen to be the single biggest way that advisors who don’t market grow their business and so I think you need a marketing system over here which I believe is seminars and you’re going to add a radio to it then you’re really powerful. If you can add TV to it, now you got all three but really direct mail and seminars works. Then you use a system to get referrals. So, when it comes to getting referrals, you need to be very clear about who you want referrals from. So, people go through these cookie-cutter referral programs that are just – the thing that infuriates me about referral programs for the most part in the financial services industry is that they’re created by people who’ve never been financial advisors. Right? You’ve seen these guys?
[00:30:10] Brad: Very true. Very true.
[00:30:11] David: And they’re bullshit. So, I want to see – give me a referral program that actual real financial advisors use. So, what we use, what we created is before we focused on referrals, we didn’t just go around saying to the client, “You know, the greatest way we’re getting appreciation from our clients is to get a referral from you,” because we don’t want referrals from all of our clients. We want referrals from our best clients. We want to duplicate our best clients. So, one day I had sort of this moment where I realized we lacked clarity not only around who our best clients were but we lack clarity around – we had done the classic things that people do. We had diagrammed our book A, B, C, D, these are the things that everybody trains to them. We have done all that. Now it’s a huge process by the fact we did that. But one day I came to the office and I said “who really are our best clients?” And my team looked at me and there’s kind of sounds in the room and my sister went in and she got the book, she was like, “Here’s the book, David. It’s all here. We did this exercise last year.” You made us run around for six months and put all this stuff together. Everything is in the system, everybody’s got a letter by them, we’re doing the mailers to the top clients.” I said, “Okay, I know that. But are those people in the A clients really our best clients? I know we did it off for revenue. Do we do it on referrals? Do we do it on how much we like them?” Because I know for instance here’s a client of ours that’s a C client and I named their name. I said, “If we sit here in a whiteboard,” and we took this whiteboard out. I go, “Let’s go through the referrals that that C client gave us.” We started going through the referrals of the guy. It was a one, two, three, and how it all spun out? The way C client that had given us as a result of a few referrals we opened up like I think at the time that year that point was over $15 million in accounts from a C client. And they’re down there in a C bucket because of their assets, their revenue when in fact they’re somebody that loves us that has tapped into all these wealthy people that every time they’re turning around they’re referring somebody to us.
[00:32:21] David: Now we go over to the A clients and like now let’s talk about this guy. None of us liked that guy and he’s in the top 20 of our clients. Then literally as we’re talking about how much we don’t like that guy, that guy called the office and so we’re in a conference room and he wants to talk to one of us. Nobody wants – I don’t want to take the call, nobody else wants to take the call. It’s like one of those shows like, “No, no, no, you take it.” “No, no, no, you take it.” So, my assistant goes and takes the call and comes back into the conference room and now the energy level has totally changed and I go, “See, why is that guy an A client?” I go, “Here’s what we’re going to do.” And so, we went through a process and I won’t give it all away because I want some of these people to come to our training but I went through a process of which we actually went through our entire book of business, looked at who needed to be removed from it. As we say, they need to go taken off the island. And so, we went through instead of folks seemed first on referrals, we actually went through a systemized approach by which we figured out who should be fired. And then once we did that, we became crystal clear about let’s have the client we never wanted to work with again so we would never let them come back in the business and then we drill down who were our favorite clients, who did we love working with the most? Once we identified who they were, what their avatar was, what we loved about them then we had a process systematized by and which we reached out to them and let them know face-to-face how much they meant to us and then smother those clients with love, service and attention. Above and beyond, they became platinum clients. And then really focusing in on those platinum clients, our goal we went out to double those clients in 36 months and the system that we created helped us do that.
[00:34:00] Brad: And the beauty of it because I’ve seen the whole process laid out and I knew you’re going to cover this at the training in June. I think it’s four total steps with a couple of scripted notes and just the methodology and it’s really that’s the brilliance of it.
[00:34:12] David: That’s not only something that I trained too, right? I usually trained on how to do these seminars and grow your business and I didn’t – it was interesting to seeing like 400 advisors in that conference and a lot of these guys have been in business in a long time. Like, in fact, if you just want to turn off a room of advisors, get on stage and talk about referral program. And I even said that the moment I walked on stage. I’m like all you gotta do to get advisors turned off is talk about referrals because we hate people who talk about referrals and I had guys coming up to me afterward. I had a guy come up to me, been in the business for 42 years and he was practically in tears like, “That is the best presentation I’ve ever heard.” He is like, “You know what, I’m going to go home and I’m going to fire all these jerks this week and everything you said is totally on and, you know, all these younger guys are so lucky because I just went through four decades in dealing with this and everything you said is true,” and I got to hear that over and over again from people. So, it was cool to see the impact at that talk.
[00:35:05] Brad: Yeah. Everybody’s had a bad client unfortunately and what you hit on, it’s not only your energy, it’s your team’s energy and it’s just this vacuum. When that client calls in that everybody is, like you said, dodging the call and so…
[00:35:17] David: And here’s the thing, I just hope people don’t think I’m like the super big mean jerk guy because I’m not. We have over 1,000 households, I mean, 1,500 households when did this process. We probably narrowed it down to 40, roughly 40 to 50 clients that we wanted to remove. It’s a small percentage but everyone’s got those. They are watching us right now. You can think about that five people right now that you just – they make you miserable, right? Like you know that the moment you got a review meeting, it’s not just the review meeting. It’s the day before when you’re prepping for the review meeting. It’s the going home and knowing you got to see the person the next day. It’s the driving to the office, it’s your staff knowing that everybody’s going to be in a bad mood because the person’s coming in. Those people are cancer to your life and to your business and if you love your life and you love your business then you deserve to let them go.
I’ve been teaching a concept called “Put Yourself First”. We all talk about paying yourself first, I think in the advisory business it’s also important to put yourself first. It’s like when you’re on a plane and they tell you the first thing if the plane is going down, if you’ve got a baby with your chair with you, you put the mask on yourself then you put the mask on your children because you got to take care of yourself first in order to keep everybody alive. In the advisory business, often we – even know it’s the best, I think it’s the greatest business in the world, a lot of advisors actually don’t take care of themselves. They don’t take care of themselves physically, they don’t take care of themselves emotionally, they sometimes don’t take care of themselves spiritually and I found that when I teach advisors to start putting themselves first and becoming clear around like what they’re no longer going to tolerate and accept in their life, their happiness level goes up incrementally like often faster than income can make your happiness level go up. Like there’s just like when you start to recognize I’m not going to have a bad client, I’m going to let the bad clients go, you feel very much empowered over your business and that’s how you should feel. You’re an entrepreneur. You should feel empowered over your business and you should never feel like you’re a victim in this business.
[00:37:13] Brad: I want to speak to that. I want to take this a different angle but that comment you’re spot on. I literally just had a call last week. A young guy, my age, working 80 plus hours a week, a badge of honor, proud of it, has two kids at home. And I’m sitting there and I’m just like, “That is not success,” and I want to dig in here because I know at one point you’ve been running hard, New York Times bestseller circuit for over a decade I think and at one point you woke up and you said, “You know what, I am retiring, I’m going on a sabbatical,” whatever you want to call it, you hung out with your kids. So, let’s speak to that work-life balance. What did you learn from that time off? Did it clarify anything for you, David?
[00:37:52] David: Yeah. You know, Brad, it did. So, I took a – I called it a sabbatical. I basically retired in 2013. I completely – I planned an 18-month break and my plan was I’m just going to be a dad. I got young kids. I got two boys. One is 13 and one is 7. They’re the light of my life. They’re my favorite. What I’m going to do is hang out with them. I just wanted to like take them to school and pick them up and go to baseball practice. It wasn’t that I’ve been gone for 10 years and missed all the stuff. In fact, I’m very proud that I missed really very little. I really run my business with balance with a life but I have charged hard. I did 12 books in 10 years. I easily traveled a million miles. When you hear, you know, I went to Oprah six times, I did the Today Show a hundred times and did 3,000 media appearances, I mean, all that stuff takes time and taking off 18 months and just being with my family and being able to take a year off and not work and do it proactively like I didn’t get sick, I didn’t go bankrupt, I didn’t have a drug addiction, there was no death in my family. Like a lot of things create a reason why people have to stop. I just said, you know what, I’m going to take – my wife said, “What do you want for your birthday?” And I said, “I want a year off,” and she’s like, “Well, then can’t you afford it?” I said yes and she’s like, “Well then great. Take it.”
So, I think well maybe it clarified for me. It clarified a lot of things. At the end of the day – actually, I think, seriously, I did an interview on this yesterday too. At the end of the day, all my kids really cared about is spending time with me. Anybody who’s watching, all your kids really care about is spending time with you. They don’t care about how many books I’ve got up on the shelf over there. They don’t care about how many TV shows I’m on or how many speeches I did or how many – they just want you to spend time with them, and so does my wife and then some of my friends and then so does my family. I went spent almost a month with my parents that year. Just hung out with them. I think that was an eye-opener for me because spending three weeks just chilling at my parents house.
[00:39:53] David: Ever since college, I mean, I only see my parents for a day or two because I live on the East Coast and they live on the West Coast. I fly in, I spend two days and then fly somewhere else. Yeah, that was really nice. And then reconnecting with friends, and again, I’m realizing like my friends are just happiest I’m down. They couldn’t care less what I’m doing workwise. That was an eye-opener and probably the biggest gift from not working was I got a real sense of presence and I became very present in my life. And that was 2013 and I think I’m very present in my life at a different level than I was before 2013. So, like I’m here right now fully with you. And part of what I took up in 2013 during my sabbatical that was life changing is I learned how to meditate and I mediate already twice today.
[00:40:43] Brad: You went ahead of me. You’re always one up at me. I only got one today.
[00:40:46] David: Well, normally I would meditate around 4:00 or 5:00 but today I just knew it wasn’t going to work so I got one meditation at 12:00 and so I meditate at 5:00 and I meditated at 12:00 And I took up transcendental meditation. I’m going to take usually twice a day, at least once a day. It is the greatest thing that I’ve ever done in my life. I’ll meditate for the rest of my life. If I ever stop meditating, it’s like shame on me but there’s probably nothing that I’ve ever done every day because it’s more like meditation and that one is a total game changer. So, anybody who’s watching when you hear people say you should meditate because everybody says this, I would always say, “I can’t meditate. I can’t get my mind to be quiet. I hated yoga because my mind is always going, going, going.” Once you learn how to meditate, once you’re trained, you could meditate one hour and you know how to meditate. It’s funny. I just did a podcast for Jean Chatzky. I haven’t seen Jean in three years. We did the Today Show for like three years together and she looked at me and she’s like, “What did you do to yourself? You look different.” I’m like, “What are you talking about?” She’s like, “You just seem so relaxed.” I’m like, “I took up meditation.” She’s like, “Oh my God, I need to do that. How did you do that?” So, I just connected her with the person who taught me how to meditate. So, I highly recommend meditation.
[00:41:55] Brad: I will co-author a book with you, Smart Financial Advisors Meditate, and we will take over the financial services industry by storm because there are so many high-strung type A personalities in our industry. If there’s an industry that needs it, it’s ours so I’m…
[00:42:10] David: Oh, my God. On that note, I’ll tell you a funny story. I went on a Grand Canyon trip with a lot of people in the industry that people you probably know like Bill Bachrach, John Bowen and it was like I think there was 13 or 14 of us on this Grand Canyon trip. It was a long time ago. But it was a 12-day Grand Canyon trip with no phones and no email. And by day three, day four, a lot of these advisors were freaking out. They were literally going through like the detox of like, “Oh my God, I can’t call the office.” So, yes, I mean when you go into business you tend to be a very competitive person if you’re successful or hard chargers and that can be great to our success as a business but can also be very detrimental. There’s a lot of divorce in this industry, a lot of kids who don’t grow up with their parents around. So, I think we do a great job helping our clients and then a lot of times we need to make sure we help ourselves.
[00:43:06] Brad: Man, just that last 10 minutes is some of the best advice for financial advisors we’ve ever, ever had on the show. I mean it had absolutely nothing to do with financial services, the job. It had everything to do with just taking care of yourself. So, thank you for sharing that. That’s…
[00:43:24] David: I’ll tell you one thing too that I’ll just throw out. It’s something that I know for advisors when you think about taking care of yourself and taking care of their clients. Most of our clients came to us before they’re about to retire and I’d say 36 – anywhere from one, two, three years before they’re about to retire. So, they come in with seminar, they’re a year, two, three years out before they’re going to retire. Some cases it’s 60, 90 days but those were like the last-minute people. So, the first thing I always ask especially if it’s the men, when they come in our office for the first appointment is, “When is the last time you had the physical? When did you have your bloodwork done last?” And if they’re coming in – we only do meetings with couples like if you’re married, you’re not coming into our office without the wife. I mean every time you do that, the wife looks to him and he goes, looks back, and their eyes are like, you know. Because the wives worry about their husband dying. I saw it firsthand. I had some clients retire and then drop dead within six months. And so, I started realizing what is the point if you don’t take care of your health, who cares if we have all this money?
So, we always would say in the first appointment like, “When did you go on a physical? When was the last time you did your bloodwork? Are you working out with a trainer?” That’s a really important conversation. They say, “Well I’m talking about my money.” I’m like, “Because, look, the time to start working out is not the day you retire. The time for working out is before you retire.” What a lot of men do is they take really terrible care of themselves then they retire then they’re like, “Okay. I’ll go take care of myself.” A lot of financial advisors again don’t take good care of themselves and then there’s a point where they say, “Well eventually I’m going to get to this.” So, I don’t know, I’m just a big believer in self-care.
[00:44:56] Brad: There’s a book I read that changed my life called Not Fade Away. Have you heard of it?
[00:45:01] David: No. I’ll read it.
[00:45:03] Brad: It’s a true story but it’s basically a media mogul that built a ton of these different networks. I think BET was one of them but multimillionaire decided to retire and literally diagnosed with cancer within a year of retiring and just money is nothing when you don’t have your health. That was the big takeaway from that whole book and it was heartbreaking but it’s so true because a lot of retirees, a lot of financial advisors it’s fully within their control and they’re sacrificing their lives, their livelihood for what shows up in the bank account.
[00:45:30] David: Yeah.
[00:45:32] Brad: Yeah. Okay. We’ve got two different ways we can go. We’ll have a chance to have more conversations in person. So, I’ll give you the complete choice, David. So, you mentioned seminars before. We’ve got about five minutes left. We can go deep there or I can ask you more philosophical questions about life in general and we can end the interview that way. What do you think? Where do you want?
[00:45:52] David: I’ll tell you what, you want to go 10 minutes and we’ll do both?
[00:45:55] Brad: Okay. Let’s do it.
[00:45:56] David: All right. So, because I definitely want to talk about seminars because I want to put a true plug-in for what we’re about to do. So, I’ve got three seminars that we created where we had over a million people go through the seminars around the US and Canada. So, the first seminar is Smart Women Finish Rich. The second seminar is Smart Couples Finish Rich. And both those seminars for nearly a decade we had licensed them to a financial service company and they distributed them to the whole industry and we had thousands and thousands of advisors to talk in those seminars and I took the seminars off the market. And I relaunched the seminars at Edelman and I took the seminars back and now we’re going to relaunch them again with AE Wealth Management. So, what I’ve just completed and what we’re super excited about is we have redesigned Smart Couples Finish Rich. It is now a 90-minute seminar called Smart Couples Smart Retirement, the retirement seminar. I’ve already tested it, I’ve toured with it in the past. It’s now updated for 2017.
Advisors that are on our AE Wealth platform are going to now have access to that seminar to teach it to help them grow their business. So, this seminar is completely turnkey. You really go – it’s got all the training and it’s got the mailers. It’s got my brand on it. So, those are going to launched here in the next 90 days to our, again, the advisors that are already on the AE Wealth platform. We’re super excited about that rollout and we’ve got advisors that will start testing that I think in the next 60 days and then kind of roll it out in a big way come September and that seminar is really designed for those who are right about to retire or have already retired and so that’s super exciting. And then we’re going to we roll out an updated version of Smart Women Finish Rich because I think the – I know the women’s marketplace is just huge need, huge opportunity so that’s going to be available for advisors on AE Wealth. I’ve seen a lot of seminars that are done out there. They’re just sort of okay. Because a lot of seminars that people teach that, they get okay results but they’re not great.
[00:47:58] David: And I think what I’ve been really fortunate to do because I’ve done this for so long is really figure out what makes a seminar work right and how to get somebody in 90 minutes to totally empowered, totally excited, ready to take action and then also ready to work with the financial advisors. So, excited to roll those out and that’s going to be a big deal and we’ll talk about that also in the training program that we’re going to be doing.
[00:48:22] Brad: Very cool. And I’ve seen the behind the scenes work and I’ve seen some sneak peeks at what’s getting ready to get rolled out and it is incredible. I’ll even speak to you mentioned at the beginning of our conversation here. We’ve literally on AE side, I know you know Josh that’s been flying around all over the country doing exit surveys from people that have gone to seminars and what we find is exactly what you said early on. We’re talking all of these financial services, acronyms, 12b-1 fees, and your normal retiree that’s sitting there that might not have a financial services background, it’s going right over their head. And just twice already at the beginning of the conversation, you mentioned the latte factor. You broke things down, you made analogies where people get it. You mentioned work the first hour of your day for yourself. People get that and that’s the beauty of what you package in a seminar to me, it’s, you take this really complex financial world ideas that overwhelm everyone and you simplify it and put it in real world terms that people get and they can make sound decisions on. So, I’m super excited about that, David, and thank you for all the work you put it into that because I know you’ve done a ton to update those and rework them and roll them back out to our advisors.
[00:49:29] David: Thank you. You’re welcome. I’m excited. It’s going to be great.
[00:49:32] Brad: So, anything else on the seminar front? I know you’ve spoken to over a million people across the world. If you’ve got any quick seminar tips you’d like to give before we roll into the final questions here you’re welcome to throw them out or we can move on.
[00:49:45] David: Okay, quick tips. First thing is at the beginning of most seminars for somebody who’s teaching a seminar, it’s always about your story and your story is not your bio. So, whenever you’re being interviewed, like you need to tell your story in a very short concise way in which people very quickly feel like they know you and know who you are and they know why you care. Because they’re trying to make a decision very quickly like in the first six, seven, eight minutes, do they like you? And then they can trust you. And what a lot of advisors do is they get up there and they’re like, “Hello. My name is David Bach. I’m a Senior Vice President in Morgan Stanley and I have $750 million under management and I have one of the biggest teams in the country and we work with high net worth individuals.” Like I feel I would never do that. It’s like that’s what most advisors do and the person just sees me and they’re like all they hear is rah, rah, rah, rah like we come and go.
You’re probably wondering like first of all, the seminars for women and money, you’re probably wondering, “What in the world is this guy doing up here and teaching a class of women and money?” That’s a great question by the way. What happens is I learned about money from my grandmother. My grandmother, Rose Bach, an amazing woman, she started with – and have a whole story about my grandmother, how she helped me buy my first stock at age seven, all true, all my stories. By the way, you have to have true stories. But like within the first two, three minutes you got a whole – you can see me like when I told the story about learning about business from my father, a little kid going into his investment classes and you got to humanize yourself very quickly in the very beginning of that seminar. Then the most important thing is it’s not what’s on the slides because we all use PowerPoint slides typically. I have a lot of PowerPoint slides in my seminars. It’s what you say in between the slides. So, it’s not the slides. It’s the story between the slides and it’s the story that everything needs to have a story to it because human beings, we learn through stories. And I think the big thing I do with my seminars that’s different than most people seminars is typical financial seminars are designed to wound the individual who’s in the seminar. It’s the old sales process of wound them and heal them.
[00:51:45] David: I’ve really seen trainers say, “Your job in a seminar is to break their legs.” How did that person come to you and they’re crawling to you and you’re going to lift them up. People call it disturbia. I’m the exact opposite. I teach a seminar. I’m there to educate you, entertain you and empower you. Some of you that are here are going to do this yourself, it’s fantastic. I hope you take all this information, God bless you, go back to Vanguard, I hope they do a great job for you or wherever you’re going to go, do it yourself. Beautiful. Some of you were here because you’re actually looking for a financial advisor. You’re looking for education. They’re looking for a new financial advisor. And if that’s you, that’s great. Some of you are going to want to come use this at the end of the seminar. Like there’s a whole process I teach on how to close these seminars. Because you need to weed out who’s doing it themselves and who’s looking for an advisor.
And I guess I’ll close on this part, huge mistake that anybody would make and I made this early in the business was if you teach a lot of seminars, it’s all about the closing rate. How many people asks for an appointment and I’m like if you’ve been trained and you’re a numbers person, we obsess over our numbers. How many people came to the seminar, people call them buying units, terrible phrase. They call them buying units. They’re families, they’re human beings but this idea of how many people asked for an appointment and how many people came into your office is the wrong data point if you’re bringing the wrong people in the office. So, I meet people and they’re like, “Oh I get 75% of people that ask for an appointment,” and then they drill them the numbers. And by the way, of the 75%, only half of them actually showed up for the appointment because what they’re getting is they’re convincing people to check off the box but then they’re not really, really ready to follow through then they’re getting do-it-yourself tire kickers in their office. And so, I learned after I got really good at closing and getting lots people ask for appointments and then realizing like “I’m wasting a lot of time on the wrong prospect.”
[00:53:37] David: I got really good at in the closing process of the seminar, very transparently authentically telling people here’s who should come into our office. These are the types of clients that we work with. Including saying to people we only work with nice people. So, if you’re not nice and I say this like literally like, “If you’re not nice, don’t try to sneak into our office,” and people crack up. Because you know who you are if you’re not nice. Don’t come in our office because we’ll figure out the first 10 minutes and then we’re not going to let you become a client anyway. So, in order to come into our office, number one, you need to be looking for a financial advisor, you need to be willing to pay a fee because we charge a fee, this is not free, and you need to be a nice person.
And what helped – and by the way, when you just saw what we taught about, we’re not looking for if you’re coming in to like trade stocks or you want to get the highest performing money manager, that is not us. So, if you want a financial plan based on your goals, trading some values with the institutional level of money management, done honestly, done ethically, we’re going to take care of you and always be there for you, that’s what we do. If you’re looking for the cheapest lowest cost price possible, I think that’s great. There are tons of funds in there that can help you. We helped. The seminar really helped you. I want everybody who comes to my seminar and feels like they left and they’ve got value. I want the right people who are in the room to come in my office to hopefully become a client.
[00:54:58] Brad: It’s like you’ve done this before, man. I mean, that was – it’s a good thing we recorded this because that was gold. Well, thank you for sharing that. That was like…
[00:55:05] David: Yeah. You’re welcome.
[00:55:06] Brad: There’s like four right there right in a row rapid fire so that’s going to help a lot of people a lot.
[00:55:10] David: See, now the beauty of recording is I don’t have to ever do this again. Now we just take this thing in class and do a replay.
[00:55:17] Brad: Hey, however I can help, man. All right. Let’s flip into a few questions to wrap up. This has been awesome, David. I appreciate it.
[00:55:23] David: You’re welcome, Brad. Thank you for having me on.
[00:55:25] Brad: This has been a blast. All right. First question for you, when you hear the word successful, who is the first person you think of and why?
[00:55:33] David: Wow. It’s funny. I think of my wife. I think my wife is incredibly successful and I think that she’s incredibly – so my wife, Alatia Bradley Bach, I think she’s successful because she just has an incredible – she has more friends than anybody I’ve ever met. I mean, the woman is just loved by everybody and so to me she’s successful because she’s had a very successful career but she just deeply cares about other people and people deeply care about her.
[00:56:00] Brad: That says a lot. When it’s all said and done, who shows up at the funeral and that says a lot about how you lived your life.
[00:56:05] David: Kind of the big – let me tell you, I don’t want her to go anywhere on me, she’s – her funeral’s going to be huge. Hope I go first.
[00:56:17] Brad: Yeah. She’ll – it’ll be like this guy sold all the books but his wife is who everybody showed up.
[00:56:22] David: See, I keep telling her I want to live to be at least 100 110, 120. She’s like, “I’m not hanging out with you that long.” I’m like, “No, no, no. We’re going to do these healthy things because on the Peter Diamandis 120-year-old train.
[00:56:33] Brad: I love it. I love it. All right. This should be a fun one coming from a guy that’s written as many books as you have. What’s the favorite book that you’ve ever read and why?
[00:56:42] David: Oh man. Okay. So, I’m going to – that one I actually, that’s easy for me. I’m going to say Alchemist by Paulo Coelho who I would think most people have read that book but The Alchemist from Paulo Coelho is just such a great book and he’s sort of my – you have an idol like somebody that you always hoped someday you can be and obviously one of the biggest writers of our lifetime and worldwide. I think he’s probably sold over who knows? Last time I saw him he’d sold 150 million books so he’s probably at 200 million books but I had this chance to go out to have dinner with him in Switzerland and that was really cool, hanging out with Paulo Coelho who I had been – I just love his books and just love the kind of writer that he is. And seeing by the way how driven he still is, is also remarkable like the kind of being he is like and talk about a rock star. I’m dealing with a lot of famous people but Paulo Coelho is a rock star. I mean you’re walking through the streets of Geneva and, “Paulo, Paulo, Paulo,” like he loves to say hi to everybody. I’m drinking late night with Paulo Coelho. That’s a kick. So, that would be the book.
[00:57:43] Brad: That’s an amazing book. How old were you when you read it the first time if you don’t mind sharing?
[00:57:49] David: I read that book in my 30s. That’s the kind of book too that you can probably go back and reread like every year, every five years. I mean it’s just that book and then, I mean, I’ll give you another book if you want another book.
[00:58:00] Brad: Yeah. Let’s hear it.
[00:58:01] David: And this one I can’t say I met him because he passed away but it’s definitely Dale Carnegie, How to Win Friends and Influence People.
[00:58:06] Brad: Yeah.
[00:58:07] David: And that’s because that’s the first self-help motivational book I ever read and I read it when I was 19 living in Waikiki Beach for the summer and that book changed my life and then that’s what led me down the path of self-improvement.
[00:58:24] Brad: That’s crazy. So, I want to backtrack because I don’t know if you knew this but I read The Alchemist the first time I was reading Steve Jobs, Isaacson biography. Steve Jobs reread that book every year.
[00:58:37] David: The Alchemist?
[00:58:38] Brad: Yes. So, it’s interesting that that’s your book because he was obviously a big dreamer. You were a big dreamer. I mean you’re writing books before it was cool to write books as a financial advisor. So, that’s cool that you have that aligned with him and then How to Win Friends and Influence People. Man, that’s like if I could live my life by the principles of that book I’d be doing well for myself.
[00:58:56] David: And that’s another one of those books that if I think that Dale Carnegie even said at the beginning of that book, “You should come back and reread this book,” like I forget it was every 90 days or once a year but I could reread that book again right now and it’s all the classic things that we know we should do but we stopped doing them.
[00:59:12] Brad: Yeah. My guess is your wife practices a lot of those whether she knows it or not just based on what you’ve already said about her.
[00:59:18] David: Yeah.
[00:59:19] Brad: So, all right. Time for two more?
[00:59:22] David: Sure.
[00:59:22] Brad: Okay. This one I’ve never asked before so this will be fun. What is something you would like to see as absurd 25 years from now?
[00:59:33] David: Wow. I’m going to think about how to answer this question without being political. So, I wrote a book called Go Green, Live Rich because I have a big belief in the need for our world to take care of our environment so that our kids will have a planet to enjoy. So, there’s just a lot of things that we do to our planet that are absurd and I don’t even think I need to make the list right now. I just think that they’re – I think 25 years from now, the idea of getting gas for your car will probably be absurd. I mean we can make electric cars. In 25 years everyone would be driving an electric car and I think the day will come when I hope when we’ll look back and go, “My God, really? We like we used to go and get gas for our cars?” and people, “I know that’s absurd. I can’t believe that we did that,” but the power of the car industry and the oil industry is so huge I don’t know if that day will come. So, that would be a major monumental environmental shift that I’m not trying to be political but…
[01:00:39] Brad: Hey. You’re in a safe spot. I have solar panels and I live in the middle of Kansas so I can get on that cause right there so I completely…
[01:00:47] David: And I’ll do one more. Our healthcare system in this country is fundamentally absurd and it’s heartbreaking how bad and how broken and how corrupt our health care system is. The cost of healthcare in this country is absolutely inconceivable and it is a complete scam. And I’ll give you an example of that. I was just in Aspen, Colorado where my son got hurt on the mountain and had to be taken down and fortunately he’s okay. I probably didn’t need to take it but we took an ambulance from the bottom of Ajax to the hospital in Aspen. And I said to the guy and they were looking at me like, “Are you sure you want…” and like my kid’s in a stretcher. They’re putting him in the back of the ambulance and then they say to me at the back of the ambulance, “Would you want to take the ambulance or would you want us to get you a cab?” What would you do? You’re the father. I said and the fact that they’re like asking me the questions three times I was like, “Yes. What does it cost to take this ambulance to the hospital?” The hospital was literally like eight minutes away. They go, “Well, we don’t know but we need to verify it’s okay. Your insurance will probably pay for it.” So, we take the ambulance to the hospital. And what would you guess that 8-minute ambulance ride cost?
[01:01:56] Brad: I’m going to guess it’s absurd on some level.
[01:01:59] David: So, just pick a number. What would you guess?
[01:02:02] Brad: Just knowing how that system – let’s say 2 grand. Let’s say 2 grand.
[01:02:05] David: $1,850. $1,850. Now the hour-and-a-half they spent at the hospital, my son having an X-ray where they could tell us that nothing was wrong, the whole process was 5 grand. That’s just wrong. So, healthcare is fixable. It’s been fixed in many countries. It is something that we could choose to fix and I hope that in 25 years we will have fixed it and I feel pretty strongly about it.
[01:02:36] Brad: Hey, I think both of those are for the better of society.
[01:02:41] David: The sad thing too is financial planners, if you really dig into financial planning, what’s the single biggest thing our clients going to worry about is health care cost. I mean, it shouldn’t be that big of a worry. So, now I feel we’re ending on a downer. We have to…
[01:02:53] Brad: No. You’re good. I’m going to bring it back with this next question. You’re good. You’re good. If you could and obviously, you know who the audience is here so when we’re directing this at financial advisors if there was one thing if you could distil it to one thing to share with our audience that’s led to your success, what would that be, David?
[01:03:11] David: I think it’s all about purpose. So, in my case, I became very clear at a very young age what my higher calling was and what my purpose was and I felt like I was put here, I have a deep belief in God and a higher spiritual calling and I think we’re all put here for a purpose. And each and every one of us you were put here for a purpose because every single person who is watching us was put here for a reason and our clients are put here for a reason and I think tapping into what your purpose on this planet is, whoever your higher calling is, tapping into that higher calling and recognizing that we’re spiritual beings and we’re here for reason and then doing your best to go and fulfill that. So, I just very young realized like I think I’m here to do something to try to help as many people as possible and my calling and my purpose was originally they go help a million women be smarter with their money so they can go and protect their families. That was my purpose. And so, everything I did was based around that. And that actually led me out to the financial service industry and now I’ve come full circle back into but looking at that higher calling, people were like, “Why did you leave Morgan Stanley, you had this huge book of business and you were set for life.” It was because I have this higher calling.
Now having a higher calling, by the way, doesn’t always make your life easy so I had a much easier life just being a financial advisor and my sisters got a nice – she works her ass off but she’s got a nice easy life. And not everybody – I’m not saying that you have to go change the world. I think figuring out what your purpose is and whatever it is. Maybe your purpose is just to be the ultimate dad or really be the highest possible service to your top 400 clients. But I will say this, I think for advisors who are watching, often we’re so busy working that we don’t have time to focus on like a question as powerful as what are you here for? And I recommend advisors who are working five, six days a week, that should take a week off and I know I was working six days a week and I already took a day a week off to go write my book.
[01:05:08] David: And that’s what allowed me to go write the book because I took Wednesdays off and I decided I’m going to take Wednesday off and write the book. If I hadn’t taken a day week off, I would never have written a book. When I went from work, six days a week to five days a week my business actually grew. Eventually, I went from working five days a week to four days a week to eventually three days a week because then I was writing books two days a week. The business doesn’t need you every day if you do it right and there’s a lot that you can do with that other time. And if I could encourage anybody who’s watching this is really here going, “Okay. I came here because I want to grow my business,” sometimes one of the best things you could do to grow your business is actually block a day a week off your calendar. And on that day, don’t work on your business, go work on your life, whatever that looks like. Go golfing, spend it with your wife, take the kids to school, go to the gym, go to the doctor because you haven’t had a physical and like your team, you got a team, let your team work that day and that can change your whole outlook on this business by the way. Just realizing that you can go and do that. Experiment with this, some people I got could never take a day week off. Start with half a day. It’s addictive by the way. Once you take a half a day like – by the way, if you’ve got a team even if you got one or two assistants, if you delegate right, they would love having you out of the office. They’re thrilled.
[01:06:22] Brad: It’s the best productive day. I’ve heard it over and over.
[01:06:23] David: Yeah. Probably.
[01:06:25] Brad: Well that’s incredible advice and a great way to end the conversation. So, David, I mean, just I want to say thank you. I’ve seen it firsthand with just our group of advisors how you’ve already impacted them in a super short amount of time and I know you’ve been impacting basically the general American consumer in helping them get smart with their finances for much longer than you’ve been impacting us but I just want to end the conversation here and say thank you. Speaking of purpose…
[01:06:51] Guest: You’re welcome.
[01:06:52] Brad: Your purpose has affected a lot of lives in a very, very positive way. So, it’s something to be very proud of. So, I just want to end and say thank you and it’s been an honor having you on the show so I appreciate it.
[01:07:02] David: Well, Brad, listen, thank you. I’m really glad we put this together. I know it took us a while to get it done but it’s been great. I’ve had a blast doing this. I hope it helps a lot of people and thanks for giving me an opportunity to do it.
[01:07:12] Brad: You’re welcome back anytime, my friend.
[01:07:14] David: Okay. Have an awesome day.
[01:07:15] Brad: Take care.
[01:07:16] David: Take care.
This is provided for informational purposes only. Producers are ultimately responsible for the use or implementation of these concepts and should be aware of any and all applicable compliance requirements. Results from the use of these concepts are no guarantee of your future success.
Federal law, state law and/or insurance carrier requirements may prohibit or place limitations on marketing activities. All producers and investment advisors should be aware of any gifting limitations imposed by federal regulation, state regulation, insurance carriers, broker-dealers and Registered Investment Advisers, as applicable. Investment advisors are strongly encouraged to obtain pre-approval from the broker-dealer and/or Registered Investment Adviser with which they may be affiliated.
AE03174073 For financial professional use only.