One of the first steps in your financial journey is to build your team, starting with your financial partner. This relationship has the potential to make or break your success story. Selecting the right financial partner is probably something that you haven’t heard someone talk about lately. We hear a lot of noise about selecting the right life partner, healthcare partner, and even insurance or investment partner, but we don’t hear about the benefits of having a trusted financial partner that understands your journey, has been there, and can help you.
What I mean, is a partner that is excited to help you wherever you are at today on your financial journey. Maybe you are just starting out in your career, loaded down with student debt and are looking for a partner to help you create a plan to eliminate those student loans and build a savings plan. Perhaps you are about to make a major life decision like purchasing a home, getting married, or even retiring, and could use some advice about the next steps. Or maybe you were like me, making severe financial mistakes in my youth, and looking for guidance to clean up my mess. Wherever you find yourself today, having someone in your corner that will be honest, knowledgeable, and can guide you through your journey is critical to your success.
If you have a bank currently, I want you to think about why you chose them as your financial partner. Was it because your parents banked there? Did you grandmother start a savings account for you as a kid and you stayed? Or, did you get a flier in the mail, offering an incentive for opening an account? Whatever the reason, its time to re-examine this relationship and ask two important questions. First, am I getting the level of advice and service from my bank that I expect? And secondly, is the advice that I am receiving from my banker right for me?
When I was a kid, there was an old turn of the century building in our town that served as our local bank. The building was magnificent, it was built with massive marble stones with ornate Romanesque pillars out front. A flagpole stood proudly in the courtyard with the American flag waving in the wind. Inside this building; the floors, counters, and columns were made of marble, and in the back was a giant steel vault door, like the kind I would see on TV. People were wearing nice suits, working at their desks, and friendly faces behind the counter greeted customers and took their transactions. I remember thinking to myself, wow you really must be somebody special to work here. I mean, you get to wear a fancy suit and people bring in their money and just hand it to you, no questions asked.
One of my absolute favorite things to do when I was a kid, was to go to the drive thru at this bank. My parents would pull around in our diesel station wagon to the side where the lanes were and a voice would come over the speaker, “Good afternoon and welcome to First Bank, how can I help you?” My parents would talk to them about their need and suddenly, a whirling sound would fill the air and a clear canister would appear, as if it just journeyed from outer space. My parents would place their paperwork inside, and send it back to outer space where the teller on the other end would come on the microphone, “thank you so much, I have received your paperwork and will have it out shortly.” Within a minute or two, the speaker would come on as the teller says, “is there anything else that I can assist you with today?” Then it would happen, the canister from outer space would appear with a treat from the beyond, usually Dum Dum lollipops, but always at least two for me. Please be root beer, please be root beer! If I can be honest, one of my reasons for starting a job at the bank when I was 18, was to work those canisters from outer space, and I loved it!
Many of us grew up with this grand illusion of banking. This idea of grandeur brought a sense of confidence and trust. You see, the design of these banks was not by accident. They were purposefully crafted and built to give the impressions of power, authority, and trust. As if, being accepted into them, would automatically improve your financial status. This philosophy was not different than the Roman Catholic Cathedrals built thousands of years ago. These Cathedrals were designed and built with such adornment and decadence, that one entering could assume it could only be built by God, and thus being in them, made you closer to God. This powerful subconscious influence has shaped our perceptions about banking and even are own finances. Assuming that, a large and powerful financial institution would provide me with all the advice, guidance and resources that I need to be successful. Unfortunately, you would be assuming wrong.
When I become a personal banker, I was elated. I could finally wear the suit, sit at the desk, and help everyone achieve their financial dreams. I was excited to begin my extensive training which would provide me with all the knowledge I needed to provide sound and accurate financial advice. My training lasted three weeks. Yes, three weeks. It takes more time to study for and pass a driver’s license exam than it took for me to complete my banker training and sit in front of my first customer. The training was focused entirely on the bank’s products, systems, and selling; leaving much to be desired to have meaningful, in depth conversations with my customers about their finances. Nevertheless, there I was, shaking like a leaf in my new suit from JC Penney as my first customer sat down. I will never forget this feeling of inadequacy, but what the hell, fake it til you make it right?
Does it make you wonder, is my banker trying to fake it til they make it? What is the true financial acumen of your banker? I mean, they are the authority, the expert, the professional right? Sadly, most large banking institutions have become what I like to call a “banker mill”. They will hire somebody without any prior financial knowledge or expertise, send them to training, to teach them how to sell and use their system. Then, put them at a desk to start meeting customers. Now from this point one of two scenarios will occur, this banker will become very good at selling, and probably will be promoted. Second outcome, they realize quickly that they are not fully prepared and take the initiative to learn more by studying the industry, listening to experts, and absorbing any information they can find to help them fill the vast gaps in their financial education. Usually once they gained enough knowledge and experience, they don’t want to be a personal banker anymore and go on to other careers within the bank. And the cycle begins again.
Note: As with all things in life, there are exceptions. I have met, managed, and worked with individuals that were the utmost professionals and truly possessed the financial acumen and skills to serve their clients well. In truth, some of these individuals have taught me some valuable lessons about money and that I still use today. I have enjoyed working with these individuals professionally and I hope that their company, or organization, appreciate the value that they bring to the job, and recognize their efforts.
So how do I know if my banker is up to the task? How do I know if they can give me competent and meaningful advice that is right for me, my finances, and my goals? And most importantly, how do I choose the right partner to help me achieve my financial dreams?
Let’s work our way backwards here, starting with how to choose the right partner. I remember some advice my mom gave to me as a teenager, after my girlfriend dumped me. I was heartbroken, my fifteen-year-old self was just sure that we would be together forever. But now, sitting sullen at the kitchen table, my mom said to me. “Do you really know what you want?” My teenage wisdom responded, “of course, I want to be with her.” My mother stayed patient and quietly said,” I know you think that way now, but as you heal you will learn more about what you want in a partner. Then, she dropped some of the most powerful words of wisdom that have stayed with me, even to this day; “When you aren’t clear about what you want, get clear about knowing what you don’t want.”
So, I did. Instead of wallowing in self-pity forever, I began listing all the things that I loved about this person, and then all the things that hurt me in the relationship. At that point it became clear, all the things that I didn’t want in any relationship in the future. So, I set my mind this truth and never settled.
So, let’s get clear about what we don’t want in financial partner. These may look a little different for everyone. For me, it starts with not being a number, account balance, or next sale. I want someone that knows me; more than my name or the balance in my account(s). Someone that knows where I have been, where I am going, and what I am focused on achieving. Second, I didn’t want someone who can talk the talk, but has never walked the walk. I wanted someone with life experience, seasoned, that has been knocked around a couple times and has lived to tell the tale, and can help me do the same.
I remember meeting with a new banker that was fresh out of training. They were excited and ready to conquer the world. In talking with them more, I learned that they still lived at home, hadn’t yet built credit, and has never had to create a budget, let alone live within one. I watched as they took their first customer of the day, an elderly gentleman, long retired, inquiring about CD rates, and an IRA distribution. The banker pulled up the rates and quoted the terms. Next, the banker made an awkward pivot and began talking about the banks newest credit card and all the features it had, you could hear the excitement in their voice and see it on their face. The gentleman politely listened and declined this overly exciting credit card opportunity. The bankers face might as well have had a neon sign the said disappointed on it. The banker then moved on to calling down to a back office to figure out this mysterious request about an IRA that they were unfamiliar with. The transaction lasted much longer than it ever should, and the older gentlemen sat there patiently waiting. Eventually, the banker completed the steps for the withdrawal and the customer went on his way, out the door, and into to his 1965 cherry red mustang.
I couldn’t help but feel bad for everyone involved. The customer, who at this point, has grown accustomed to the in-personal service and long waits. As well as the ever so often product offerings that the bankers were so eager to share with him, every visit, every week. And the banker, who was so focused on selling, that they must an opportunity to connect with a customer and really understand what his true needs were.
Think about the last conversation that you had with your banker, if you are fortunate to work with the same one regularly. What was the conversation about? Did you feel confident in their knowledge of the subject matter? This is not saying that your banker is expected to be an expert at everything, far from it. However, there should be an expectation that your banker, your financial partner, should be knowledgeable about basic banking and services.
How can I know if they can give me competent and meaningful financial advice that is right for me? The answer to this one is simple; if they aren’t asking, they don’t care. I know this seems harsh, but it’s true, so let me explain. You see, in order to provide accurate and helpful advice, you must fully understand the details of a situation, in this case, your financial situation. In order to understand, you must ask questions and listen. If your banker isn’t asking about your goals, priorities, and current finances, then they certainly cannot offer relevant or competent financial advice. One of my favorite quotes is, “listen to understand, not to respond.” I love this because it requires listening to be an action, an in the moment and engaged activity; not thinking of the next thing to say or how to say it. You see, the art of listening has been nearly lost in our ever noisy, busy, and distracting world. The ability to shut everything out and listen intently is so powerful, yet profoundly underutilized. If you have not had a conversation with your banker that did not lead to them offering you another account, credit card, or lower rate on your loan, then take a step back and re-examine the dynamics of the relationship. Ask yourself, “Are they listening?”
Are they up to the task? This one is vitally important but takes a little effort on your end to find out. In order to know if your banker has the experience and knowledge you are looking for, you will need to ask some important questions. This isn’t an interrogation and you don’t have to sit back with clipboard as you fire off question after question. But to get the information you are looking for, think about the things that are important to you. “How long have they been in the industry?” “Do they specialize in anything?” i.e. Small Business, Lending, Retirement, etc. “How do they get to know their customers, and how often should you expect to connect with them?” These are just some examples to get you started on your own list of questions for you banker. Feel free to try them out on a few bankers at different banks. After all, you’re looking for a partner, not a one-night stand.
When we get sick, the first thing we do, after popping a cold and sinus pill, is to go online and start self-diagnosing ourselves, instead of calling our doctor. Usually, this ends with us convincing ourselves that we have come down with multiple infectious diseases that do not have any sort of treatment known to man. When we want to buy a new car, we usually start looking online, again. We may even go to the dealership and kick the tires while also trying to convince the salesperson that we have that infectious disease you came down with, so they don’t bother you. But when it comes to selecting a financial partner, we just go with the flow, accepting whatever the path of least resistance gives us, until now. It’s time to be empowered and take control of your financial relationships, setting expectations and never settling. This will pay dividends now and in the future.
Truth and Cents 