Most people I know deal with a financial advisor. It makes total sense since we can’t be good at everything and personal finance is probably one of the most important things in your life. If your finances are not in order, you won’t be able to do what you like and financial problems often lead to high levels of stress. This is why we all look for a financial advisor to help us take care of our personal finances. As is the case with any other job, some financial advisors are awesome while others are clowns. Let’s just say that it’s harder to find a good advisor than most people expect!
We are often stuck with very few options when it’s time to find our financial advisor. We either go to the bank we do business with and pick the guy or the gal who’s available or we ask our entourage for a referral. You may have been solicited as well by people who promise that they are better than who you have right now. It might be true (if it’s me calling…lol!) but how can you really tell the difference between a professional and a clown?
The answer is easier than what you think…For each industry, there are some “secret facts” known by those who work in the field and may be ignored by others. If you want to know which car breaks down more often, don’t ask the dealership, ask a trusty mechanic. It’s the same thing in the financial industry; the professional will tell you about his secrets…
The first question you should ask your advisor is how much he earns and what pays him the most. Money drives everything, once you know how your advisor is paid, then you know how he can help you… or waste your time.
If you have money sitting in a cash or money market account and you have an outstanding debt at 6%, sound financial advice would be to use your cash to pay off your debt. Most advisors will ignore this principle since each time you withdraw money from their your account, they lose money.
I don’t believe the best financial advisor is the cheapest one. Your mortgage rate may be higher or your banking fees might be competitive but not the cheapest in town. However, if your financial advisor picks up the phone to advise you about finance without you asking for anything; this guy worth every extra penny you paid. Ask your advisor why he is more expensive – the right answer is “because I am worth it”.
A good financial advisor won’t be afraid to tell you that a part of your portfolio (or even the whole investment) is well invested even if it’s with a competitor. The point is that you ask him to be honest; if you are doing the right things he must be able to tell you.
If you didn’t know yet, one of the best secrets of the industry is that insurance policies sold are incredibly profitable for the advisor (and his firm). Ask him how profitable the insurance you purchased from him is… and wait for his answer.
I’ve ran into too many insurance agents selling insurance based on the clients’ fears. Insurance needs are real, fear isn’t. Therefore, ask for a realistic proposal with numbers that make sense for you. I once saw a permanent life policy of $300K for a client who was sitting on $1M cash in his company…. What are the odds he needs an additional 300K upon his death if the company is already full of cash?
Regardless of which firm your advisor works for, he doesn’t call all the shots. It’s better for him to be upfront and tell you that a credit department or a compliance board will have the final say in your application. It’s better if he’s transparent.
Yes, mutual funds can be seen as expensive and they are if you compare yourself to a DIY investor who picks his own ETFs. However, when we make this analogy, we don’t consider the time and passion invested by a DIY investor to manage his portfolio. If you ask any mechanic about an oil change, they will all tell you it’s stupid to pay for that since you can do it yourself. Well, when you don’t want to take care of something, you might want to pay a professional to do it for you. This is why mutual funds can be good for investors who don’t want to manage their own portfolio.
Some advisors don’t have any penalties attached to their investments or mortgages while others charge a final bill if you ever leave. This is important to know the complete structure of your personal finance and to understand if you are attached to your advisor (and his company) or not. It’s not necessarily a bad thing, but you need to know before your sign-up!
I believe personal finance is more personal than financial. Therefore, the most important thing when you deal with a financial advisor is to be able to trust him and get along with his way of working. A simple question that will tell you a lot about the guy/gal in front of you is “why do you do this job?”.
Here’s my answer:
Because I love the stock market, I love to talk about finance and love even more when I can teach finance to other people.
This will tell you if he will stay in his job or not!
Readers, do you have any good questions you would like to ask your financial advisor? What do you do before you can trust him?Google+ Comments: 9 Read More
If you ever thought of selling something, you’ll know what I’m talking about…
I have quietly mentioned on TFB that I’m working on a membership website of late. I didn’t put too much emphasis on it simply because I didn’t want to bug you with my project that has nothing to do with making money online or becoming an entrepreneur.
However, if you have ever thought of selling something, regardless if it’s on the web or not, I am now offering you my thoughts about the incredibly long process behind any product launch. I now understand why big companies spend millions on a marketing team to coordinate their launches!
Not only is it a lot of work (that you can imagine) but the worst part is to wait through days, weeks and months of working on details before the launch. This is what is truly killing me from the inside out. It’s like being pregnant and ready to give birth at 9 months but waiting 4 more weeks before you see your baby!
One thing I’ve learned during the process is that having a product is good, but building a great package and finding the right audience matters more than everything else. Anybody can come up with a product, literally! We all can change the world from our basements with a brilliant idea.
But the first question you must ask yourself is: is my idea useful for people? It is clearly useful for you since you thought of it, but this doesn’t mean it’s useful for others! In order to answer this question, your idea must answer one of the following:
#1 Takes care of a pain
#2 Improves one’s life
#3 Alleviates a fear
To be honest, pretty much everything you can think of will answer one of these “three pillars of a great product”. The point is to package it the right way.
The best example I can think of is the “Post-It” invention by 3M. Post-it stickers were invented after a failure to create effective glue. Instead of throwing this failure in the trash, 3M decided to package it differently. We all like post-it stickers that we can move from one place to another. However, we would never buy a sticker with poor quality glue that doesn’t stick around. This is why we needed to be told that the post-it was made to be moved. This is how to package an idea.
Then, you need to find your potential clients. Don’t think that everybody around you will buy your product. It’s not true! In fact, most people will likely not buy your product. As I mentioned earlier, my next product is not in line with TFB main topics. I will still make you aware it exists but my conversion rate should be very low.
It takes time to build an audience or a list of potential clients. If you don’t build your list first, you may waste a lot of time creating a product that doesn’t meet anybody’s needs. This is why I started with my idea and created a landing page with a specific mailing list subscription option. If you want to look at it, you can see it here.
It is obvious that I already have an audience to launch my product; I run several financial websites! But I wanted to make sure that I have people interested in a paid site that will provide them with information. This is why I created this new list and asked people to register for it if they are interested in hearing about my idea.
I didn’t want to spam my regular readers with a series of emails mentioning my concept and how I intend to package it unless they clearly tell me that they want to hear about it. This was the purpose of making a new list apart from all the others. I sent 4 emails so far to this list. If you have a mailing list, you know that a good average opening rate is around 30%. Here are my numbers:
This list has over 500 subscribers. Therefore, roughly 350 people opened and read these emails attentively. This is a very important sign that my package and what I offer will be welcomed by these readers. Another interesting stat is the 200+ emails I’ve received back from these readers commenting and asking questions… Definitely, I can tell that I’m close to something good now!
If you want to know how I build my mailing list and email funnels, read this series and you’ll know all my secrets.
But I’m not ready to launch yet. There are too many details left to be taken care of. The idea of your product is important and, the packaging is even more important. However, all these little details supporting your product need to be taken care of thoroughly. Don’t think you can launch and then fix them along the way.
Each time I think I’m done with one section, I ask my partner and VA to take a look around and give me feedback. Each time they come up with something new and I have to go back to the drawing board and apply some modifications.
Pictures used, navigation process, charging methods, software used, update rules, writing methodology (font, color, size, etc). These are all details that need to be perfect. I’ve spent several hours creating my email series and organizing the launch date.
I won’t lie, taking care of the details sucks. It’s not fun and you don’t get anything great out of it. No money, no traffic, not even a “thank you”. You just have to fix everything so the day you open your doors to the world, everything is perfect!
Having a deadline for any project is probably one of the most crucial parts of your launch plan. Without a deadline, you won’t do anything. You need to commit to a higher level to make sure things go along the way.
I’ve personally committed to launch my project for December 2013. At first, it was just a vague idea of launching a membership website. Then, when I came back from vacation in late August, I realized that not much had been done and that I would not be able to finish everything for December. This is why the deadline was so important; it creates the sense of urgency.
I went a little bit further by creating my mailing list and the email series. I’ve committed to myself of sending 1 email every two weeks. This technique is being used to keep the momentum about my project going, giving an update while slowly selling my concept. At one point, these people should be as ready as me for the launch!
I must also go forward with my project faster if I want to make it a success. Imagine the opposite; imagine that I wait another 6 months to launch my site? I would probable get close to ZERO sales!
On the other hand, deadlines are deadlines, nothing more. The world won’t end if you don’t make it. The key is to commit yourself to a high level so you need to work on your project every day. Then, if you miss your deadline by a few days or weeks, it’s not the end of the world either.
I’m given myself a small buffer (don’t tell my partner! Hahaha!) of launching in January instead of December. If I can’t launch in the first week of December, I’ll probably launch during the first week of January. I guess people will be more interested in buying gifts than buying a membership website subscription during the Holidays!
But my hopes are still to launch on December 1st and make myself a real gift for the Holidays!
The most important thing I’ve learned during this process is that patience is key. If you get too impatient and want to launch right away, you won’t be doing things the right way. You will likely miss some key details and sales won’t be as good.
I want to make sure that I’ve done 100% of what I could do prior to the launch. At that point, I know that I couldn’t have done things differently and will be satisfied with the results.
Do you have a product that you sell? How did (do) you plan your launch?Google+ Comments: 3 Read More
Back in September, I was just coming back from my vacation when my debt level surged. This was a result of a bad combination of investment in the home daycare, clothing for kids, activities for kids, municipal taxes and my credit card statement from my vacation.
At that time, I’ve thought of selling my beloved RX-8 for sale and rely on 1 car only. For a family of 5, living with one car might not be the easiest thing. With today’s crazy life, can you really live only with one car for a family of 5?
Since you know that I’m pretty far from being frugal, you can imagine how hard it was to put the sale sign on my car as the first move…
When I first thought of selling my car back in September, I was truly torn. Don’t laugh, I really liked my car! You may or may not understand the following but this is how I see it: my car is a statement of my standing. In my industry, it is important to shine out. If I come to visit a client with my RX-8, I already make a good impression. My chances of closing are better with an uncommon car.
I didn’t think of that aspect of my job when I purchased the car though. I actually wanted a sport car to do the 1 hour drive to work each morning and evening. But then I realize something; most of my clients were talking about my car when I met them. It became some kind of magnet. They were curious about the engine (it’s a different technology) and wanted to know how fast it could go (duh!).
So by selling my car, I wasn’t just selling 4 wheels and a steering, I was selling a part of my unique selling proposition. I was selling my “status”.
On the other side, I also kept piling up car maintenance bills for the past 18 months and this was getting on my nerve big time. For what the car cost me, it became ridiculous to keep it to maintain some psychological status.
But what made me put my money where my mouth is was another factor. For three weeks in a row, my car was gently sunbathing in my driveway. Before selling my car, I’ve tried not to use it for three weeks… and it works! Then, I came to this shocking truth:
So I took the decision of getting rid of my sport car. I know… it’s about time! But on the other side, I wasn’t convinced we could live as a family of five with only one vehicle. My car was expensive, but using my SUV only could lead to some schedule complication.
My daughter has swimming classes along with ice skating. My son plays soccer. I often get to work during one evening per week. How can I manage all schedules within using one car?
Funny enough, this question worried me a lot but answers were very easy to find. We put most kids activities over Saturday and Sunday morning and we kept a tight schedule on our fridge to make sure everybody knows where they are at anytime. Worst comes to worst, we can always take a cab and pay $10 for the ride. This is a lot cheaper than paying for winter tires, oil changes, gasoline and car insurance!
But instead of selling 1 car, I’ve sold both of them! Since I’ve made the decision of keeping 1 vehicle, I wanted to make sure I didn’t get stuck with problems. I can’t afford losing time at the garage and I don’t really want to put more money in car maintenance.
By selling both cars, I had the possibility of buying a brand new car with the same monthly payment. I’ve extended my loan to another 7 years (I had 2 remaining on the Tribute), but now that I don’t use my car much, I probably won’t reach over 150,000 km within that period. This will leave this new car in a very good shape for the time being.
On the other side, I’m saving money on car maintenance and time. Since I don’t have another car, saving time spent at the garage was crucial.
After two months of using a single family car and I tell that we spent the huge amount of… $10 for a cab! We are currently saving on all car maintenance along with car insurance. It has helped our current budget and generated more cash flow to pay off our immediate debts (credit cards and personal loans).
Now that we have cut on several expenses and generated extra income from the daycare, I’m seeing a positive impact on our monthly budget. Our debt repayments increase month after month and I am now looking to cash my bonus in January to make a big debt payment!
What do you think of this strategy? Would you have sold both cars like I did or kept the old Tribute with only 2 years worth of payment remaining?Google+ Comments: 5 Read More
Hey folks! Remember a few weeks ago, I wrote a huge piece about how hard it was to make money blogging these days? Well I just got back from FinCon13 that happened 2 weeks ago and heard the same song from other bloggers; Google sucks, money is hardly earned and the community is stronger than ever.
FinCon13 is a great conference where 511 financial bloggers met in St-Louis. This is the 3rd edition of the conference and I’ve been to all of them. As always, I learned a ton. Here’s my personal take of what is going on in the blogging world.
If you have any blogging friends irregardless of topic, forward this to them, it will be a great help!
My first thought on the trip back home was “OMG, the internet moves so FAST!”. That’s funny; I sound like a 60 year old that can’t keep up with technology. The truth is that I’m 32 and…. I can’t keep up with the internet! The fact that I started blogging back in 2006 makes me a dinosaur today. Forget about the whole “with age comes experience”. There is an Ice Age crashing dinosaurs every 2 years on the web so 7 years in the business is like 500 million years in the real world.
The last Ice Age happened for us in early 2012 when Google struck with his minion called PANDA. Since then, my race (thefinancialusbloggerus), is starving and constantly on the move to desperately find Atlantis, the promised land. Jeff Rose from Financial Cents shared how he strived and survived being dumped by Google in a hilarious presentation. The most important lesson learned from his speech was about what to do when you get hit by Google. I’m sharing this with you…
Yeah… not the fanciest way to put it, but it’s so true. There is nothing you can do, so you had better move on. The thing is that Google is too big and too powerful for you to do anything. The worst is that you are too small and too insignificant for Google to care about. Therefore, you can enter in an endless manual reconsideration process but it will take you several months of back and forth email before it achieves anything.
Once Jeff got over the “denial stages” and stopped thinking “Google is going to fix this mess, it’s a matter of days”, he started to hustle like a villain.
He started this huge guest post campaign to be featured on about every single blog in the financial niche.
He connected with several bloggers and went back to the basics of blogging; connect with a community.
He used other ways to get traffic such as Twitter and Pinterest (he also has an awesome wife who does all the “Pinteresting”).
After all his work, after going back to the basics of blogging, after he worked like a maniac on his websites, he finally got his traffic back, and more. All this took him 12 months or so of hard work and thinking outside the box.
The most important lesson from Jeff was to “suck it up” and start hustling. If you don’t work very hard, all the time, you will get mediocre results. I’ve seen this for many of my sites which I’ve left drifting in the web ocean. Nothing good is really happening with them. This is why it is so important to keep your focus and work on things that matter… like your main blog!
Another great session was delivered by a great panel of self-publishers; Derek Olsen who wrote The Four Week Financial Turnaround, Mike Piper who is living from his 8 investment books on sale at Amazon, Todd Tresidder who wrote an Amazon top selling retirement book called How Much Money Do I Need To Retire? and Ben Edwards from Money Smart Life who wrote Get Out of Debt Like Debt Heroes with the help of 21 bloggers.
The four guys reminded me, once again, that evolution is faster than the motion. About six month ago, offering your eBook on Kindle for free for a small period (3 to 5 days) was an amazing way to jump in the rankings and surf among the top sellers of your category. If you had a good readership (read a sizeable mailing list), you could drive enough downloads to make your book a success instantly. Well it appears that this technique is still good, but doesn’t provide the same drive as it used to. The reason? Amazon changed its ranking weight depending on the price of the book; a book sold is worth a lot more than a book downloaded for free!
However, while Amazon evolves with time, its internal search engine is similar to what Google used to be… 10 years ago. This means that keyword stuffing still works for your book description! In order to find your book in its library, Amazon has designed its own search engine where users type in some keywords to find what they are looking for. A good example of keyword stuffing is to add a sub-title to your book that includes several good keywords. This sub-title doesn’t show on your book cover and will be mostly read by the Amazon search engine and nobody else. For example, for my book “Dividend Growth”, I could add a sub-title like: A Dividend Investing Process to Invest in Dividend Growth Stocks. Not the most appealing sub-title and pretty repetitive (where you get the word “dividend” and “invest” twice in the same line). But Amazon’s search engine will pick it up and rank you for those keywords!
Mind you, by the time you read this, this trick might not even work anymore… hahaha!
Since I’m nearly working on just one thing these days (launching a membership website), I attended several “course building” or “mailing list funnel building” sessions. Steve Chou from My Wife Quit Her Job was generous enough to share his step-by-step email funnel generating a 6 figure business.
What was truly shocking was to see how he used what he learned from his first email funnel (to help his wife build his wedding handkerchief business) to build a second business (related to how to setup an ecommerce store). So he basically “copied/pasted” his funnel for his second business and the results were instantaneous.
I’m not going to “steal” his stuff and tell you about it on my blog. Instead, I’m going to tell you to register to his free mailing list and you will understand his process as you receive the emails. I think it’s the best way to learn.
Have you ever heard of creating a freemium to convert more people to your product once they have registered to your mailing list. A Free what? A FREEMIUM. Quinn from Cubicle Free was the first guy who told me about the concept. Then, I revisited the concept and more in a great presentation given by David Siteman Garland (Rise to the Top) who sells an online course about making great online interviews.
A Freemium is basically something you can offer for free that would be halfway between what’s free on the web and what you truly offer in your membership/product/online course. For example, David offers a first series of free videos on the basics of how to do the interview. This series is offered to his mailing list subscribers at no hidden cost whatsoever.
You probably know a bunch of people who register to his mailing list, “steal” his free videos and move on. From those readers, David makes zip.
However, there are others who will register to the mailing list, watch the videos and think “I definitely need more info about this; I really want to invest myself in this project”. These readers become clients and this is when David makes money.
Is he leaving money on the table because he gives stuff away for free? I don’t think so. The basic info found in his first videos is just to get you started to hold the interview. So if you are not ready to do more, you are not the right client for his product anyways. The freemium is also used to validate the interest of your potential client. If someone who’s not too sure about hosting an interview ends-up paying $500 for a course that he doesn’t really use because he bought it without thinking too much, you can be sure you will get a complaint.
The last thing I want to highlight from his presentation is the following:
When you think about it, the more you charge for your product, the higher the chances are that your clients won’t be jerks who expect everything for free. They are more likely to appreciate your work and effort to deliver a high end product. The satisfaction of a client doesn’t come from the product or the price, it comes from the perception of the product compared to the perception of the price paid. Nothing more, nothing less.
I’m going to stop here for today, however I have a lot more to share in the upcoming days. For now, I have to get back to my membership site and launch it before Christmas!
MikeGoogle+ Comments: 9 Read More
For the past few years, I’ve been fascinated by the way classic newspapers handled the shift to the internet. Most of them handled it poorly and thought that simply copying / pasting their paper news would make it online… Their business model is broken, profits are thin and they still don’t see a light at the end of the tunnel.
What will happen to the old media?
This is where the problem stands; once you go online, any newspaper is as important as any other blogger. In fact, some bloggers are way bigger than some newspapers! This is where the problem is; there is no more entry barrier to publish content. I remember that when I was young, I wanted to become a writer. While growing, I realize how it was difficult to live from writing and decided to head toward the financial industry to assure a comfortable retirement.
In order to write; you needed an editor or a job as a journalist. Then, your destiny was held by a handful of major players. If you didn’t make the cut, writing for the local newspaper wouldn’t be as lucrative. But these days have changed as anybody with a strong personality and the ability to write can setup their blog for less than $100 per year. They can publish and share their stories with no marketing budget and they can even make money without having to setup a distribution network across the country.
Old media thought they would simply open their “dot com” window on the internet and occupy the same space they have in the “real world”.
The competition on the internet is as close to fair as it can get. We all have the same medium and it doesn’t require any background nor massive funding to start a website. This is why old media doesn’t compete against 5-6 major competitors but several hundred thousand bloggers without papers. Basically, anybody with an opinion can be a competitor.
The journalist by trade who is sitting in the same chair for the past 30 years now has to wake-up; anybody can pick-up “his” seat and he won’t even know it. Survival of the fittest; your experience and number of years worked at the same place won’t save you from the guy next door without any background or paper!
The first thought old Media had when they noticed a drop in their revenues was to charge for their content. We saw it with the Wall Street Journal at first, and more locally, the Globe & Mail is now charging to read full content online. I’m not too sure that it’s the right way to approach this new evolution in the industry.
On the one hand, not all newspapers charge for their content. Therefore, you better have a hell of an offer to charge readers. If they think they can read similar articles elsewhere for free, you won’t get many subscriptions. At the same time, you still have tons of specialized/niche sites covering the same topics for free as well.
I’m not convinced charging for content is the right answer. I think it’s a Band Aid on an open wound. The whole business model needs to be changed. Charging for content or posting an avalanche of ads will not solve the problem. Readers are looking for free and useful content – not a Nascar newspaper full of ads.
As long as old Media heads towards the classical way of making money with news, they will walk on the path to the cemetery.
I think there are others options traditional newspapers could use to make money online and survive the internet wave. I’m not a guru of any kind and don’t pretend I hold the key to success online. However, I believe there are different ways to make money online without upsetting readers.
Newspapers have 2 major strengths they should use to their benefit;
#1 They already have an audience.
#2 Google likes them and it’s easy for them to rank in the search engines.
Therefore, they already have the 2 things we, as bloggers, fight for since day one! This is how they could easily insert one or two “profitable” articles in their edition each day. These articles will be SEO optimized and include different type of advertising. It could be Adsense or affiliate links if the writer liked a product and recommends it. There is obviously a risk where the journalist may or may not cross the line of integrity by recommending a product with a commission attached to it.
Conspiracy theory fanatics will see the loophole and scream. But we already have the same issue with other bloggers anyways. Is Pat Flynn writing about Blue Host because he truly loves their hosting service or because he makes over $20,000 per month through his affiliate commission? Who cares??? I bought my hosting with Blue Host because I trust Pat, period. So why wouldn’t it be the same thing with your favourite columnist?
With such a large audience, there is definitely a place for side products such as info products, ebooks, paid newsletters for specific information. I think the main platform should remain free, but additions could be charged to readers. People are craving for more valuable info on what they search for. Since old Media has the resources, time and money to create side products, they seem to be in the perfect position to do it.
Once they track their traffic, they can see what are their most popular topics and columnists. Then, they can easily create products targeted to this audience.
Not too long ago, there was a big launch made by a French newspaper called La Presse. I actually like reading La Presse for free on my laptop and also on my iPad. A few months ago, they launched an app called La Presse +. At first, I wasn’t too convinced about the idea. I just thought that, once again, big media was wasting their money on a marketing exercise.
But now that I’ve gone through the app several times, I can tell you that I simply love it! The content is fun to read because you have more colors, images and they even include videos! Therefore, it’s more than a blog, it’s more than a newspaper and it’s even more than a TV show!
The only thing missing on this app is probably the ability to comment on any news live and discuss it with other readers. However, it has clearly changed the way I read a newspaper. Even if you don’t read French, just download the app to see how it works. It’s clearly amazing. I wonder if there is an equivalent in English, do you know any app like this one?
I am asking you, what is going to happen to old media? Are they going to die and other internet giants will create more content? It has already started… what’s next?Google+ Comments: 4 Read More
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