SMART | work


Fixing the financial business


money, the financial business in Canada is broken. I introduce you to today’s financial business in THE END OF WORK: “Tere are many financial planners and advisors who are knowledgeable


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and dedicated and really do care about their clients. Unfortunately, there are more who are not. Tere are some 90,000 people in the financial business across Canada. Most are paid on commission. Tey have to be pushy, and sell you whatever they can. It is a tough business in which to make a living, resulting in high turnover. Some financial companies recruit anyone with a pulse, sell them the “opportunity” to get rich, teach them some sales pitches, and let them loose on you. Many have little financial background, but they have bought into the company sales pitch and can make their product sound “soooo” good. You may have already met one of these. Tere is no regulation of the term “financial advisor” or its variations. Anyone can hang out their shingle as a financial planner, once they meet the basic licensing requirements to actually sell financial products.” There is likely another 100,000 or so sales


Financial


Literacy Fred Petrie


people who work for the big banks and all the credit unions et cetera. Even those paid on salary still have quotas to meet. Despite the reputation of their employer and an impressive title, most have limited financial training and are simply salespeople pushing product. Te myriad of financial industry regulators have been pursuing the


transparency approach to fix the finance business. More regulation forces more disclosure and even fiduciary duty obligations on advisors. My criti- cism of this approach is: “In the interest of consumer protection and disclosure, the U.K. and Aus-


tralia have banned embedded compensation and have imposed a statutory fiduciary duty obligation. Similar regulatory changes are now being proposed in the U.S. and Canada. CRM2 rules, effective July 1st (2016), and just being seen by many clients in their year-end statements, do require more disclosure from financial advisers. Te satire shows are already spoofing poor clients trying to make sense of this new information. On the down side, under such regulations in the U.K., some 25% of advisors left the business due to the costs of compliance, including all the paperwork to prove fiduciary duty. Tat cost forces the rest to focus on higher net worth clients, where more revenue on larger sales can compensate for the added cost of regulatory compliance. Tat can leave the rest of us relying on Google for our financial advice.” Many products have been sold for many years on a commission basis, from


cars and travel to insurance and investments. It is a business model that can work for both consumers and producers. Te problem arises when one party has an advantage in information and knowledge. Financial products are complex and the seller has the advantage, to the point that too many consumers are left to rely on “trusting” the financial planner and what he is selling. Tat is where the majority of the licensed salesmen and bank employees make their living, by taking advantage of that trust. I saw this in a recent client review where they had recently signed up for a big bank mutual fund as an RRSP. Tere was not really anything “wrong” with this purchase, it was just, in my view, inappropriate. Te mutual fund fee was too high, the deposit amount was not enough to make a difference, and at her tax bracket there was little advantage in registering the account. Te commission model is popular with many consumers because they do not have to pay separately for the financial advice. Te solution that I have been advocating is the importance of “Financial


Literacy”, to educate yourself to be a more knowledgeable purchaser of the financial products you need for a secure present and future. You can (somewhat) level the playing field. Financial services are really two products. One is financial planning and


advice in setting your goals and priorities. Te other is choosing the financial products that are going to provide you with the greatest value in pursuing your goals and the management of your money to ensure it continues to serve your evolving goals. Te problem is in getting both planning advice and product selection from the same source. When the product purchase advice is what pays the advisor, how can you be certain the financial plan- ning advice, leading to the purchase, is really in your best interest? You can’t. Te only assurance that your interests are considered first is when you are paying the piper. In addition to improving your financial literacy, you have another alterna-


tive. More financial planners are providing services by the hour, just like a lawyer or accountant, to address your needs and goals. You can have the choice to pay the piper yourself by hiring a by-the-hour financial planner*. With that plan in hand, you can then go buy the products you need, often online, sometimes with a robo-advisor to manage your portfolio, using very low fee ETF investment funds. Or you can even use a financial product salesman, but where you give clear directions and control the transaction. Since re-joining the financial business five years ago, I have tried to be one


of those “knowledgeable and dedicated” professional advisors. I have always told myself that looking after my clients’ best interest in the short term is going to be in my best interest in the long term. In the past few months I have caught myself bending that approach, selling what was easier than perhaps checking all the alternatives. Tat has led to some soul searching that has resulted in a decision to change my business model. Instead of continuing as a salesman of financial products, I plan to focus on financial education, offering my knowledge and counsel through book sales, seminars, the speakers’ circuit, and through personal financial counselling, at a flat fee. Fredrick Petrie, B. Comm. (Hons.), author of “THE END OF WORK:


financial planning for people with better things to do”, provides financial education at www.navigatingfinance.com, reach him at navigatorfi- nance@shaw.ca or call (204) 298-2900. You can get started at http:// www.amazon.ca/END-WORK-Financial-Planning-People-ebook/dp/ B00XCY0AJ2/


* Some planners claim to be “fee only” but the fee is as an annual percentage of your portfolio (and likely additional fees for every service). That is little different than a commission salesman (or a bank).


6 Smart Biz


et’s continue last month’s discussion: “Feeling Ripped Off?” From bank tellers pushing unwanted products to financial advisors charging huge hidden fees for their “expertise” in managing your


10 reasons why your business needs a blog


nesses investing in a content strategy? Honestly: it’s because


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most people don’t see the value in blogging. Content creation is often


Social Media Alyson Shane


seen as a waste of money because it can be hard to connect the ROI of blog- ging to sales, but below we’ll go over a few key reasons why you should be rethinking blogging for your business, and why content creation should always be included in your digital marketing strategy: Blogging Drives Inbound Traffic to Your Website We all know that get-


ting visitors to your website is an essential step in encouraging them to buy from you, but how does blogging help increase these odds? Let’s take a quick look at the ways that people


could find your website: Tey could type your website address into their


browser. Tis is great, but these customers are al- ready part of your target audience. Tey know who your business is already, so this doesn’t help get more traffic to your website. You could blast people using your email newslet-


ter list (assuming you have one). Which is well and good - but, again, these people are already sub- scribed to your list and know who your business is. You could pay for traffic by buying paid ads. Tis


can be great in the short-term, this can get expensive and doesn’t help convey additional value to your potential customers. On the flipside, blogging regularly ensures that


there is always fresh content on your website, which helps it rank higher in search engines (known as ‘Search Engine Optimization’ or, ‘SEO’). New blog posts are indexed by search engines as


new pages, which means they’ll help drive traffic to your website in organic searches. Blogging converts traffic into leads


So now you have a flow of new visitors to your


website through your blog, and it’s time to start con- verting them into leads by adding a call-to-action in every blog post. Calls-to-action generally include links to other


types of content, known as “Lead Magnets” or “Gated Content” (depending on your field of exper- tise) which encourage visitors to sign up for your newsletter. Tis helps convert visitors into leads for


logging is one of the best ways that a busi- ness can connect with their customers and increase revenue, so why aren’t more busi-


A blog for your business is a chance to showing off your expertise.


your sales department, and gives you a better un- derstanding of the types of promotions and content that get visitors excited. Blogging positions You as an industry expert Blogging regularly about trends in your industry,


publishing helpful how-tos, reviews, comparisons, and updates, may seem like a lot of work - and it is! However, blogging is valuable work because it can


help position your organization as a thought leader in your industry. Blogging regularly shows that your business is engaged, thinking actively about your field of expertise, and actively looking for ways to share that useful information with your customers. Being a thought leader may not seem like a big


deal, but when you take into consideration that 47% of buyers viewed 3-5 pieces of content before engag- ing with a sales rep (Demand Gen Report, 2016) then you need to have content out there and available for consumption in order to help customers make informed decisions. After all, consumers from both B2B and B2C


markets are looking to make educated, informed decisions when it comes to making a purchase, and if your business isn’t producing the content that people are looking for, it’s likely that at least a few of your competitors are. Alyson Shane runs Starling Social, a Winnipeg-


based digital marketing agency which specializes in copywriting and social media management services. You can learn more about her business by visiting https://www.starling.social, and you can talk to her about social media, content marketing, cat memes and gardening by finding her at @alysonshane on Twitter.


Sweet suites Fort Garry Place Furnished Suites are one of Winnipeg’s hidden gems.


be on the city, and visitors will be coming in by the thousands looking to experience everything Winnipeg has to offer. As much as people want to enjoy their time away


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from home on vacation, more and more people are turning to rental suites as opposed to hotels while on their vacations so they can still have that home-style feel.


Edison Properties Nicole Allard, Hospitality Manager of the Fur-


nished Suites at Fort Garry Place says people who stay at the suites enjoy the amenities they have access to the most. “The in-suite laundry is usually the biggest


selling feature,” adds Allard. “But with a full-size kitchen, weekly cleaning services, and workspaces, it really gives our guests everything they need.” Te fully-furnished suites also include wifi, ca-


ble, local calling, a dishwasher, stove, With an on-site convenience store, access to


three restaurants, as well as a gym, pool and hair salon, you could walk in on your first day, and if you choose to do so, not have to leave the building until your last day. Location, location, location


The Canada Summer Games are expected to


attract nearly 20,000 people to our city. With 16 sports, more than 250 related events and a major cultural festival taking place throughout the city, Fort Garry Place, located at 85 Garry Street in the heart of downtown, is at the center of it all. “We are literally steps away from the Forks, the Canadian Museum for Human Rights, the MTS


www.smartbizwpg.com


Enjoy all the comforts of home while you're visiting Winnipeg by staying in a Luxury Furnished Suite.


Centre, and so many other great attractions,” Allard says. “You name it, we are around it.” Edison Properties offers both short-term and


long-term stays. Whether it’s a two-week stay for the Canada Summer Games, a one-week stay for business, or coming to the city for an extended period of time, Allard says the fully-furnished suites are an option more people are starting to take advantage of. “We have noticed a lot more traffic here in the


last few months and we expect this to continue especially with Winnipeg being one of the hottest cities to visit this summer,” Allard says, adding most of the guests who have stayed in the suites will usually stay again. “Most of our client base is theatre and art groups,


insurance companies, department of national de- fense, business travel, and vacationers, so we get people from everywhere.”


June 2017


t’s going to be quite a summer here in Winnipeg. From the Canada Summer Games, to celebrat- ing Canada’s 150th birthday, the spotlight will


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