{"id":14362,"date":"2019-03-27T11:00:43","date_gmt":"2019-03-27T01:00:43","guid":{"rendered":"https:\/\/www.prosolution.com.au\/?p=14362"},"modified":"2019-03-28T09:08:08","modified_gmt":"2019-03-27T23:08:08","slug":"importance-becoming-more-professional","status":"publish","type":"post","link":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/","title":{"rendered":"The importance of becoming more professional with your approach to investing"},"content":{"rendered":"

\"professional<\/a><\/p>\n

I\u2019m a huge fan of Seth Godin\u2019s work. He\u2019s a presenter, author and entrepreneur and if you have any interest in marketing or business, you must subscribe to his daily blog<\/a>. Anyway, his recent blog<\/a>\u00a0about the difference between how an\u00a0amateur<\/em>\u00a0and a\u00a0professional<\/em> buys a service got me thinking, as concept applies perfectly to investing. I think many of us could benefit from approaching our finances more professionally.<\/p>\n

The different between a professional and amateur<\/h3>\n

Often, a professional investor such as a fund manager approaches investing a lot differently than an amateur investor. I have listed some of these differences below to highlight this point.<\/p>\n\n\n\n\n
Professional<\/strong><\/td>\nAmateur <\/strong><\/td>\n<\/tr>\n
\n

–\u00a0 Understands that making investment decisions requires experience, education and understanding of the market<\/p>\n

–\u00a0 Seeks out experts in their field and is willing to pay a fair fee for their advice<\/p>\n

–\u00a0 Will have a methodology for hiring and firing advice professionals \u2013 a clear list of things they want and don’t want, thorough methodology, etc.<\/p>\n

–\u00a0 Will hold their advisors accountable for producing results<\/p>\n

–\u00a0 Won\u2019t try and take on a task that is outside their sphere of experience<\/p>\n

–\u00a0 They make investment decisions on a daily basis<\/p>\n

–\u00a0 Will take almost any steps to ensure the risk of losing capital is low or non-existent.<\/p>\n

\u00a0<\/strong><\/td>\n

\n

–\u00a0 Has no metric or methodology for measuring the value of advice<\/p>\n

–\u00a0 Asks friends or colleagues for advice<\/p>\n

–\u00a0 Is prepared to have a go at trying to do it themselves before asking for help<\/p>\n

–\u00a0 Considers it a saving<\/em> if he works it all out himself and therefore doesn\u2019t need to pay anyone for advice<\/p>\n

–\u00a0 To some extent, is guided by emotions e.g. it feels right, falls in love with the potential returns, etc.<\/p>\n

–\u00a0 Gets seduced by investment returns and doesn\u2019t adequately consider (and mitigate) investment risks<\/p>\n

–\u00a0 Doesn\u2019t realise the danger of their lack of experience<\/p>\n

–\u00a0 Makes a handful (or less) of investment decisions over their lifetime.<\/p>\n

–\u00a0 Its prepared to make a mistake i.e. learn through trial and error.<\/p>\n

 <\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

But we don\u2019t compromise on some things\u2026<\/h3>\n

Imagine how you would react if your friend told you that he did his spouses dentistry work. Or wrote their own will. Almost all of us understand the perils (stupidity) of this and wouldn\u2019t even consider trying. Instead, we find a professional that we respect and trust because we have what phycologists refer to as conscious incompetence<\/em><\/a>. That is, we know that we have a deficit of knowledge and experience to do it ourselves.<\/p>\n

Your responsibility is to manage the people that manage the money<\/h3>\n

Just because you can do your own financial planning, taxation, loan structuring \u2013 it doesn\u2019t mean you should. More importantly, maybe you have misunderstood your role. Your role is to not figure it all out yourself. That is potentially way too costly in the long run. Instead, your role is to hire the best people you can afford to help you make the smartest possible decisions. It\u2019s what we all do in other areas of our life. It\u2019s what successful professional investors do too.<\/p>\n

Use a professional lens when selecting the right<\/em> people to have on your team<\/h3>\n

In order to do this successfully, you have to have a robust methodology for selecting the right professionals. Here are some of the things I consider when selecting other professionals that help my clients.<\/p>\n

1. How do they make money?<\/h4>\n

It\u2019s important that I work with strong and sustainable businesses. If the business isn\u2019t sustainable, then they might not be around in the future to continue to help my clients and me. So, I must understand their business model, how they make money and ensure that doesn\u2019t contradict with my goals. I want them to make a fair profit, not more or less. How they get paid should be transparent and easy to understand. And alignment of goals is good too e.g. they only make money when I do.<\/p>\n

2. Is there overwhelming evidence that the results will be good?<\/h4>\n

I have written about the benefits<\/a> of evidenced-based-investing in the past. Essentially, there must be strong evidence that utilising the investment methodology\/approach has driven quality investment returns. If there\u2019s an absence of evidence, then often the risk is too high.<\/p>\n

3. Do I understand how they deliver investment returns?<\/h4>\n

I need to understand what has driven past investment returns. Is it luck or good timing? The market? Or their skill\/intellectual property? Obviously, I\u2019m only going to pay a fee for the latter.<\/p>\n

4. Longevity \u2013 how long have they been in business?<\/h4>\n

How long have they been in business? This is important for a few reasons. Firstly, if they have been in business for many years\/decades, they have navigated and experienced many markets and client situations. They have seen it all. Secondly, if they have retained clients for a long period of time, it provides strong social proof.<\/p>\n

5. Exemplary ethics and morals<\/h4>\n

This one can be hard to ascertain but it\u2019s still very important. I only work with \u201cgood\u201d<\/em> people. People that have pride in what they do. That want to do a good job. That get a kick out of helping people. Honest. Open. Transparent. Will always tell you the good, the bad and the ugly. Will always put their clients first. If there are any signs that the person doesn\u2019t have perfect ethics and morals, no matter how small the sign is, be concerned!<\/p>\n

6. Are they on the hook?<\/h4>\n

Accountability makes a big difference. Therefore, if the person giving me some advice will be on the hook for the outcomes of the advice, they will always do their best work. That\u2019s why I\u2019m a strong believer that financial advisory relationships must be long term. Because you want the advisor to be around to take responsibility for the outcomes 10 years from now (and beyond). They are on the hook.<\/p>\n

Could you up your professionalism?<\/h3>\n

When you read the examples in the above table, which category do you fit into; professional or amateur? What improvements can you make to your approach and the people you engage to make it more professional? Its worth taking a moment to think about this as it could make a huge difference to your long term success. Good luck.<\/p>\n

 <\/p>\n ","protected":false},"excerpt":{"rendered":"

I\u2019m a huge fan of Seth Godin\u2019s work. He\u2019s a presenter, author and entrepreneur and if you have any interest in marketing or business, you must subscribe to his daily…<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"__cvm_playback_settings":[],"__cvm_video_id":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"footnotes":""},"categories":[30],"tags":[],"yoast_head":"\nThe importance of becoming more professional with your investments<\/title>\n<meta name=\"description\" content=\"How to take a professional approach to manageing your finances - stop being a amature. Here are 6 conditionations to pick the right advisors.\" \/>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The importance of becoming more professional with your approach to investing\" \/>\n<meta property=\"og:description\" content=\"How to take a professional approach to manageing your finances - stop being a amature. Here are 6 conditionations to pick the right advisors.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/\" \/>\n<meta property=\"og:site_name\" content=\"Prosolution Private Clients\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/ProSolutionPrivateClients\/\" \/>\n<meta property=\"article:published_time\" content=\"2019-03-27T01:00:43+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-03-27T23:08:08+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/wealthcoach.com.au\/stage\/wp-content\/uploads\/2019\/03\/becoming-more-professional-with-your-investments.png\" \/>\n<meta name=\"author\" content=\"Stuart Wemyss\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@StuartWemyss\" \/>\n<meta name=\"twitter:site\" content=\"@StuartWemyss\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Stuart Wemyss\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/\"},\"author\":{\"name\":\"Stuart Wemyss\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/person\/c3aa63480e5d77a56fbd3f70e41b9ce8\"},\"headline\":\"The importance of becoming more professional with your approach to investing\",\"datePublished\":\"2019-03-27T01:00:43+00:00\",\"dateModified\":\"2019-03-27T23:08:08+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/\"},\"wordCount\":1080,\"publisher\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#organization\"},\"articleSection\":[\"Financial Planning\"],\"inLanguage\":\"en-AU\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/\",\"url\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/\",\"name\":\"The importance of becoming more professional with your investments\",\"isPartOf\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#website\"},\"datePublished\":\"2019-03-27T01:00:43+00:00\",\"dateModified\":\"2019-03-27T23:08:08+00:00\",\"description\":\"How to take a professional approach to manageing your finances - stop being a amature. Here are 6 conditionations to pick the right advisors.\",\"breadcrumb\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/#breadcrumb\"},\"inLanguage\":\"en-AU\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/wealthcoach.com.au\/stage\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"The importance of becoming more professional with your approach to investing\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#website\",\"url\":\"https:\/\/wealthcoach.com.au\/stage\/\",\"name\":\"ProSolution Private Clients\",\"description\":\"Holistic Financial Services\",\"publisher\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#organization\"},\"alternateName\":\"ProSolution\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/wealthcoach.com.au\/stage\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-AU\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#organization\",\"name\":\"ProSolution Private Clients\",\"url\":\"https:\/\/wealthcoach.com.au\/stage\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-AU\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/i0.wp.com\/www.prosolution.com.au\/wp-content\/uploads\/2016\/02\/ProSolution-logo-new-1-580x160-300x83.png?fit=300%2C83&ssl=1\",\"contentUrl\":\"https:\/\/i0.wp.com\/www.prosolution.com.au\/wp-content\/uploads\/2016\/02\/ProSolution-logo-new-1-580x160-300x83.png?fit=300%2C83&ssl=1\",\"width\":300,\"height\":83,\"caption\":\"ProSolution Private Clients\"},\"image\":{\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/logo\/image\/\"},\"sameAs\":[\"https:\/\/www.facebook.com\/ProSolutionPrivateClients\/\",\"https:\/\/twitter.com\/StuartWemyss\",\"https:\/\/www.linkedin.com\/in\/stuartwemyss\/\"]},{\"@type\":\"Person\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/person\/c3aa63480e5d77a56fbd3f70e41b9ce8\",\"name\":\"Stuart Wemyss\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-AU\",\"@id\":\"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/ae5c5d8e27329e215a9779262143f501?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/ae5c5d8e27329e215a9779262143f501?s=96&d=mm&r=g\",\"caption\":\"Stuart Wemyss\"},\"sameAs\":[\"http:\/\/www.prosolution.com.au\"],\"url\":\"https:\/\/wealthcoach.com.au\/stage\/author\/swemyss\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"The importance of becoming more professional with your investments","description":"How to take a professional approach to manageing your finances - stop being a amature. Here are 6 conditionations to pick the right advisors.","robots":{"index":"noindex","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"og_locale":"en_US","og_type":"article","og_title":"The importance of becoming more professional with your approach to investing","og_description":"How to take a professional approach to manageing your finances - stop being a amature. Here are 6 conditionations to pick the right advisors.","og_url":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/","og_site_name":"Prosolution Private Clients","article_publisher":"https:\/\/www.facebook.com\/ProSolutionPrivateClients\/","article_published_time":"2019-03-27T01:00:43+00:00","article_modified_time":"2019-03-27T23:08:08+00:00","og_image":[{"url":"https:\/\/wealthcoach.com.au\/stage\/wp-content\/uploads\/2019\/03\/becoming-more-professional-with-your-investments.png"}],"author":"Stuart Wemyss","twitter_card":"summary_large_image","twitter_creator":"@StuartWemyss","twitter_site":"@StuartWemyss","twitter_misc":{"Written by":"Stuart Wemyss","Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/#article","isPartOf":{"@id":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/"},"author":{"name":"Stuart Wemyss","@id":"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/person\/c3aa63480e5d77a56fbd3f70e41b9ce8"},"headline":"The importance of becoming more professional with your approach to investing","datePublished":"2019-03-27T01:00:43+00:00","dateModified":"2019-03-27T23:08:08+00:00","mainEntityOfPage":{"@id":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/"},"wordCount":1080,"publisher":{"@id":"https:\/\/wealthcoach.com.au\/stage\/#organization"},"articleSection":["Financial Planning"],"inLanguage":"en-AU"},{"@type":"WebPage","@id":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/","url":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/","name":"The importance of becoming more professional with your investments","isPartOf":{"@id":"https:\/\/wealthcoach.com.au\/stage\/#website"},"datePublished":"2019-03-27T01:00:43+00:00","dateModified":"2019-03-27T23:08:08+00:00","description":"How to take a professional approach to manageing your finances - stop being a amature. Here are 6 conditionations to pick the right advisors.","breadcrumb":{"@id":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/#breadcrumb"},"inLanguage":"en-AU","potentialAction":[{"@type":"ReadAction","target":["https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/wealthcoach.com.au\/stage\/importance-becoming-more-professional\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/wealthcoach.com.au\/stage\/"},{"@type":"ListItem","position":2,"name":"The importance of becoming more professional with your approach to investing"}]},{"@type":"WebSite","@id":"https:\/\/wealthcoach.com.au\/stage\/#website","url":"https:\/\/wealthcoach.com.au\/stage\/","name":"ProSolution Private Clients","description":"Holistic Financial Services","publisher":{"@id":"https:\/\/wealthcoach.com.au\/stage\/#organization"},"alternateName":"ProSolution","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/wealthcoach.com.au\/stage\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-AU"},{"@type":"Organization","@id":"https:\/\/wealthcoach.com.au\/stage\/#organization","name":"ProSolution Private Clients","url":"https:\/\/wealthcoach.com.au\/stage\/","logo":{"@type":"ImageObject","inLanguage":"en-AU","@id":"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/logo\/image\/","url":"https:\/\/i0.wp.com\/www.prosolution.com.au\/wp-content\/uploads\/2016\/02\/ProSolution-logo-new-1-580x160-300x83.png?fit=300%2C83&ssl=1","contentUrl":"https:\/\/i0.wp.com\/www.prosolution.com.au\/wp-content\/uploads\/2016\/02\/ProSolution-logo-new-1-580x160-300x83.png?fit=300%2C83&ssl=1","width":300,"height":83,"caption":"ProSolution Private Clients"},"image":{"@id":"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/ProSolutionPrivateClients\/","https:\/\/twitter.com\/StuartWemyss","https:\/\/www.linkedin.com\/in\/stuartwemyss\/"]},{"@type":"Person","@id":"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/person\/c3aa63480e5d77a56fbd3f70e41b9ce8","name":"Stuart Wemyss","image":{"@type":"ImageObject","inLanguage":"en-AU","@id":"https:\/\/wealthcoach.com.au\/stage\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/ae5c5d8e27329e215a9779262143f501?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/ae5c5d8e27329e215a9779262143f501?s=96&d=mm&r=g","caption":"Stuart Wemyss"},"sameAs":["http:\/\/www.prosolution.com.au"],"url":"https:\/\/wealthcoach.com.au\/stage\/author\/swemyss\/"}]}},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p7FPzp-3JE","jetpack_likes_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/posts\/14362"}],"collection":[{"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/comments?post=14362"}],"version-history":[{"count":8,"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/posts\/14362\/revisions"}],"predecessor-version":[{"id":14372,"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/posts\/14362\/revisions\/14372"}],"wp:attachment":[{"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/media?parent=14362"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/categories?post=14362"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wealthcoach.com.au\/stage\/wp-json\/wp\/v2\/tags?post=14362"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}