Within the financial planning world, there is often little love for popular consumer "personal finance gurus" like Suze Orman, David Bach, and Dave Ramsey. Whether it's because of their entertainment-style deliver of financial advice (in the case of the former), their bombastic platitudes of overgeneralized advice with little client-specific information (in the case of both), or their controversial views about how to address common problems like debt (in the case of the latter), most financial planners don't seem to think highly of their consumer-popular counterparts.
Yet the success of those like Orman, Bach, and Ramsey - who, in the end, touch the lives of hundreds of thousands if not millions, while the "average" financial planner's impact may only be measured by a mere few dozen or hundred clients - makes me wonder: Maybe there is something we as financial planners could - and should - learn from the success of those like Orman and Ramsey?
The inspiration for today's post came to me as I was browsing the popular books section at the airport bookstore, seeing books by both Dave Ramsey and Suze Orman, and David Bach's "Debt Free For Life" book top the shelves. As a "classically trained" financial planner, I too tend to recoil at the overgeneralized advice platitudes delivered by many of these so-called personal finance gurus. Yet at the same time, my eye was drawn to one of the headlines on David Bach's book: 7 million copies sold.
7 million copies. There are currently about 60,000 CFP certificants in the United States. If each of them have deep personal financial planning relationships with 100 individual clients, the collective financial planning community nationwide serves... 6 million Americans. So David Bach, alone, apparently may have reached more Americans that all CFP certificants in the aggregate? And then there's the books (and other programs) of Dave Ramsey, and Suze Orman, and others. Viewed in this perspective, I feel like we as financial planners perhaps need to eat a little humble pie; we may have rich relationships with our clients, but our reach is dwarfed by those like Bach, Orman, and Ramsey.
Is it just because those personal finance gurus are "marketing experts" while the average financial planner is not? Maybe they're just better at being popular TV and radio book celebrities than most financial planners are? That is perhaps the most common reason we suggest that Bach, Orman, and Ramsey have such success, but the more I think about it, the less convinced I am.
Instead, I have to wonder if it's because at the end of the day, the messages and programs and books that Bach, Orman, and Ramsey put forth change lives. A lot of lives. They have a significant success and impact on those they reach. And more than anything else, it is perhaps that success that they bring to their "clients" at large, that feeds their popularity, success, and "celebrity" status. In other words, maybe we need to give them a lot more credit for being popular because, in the real world, what they're doing really does help a whole lot of people.
It's interesting as well to look at some of the messages put forth by some of these personal finance gurus on their websites. Take a look at the sites for Suze Orman, or Dave Ramsey, or David Bach. What do you see? I see messages about "protection" and "making it simple"; I see Action Plans and Financial Peace; I see crushing debt and finishing rich.
And what don't you see? I don't see messages about managing wealth and portfolios; I don't see proposals for personalized financial advice and determining your goals; and I see costs that are $10-$50 or perhaps $100-$200, not $1,000 - $5,000 or more. Yes, we as financial planners are entitled to be paid for the time we spend and the value we bring; but one has to wonder if perhaps we need to figure out a better balance between what we provide and how much we have to charge to make it business feasible.
I'm not quite certain what to make of all of this. Those like Orman, Ramsey, and Bach don't spend a lot of time asking you about your goals. They assume your goals - get control of your debt, find financial peace, and retire and finish rich - and tell you how to achieve them. They don't spend a lot of time worrying about the details; they just give actionable steps to change your life, presumably for the better, and expect (and guide) you to follow them. Perhaps we as financial planners are making a lot of this more complex than it needs to be?
And perhaps most of all, it's notable that I think the "average" follower of Orman, Ramsey, or Bach probably has a much lower average income and net worth than the typical financial planner's client. Have financial planners, with the tremendous depth of their financial advice, forced themselves into a niche for the most wealthy top few percent of the country, when in reality the overwhelming majority of Americans need less depth of advice and more actionable steps that can be delivered in bite-sized (and much more cost effective) pieces? Is this a clue as to how financial planners could change their own time horizon for planning from years and decades to a more tangible days, weeks, and months with measurable positive outcomes?
I suspect that many who read this blog post will still be unable to do much but recoil at the thought of the impact that those like Bach, Ramsey, and Suze Orman have on the lives of Americans, for all the reasons that I stated earlier. But the reality remains that their impact, and the number of people that just these three personal finance gurus reach and in whom they evoke positive change, may be far more than all 60,000+ CFP certificants in the aggregate. So maybe we need to spend a little less time throwing stones, and a little more time trying to figure out what it is that allows these three to positively impact so many lives, and see if there are any aspects of what "they" do that "we" should be doing, too.
So what do you think? Is there something that we could - and should - be learning from those like David Bach, Dave Ramsey, and Suze Orman, about how to broaden the reach of financial planning and make it more relevant to more people?