Welcome, everyone! Welcome to the 61st episode of the Financial Advisor Success Podcast!
My guest on today’s podcast is Mary Beth Storjohann. Mary Beth is the founder of Workable Wealth, a financial planning firm in southern California that in just its first four years has built to more than $200,000 in recurring financial planning fees, serving a Gen X and Gen Y clientele with a combination of upfront planning and ongoing monthly retainer fees.
What’s unique about Mary Beth’s practice, though, is the fact that she’s built it over the past four years while also having two children, who are now 2.5 years and 3 months old, respectively.
In this episode, we talk in depth about Mary Beth’s financial planning fee structure, the process she engages in to deliver financial planning value to her typically 30-something or 40-something clientele, why she rarely even uses traditional financial planning software at all for most of her clients, and the unique proactive process she has leveraging software to facilitate regular “check-ins” with clients and actually help ensure they follow-thru and implement all of their financial planning recommendations.
We also talk about how Mary Beth built her own personal support system to help her launch her practice, with a series of Mastermind Study Groups with peer financial advisors at a similar business stage, and an ongoing executive coach relationship to help keep her on task and be her own accountability partner.
And be certain to listen to the end, where Mary Beth shares how she managed to take time off to give birth to her two children, without blowing up the relationship with her clients or losing her marketing and growth momentum, and her suggestions for how female advisors should think through the balancing act of when to start your own firm when you also want to start a family.
So whether you are interested in learning more about profitably serving Gen X and Gen Y clients, have been thinking about joining a Mastermind Study Group of your own, or are interested in how financial advisors can manage the balancing act of starting a firm and starting a family, I hope you enjoy this episode of the Financial Advisor Success podcast!
What You’ll Learn In This Podcast Episode
- What Workable Wealth does for clients, and how their fees are structured. [3:35]
- How Mary Beth made herself comfortable increasing her monthly retainer fees with existing clients. [8:42]
- The most powerful thing you can do to lift the profitability and effectiveness of your business. [10:42]
- Mary Beth’s tips for building a personal support system. [17:59]
- Why Mary Beth rarely uses traditional financial planning software. [34:14]
- Where clients tend to need more help—and advisors tend to struggle. [43:36]
- How Mary Beth brings in revenue that is separate from her advisory business. [50:00]
- What Mary Beth did to give herself peace of mind before her maternity leave. [1:00:53]
- Advice for women who want to start a family and start a business around the same time. [1:12:52]
- Why Mary Beth wishes she would have started out doing investment management. [1:24:28]
Resources Featured In This Episode:
- Mary Beth Storjohann – Workable Wealth
- Work Your Wealth: 9 Steps to Making Smarter Choices With Your Money by Mary Beth Storjohann
- J.D. Bruce – Abacus Wealth Planning
- Executive Coaching – Arlene Moss at XY Planning Network
- XY Planning Network
- Pat Flynn: Building A Book Launch “Street Team”
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Full Transcript: Starting A Gen X/Y Financial Planning Firm While Also Starting A Family with Mary Beth Storjohann
Michael: Welcome, everyone. Welcome to the 61st episode of the financial advisor success podcast. My guest on today’s podcast is Mary Beth Storjohann. Mary Beth is the founder of Workable Wealth, a financial planning firm in Southern California that in just its first 4 years has built more than $200,000 in recurring financial planning fees serving a Gen X and Gen Y clientele with a combination of upfront planning and ongoing monthly retainer fees. What’s unique about Mary Beth’s practice, though, is the fact that she’s built it over the past four years while also having two children who are now two and a half and three months old respectively.
In this episode, we talk in depth about Mary Beth’s financial planning fee structure, the process she engages in to deliver financial planning value to her typically 30-something or 40-something clientele, why she rarely even uses traditional financial planning software at all for most of her clients, and the unique proactive process she has leveraging software to facilitate regular check-ins with clients and actually help ensure they follow through and implement all of their financial planning recommendations. We also talk about how Mary Beth built her own personal support system to help her launch her practice with a series of mastermind study groups she joined with peer financial advisors at similar business stages, and an ongoing executive coach relationship to help keep her on task and be her own accountability partner.
And be certain to listen to the end, where Mary Beth shares how she managed to take time off to give birth to her two children without blowing up the relationship with her clients or losing her marketing and growth momentum, and her suggestions for how female advisors should think through the balancing act of when to start your own firm and when you also want to start a family. And so with that introduction, I hope you enjoy this episode of the Financial Advisor Success podcast with Mary Beth Storjohann.
Welcome, Mary Beth Storjohann, to the Financial Advisor Success podcast.
Mary Beth: Thanks for having me, Michael. I’m excited to be here.
Michael: I’m really excited to have you on the episode because I think we will get to talk about something today that frankly, I feel a little remiss. We haven’t spent more time talking about on the podcast in the past, which is the very real-world challenge of running an advisory firm or starting your own advisory firm while you’re also starting a family, which I’m cognizant is particularly challenging for women because you literally are going to be carrying a baby and giving birth to a baby. And, you know, there’s just the…we can spend a little bit more time in the business as the husbands if we have to, to manage some stuff, but if you’re literally out of commission delivering a baby, you’re really not going to be returning client phone calls for a few days.
And I know, you know, you started your firm five years ago, you’ve had two little ones over that time period, and so I think a lot of people are just really curious to hear what your either tips and best practices are about how to do this or I know having gone through this because we have three little ones ourselves, you know, maybe just sheer survival tips is okay as well. But how do you do that? So I’m looking forward to talking about that.
What Workable Wealth Does For Their Clients [3:35]
But I think just as a starting point to frame the conversation a little bit for everyone, can you just talk a little bit about your advisory firm Workable Wealth? Like, what do you do and who do you do it for as a financial planner?
Mary Beth: Sure. So Workable Wealth is a virtual financial planning firm. I’m based in San Diego, California and I have clients all over the country. I launched in August of 2013, but I think I got my first client on actually, though, like, you know, December 2013ish. And when I launched, I was…
Michael: Yeah, it takes a little while.
Mary Beth: Yeah, it takes a little bit. And when I launched, I was focused solely on, you know, Gen Y millennials. That was kind of the hot thing at the time and that’s still a big portion of who I work with. But it’s evolved over time, so most of my clients now I work with are in their late 20s to, I’d probably say like mid to late 40s. I have some in their 50s as well. I work with… the subset I would say would be professional entrepreneurial women. I work with military families and then just, like, young families with, you know, little ones at home. Very much I work with myself as a client. You know, those who are, you know, having their own businesses, they have little kids, I was a former military spouse. So that kind of…it was kind of just like those are natural groups that I gear towards.
Michael: So you work with professional entrepreneurial women and military families because you are a professional entrepreneurial woman in a military family.
Mary Beth: Yes. Former yes. So…
Michael: It worked, right?
Mary Beth: Yeah, it worked. And it just kind of evolved that way over time. But what I do with them is I do just your typical comprehensive financial planning. I do a full-on upfront plan, and I get paid a flat fee. I charge an upfront fee and then I get paid a monthly retainer going forward. So that new trendy model that we’re all doing these days. And I do business financial planning as well.
Michael: So what do those fees look like? You know, you said you’re working with Gen Y folks. Well, I guess Gen X and Gen Y, right? Like late 20s into your late 40s, early 50s, which is kind of the tail end of Gen X. So what can people like that actually pay for financial planning if you’re just charging upfront fees and then ongoing monthly fees?
Mary Beth: So the practice has evolved a bit, and where I started was much lower, but now my minimum fees are $1,500 upfront and $250 a month. That was kind of where my low end if they’re just, like, starting out basic baseline Anybody who’s an entrepreneur is at least a minimum of $1,999 upfront and $300 a month, although I’m bringing on clients at higher than that right now. So, I mean, $350, $400, $5000 annual retainers. I just signed one for $7,500 for an annual retainer.
And then, you know, realistically ebbs and flows. And so I built the practice to where sometimes depending on the client, you know, we get creative. I won’t do an upfront fee knowing that they’re going to be a bigger annual retainer and there’s going to be a lot of that work throughout the year. But minimum, I’m looking for a $3,000 low-end annual retainer ideally, though, now that I have 2 little ones at home. And I’m in the mindset of increasing that even more, both sides.
Michael: Okay. But that’s kind of your line in the sand now is basically, like, $3,000.
Mary Beth: That’s kind of the line. Yeah, the line in the sand right now.
Michael: So I’ve got to ask, like, you said this has moved up, where did you start? Like, how has this evolved for you over time?
Mary Beth: I think I brought it up for you because I wanted to make sure I could talk about this. Okay, so I won’t even lie. And granted, I launched Workable Wealth after I had 10 years in the industry of experience and I was still a little bit like, you know, “People are going to pay me, and what am I doing with this model?” I brought on my first 3 clients at $250 upfront and a $75 a month retainer. Those were three clients. Then quickly realized…
Michael: Two hundred and fifty upfront and $75 per month. So if we go through like a full year cycle with the client, you were going to do about $1,000 of revenue per client?
Mary Beth: Yes. And that was a full-on Gen Y clientele, like just baseline just getting started in terms of like getting organized and stuff, very basic situations. And I quickly realized that I do know what I’m doing and I am good at what I do, and so I increased my fees from there. And I always tell that now to people as well. Like, if you’re just getting started, you can do those three, those…you know, cap it, whatever your limit is. The three, you know, just to give yourself the confidence and to kind of get yourself organized and make sure that you are qualified and know what you’re doing, and then you must increase it from there because it’s not sustainable to obviously do that.
Michael: Yeah. I mean, at minimum. I know a few advisors that have kind of built businesses around those levels in, you know, frankly like Midwest parts of the country where, you know, having 60 or 70 clients like that and bringing in $70,000 a year, like, is actually a very good income and works. You know, I know you’re in Southern California, you’re down by San Diego so a little bit harder to raise 2 children on, you know, $60,000 or $70,000 gross out there.
Mary Beth: Exactly, slightly. So the upfront fee bumped up and the monthly fees have upped from there as well. And that was when I launched, though, I was not doing any type of investment management. And I think we’ve talked about this before. But I was just baseline doing only financial planning retainers.
How Mary Beth Made Herself Comfortable Increasing Her Fees [8:42]
Michael: So I’ve got to ask, the original 3, have you allowed them to keep paying, you know, $75 a month or did you move them up as well?
Mary Beth: No, I moved them up as well. They have been moved.
Mary Beth: Yeah.
Michael: So I’ve got to ask, like, how did that conversation go? Because I feel like for a lot of advisors, particularly when they start, there’s just like, “They took a chance on me so I have to honor that fee forever and give it to them for life.” Like, how do you break the news to them that like, “Hey, thanks for starting with me, but, you know, now that we’re going, I’m charging a lot more?”
Mary Beth: Yeah. So I will say…
Michael: Obviously you don’t literally say it that way, but how do…
Mary Beth: No, no. So one of them I will say…so she was my very first client, she started at $75, and I increased her I think to $100 a month. And then we started with…I was using Betterment so we started investing some of her money. So there was that. And she’s still…you know. And I’m doing a round of fee increases right now. So that was a little bit easier, right? It was $25 a month. And mind you, she’s an attorney, brings in a decent amount of money. She’s single professional sitting on a bunch of, you know, cash. And so we bumped it up a while…I think I can’t remember when I bumped her to $100, to be honest. It was probably a while ago because she’s still my lowest paying client.
So just recently actually, probably a week or two ago we just had the conversation again where I said, “Hey, look, you know, going into the new year, I’m basically refining my whole practice. There’s certain clients I love working with, I provide a ton more value, I’m doing investment management, it’s going to be a flat fee.” Because basically, she was paying the flat financial planning fee and then we had her on the Betterment platform. Basically said like, “We’re going to do one fee all-in.” I’m going to right now percentage of income and net worth model. So basically I just bumped her fee up and I said, “I hope you obtained a lot of value from our time together, here’s how your net worth has grown, here’s all that we’ve been able to accomplish. You’ve gotten an amazing deal, but unfortunately, it’s no longer sustainable.” We’re upping her fee to $3,600 a year. And she said, “That makes a lot of sense,” and she signed the contract, set up her payment already.
One Of The Most Powerful Things You Can Do To Lift Your Profitability [10:42]
Michael: Did it scare you to have that conversation?
Mary Beth: Not anymore, I will say, because where I’m at right now and the clients that I’m bringing on right now and where things are at, I can afford to lose…you know, I would be disappointed because I love my clients at this point and I really like the relationships that I’ve built with them as well. That was something that I was probably the most insecure about when I started was, “How am I going to build these relationships and what will that be like?” So I think I wasn’t scared because…and also, you know, with the level of clients that I’m bringing on now, as sad as I would be to lose that relationship, I mean, one client can account for like two or three of these ones that I’m just about to….I’m having the conversations with this year. So I’m not as nervous about it actually.
Michael: Well, I find that’s one of the sort of the hard kind of business math realities of going through fee increases. You know, if you have to go through a world or, like, you’re whatever, you’re taking a client that was paying you $1,500 a year and you’re saying some new minimum fee at $3,000 a year because that’s where you’re doing your new business, you know, technically, if you go to all your clients and you do that fee increase and half of them say, “Forget it, then I’m leaving,” you actually just improved your business because you are now going to make the same amount of revenue, twice as much from half as many clients, and you have half the work to do because half of the people just left.
Like, it’s sort of a harsh thing but, you know, often one of the most powerful things you can do to just lift the profitability and effectiveness of the business is putting…you know, lifting your fees or lifting your minimum fees and recognizing like you could actually lose a lot of existing clients and end out with a healthier business.
Mary Beth: Exactly. And I will say having our second child, I’m actually excited to go into this year and to be able to do this. I mean, like I said, I love all of my clients, and there’s a few who… I’m working with a coach and she’s like, “What’s your minimum? What’s your hardline that you’re going to do on these fee increases?” Because there’s some who I know won’t be able to pay my minimum, and I’ll be sad to see them go, but time…
Michael: So if you know you’re going to have your exception list and how many exceptions you’re going to take and…
Mary Beth: Well, that’s where it starts to get gray, though, right? When you start to do that, you know. And so it’s hard because it’s so…time is the most important thing to me right now especially having two little ones at home. And that’s what I have to keep remembering is I also would like to be present for my children as they’re growing up. And the way that I do run my practice is very…it’s high-touch. That’s just what I choose to do and that’s how my clients are. And so it’s going to require a higher price point at this point in time. And so I look at it that way, you know, what am I giving up? And I’m at the point where I’m not…my revenue is a point where it’s comfortable. You know, I’m able to start making these changes now.
I did have one conversation recently. She hasn’t signed the contract yet, I’ll be completely honest, and I was a little bit scared about that because she signed on a $3,600 in August of last year and she had a big IRA. Not big, she had a few hundred thousand in IRA and we did financial planning and I hadn’t geared up yet. I’m getting onboarded at TDA and so we’re transferring everything over, doing DFA, all that fun stuff. And she was one who, which we’ll talk about, during my maternity leave she was getting a new job. So she was unemployed when I signed her on and we quoted her $3,600. She’s since gotten a job. She’s making $200,000 a year. We’re now looking at stock options and other things. Yeah. And so I had the conversation with my study group of, “Do I go back to her right now and increase the fee because this is obviously a lot more work than what we quoted originally?”
Michael: Yeah, yeah, your circumstance kind of changed from when this originally was set out.
Mary Beth: Exactly. And so we had that conversation last week and she said…you know, she was a little hesitant. You know, she was like, “I shouldn’t be asking my financial planner this but can I afford you?” And I was like, “Well.” I was like, “Based on the complexity, here’s where you signed on, here’s what we’re doing to add value.” I was like, “We still have to look at your new cash flow with your new job.” And I said, you know, “If there’s an issue, we’ll reevaluate, but this is the new fee.” And I said, “I hope you’ve seen the value.” And she said, “I really have.” So I sent her the contract and she agreed. So I am still waiting for the signature. I’ll be totally transparent. But that was something where, again, I could have just, you know, fallen on the sword, given the time. But again, I’m trying to be really impactful with what I’m doing right now.
Michael: Well, and it seems like there’s just this crossover point that, you know, you said you’ve reached, where, you know, you’re comfortable, there’s enough revenue there. That, you know, just there’s…I was going to say there’s a luxury in the business but luxury is probably not the right word. Like, just there’s a point in the business where, you know, if you know what you need to get out of the business to make your household and your lifestyle work, right? Just like, “I’ve got enough money to pay my bills. I’m no longer just feeling the pressure to get more clients and more revenue to make sure I can pay my bills.”
You get to the point where you can afford to be choosier in the business and saying like, “Okay, well, I can only work with so many clients because then I just hit my personal capacity.” So if you’ve only got 75 or 100 client slots or fewer or whatever your number is, like, who are you going to fill into those slots, and do all of those people pay you what your time is worth? It’s hard to take those risks until you get to that point where you’re no longer just feeling the pressure of, “I don’t have enough revenue to pay my bills.”
Mary Beth: Exactly. Yeah. Yes, and, you know, after this… I’ve gotten to that point. And even then it’s still hard, though, right? Even, like, as financial planners, we’re in the cash flow. And I don’t know how many…I’m sure listeners all the time are looking at the spreadsheets and the P&Ls. And sometimes it’s even hard to get rid of those ones who you’re not making any money off of just because you like to see the number there. You just like to see that number and you know you’re actually probably making minimum wage on the other side but you just keep it there because it looks good on paper.
Michael: So is it like…how have you worked through that since you seem to have managed to put through fee increases for pretty much all the clients? You’ve made that transition. Is there something like mental trick that you put yourself through to get comfortable actually doing that?
Mary Beth: So I’ve always been big on having study groups so I lean on my peers a lot in terms of bouncing ideas off of. It’s like I said with this client just recently. I emailed them first like, “Oh, what would you do?” And it’s $1,400, we’re not talking about a huge amount of money here, but obviously, it was tough conversation because she’s a newer client and it’s not like, you know, hundreds of thousands. But when you’re having these conversations over and over again, it’s something that now with the study group that I’m in, a mastermind group, we’re in similar points in our businesses so we’re constantly bouncing around ideas like, “Okay, how do you address this?” And cheering each other on a bit too of like, “You are worth this.” You know, recapping the value that each of us provides to the clients and leaning on them.
I’m constantly looking at the numbers in terms of, “Okay, what have I gotten? Do the price point…or what services do I provide my clients and who are the ones that I enjoy working with the most? Who makes me happy?” You know, “Who do I walk away from the client meetings feeling really excited or energized to be working with?” And those are the things that motivate me.
And I also have a coach who kind of help me figure out, like, the thing. “You’ve gotten a really amazing deal so far.” And she gave me a great analogy recently. I think it was if you took your car in for an oil change and they found out that there was something wrong with the engine, would they still charge you for an oil change? No, they would charge you, you know, what it cost to fix the engine. So why would I still keep the same price from, you know, somebody who signed on one rate even though their situation ended up being much more complex? Which I thought was a great analogy.
Mary Beth’s Tips For Building A Support System [17:59]
Michael: Yeah. Yeah, I like that analogy. So you’ve mentioned both mastermind group, a coach, so can you talk a little bit more about that structure? Like, where did your mastermind group, study group, like, where did this come from? How did you find it? What do you do with these folks aside from, you know, bringing them weird client situations, people and circumstance and trying to figure out whether you should change your fee after you quoted them one originally? So, like, where did this come from?
Mary Beth: So when I launched my practice, I think I reached out to you back in 2013 before I launched. And when I was getting ready to go on my own, I think you put me in contact with Alan, Alan Moore, and then I met Sophia Bera and Eric Roberge at a, oh, my gosh, NexGen, NexGen gathering. And so that was actually the first time I was ever introduced, like, what a mastermind or a study group was. And the four of us and a couple of others, we were actually in a study group probably for, like, a couple years when we first launched. And that was very helpful in terms of getting us through the initial launch phase of, “Okay, how do we keep ourselves going? What are we doing? How are we pricing?” You know, evolving things from there. And then, you know, even I remember Alan talking about, you know, XYPN in my living room floor when we got together for our first meetup, and stuff like that. So kind of just idea sharing.
Mary Beth: Yeah. So that was really cool at the time. And that group kind of…it served its purpose, right? So that one served its purpose. Again, study groups don’t have to always be forever. But served its purpose, we kind of disbanded. And one of the things that I was looking for in the industry was at the time, you know, I was obviously…media exposure has been something that’s good. Like marketing-wise, that’s something that’s come naturally to me. I really wanted to find a group that I could do, like, best practices. Like organizations, process, “Let’s dig in there.” Those were the things that I felt were a little bit…everything was working but I wanted to really have, like, some structure behind the place more than… I always say like, “Get the butts into the seats first then worry about everything else.” Get people paying you and then, you know…otherwise, you get stalled out.
So I reached out to…Scott Frank reached out to me, I think before he launched his firm, and he and I…he’s based out of San Diego as well so he and I actually started doing like monthly lunch basically. And somewhere along the way I mentioned, you know, that I was looking for another group. Those who were more experienced, who had been on their own practice for a few years, not those who were just starting out. And he basically looped me in with the group he had going. And so far there are five or six of us in that group now and we meet every Tuesday for an hour. And that’s kind of evolved as sometimes it was two hours for a bit. It was every other week, now it’s every week for an hour.
Michael: Meet every Tuesday for an hour. Like, that’s a hefty commitment. So what do you do for an hour every Tuesday?
Mary Beth: So it really varies what we talk about. Sometimes we’ll talk about, you know, portfolio structure, sometimes we’ll talk about fee increases, sometimes we’ll dig into, like, specific financial planning topics. You know, how do you do life insurance analysis for your clients? Just it’s really process-driven. We kind of sometimes have like a loose formal agenda, but really it’s just about, like, anything and everything. Sometimes, you know, it gets to a point sometimes we’re like…sometimes we get to…you start showing up and you’re like, “Okay, what are we really, you know, doing here?” But then we’ll usually within a week or two get back on track.
So it’s kind of like when you work for yourself. There’s a little bit of like the water cooler chitchat, but for the most part, we’re really, like, helping each other through struggles in terms of like, “Okay…” We even do like sales script practice. I think I mentioned offline that a group of us are being mentored right now by J.D. at Abacus. And so that’s our group right now is going…
Michael: J.D. Bruce at Abacus.
Mary Beth: J.D. Bruce at Abacus. J.D Bruce at Abacus is mentoring a group of us right now. And we go up there I think once a quarter we get together with him. And so in between there, we’re working on our “homework” in terms…you know “homework.” You know, refining core values, refining, like, marketing. You know, same thing with, like, reviewing models, reviewing goals for ourselves. So we really come together to hold each other accountable on that. And with the new year starting, we just reviewed what our goals were for the year for each of us.
And we kind of call each other out also, you know, if somebody is getting…we all get in our own ways. So we lean on each other to help each other get out of the way. So, you know, somebody is talking about, you know, doing a website revamp, for example, and they’re not getting anywhere in the marketing or they’re getting in their own way with content, we’re like, “Outsource it.” You know, stuff like that of, you know, kind of lifting each other out. But we rely on each other for a lot of things like that or even just, you know, random one-off questions about like, “Yeah, hey, which investment do you use for this,” or, “What are you telling…” Bitcoin, that was one that went around in our group too. “What do you tell all your clients about that?”
So it’s kind of like anything and everything. But it’s also this group has been together for a bit now so we also talk about, you know, personal things. Like, you know, I went through prepping for maternity leave and having a baby this past time. I joined the group before Angele SP] had her baby and so she went through a maternity leave as well. So prepping for those kind of transitions and talking through the balance of it all.
Michael: So for folks that are out there that are listening to us and thinking like, “Yeah, I would love a group where I can bounce these kinds of things off people as well,” like, how do you suggest someone finds a study group or, like, gets this together if they want to get a similar peer group?
Mary Beth: Honestly, I feel like the best thing that you can do if you want a similar peer group is take initiative and send emails out to those people you’d want to be in a peer group with. Get a great pitch together, put the structure in place for how you’d want the meetings to be run, you know, sharing wins, have a loose agenda, and reach out to people directly. Like, do your research and try to pull together people. And if they’re not interested, ask them if they have anybody else in mind who would be. I think the problem is so many people wait for the opportunity to knock on their door as opposed to going out and trying to pursue something and build it themselves.
Michael: That makes sense, so.
Mary Beth: I mean, that’s the best thing that you can do, no matter the industry you’re in realistically. And so for me, the big thing is I’ve had this study group and mastermind, but I’ve also been in study groups or masterminds that have not been in this industry. I’ve been in one with online entrepreneurs only. I’ve been in one with female business owners. And that female business owners one was great because those are potential clients, you know, in terms of me being able to pick their brains. So there’s lots of different ways that you can leverage groups like this.
Michael: But basically, it just comes down to, you know, if you want to be in a study group with half a dozen similar peers, find five and email them and ask them to be in a group with you?
Mary Beth: Realistically. I mean, you can obviously go to something like NAPFA, like FPA, like XYPN. There’s groups on there. I know that you guys put together groups as well. I mean, I think they’re built-in for you. There’s resources like you who do it for you. But yes, if you’re, like, feeling at a loss for something and you’re not leveraging networks like that already then the best thing that you can do is reach out to people directly. I mean, that’s really how I got my start with building my own firm anyways was I reached out to you, who you said, “Reach out to Alan.” I reached out to Alan and then I met Sophia and then, you know, then we’ve all been in it. So it all kind of evolved from there.
Michael: And off it went.
Mary Beth: Yeah. Which is, I feel like if you’re trying to build your own practice, it’s kind of necessary to be able to put yourself out there and face rejection even by your peers.
Michael: Unfortunately. Yeah, it’s kind of an essential requirement for the business building process.
Mary Beth: Yes.
Michael: So then you also mentioned having a coach, is this like an executive coach-style relationship?
Mary Beth: Yes.
Michael: So what does that look like?
Mary Beth: That looks like I’m currently leveraging the XYPN coach. So can we go into details? I’m using…I don’t know if you wanted to know.
Michael: Okay, yeah.
Mary Beth: I don’t know, I don’t mind talking about it. So I use Arlene right now. So I’m a member of XYPN, I’m using Arlene as my coach right now. And I reached out to her while I was pregnant, so I think probably three or four months before I went on my leave, maybe even a little bit less, really to kind of help, again, like, prioritizing my focus and not feeling like I’m trying to juggle all of the things, you know, being a mom and business owner and all of that stuff. So prioritizing where I’m focusing and making the most impact and ensuring that I can have some sort of work-life balance, and just holding myself accountable to that as well.
So right now it looks like we do two calls a month, and I have a pre-call form that I fill out. And this last one, I’m about a month into, I think three…am I a month back into work right now? Maybe three weeks back into work and I brain-dumped in the last one. I called it “word vomit.” But I said, “Here’s all of the things that are going on that I need help prioritizing.” And so we had our call last week and she was like, “Okay, let’s run down the list. Let’s do yes, no, maybe. And what do you need to do? You know, what do you need to sync to cross off your plate and get it off?” And so it was just nice to have that conversation and having that accountability partner as well. She sends me emails afterwards like, “Here’s your to-do.” And literally my email list is my to-do list, and so I just love having it there in my inbox of like, “Okay, you have to be held accountable to this. You’re going to get done before, you know, your next call.”
Michael: You have to make that email out of your mailbox, right?
Mary Beth: Yeah.
Michael: Like, you’ve got to check that email off.
Mary Beth: Exactly. I’m going to cross it off my list basically. Yes, that’s how I look at it. And, you know, I feel really good about the progress that I’ve made and some of the decisions that I’ve made as well just to kind of, like, give myself space and breathe. Again, that’s also talking through, like, things like the fee increases or where I want to focus my time and my energy has helped me to figure out, “Okay, team building and processes and what do I leverage? What do I put on the back burner? What’s, you know, not necessary at this point in time?”
Michael: So I feel like that’s quite an overall commitment that just, you know, you’ve got a study group that’s meeting an hour a week, you’ve got a coach that’s, I guess you said twice a month, so for you, like, is that hard time to find? Like, I feel like for a lot of folks we say like, “Yeah, just start taking an extra hour or two a week to work on this stuff.” Most people are like, “Yeah, I don’t have an hour or two a week. I’m kind of busy already.” Like, how do you set time for that much stuff on top of clients you serve, growing business, two little children, and family? Like, how are you managing that?
Mary Beth: I’m not lying, the hardest time it is for me to find right now is time to go to the gym. I’ll be totally honest on that part. But in terms of my mastermind and the coach, I mean, it’s just those are standing appointments. Those are non-negotiables for me. That’s basically what that is. Sometimes obviously the mastermind, I’ll miss it, you know, for medications or other things but those are my standing, recurring things. Actually with Arlene, what happens, I actually start earlier in the day. So she’s a 7:30 call for me in the morning, which my husband knows the commitment there in terms of childcare because our daughter doesn’t go to preschool until about 7:45. And so it’s, like, managing the two right now. But that’s a standing commitment that I make because I see the benefit that it plays in my business.
I’m very grateful to have both of those in my life and I see the impact and the payoff. So even though, like, my schedule is jam-packed, Tuesdays…my Tuesday tomorrow starts at 7:30 with Arlene and it goes until 5:30, 6:00 tomorrow night just with meetings. So yes, it can be a little bit more stressful, but those are things that I enjoy and that I need. Otherwise, I feel like, without my mastermind and my study group, it’s very easy just to get heads down do the work. But I really like to stay…like, that’s where I kind of stay involved with other people’s lives and that’s kind of where I learn my best practices and kind of grow together. So I miss being in a firm because of that water cooler talk a little bit. You know, you have those interpersonal…in a bigger firm, I should say. So I get that from there. So once a week I give myself that hour because it’s actually also to cheer the people on or to have them cheer me on or, you know, kind of be bummed about something, you know, with them.
Michael: I mean, it’s an interesting thing when you’re out on your own, for everybody that goes out and launches their own firm that just it is very isolating. You know, it took me a while to adjust to it as well when I went from, you know, being full-time internally at our advisory firm to spending more of my time writing and speaking. And then I was working from home a little bit more, and, you know, no thought upfront to just the shift in dynamics of what it’s like to be working from home and like, “Oh, yeah, all those people? Like, you want to take a quick break and just go chat down the hallway with a colleague?” Like, you can’t do that in the office with them anymore.
And, you know, just like finding…I’d never given much thought to making sure I had just a peer group outlet until I went out on my own and realized like, “Oh.” You know, “Peer group outlet.” Otherwise, it gets really isolating. At best it gets isolating, at worst I think, like, we get stuck in our heads and then we start making bad business decisions because no one’s there just to call us on.
Mary Beth: Exactly.
Michael: So, you know, you said you’ve got this framework now trying to do about $3,000 of revenue per client because you’ve, you know, lifted up the early ones and you’re charging new folks even more. So what does this practice look like overall now? Like, how many clients are under the umbrella? You know, like, what does revenue add up for you in the business because you said, like, you’re doing planning fees not AUM so I guess we can’t just say like, “What’s your AUM?” And do the 1% math to…
Mary Beth: So I have about 60 clients. Yeah, a little over 60 clients and my revenue is about $195,000 new coming in. With the fee increases, I’m slated to go through the year, probably in the next, you know, 4 to 5 months, there’s potential to probably add another $50,000, give or take. And that’s just, again… Yeah. So that’s, yeah, over those 60 clients. That’s just the practice arm. And then there’s the, you know, writing, speaking, all of that other stuff goes in an income stream.
Mary Beth: But last year, I think I closed 2017, I made $205,000 all-in.
Michael: Okay. You know, looking forward this year, like, $240,000 to $250,000 in the practice plus writing and speaking revenue, like, this is still growing pretty rapidly for you.
Mary Beth: Oh, yeah, that’s with new…yeah, with new client. With adding on I should probably be able to bump up just from recurring clients to $40,000. I’m hoping for, like, about $40,000 probably what I would add, and then with new clients on top of that. So I’m hoping to yeah, probably close somewhere between $250,000 to $300,000 recurring revenue and then plus all of the other income.
Michael: It’s a heck of a model for serving Gen X and Gen Y folks that most people still say don’t have any money to pay a financial planner. Like, it’s a heck of a business that you built in five years out of the gate. Because you said you worked in another planning firm previously, like, did you get to bring a bunch of clients with you to get started or did you have to make just like a clean break transition when you went out on your own?
Mary Beth: No, a clean break. So actually well, not a clean break. So actually, I mean, technically, if we’re talking December 2013 and we’re in, you know, just February 2017, so it’s kind of over 4 years that I’ve been able to build this, or maybe. Yeah.
Michael: Four years plus a little. Okay
Mary Beth: Yeah, four years plus a little.
Michael: So this is the fifth year. Okay.
Mary Beth: Right now. So the transition actually, I have one of those, like, dream transitions that I happen to talk about. When it came for me to launch my own firm, I went into managing director’s office and basically said, “Hey, here’s what I’m looking to do.” They were trying to put me down one path to partner with somebody else and it was less than ideal in my personal situation. And I let them know I wanted to launch my own firm. And at that time I was managing…I was the director of the firm. So basically they asked if I’d want to stay there and try to do my own thing, and I turned that offer down because I was very adamant to look like.
And basically, I launched. Yeah, as I launched, I basically stayed on with them for about six months to phase myself out. So we talked about those fees, in the beginning, I was able to do those fees. I also had, you know, the benefit of I had an additional income stream. So I phased myself out of there while I ramped Workable Wealth back up.
Michael: Right, right. Because they were working with AUM clients, probably mostly retirees, and you’re working with all those young people that they weren’t going to work with anyways so…
Mary Beth: Correct.
Michael: …very not conflictive for them.
Mary Beth: Exactly.
Mary Beth: And a couple of my clients, I will say a couple of my first clients, my early clients, I got from them. I think one of my clients…two of my clients, two of my early clients, my very first client came from them, came from that firm as referrals.
Michael: Because someone contacted their firm and they said, “Oh, I’m sorry you’re below our minimums but have you met Mary Beth?”
Mary Beth: Yeah. One of the advisors there.
Why Mary Beth Rarely Uses Traditional Financial Planning Software With Her Clients [34:14]
Michael: Okay. So I’ve got to ask, like, what this looks like from the service model end, right? So if clients are paying $1,500 upfront and $250 a month, like, what do you do for them? Are you doing stuff on a monthly basis to fill out their $250 a month? What do you do in addition upfront for an upfront fee? Like, what does this process or experience for clients look like?
Mary Beth: So one of the things I talked about a lot and as you know is how to actually do the financial planning, whether you do it piecemeal, whether you do it all at once. And so just the way that I was trained in the industry and the way that I do my best work as a financial planner is I do the comprehensive plan upfront. And that just basically is it’s the intake meeting, it’s the… So basically when a client signs on I send the contract and the invoice, they pay the invoice. From there I send them a link to an online questionnaire, and I send them a link to upload the documents to a shared file. So we talk technology a bit too.
So they upload…it’s a Google questionnaire that’s very, like, high-level information. There’s no secure data, no account numbers, none of that is on there. They give, like, a big picture. And that just helps for my director of client services. It helps her to round out the agenda and get things input really quickly. So they upload all of those things. From there we do the intake meeting. And my intake agenda is very templated. I plug all of the CFP topics, everything gets transferred in there, and then I create the financial plan.
And so I’d probably say like the financial plan, one of the things that I have done since I launched my firm, the financial plan is 10 to 15 pages. It comes with a financial snapshot, the net worth statement, cash flow. The executive summary covers all of the topics, and then retirement projections. And so this is…it’s a Word document. So this is one of the things. I don’t do MoneyGuidePro and call it financial planning. That’s not how I work and I can’t…it does not work for this generation either. For the age group that I work with, I give them MoneyGuidePro and it doesn’t matter to them, for the most part.
Michael: So, like, even…I mean, you mentioned retirement projections, so are you not even into planning software for retirement projections?
Mary Beth: So I use MoneyGuidePro for clients who are established. If I know they have their kids and their mortgage in place then I will do MoneyGuidePro. If they are still in that, like, position of, like, trying to buy a home or trying to start their family, which I’d probably say half of my clients are, then I just do a straight line retirement projection in Excel. And, you know, we talk about that but honestly, in terms of big-picture focus, we’re talking about, like, 10 other things as well.
Michael: Right. Because I guess, you know, when you’re 32 years old, like, the primary concern is not, “Hey, am I saving enough to retire in 35 years when I haven’t been alive for 35 years yet?”
Mary Beth: Right, exactly.
Michael: “Because I’ve got really big goals. I’d like to buy a house in three years and get married. Can I afford to do that?” Like, “Let’s come up with a 3-year plan, not a 35-year plan?”
Mary Beth: Exactly. It’s like this couple, right? And then they’re starting their family too. And so my main job is like, “Okay, here’s how much mortgage that your cash flow says you can afford, but let’s actually factor in the $1,000 a month for childcare plus and then take that down. That’s how much mortgage you can afford.” Preventing them from making super mistakes like that, where they lock themselves into a higher mortgage and haven’t factored in the childcare that’s going to come into play in 2 years when they’ve locked themselves into a 30-year-old fixed mortgage. So that’s the upfront plan creation. It covers recommendations across all of those areas.
But what that is, the financial snapshot is… I just was trained in Excel and I haven’t found anything that makes me happier yet, so the network statement is in Excel and the cash flow is actually in Excel as well. So I do a detailed amount of cash flow planning because I can tell you I don’t care if my clients are making $100,000 or $300,000, $500,000. A lot of them just have no idea where their money is going. And so I do have them create…they fill in an Excel cash flow, just like rough estimates. I say, “as you do or don’t want to be.” They like to see kind of where the money is going. And the template that I have shows percentages of what’s going into each category. You know, if they’re spending money on housing or groceries or whatnot.
And then I take that and I basically say, “Okay, I can, you know, target areas or I can tell you what to save and you’re responsible for the rest.” And I let my clients make that decision. They can say, “Actually we’re struggling in some areas, can you just give us a budget” or, “Actually just tell us what we need to be saving and we will allocate the rest.” And so with the cash flow, I basically use Excel because then I can copy and paste to them and say, “Here’s your projected.” You know, “Save this much into your 401(k) and to your emergency fund, for your home down payment fund. Here’s what you have left over.” So I kind of show them how it actually works out with everything and whether they still have money and how much they have.
Michael: So one of the most common questions I hear around this kind of model, like, I get when you do the upfront and they pay, you know, you said $1,500 for an upfront financial plan. So what do they get for the other 11 a year that they’re now paying this ongoing? Like, what else are you doing for them to justify, like, an overall monthly fee on top of the plan you just did?
Mary Beth: So what I basically say when clients are going through the consultation is I say, “Okay, the plan is about 10 to 15 pages, we’re going to go through all the recommendations in these areas.” On top of the plan, though, after the executive summary, it’s a lot. And I’ve been in the industry for, you know, how many years now, 13, 14? And I basically say, “I know based on experience that I can do this plan for you and I can hand it to you, but the chances of you actually implementing the whole thing on your own are very slim. What I see happens a lot is you’ve paid for the plan, you would think that you’ve, you know, bought the solution, and then action is not taken on it or you pick and choose what you want to get done and things like estate planning or life insurance don’t get done because they’re a little bit harder and those are longer processes. So what I do is I take all of the recommendations and I turn them into page action checklists for you. And basically each month…” You can read my whole sales script, everybody.
“Each month, this action checklist gets plugged into a software where each month you get pinged with two to three activities that you have to complete that month. And what happens is I get copied on those as well. So, you know, whereas we have all of these things to do, maybe this next month the next few things for you to do are to set up your emergency fund and move it to a higher interest rate savings account. For you to reallocate your 401(k), for example, or to, you know, start the life insurance application process. Basically, I then turn into your accountability partner.”
“So what happens is we do the intake meeting, the financial plan delivery meeting, I then do a 30-day check-in to figure out how things are doing for the first month and we adjust along the way. Then from there, I do big six-month reviews with my clients to make sure we’re measuring progress, to see everything that’s been accomplished. But in between, there is when we are working on individual action items. And some months we might be on the phone multiple times, some months we won’t be on the phone at all. But in times like tax or open enrollment, those types of things we’ll be on the phone for. So you have ongoing access to me throughout the year, when your life changes, but in between then, this action checklist that we’ve created for you throughout the plan, these things for you to do, you’re getting pinged with those each through this. I use what’s called MyPlanMap. You have the ability to email me, to request assistance, to alter due dates.”
And I basically say, you know, “I can see when you’re changing due dates or I know…you know, I get notified if you haven’t responded.” So I basically say, “I give you a month or two buffer. From there if I haven’t heard from you then we’ll send you an email to ping you or we’ll call you if you fall off the earth basically.” So they get a lot of value-adds. I leverage technology.
Michael: So what does MyPlanMap do exactly? Because I don’t think that’s very widely adopted by most advisors. Can you talk about that a little bit more?
Mary Beth: It’s not. Everybody is so resistant to it and I love it. I depend on it so much. It helps my practice so much. So the executive summary that any of us basically create, I will say this is probably…it takes me maybe 10 minutes when I wrap up my plan. I go through the executive summary and I literally turn it into like a three or four-column chart that I can input a table, that I can put to the plan, where it basically says, “Here’s your to-do list.” Where it says, you know, “Open emergency fund to save…” You know, “Move $25,000 over.” It says who’s responsible, and it says the page to reference in the plan. But what happens is this chart then gets plugged into MyPlanMap. So my assistant basically will take the chart. You can plug in individual tasks for clients. You can say that, “Plug in the task.” You plug in their email, you plug in the due date and who’s responsible for it, meaning the client or me.
And basically each month, when the month hits, whether it’s the 1st or the 15th, I think are the dates that we choose for the due dates, the client gets an email that says, “This month, here’s your activity,” or, “Please let us know if you’ve completed this.” And so the client gets emailed. Or it actually says, like, you know, “Steven Susie, tell us how you’re doing on this task.” And they open the email and it says what it is. You know, “Start your life insurance process,” or, you know, “Send your open enrollment benefits over. It’s October.” And then from there, they can email me directly if they respond to anything. They can go to me directly or they can just request assistance and they can input a note saying, “Oh, we’ll discuss on our next call,” or, “Need more time to, you know, gather paperwork,” or whatever it is. Or they can just request a call with me as well.
Where Clients Need More Help And Where Advisors Struggle [43:36]
Michael: So it’s just automating all of that, like, in between action item management correspondence stuff basically?
Mary Beth: Yes. So much yes. Exactly. So I don’t have to plug in individual tasks that says, “Hey, Mary Beth, follow up with the client to do their 401(k).” And, you know, I have, like, big stuff like that in my CRM but I really leverage the client plan map because it’s a great way for me to stay in front of clients as well. My logo is on there, they’re getting emails, they know it’s coming from me. So when I do my six-month review wrap-up and when I do my financial plan wrap-ups I say, you know, “Just know in the months ahead you’ll be receiving automatic reminders from my client plan map. We’ll have this ability to do these things.” It pings them also when they need to set up their six-month reviews. But obviously, we have our own list to track that as well. But it’s just a really great way for us to stay in front of them and to hold them accountable.
And for me too because when I have 60 clients and they all have action items, it’s nice for me to be reminded too when things are coming due, right? So it comes into my inbox. I’m not going to lie, on the 1st and 15th I wake up to a lot of emails sometimes because they all come through. But I can do a quick scroll and I can see, like, I can kind of just do…it takes me maybe 20 to 30 minutes. I’ll scroll through all like, “Which ones do I need to…which ones require something from me or do I need to prod the client on?” So I really love using that. And it actually helps me to provide a ton of value to them because I think the accountability part is where clients need more help and advisors lack.
Michael: So you go through this process, you’re doing your check-ins and your big month reviews and you’re working through your action item list, does that mean that, like, at some point in 12 or 18 months you get through all the stuff on the list, you finish with your clients and then they stop paying the ongoing monthly fee because you’re done?
Mary Beth: No. So where I’m at right now I would probably say retention-wise maybe like 25% of clients have fallen off. Like, some reached that point where they’re good to go and there’s not really much more I can do. I’m not going to lie, there are those clients. But for the most part, especially like this age group that supposedly doesn’t have all the money to pay the fees or doesn’t have that complicated of lives, like, no it’s still going. Their lives are changing. You know, they’re merging finances, they’re getting married, they’re buying houses, they’re having babies, they’re trying to price-shop daycare, they’re trying to negotiate, you know, career raises, they’re trying to start their own businesses. Like, this is, like, so much transition. And that’s why I say there’s a lot of…I am a high-touch practice, there’s a lot that my clients can reach out to me for. And I do help them through things like negotiations. I have helped them…clients get plenty of raises in terms of, “Here’s how you do your value-add, here’s how to do your research.”
Same thing on the business side. I work with a lot of solopreneurs, so there’s the business planning side of what I do as well. So I will actually sit with them, and this again is, like, you know, making sure it’s priced in, but I will look at their P&Ls, I will ask them about their pricing, I’ll ask them about the profit margins. A lot of my clients are service-based entrepreneurs and so understanding again, like, “What are you earning?” You know, they don’t know how to pay themselves. Like, proper structure, how to set up payroll. How to determine what should be payroll versus distributions. So I coordinate with, you know, them, with their CPAs. There’s a lot of analysis. I mean, most of my clients, a lot of them don’t know how to analyze their profit and loss statements. So it’s teaching them about those things. And for that, I make the relationship a lot more stickier.
Michael: Interesting. So, you know, in essence, like, by the time you spend 12 to 18 months getting through all the stuff on their checklist, their lives have changed and there’s a whole bunch of new things on the checklist.
Mary Beth: Oh, yeah. So every six months basically we’re reevaluating. So at the reviews, for my own process, I copy in their old action checklist. We go through what they’ve completed. And then before they get the follow-up from the review meeting, they will add any new items on there, make adjustments as needed. So sometimes it’s, you know, paring things down, sometimes a lot of the longer to-do list. It just depends on where they’re at. But it does typically get updated every six months.
Michael: Okay, interesting, interesting. And what’s the rest of the technology that you’re using to power the practice? You mentioned MyPlanMap and Excel and Word but what else is in there for just running the business, for what you do? God bless Microsoft Office. It keeps all of us going, right?
Mary Beth: Yeah. I use Wealthbox for my CRM, I use ConvertKit for my newsletter system. I started off on MailChimp but I converted to ConvertKit. I use them for my newsletter. So I use Wealthbox a lot but I’ve also started using Trello in terms of big picture, like, practice, like goals and to-dos. And I actually have, like, my…I have not figured out an easier way to do this but I love it so much. I don’t know I would ever change it. In Trello I basically have…Trello is just like boards and it’s a way to kind of collaborate with your team.
One of the boards I have is a client scheduler, and it literally just has each…there’s like a column for each month, and then I can create little tags for, like, client name, so the client’s last name and basically whoever is due for a review that month. Lisa, my assistant, can go in and say, “Okay, we’ve got to email all these people because they’re due for their review.” She can send their emails out and then, like, just basically adjust the due dates. And then they have their review, they automatically just drag the name to the next six months over. So while we could do all of these tasks and, like, overflow the CRM, it’s just really nice to be able to see, like, open up, you know, that board and say, “Okay, these 10 people are due for reviews this month.” As opposed to, like, trying to go through a task list. I haven’t figured out a better way to do that but it’s just really nice for me to see that.
I also track goals and just, like, some processes. Like I manage my whole podcast workflow in Trello, and then there’s, like, the whole podcast technology. But I’d say those are the big things, Trello, Google Drive, Microsoft, Wealthbox, ConvertKit. I think those are the big ones.
Michael: Out of curiosity, why ConvertKit instead of MailChimp? I feel like to the extent advisors are doing mailing list at all, MailChimp still seems to be by far the most popular. So what led you to ConvertKit instead?
Mary Beth: I believe it was a price point issue. My newsletters hit a certain reach. And then it was also ease of use. I think those were two things, to be honest. I can’t remember exactly what it was, but I think it was then.
Michael: Yeah. That’s kind of the caveat on MailChimp. You know, it’s built to be free out of the box. I forget what the numbers, like, your first 1,000 subscribers or something. But, you know, if you actually start growing and building a big list, it’s not horribly priced but, like, the dollars start adding up, it gets a little pricier once your list is growing.
Mary Beth: Yeah. Oh, and I think I was using MailChimp plus Leadpages for opt-ins, for, like, the book and, like, for landing pages for my website. And then I think with ConvertKit I realized you can create your own, combine with the website. And so that was kind of what prompted it.
How Mary Beth Brings In Revenue Through Separate Income Streams [50:00]
Michael: For folks that are listening, we’ll put links out to all these in the show notes because I know there’s a couple of new tools here that are probably not familiar for a lot of advisors, MyPlanMap and ConvertKit and Trello. So this is episode 61, so if you go to kitces.com/61, we’ll have links in the show notes for all these technology tools if you want to go and check them out.
So for your business, from the kind of overall revenue side, you know, you talked about the recurring revenue from the business and where you’re trying to grow, but you mentioned writing and speaking as separate income streams. And I know you do some of that because you do it for your marketing. Like you published a book and do a lot of speaking. So can you talk a little bit more about like how do you…what’s going on with this other revenue that is separate from your advisory business if you’re doing it to getting clients, or maybe you’re not doing it to get clients at this point?
Mary Beth: No. Sure. Well, basically what happened was I think when I started speaking I was speaking at a lot of industry events. And that was kind of where it started. And I think it was just, like, you know…that was like for free thing, right? I was just going and kind of spreading the word about…
Michael: Yeah. Like, “Hey, Mary Beth, come talk about what you’re doing.” And it’s, like, really cool to be invited. So you said, “Sure.” And then you go.
Mary Beth: Exactly, yes. So that’s kind of where it all started. And same thing with, like, the media stuff, being in the media. Like my media presence actually started from being in the financial planning media, from working with Gen Y and millennials at the time. That was kind of where everything spun off from. And then it turned into…NBC found me from Twitter and then from there everything kind of evolved.
So the writing income kind of started I think when… I’ve always loved writing. Writing has always been kind of a thing for me. When I launched my practice, I believe there was some side income there that kind of just came in from different projects. So as I was building obviously revenue was an issue, and so having some sort of income was something I wanted to make sure I did. So I had some side income or some side gigs with different places. Like, I think like AOL, like DailyFinance at the time, wrote for different places. And then from there…
Michael: So you would just, like, contact them and say, “Hey, you know, I wrote this article about, you know, saving more in your 401(k), hey, do you guys want to pay me for it?”
Mary Beth: No, they kind of found me. Again, it was from…a lot of the site income stuff there stemmed from me having a presence in our industry and kind of building kind of a following there. And so they reached out to me or I was connected with them…they either reached out to me directly or I was connected with them through another financial planner who already had, like, a contact with them. I didn’t necessarily know enough how to seek out these opportunities, to be completely honest. And that’s how I actually pursue and treat this income stream right now as well. I don’t actively seek out speaking opportunities, for the most part, and I don’t seek out anything that comes from, like, the consulting side, the kind of, like, big…that’s just too vague. And I welcome the opportunities. If anything, all I’ve done so far is I’ve filtered down what I will and won’t do.
But from there, the income kind of came through writing contracts like that. But what actually happened was I wrote my book maybe three years ago in March I think I wrote the book. Is it three years ago? Gosh. I think it was three years ago or two years ago. Sorry, I just had a baby and my brain is a little worse but I try.
Michael: You’ve got two young children. Like, everything gets fuzzy. No problem. It’s all good.
Mary Beth: Yeah. But when I wrote the book, I wrote the book with the thought in mind that again, this generation supposedly who didn’t need the advice, I was getting a lot of people who needed the advice and couldn’t even afford the fees I was charging at the time, which were lower price points. And so by writing the book, my thought was to be able to stay relevant. Obviously to help them get started, and to be able to kind of like… I did not do it for an income stream. That was not my goal with writing the book. But that actually has been a business card in terms of it’s led to speaking engagements. Just recently, actually this month, I was approached at the end of last year, somebody bought my book for a subscription box for female entrepreneurs, so I sold over 1,000 books to the subscription box. And so now obviously the book has…
Michael: Oh, yeah.
Mary Beth: Yeah, exactly. It’s going out to over 1,000 women who are in my target. Like, I work with female entrepreneurs, my book is being mailed to 1,000 female entrepreneurs, solopreneurs, creative entrepreneurs who get the subscription box. So it’s like, not only do I get paid for this, but it’s also going out to my target market. So that’s kind of fantastic. Opportunities like that. So the income for that it’s just kind of evolved over time. Honestly, it’s a wait and see. And at this point in time, I just filter opportunities whether or not they are aligned with my idea of what I’m trying to do and what I’m trying to reach and who I want to work with.
So whereas I used to do more speaking for the industry and would go to different conferences and do things, at this point in time, unless I’m planning on attending the conference for my own CE credits, my own education, I turn those opportunities down now because I only speak to clients that are…or to audiences that might be an actual target client of mine. And I do charge for those speaking engagements as well. And so it typically just depends on who the audience is, the size and what the topic is. But now with the book, I’m able to say, “Okay well, here’s a rate that I’m charging, but if you want to pay this, I’ll actually throw in X number of copies of my book as well.” And so that’s a way for me to get more book sales and to do other things also.
Michael: Okay, interesting. You know, it is kind of a fascinating filter I find that comes, that when you focus into some kind of niche, A, you know, it’s amazing the sorts of opportunities that can find you out, right? Like, you wrote a book on working your wealth that became so well-known for female entrepreneurs, your target market, that they contacted you and asked to distribute your book, for which they paid you, to 1,000 of your target prospects so that you can potentially do business with them, right? Like, that to me is the power of what happens with niches and focus after a couple of years, right? I don’t know any advisor generalist who has had someone come to them and say, “Hey I’d like to take the best representation of your expertise and send it to 1,000 strangers who might be interested, and I’ll pay you for it.”
Mary Beth: Exactly.
Michael: Right? Like, that doesn’t happen…
Mary Beth: Exactly. I mean, that’s amazing.
Michael: …until you focus your market.
Mary Beth: Right. And the fact that this book is still… you know, so it’s two, three years after I wrote the book, and that’s the fact that…you know, that’s the really amazing thing is this book is still working, you know, well, you know, after I’ve launched it. You know, a lot of people are like, “Oh, how many books did you sell initially?” You know, that wasn’t the point. The point was for me to have this resource available to me.
Michael: How many books did you sell initially?
Mary Beth: Initially I think I sold about 1,000 initially. And so it wasn’t like some big like…you know, and I went through, like, a whole launch and whatnot, but, you know, since then, it’s been… You know, that was it. And obviously, I just sold 1,000. I’ve sold at multiple conferences. It’s been purchased for, you know, handfuls of sessions that I’ve done. And then you’re able to do things like have a flash sale on Kindle. And, you know, for me now I can leverage the book. It gets mailed out to every new client that signs on with a little pretty note card that was printed up that says, you know, “Welcome to the Workable Wealth family. Looking forward to working with you. Read this book or feel free to pass it along to somebody.” There’s really unique ways that you can leverage that. And so, like I said.
So the breakeven, a lot of people are like, “What kind of money did you make on it?” I’d probably say I broke even on the book in the first year. So that definitely paid for itself in terms of money, but that wasn’t my intention was to actually make money off of it. But because of the speaking engagements, I got because of the book, that has led to plenty of clients, which has led me to actually…
Michael: No, and I think that’s one of the key things around books, right? Like just you sold 1,000, you’re like $8 or $9 on Kindle, $13 on paperback. You know, you only keep a portion of that because Amazon or the others take a slice so, like, you know, a couple dollars a book times 1,000 books. Like, you don’t make your money on the books, you make your money on the fact that other people send this beautiful paper-bound business card to 1,000 strangers and tell them to read it and then make them interested in you. Like, that’s the real value to me around publishing.
Mary Beth: Oh, yeah. I mean, I work with…a lot of my clients are, like, I work with creative entrepreneurs, creative female entrepreneurs, and I work with, like, therapists have become a subset as well. But, you know, the creative women. And my book has a glittery gold dollar sign on the cover. I mean, I got people reaching out to me for months afterwards telling me how much they loved the cover of my book. So, I mean, that was geared specifically towards women. It wasn’t necessarily, you know, for men. So it worked well, the targeting of that as well.
Michael: Interesting. And how did you actually go about getting it done and published? Like, did you get a publisher that wanted to work with you as well the way you were getting article inquiries because you were, you know, doing all this initial speaking in the industry about serving Gen Y or did it come about some other way?
Mary Beth: I had some publishers reach out to me. And when it came time for me to actually write the book, by kind of just snooping and talking to other people and hearing about other people’s experiences again in working with a publisher, same way that I launched Workable Wealth, I was very specific about what I wanted the book to look like interior and exterior. So I opted to go the self-publishing route because, again, that cover to me was very important, and I knew I don’t want to give up control over it by going with the publisher. And so, again, because it wasn’t necessarily something I was trying to make money off of, but mostly I really wanted creative control over the process, especially for my first time. So I hired a project manager and I found…I leveraged Facebook groups for a lot of my marketing in the beginning, and I found a cover designer and interior book designer from the group and I got to work.
Michael: So you just, like, you found these folks through Facebook groups? Like, a group for people self-publishing their books and say, “Hey I need to self-publish my book, who wants to manage this project?”
Mary Beth: Actually a group for female entrepreneurs, creative female entrepreneurs. Just, like, a group that I hung out in. And so when it came time for me I basically said like, “I’m looking to have my book cover designed.” I put a call out in the group, people, you know, responded like, “Oh, I could do that for you.” I interviewed three or four different people. And then I had done some research and kind of had an idea of what I wanted it to look like as well and just found somebody that I was comfortable working with. And from there she actually happened to be very knowledgeable at the process of leveraging CreateSpace, which was Amazon self-publishing platform. And so she kind of helped to navigate that.
And the launching of it, though, like, I didn’t just say, “Okay.” Like, “It’s up.” There was a launch process behind it too. And I leveraged a lot of…I can send you the link afterwards if you remind me. Pat Flynn launched his book and had, like, a whole thing about using a launch team to spread the word. And I did a lot of that as well. I had people apply to be on the launch team, which means they got a pre-copy of the book. They could read it ahead of time. They could help spread the word to their audiences. We did a raffle, that sort of thing. Because I had already actually already had, like, a newsletter following list at that time as well. So I really leveraged that. I created my own Facebook group around it, and it kind of helped to build up exposure that way.
How Mary Beth Gave Herself Peace Of Mind Before Her Maternity Leave [1:00:53]
Michael: Okay, very cool. Yeah, we’ll make sure we either follow up or go online directly and find a copy of Pat Flynn’s launch team article and make sure it’s linked in the show notes as well.
So as you kind of look at this growth trajectory overall, you know, we kind of mentioned a little bit at the beginning but I’d love to talk about it more. You know, you are 4-something years in the business. I guess, you know, we said 5 years but really, like, you’re in your fifth year, you’re clearing $200,000 of revenue and growing well from there, you know, just charging planning fees for fee-for-service, and you also had 2 babies over the past 2 and a half, 3 years. So I guess you were pregnant, like, almost within a year of when you launched the business and went out on your own. So can you just, like, talk to us about that? How do you get a business from scratch up to $200,000 of planning fees in 4 years while also having 2 children?
Mary Beth: Well, you have a team in place. So although I can do it, really it was about leveraging systems and processes and communicating with my clients. Because I am a virtual firm and because I rely so heavily on virtual meetings as well, and I’ve already had, like, an online marketing in place. I’ve done newsletters probably since the beginning of launching my business. It was weekly, it’s bi-weekly now. But I was used to leveraging technology to communicate with people.
And so when I first got pregnant with our daughter who’s now two and a half, I believe…I can’t remember at the time if I launched it in my newsletter or…to my clients directly first or if I put it out in the newsletter, maybe simultaneously, but basically I let people know. I was due in July with her and I made an announcement in January that I was pregnant. So I think I waited until I was like 16 or 17 weeks along and went public. And from there it was just a matter of…I know I went public, but I reached out to clients right away and I basically said, “Hey, here’s what’s going on,” just as a reminder.
I’ve always had, like, some sort of help with the company, you know, whether it’s a client service associate or like Lisa who’s my director of, you know, getting it done, she’s my director of, like, all things. I have had associate financial planner in the background recently as well. Basically, it’s just being really clear on what clients can expect and not making it an issue. There’s no panic, for example. So recently, when I was going or gearing up for maternity with my son, I think I sent an email back in August basically said like, “A lot has been happening behind the scenes at Workable Wealth and I want to make sure you’re in the know about our current team and who you can expect to hear from now and for a brief period in the coming months.”
So I reintroduced the team. I said, “Lisa is a director of getting it done, Lex is our associate financial planner. Here’s who you’ve probably heard from in the past, here’s who you reach out to when you have certain requests or who you may hear from.” And then I basically said, “Additional expansion. In other news, you know, I’m personally expanding as well.” I said, “We’re having a little boy.” This was August, I said in late November. And I said, “We’re looking forward to an adventure with two,” and basically said, “Scheduling will be a big focus.” This is. This is what’s on your plate now. If you’re due for a six-month review…” Right after Thanksgiving is when I was due. So I basically said, “If you’re due for a six-month review in November or December, the goal was going to get you on the calendar prior to November 10th for your meeting.” So I was giving myself a two-week window.
And I said, “You’ll receive an email from our team in early October if this is you.” And I said, “By the way, as a financial planner, the worst time to have a baby is, like, the end of the year in terms of, like, year-end planning strategies.” But I basically said, “There’s, of course, going to be year-end issues that we may need to address, but the goal is to have everybody reached out to with any pertinent issues before the middle of October.” And I gave them my due date. And I said that basically…expectation that there would be…I’d be taking four weeks off completely to adjust and bond and they could reach out to Lisa and Lex during that time, email them.
And I basically said, “I’ll be able to log in intermittently, but obviously response times will be delayed. And know that by emailing Lisa…” Lisa was who ended up being the main contact. By emailing Lisa and Lisa responding with client, she would have a direct access to me and could filter out those requests. She would, you know, push things up, she would respond to clients if necessary, but she actually was the one who managed my calendar and managed that interaction while we were away. But I let clients know in August of 2017 that I would be out for, you know, 6 to 7 weeks basically is what it ended up being. But actually ended up being, like, 8 to 9, at the end of the year. And so I gave them the heads-up in advance obviously, and I wrapped up by saying, “Thank you so much for your kind words and support through this transition.”
And I sent another email in October and just said like, you know, “Touching base again. Here’s what to expect. If you haven’t scheduled your due date, because obviously there’s those people you can’t get your review, I mean, if you haven’t scheduled that.” Tell people you can’t get a hold of that you are now being pushed back into January. And then that was it basically. I just said, “Lisa would reach back out.” So I went into labor, I had my son November 17th and I returned to work on January 9th. So during that time, she was the main contact, main go-to. I had an autoresponder on that basically said, you know, “Thanks for reaching out. If you’re a client, like, please resend your email with “client” in the title and CC Lisa.” Like, “Follow instructions.”
And I had a couple client issues during that time, like one who got the new job. She got the new job while…she was negotiating careers while I was on my leave because I was helping her, like, kind of…you know, coaching her through analyzing packages of what would be the best choice financially. And I think there was maybe one other client issue. But other than that, I was able to take that time to bond with our son.
And it was really because we did the upfront work, right? So we leveraged Trello a lot during that time as well in terms of, like, “What are the projects?” There was just like…I had a big brain dump board in there like, “Who do we need to do, like, you know, any tax loss harvesting? Like, you know, IRA contributions. Like, 401(k) maxing out, whether it’s Roth conversions.” All of that stuff was all in there. And I just went through each client. So I spent the upfront time doing that work. And it was a little bit more hectic, but because I was able to go through each client and then cross them off the list, I was able to have that peace of mind knowing I went into my leave without any, like, loose things hanging over me.
Michael: So I guess sort of an essential piece of this, like, do you have to grow the business to the point that you’ve got at least one staff member to kind of support you and back you up in order to do this and make it work?
Mary Beth: I think you have to. So with our first, I think I…I’m trying to remember whether I had…I had her. I had somebody on team but I definitely didn’t rely on her as much as I had Lisa. I basically said like, “Just, you know, she’s in the background, she’ll be available.” But basically I think I had the same instructions for clients and I think they sent them directly to me, though. So I think they came to me. And obviously, the workload wasn’t as heavy, you know, two and a half years ago. I didn’t have as many clients.
Michael: Oh, yeah. I was going to say, like, it was more manageable when there were fewer clients so far. Yeah.
Mary Beth: Exactly. And I will say, though, I had…and I don’t know how many clients I had back then. Let me see how many I had. I could probably tell you but it was maybe 30. Yeah, probably 30 or I don’t know, 35 give or take. I don’t know, 30 maybe. But basically, I remember one client asking me, so this is always question two. So my clients pay me monthly. I remember one client finding out and asking me, “Are we still going to be paying our monthly fee during that time?” And so then for me, it was…
Michael: Yeah. Like, “Do you pause the fee while you’re out?”
Mary Beth: Right. And so I had to re-educate her and I said, “Actually this is an annual fee broken into monthly payments. We still do all of this work and service. The business still runs behind the scenes,” at that time. So that was the one issue I had during that time as well. But basically, I mean, it took planning. It takes knowing your clients and going through the issues. But I went into my leave with confidence. And actually second time around, I gave myself a buffer because I had my daughter two weeks early and I was at the hospital sending client emails because I had meetings scheduled that week. But this time around, I will say, you know…
Mary Beth: Yeah. Yeah, exactly. So I gave myself a two-week buffer.
Michael: Lessons learned.
Mary Beth: Lessons learned. Yeah.
Michael: Yeah, don’t cut it too tight because babies come early sometimes.
Mary Beth: Exactly. They’re on their own agenda. But I will say most…and this is also, again, by establishing those relationships and having clients that you work with, that’s something very important to me. I don’t even know how many cards I got from my clients. Just like congratulations, emails and stuff in the mail over the past, like, you know, since he was born. And that was really amazing to me. And because I work with…a lot of my clients are moms themselves too or they have two at home. I’m getting like the, “You can do it,” emails from them. Or, “It gets better,” and stuff like that. My relationships with my clients are so much stronger now.
And that was the part where going back to the beginning, I didn’t know if I had the confidence to have my own practice because the “sales” always scared me. I just only knew what it looked like to work with people in their 60s and 70s and was a little bit nervous about, you know, “How do I actually do that?” But now having clients who are in similar life transitions or ahead or also building their businesses and managing families, it’s really cool to have those relationships and to be able to assist them to, you know, have their own clarity as well. So that’s the really cool part about, you know, having a niche, niche.
Michael: So what does this look like now in terms of just you’ve got two little ones that you’re handling, like, are you working and your husband’s a stay-at-home dad? Are you both working and just trying to juggle this? Like, what does this balance look like when you’re still trying to run your business or, you know, coming back to your business and now there’s two children under three at home?
Mary Beth: So we have a nanny and my husband is still working full-time. The goal is, and this was the financial planner in me, the goal was for him to be able to make a transition. And that is still the goal and that will probably happen once our son is a little bit older. But yeah, we’re both still working full-time. We have a nanny. She comes in four days a week. We both work from home actually. That’s one of the unique things. My husband’s job allows him to work from home as well. And right now, though, I mean, so I’ve been back at work, back in the “office” probably for about a month. I’ve signed on five new clients this year.
Mary Beth: Again, though, but with those parameters in place around fees and different things, you know, that I’m looking to do and end up leveling. So just for me, this is the year. For me what it looks like is just, again, it’s being very intentional about who I want to work with and what this practice looks like going forward. So it’s just going to look like the same level of service. Making sure that the fees, the price point is right and those people who are getting the service are able to, you know, pay the fee because there is a lot of, you know, business and personal planning that happens in there. But yeah, just kind of continuing to grow.
So I have an associate financial planner, I have Lisa who I depend on a lot. Lisa’s role is kind of evolving to where she’s been kind of the CSA, she’s also, like, fantastic in terms of having her to offload things like, “Can you reach out to this person to schedule that?” She mails out all of the books to, like, new clients. She handles all my birthday cards even remotely, by the way. I’m in San Diego and she’s in Michigan. So that’s fantastic as well. It’s like we can manage this relationship in two different locations.
Michael: So your team is all virtual.
Mary Beth: Yes, exactly.
Michael: Your team is all virtual as well.
Mary Beth: Yes.
Mary Beth: And so we’re ramping up Lisa’s role right now as well and kind of upleveling her to what she can do so that when we do bring in, like, that associate financial planner, we’re really clear on clearly defined roles. That’s my big thing right now is there’s been a little bit of overlap, so I just want to make sure…I’m kind of building one person at a time as opposed to doing too much. So I want to make sure that Lisa is happy, Lisa feels fulfilled because she’s one of those people that I depend on a lot right now.
And we had a retreat actually last July too, like, a virtual retreat where we talked about, like, “What’s your dream role? What’s your dream pay? What do you see your, you know, contribution to this company being? What do you see your role evolving into?” Because I want to make sure that my team is happy as well. Obviously, if they’re happy then business is better also. So focusing on making sure she’s rounded out then the associate financial planner. Building that from there and moving up.
Mary Beth’s Advice For Women Who Want To Start A Firm And A Family Around The Same Time [1:12:52]
Michael: So for other women maybe that are out there and interested in going out and starting their own advisory firm but concerned because they also want to start a family at some point and are concerned about this intersection of the two, like, what advice would you give to, you know, women that want to go start a family but have this concern around starting a family and starting a business in relatively close conjunction to one another?
Mary Beth: The biggest thing I could say is it’s about setting and managing our client expectations. I mean, that’s the number one thing. Obviously, a client signs on I’m not saying, “Okay, I could get pregnant in the next, you know, 12 to 18 months. So, you know, FYI.” You don’t need to have that conversation.
Michael: “Just so you when you sign on.” Yeah.
Mary Beth: Disclaimer. But you basically just say like, “Here’s what you can expect from our relationship.” I lay it all out right up front. I basically say like, you know, “My whole educational…” Little script in the beginning is like, “Here’s the process. Here’s when you can expect to hear from me. Here’s when I’ll be available to you. If you can’t get hold of me here’s what you can expect.” So just going into it if you are concerned. Do not do it because you might be out for a little bit. Basically just set your process up or set yourself up ahead of time to where you’re preparing. Just like our job is to create plans for our clients, the best thing you can do is just create that advance plan. And I still say jump into it. Like, take the risk because once you have a baby that’s definitely not a good risk either. You know, I mean, there’s no good time. Not a good risk but there’s never going to be a good time for you to do this.
And I tried so long to kick the can down the road with Workable Wealth and it wasn’t until a friend of mine was like, “Just do it. If it doesn’t work, you go back and get a job in the industry. There’s somebody who’s going to pay you again.” Like, that’s the worst case. So if you’re not doing it because of this, like, well, then you start the firm, you have your baby, if it doesn’t work out you go back and get a job in the industry. Like, those are usually…that’s your fallback plan.
Michael: Well, you know, it really is a good point as well that I see a lot of advisors who are really concerned about going on their own and trying this out and what if it doesn’t work and then what comes next? And, you know, just remember, like, what comes next, there’s still a giant talent shortage for basically any kind of experienced advisor under the age of 50-something, so there will be jobs for you to go back to. I actually know a lot of advisors that have found that going out on their own, like, they never got better job offers to be an employee until they stopped being an employee and started their own business. Because there’s something about how I think other advisors tend to come at it. Firm owners get really excited about hiring entrepreneurial people. So going out to start your own business is actually a surprisingly good way to get hired into someone else’s business.
Mary Beth: Couldn’t agree more.
Michael: But just remembering, yeah, there’s always a fallback there. That you just go get another job, there’s not a shortage of them right now. Thank goodness there’s not a shortage of financial advisor employee jobs.
Mary Beth: Exactly. And the thing is, I mean, for me anyway, so it’s been 4 years, we’ve built to $200,000, where it’s going to be this year, I’m still in my early 30s, you know. And that’s the other thing too that I will say. You have a big industry.
Michael: Yeah, you have a long runway.
Mary Beth: I’ve got a runway ahead of me. And, you know, there’s other people who are listening like, “Oh that’s nothing.” But for me, I constantly say like, “There’s time on my side right now.” And for me I do focus. So that’s why, you know, this year, for example, building it and refining it. That sets the stage for, you know, a long way into the future. So that’s the other thing too is like when you are…being a younger planner, there’s that fear that you have to get going right away and get, you know, six figures, multiple six figures. Like, there’s, like, this constant rush with all of us. And for me, just know what your goals are.
And again, like, even with us within the industry, I think there’s a lot of comparison games. There’s a lot of like, “Oh, we all do things differently.” And it goes back to even financial planners need their own financial planners. So just focus on your own goals as well. And just because you are starting your firm, don’t feel like you have to get to that six-figure mark just because. I think it goes back to knowing what your goals are. I just want to say that for other people listening.
Michael: Amen. Amen. So, I mean, speaking on this forward-looking growth trajectory and having a long runway, like, where does this go for you? Like, is there an ultimate goal or game plan for where this ends out? Do you have a sense as to what you want to build towards or how big you want to build it or what you’re doing with it in the long run?
Mary Beth: Yeah. I’d say one of the goals for me is probably…it’s revenue of like $1 million, $1.5 million. I could have multiple millions but I’d say probably getting to that point of $1 million in revenue, $1.5 million in revenue. And I would say my absolute, like max tap out, like, however big the firm grows, like, I couldn’t imagine me having more than, like, 250. Like, obviously that’s like a team of advisors that would be under me as well. Two hundred and fifty clients, somewhere around there. I don’t want to have a huge firm, but that would basically probably be what it is.
And then that revenue, maybe an associate advisor, a partner eventually. I basically know that I want to have that kind of revenue, that number of clients, and then from there, I want the systems and streamlined things in place so that I can focus more, again, on spreading financial education to a bigger audience. So my goal would probably be around $1.5 million, 250 clients, and then whatever that team looks like. And I kind of have some idea of what the staff would be. I’ve done some brainstorming there in terms of how big the team would be. Maybe, you know, five to six people. And then from there building the Work Your Wealth arm. Basically, the book is “Work Your Wealth,” the podcast is Work Your Wealth. So building out that business in terms of educating people. That’s a personal passion project of mine.
Michael: And just curious, like, where does this $1.5 million target come from? Because I feel like, you know, it’s always interesting just how we get to the goals that we set. Like, is it for you more about 250 clients is the number that you want to reach and that’s just what the revenue would add up to given what you’re planning to charge them and do for them or is it like you’ve got an income goal and, you know, you need the business to be a certain size so that the net profits come down to the dollar amount that you’re trying to reach? Like, how do you set a target like that for yourself?
Mary Beth: It’s an early retirement goal, to be honest. So we’ve done our own financial planning. It’s an income goal. It’s basically the net income and what we could save. We know what we need to live off of, what kind of lifestyle that we want for our family, and then basically it’s the salary and net profit goal. What we would be able to do with that and how to make that work for us. So it’s kind of a personal goal.
Michael: So that’s like a financial independence threshold. “Once we get here, I can pay all my bills and achieve my goals so I don’t need to grow any more income,” and that’s when you go more in the financial literacy consumer education direction?
Mary Beth: Correct.
Michael: Okay. Interesting. Very cool.
Mary Beth: Yeah, it’s a little different. Because the firm could obviously keep growing, right? I mean, I’m, you know, as I said early 30s, so a long runway ahead of me. But that’s something for me…you know, that’s the benefit of our industry and our profession as well is I could have that, very much that lifestyle practice. And that’s what I want because I have bigger goals in other areas. And for the Work Your Wealth arm, I have a lot of ideas there. There’s another book to come. There’s more educational stuff to come there.
Michael: So as you look back on this over the past couple of years that you’ve been going down this road already, I’m just curious, like, are there things about being a business owner and starting family now that surprised you relative to what you had in your head about how this was going to go four-something years ago when you were getting launched? Like, has this pretty much unfolded as you’d expected or were there surprises in how this has happened?
Mary Beth: No, dear God. No. Nowhere near what I expected.
Michael: So what did you expect?
Mary Beth: I feel like maybe…It’s kind of, like, I didn’t necessarily expect anything, I just planned for the worst. Like, as a financial planner, I’m just incredibly conservative. So, like, basically when we launched, like, even my husband when we talk now he’s like, “I planned for you not to have an income for three years.” Like, that was what he was telling himself. And I had a positive, like, in the first year. And I think basically…
Michael: Oh, like, that was part of the plan for you guys literally? Like, you were going to live solely on his income for a couple of years while your business grows so that you’re not counting on any income from the business if it doesn’t grow?
Mary Beth: Kind of. Yeah. I guess in his mind that was what he was saying I needed. But I didn’t plan on my income growing. Yeah, basically, like, I was nervous about not having an income. So, in general, I basically…I didn’t know what to expect in terms of like the evolution of the business being built, but I think there was a lot of comparison, I would say. Like, in the beginning, there was a lot of anxiety and guilt of like, “Okay, am I doing this right? Am I making enough?” Going back, I was very worried about what other people were doing and was I doing it right or wrong. And I was already being different, with this millennial Gen Y focus and then the monthly fee. I felt like an outcast already, right?
Michael: You were concerned about what other people were doing in what context? Like, what do other financial planners do…
Mary Beth: In their income.
Michael: …for Gen Y clients or just like, “Am I making enough and successful as an advisor?”
Mary Beth: Doing things different. Like, “Am I doing it all wrong?”
Mary Beth: Yeah, “Am I making enough and successful as an advisor?” Because when I launched I was told no, that this generation didn’t need advice. I was told, “No, it’s not going to work.” That these people won’t pay for. This generation doesn’t need any help anyways. So there was a lot of those questions that I went out with. So I launched this practice, you know, and then again I’m charging people $75 a month at first. So there was a lot of that like, “Oh, I was kind of prepared for, like, it’s probably not going to work and maybe I’m going to have to go back and get a job.” That was what I was telling myself is, like, the safety net. So in that sense. And then the fact that it’s grown, there was that when I launched. I was a little bit more pessimistic than optimistic because that’s just how I am naturally.
Michael: And you roll, I understand.
Mary Beth: That’s how I roll, just to make sure that we have all the boxes checked financially. In general, though, I never would have thought that the… I don’t want to say niche, niche, whatever. The niches would have…like, they basically built themselves. I went out focusing on young people, and then by Brian, my husband, sharing what I was doing just like on Facebook and his audience, like the military officers became a subset of clients. And because one of my early on clients from a Facebook group was a coach for therapists, and from there I now have multiple…I mean, probably, I don’t know, a handful of therapists, definitely female therapists are my client subsets as well. So I know that practice.
And then by meeting somebody else who ran a Facebook group early on for creative female entrepreneurs, we grew at the same time and then I ended up in front of creative female entrepreneurs. So those were not actually my targets in the beginning and I never would have thought that it would evolve that way, but it has and so now I’m known in certain communities. And the speaking, all of that stuff that’s come, I wouldn’t have ever thought that I would have a book and a podcast or that I would be on NBC. NBC comes to my house to interview me. You know, from Twitter, from a tweet on Twitter, he comes to my house, from like one tweet. Stuff like that I never would have known if I didn’t take a chance.
And so what happened early on was saying yes to a lot of opportunities. Like, a lot of yeses. Walking through whatever door opened. I said yes to a lot of things early on, and then it got to a point where my revenue was at a point for me, my take-home was where I was like, “Okay, I can start saying no to things now.” And then now basically I said, “Now we’re back to refining things back down.” I said yes to a lot of things, opened a lot of doors, had a lot of opportunities, and now we’re refining it back down so that I can be the most impactful with those things that are revenue generating. So I think it’s just a matter, of, like, I would have never pictured it to go that way, I would have never pictured the opportunities that presented itself to me, but I think by taking those chances and being able to say yes to those opportunities and connecting with people and reaching out, that helped my career a lot.
Why Mary Beth Wishes She Would Have Started Out Doing Investment Management [1:24:28]
Michael: Okay. Interesting. And anything in retrospect that, like, you regret or wish you’d done differently?
Mary Beth: I will say the one thing that I didn’t think I was going to do investment management at all when I launched and now it evolved to Betterment and now I’m doing TDA with Dimensional Funds. And so I’d say that if anything, I wish I would have probably started that a little bit earlier. And that for me, financial planning and investments, like, for me I just felt like I could only take off one thing to two at a time. I kind of wish I’d maybe done…figured that out a little bit earlier.
Michael: What led you to not do AUM originally and then decide to do AUM after all?
Mary Beth: I was still working. I wasn’t as comfortable, like, on like the sales side, to be honest. Like, in general, like I said sales always scared me. And that was a part where I was like, “Is this going to work? Do I know how to sell?” Selling is, like, something that has to happen, and it terrified me. Selling was just, like, awful to me. Even though I know I’m a good financial planner, the selling side. And so it wasn’t until, like, I got a script down and then I basically realized that when it comes to working with clients and I actually enjoy working with and meeting their needs, I realized I’m actually just educating them on what the services…it’s education. That sales is education.
So it wasn’t until then that I felt more confident about, “Okay, how do I explain what I do?” That the investments would be able to come in? Because I felt like that was a whole nother beast to tackle, especially with the people that I work with, and I didn’t feel comfortable exactly, like, how I would explain that yet. So I felt like it was taking on too much at that time to try and hold myself accountable to explaining it all. And I put a lot of that pressure on myself thinking the clients will expect me to know it all or explain it all off the bat.
Michael: Yeah. You know, it’s just one of those things of finding your confidence through the first few years. Like, you know, almost every advisor I know that goes out on their own ends out dramatically raising their fees in the first couple of years. We did a benchmarking study internally at XY Planning Network and literally, 100% of advisors raised their fees in their first 3 years of starting their business. And I think so much of it is just there’s this confidence factor that’s just hard until you do it and you get your first few clients and, like, a few people say yes and you go, “Oh my God, this might actually work.” And then you start to feel better and price your time and your worth a little bit more fairly and start lifting up that fee.
Mary Beth: Exactly.
Michael: I wish there was a shortcut to it but I don’t know how to get a shortcut to it because I just feel like we all just have to go through that.
Mary Beth: Shortcut the confidence. Just confidence, you can’t shortcut the experience.
Michael: Yeah. So as we come to the end, this is a show about success, and one of the themes that always crops up is just that success means different things to different people, sometimes different things to us in varying stages of our own life. And so, you know, you’re off for an amazing start for the successful business. You have, as you noted, a very long time horizon for it. So, you know, you talked a little bit about where the business can grow and some of your targets, but I’m curious just at your kind of individual personal level for you Mary Beth, how do you define success?
Mary Beth: Success basically just means me being able to financially support my family and to be able to be present with my children and my husband and family basically and enjoy life. So it’s the balance there. You know, being able to check all the basic financial planning boxes like save for retirement and, you know, financial independence, but mostly just, you know, one of the things is when I turn 80, like, how do I picture myself? Do I picture myself with a bunch of money in the bank or do I picture myself surrounded by my family? And that’s one of the things for me is family experience is really important right now. And so being successful means that my kids have good memories of me and my kids know that I’m present while they’re growing up. So my thought is it’s okay during this season of life to grow a little bit slower because I think there’s going to be years when they’re in school full-time, where I’m going to be able to really ramp it up as well.
Michael: Well, very cool. Well, thank you so much for joining us and sharing all of this path and journey to starting a firm and starting a family and surviving. I feel like step one…
Mary Beth: Survival.
Michael: …is just surviving through the exhaustion and the sleepless nights and all the wonderful things that come with little kids.
Mary Beth: Yeah and maybe reach out in, like, a month or so and I’ll probably want to work a lot more, depending on how crazy I’m going. So we’ll see.
Mary Beth: Thank you for having me.
Michael: Absolutely. Thank you for joining us.