What Elite 401(k) Advisors Actually Do Differently

[0:00] JD: But you somehow fell in love with this idea of trying to make these conferences better. [0:05] Mark: Yes. [0:05] JD: You do it on a local level, and then somehow you decide, well, let's take this thing national, and I should know better. When did all this start? [0:17] Mark: This is year four. [0:18] JD: This is year four. [0:19] Mark: This is year 4. So the regional events worked extremely well. We still do them to this day. We do a lot of private label events for other companies and help them run their local events as well. So we've got that formula, and it's a simple formula. Would I go to the event? And that's a common theme that you will find in our office. Would Ross leave his office? Because I'm really protective about my time. Little fanatical about it, and he came to see me. Well, I got nothing to do this afternoon. So this is all blackmail. [0:47] JD: I want to apologize. Your regional events, I think Chad spoke at one. [0:51] Mark: So did he recover? No, we were good. [0:53] Speaker C: Hey, I got an email from your team saying that was the highest scores for my presentation. [0:59] JD: That's what happens when you pay everybody when they leave. [1:01] Speaker C: Two things I want to mention on that. That was my first regional recon. [1:04] Mark: Is that a pleasure? [1:05] Speaker C: Fantastic. [1:06] JD: Really. [1:07] Speaker C: You had All Stars in that room. I mean, like, 40 of the best advisors in the Bay Area sitting in that room. People drove from Fresno, like, two and a half hours. [1:15] Mark: What is he doing? [1:16] JD: This is special. [1:16] Speaker C: I was there. [1:17] Mark: Oh, God. [1:19] Speaker C: Really? And what you've done here so well is. I was chatting with another advisor, this is her first year, and she said, so what's better, going to Napa or going to this? I said, well, let me tell you why I think this, and you tell me what your experience will be over the next 48 hours. It is your peers teaching you what they have been successful with. It is not wholesalers. I hate to say that about myself, or other wholesalers or partners talking about product. That is the most attractive thing that you've done with these sessions. And that's why it's so valuable. And that's why people drive two and a half hours for a regional event. [1:47] JD: So I didn't want this to be a huge plug for you. And I do want to get to those beers, but I am curious how many people came to this one this year? I mean, where are we at now? [1:57] Mark: About 600, I think. [1:58] JD: Yeah, 600. 600. So way to go. Yeah. Thank you. That's pretty, pretty quick. Scale up to a good conference. [2:03] Mark: Well done. [2:04] JD: So we got a beer. We. This is from Jamaica. [2:11] Speaker C: Where's Red Striped in Jamaica? [2:13] JD: What's the tagline on the commercial chat? Questioning my knowledge. [2:16] Speaker C: Texas, to be quite honest. [2:17] JD: And Ross, you are far more responsible than us. You've got a conference to run here. [2:23] Mark: Yes. [2:23] JD: And you wouldn't be our first guest to not partake in the alcohol. And we support that. And we. [2:29] Mark: You do know that I'm doing the close session in about 30 minutes? [2:32] JD: No. [2:32] Mark: And while that would make it incredibly more interesting, I'm going to refrain. [2:36] JD: Yeah, that's fine. [2:36] Speaker C: So, yeah, we'll pass stage with you if you'd like and just, you know, cheers. [2:40] Mark: It would be a real good prop. There you go. Yes. One of my big three goals for the end of the day. Maybe I mix that in. I'm not sure how that works. [2:47] Speaker C: You could find a way. [2:48] Mark: Yeah, we'll pass. [2:48] Speaker C: You're clever. [2:49] JD: We also have a word of the episode which thankfully you will not have to partake in because it can be a little rough sometimes and we've got some stuff out here. Can you let the audience choose that we're drinking? The audience will choose the word of the episode. Sure. Trey, what word? If we say, will we have to drink this little cough syrupy stuff? [3:12] Mark: Oh, my God. [3:13] JD: Simple one. I'm say it one more time. We did backwards last week. Advisor. No more. [3:19] Speaker C: Perhaps we should make Mark drink. [3:21] JD: Ross, I'm going to add to the fun if. Yeah, okay. If Ross says the word, Mark will drink. [3:27] Mark: Or does everybody have to say advisor and then all of a sudden you have to drink every time I say advisor. Does it. I mean, I don't know the game. Do I go down the line? And when I say advisor, do you now have to drink? I just don't know. It's a long time. I'm not really a drinker, so I don't know the drinking game. [3:44] JD: That's how it's gonna work. [3:45] Mark: Okay. Is this the advisor version of the game? When he says it, I just wanna. I wanna know. [3:51] JD: I thought you were a nice guy. [3:52] Mark: I am. [3:53] JD: Everyone told me you're a nice guy. [3:54] Mark: Well, it's the advisor'. What do you expect? [3:57] JD: I don't know. Mark, please. Mark, you do have a flight tonight, right? [4:02] Mark: I might not let you on the flight. [4:04] Speaker C: As long as they let him get through security. [4:05] JD: Here's what I like to do. Weekend in Burning, you have written some articles published up at 401 specialists. [4:12] Mark: Yes. [4:12] JD: And I've read through them. And so I'm going to do kind of like. What do they call it, Mark, on your support shows when we just quick go at a subject and then go at another one. Quick fire, lightning. Quick fire, lightning round. Perfect. So I'm gonna mention to you an article you've written and then I'd like us in two minutes or less to kind of go right to the heart of it and. Okay, great takeaways. The first one that I read was why 401k industry consolidation will kick into high gear. And I read through this. You had interviewed and talked to Cullen and I heard something about a hockey stick. And in three to five years, if advisors don't get their tech game on, their millennial facing stuff on that, they're going to face a tough world. Is that something you still believe in? Thoughts, Opinions, Go. [5:04] Mark: I do. I think I love the advisor version of Quickfire here. So I think that's impressive. What we talk about with the hockey stick is what we're required to do as advisors now is expanding, I think almost exponentially. What we talked about yesterday in the opening session was being a 401k specialist is important because it's an expert type industry. We have to be able. [5:26] JD: Super niche. [5:27] Mark: We have to be super niche. It's not enough because now we've got organizations that are looking for so much more help, more tied to outcomes, health and wellness. Being an advisor, it's simply not enough. So in order to provide those type of. Did you breathe okay? Cause I don't. You're doing okay. Okay. So in order to be an effective advisor going forward, I'm not invited back next year. Am having so much fun. I mean, because I don't get to do drinking games any. Yeah, this, this is like 30 years of drinking games. It's all coming. [5:57] JD: You're saying you cannot continue to survive in this business if all you're doing is showing up for a quarterly fiduciary view meeting, going through your fund scores, doing your agenda, doing your documentation and heading back to your office, which a lot of financial professionals do out there. [6:16] Mark: Right. [6:17] JD: That won't work anymore. [6:19] Mark: I don't think it's going to be enough because my competitors, who also advisers to plans, are going to be delivering a value proposition that is not just 401k. It is outcome. It's going to be benefits. And it's also, we've run people up to the point where they're retiring and then after that we often kind of let go of them and they roll out of the plan and we don't maintain that relationship. The record keepers do not want that anymore. They want to maintain it. So do the specialists as well. So our entire industry is going to figure out, how do we help someone through the life cycle of an investor in a 401k plan? And in order to do that, you need more capacity, you need more competence, you need to be able to offer a better level of services. I'm still just a guy. I mean, I'm not going to be the smartest guy in the room because I'm an advisor. Because of that, I have to partner up with aggregators and other teams in order to do that. [7:09] JD: I watch Aaron Potichino finish his presentation today with something to the extent of he's talking to a room full of financial professionals and he's saying, if you guys don't up your game in this area, I'm coming for your business. [7:24] Mark: That's what he said. [7:26] JD: And so when I read that article, I felt fear for advisors, especially when I heard this three to five year kind of look. Sir. [7:36] Mark: Thank you. The advisor should be fearful. [7:38] Speaker C: I love knowledge in there too. The need for those folks to transition who their average client is, it's going to be a millennial here shortly. And so they need to change their model and the way they're delivering their model to be prepared for that. And I think that that is something that your conference and some of the sessions we went to, they've done a really good job preaching. [8:00] JD: That seems to be a theme. [8:01] Speaker C: Those are the successful folks. The people who are standing on stage this morning for Tapo are the people who are embracing that you're focusing. [8:07] JD: They need to focus on millennials. That's. That's clear and apparent to me when the winner of your Tapo award is standing on a stage in Air Jordans. Things are changing a little bit. I feel like. Okay, all right, next subject. We all agree. I had a question, but I'm not gonna ask it. Okay. Because I don't want him to say that word. [8:27] Mark: Okay. I will answer the question without saying advice. [8:31] JD: The next article I read was Dollars to Donuts Making the Best Use of Advisors Time, and you had a narrative in there. Dang it. That's part of the article title. [8:43] Mark: Trey, that was fantastic. You have picked the ultimate word. [8:48] JD: Nice word. [8:48] Mark: This will be their last interview because they'll be sleeping shortly. This one's going to be legendary. [8:54] JD: You, you talked about at your company. And this really resonated with me how as the owner of the company, when you stick your nose into things, day to day activities, that it's not necessarily a good thing. And that happens at my office. When something comes up, I go Back into the office, stick my nose in and myself, like, it's just better if you stay out of this. Like, you do your thing, you're just gonna make this worse. And I've learned that over the time. Your article then went on to say not just about that, but that advisors need to look at where they're spending their time. [9:28] Mark: Yes. [9:29] JD: And my stupid mic that's on my hat when I lean forward. You look really funny with that. I like it. Thank you. And so if they're spending their time in the wrong areas, paperwork, day to day stuff, you know, office stuff, that's not really where their value is best served. Right. They need to be out. And in most cases we can decide, discuss out in the world, sharing their brand, sharing their value, prop selling, bringing on new clients. And I think in today's day and age, a lot of them do misuse their time. [10:03] Mark: Yes, absolutely. [10:05] JD: The people you guys meet with, wasting a lot of time on day to day. [10:08] Mark: I think it depends on the size of their, their book, them themselves, how big their office is, if it's only themselves only or if they have a [10:15] JD: team behind one man, guy, what do you want me to do? [10:17] Mark: Hire a bunch of people? [10:18] JD: I'm not there. [10:18] Speaker C: There's a lot of fear. The human capital side, there's a lot of fear in these folks who have built a little practice and they feel good about it to bring on somebody else to run the paperwork side, to do those things that there are times better spent elsewhere. [10:30] JD: There was once a time in our company where nobody sold plans unless they had the last name Carlson. And now these three gentlemen are out there every day in suits and ties talking to financial professionals and sharing our stories. And so I figured that out a little bit, right. Like I'm not out there doing that, they're doing that. Do you think that's a problem in the industry? Do you see people recognizing that? What's your take on it? [10:59] Mark: Yeah, I think the challenge of the business is actually to think like a business person. And you're spot on about the risk of human capital and we worry about that. One of the scariest things you can do as an advisor is hire your first employee because your overhead just skyrocketed. The second scariest thing, hire the second employee. Because now your overhead may have gone up, say 30 to 40% and you probably aren't going to have a jump in revenue of 20, 30, 40% like that. So this initial scale up is extremely scary. That's the hardest part. Going from seven staff members to eight you can do that with a simple relief mindset. What tasks do you not want to do? Great. Position number eight. We're done here and there. Joe denouyere creates brand new positions in his organization, often around that of what do you want not want to do? What do you want to move on my entire career. Right. [11:48] JD: What do I not want to do? And basically for me, that's everything. I don't want to do anything. [11:53] Mark: I resemble that remark. So. So I get it. So that's part of it. So I think that's hard. That ties back to your first question. This is why the aggregators, the super OSJs, the fintech companies are so valuable going forward. Because now you're scaling, because you're partnering with. Without the human capital component. And if I'm going to scale up quickly and I'm going to compete with Joe Denoyer, which sounds kind of funny because. No, but if I'm going to compete with somebody in my market that may have twice as many people in their office and more organizational capacity and competence, I have to bring it. And the only way I'm going to bring it is by partnering up. And that's it. Because the human capital is the issue. Jeff Collins. Great at it. You're going to build it, you're going to buy it or you're going to rent it. Love that presentation. Figure it out. Right. Building it on your own is the most expensive, most time consuming way. [12:45] JD: Although at first glance it seems like the least. Right. [12:48] Mark: It does. [12:48] JD: I'll do it myself. I'll do it just myself. Right. [12:51] Mark: Well, and here's the question on that. Tell me what your practice is going to look like in five years. Well, I'm not really sure. Then how do you really know what you should build? So to actually try to build something that you believe right now is customized for me, you've got a problem. You don't see the future. So let me rent it or buy it and we'll see what happens when my practice doubles and how I need to go from there. [13:12] Speaker C: It's like dating. I didn't just get married right away. I dated my wife. I rented my wife. [13:18] Mark: Whoa. [13:19] JD: This is really weird. [13:22] Mark: You can advise. Someone said that you have some really good analogies. You guys all need to drink some. [13:28] JD: Brooke Johansson. I apologize guys for chat on that one. I don't know what's been there. All right. I think you might not have a [13:34] Mark: one anymore after that. [13:36] JD: Another thing that you did that I got super excited about it because I think if I remember you Even teased it like you stated. I'm going to go out there, I'm going to write some, talk to some big financial professionals that are great in the 401k space. I'm going to learn what really makes them succeed. You called it Elite Advisor profile series. Oh dang. It's in the word. [14:00] Mark: Help me out Martin. [14:01] Speaker C: Did you leave any [14:03] JD: and you went on to do that? I did. You met with people, you interviewed them and Chad was super interested in this. What were some of the coolest things, the best takeaways from all those types of articles. And by the way, anyone that wants to read these, they're out on 401k specialist. They're not hard to find. [14:22] Mark: Fine, they're not. [14:23] JD: No. [14:23] Mark: There's one overriding theme that was present in every single Elite advisor and when I tell it to you, you'll say duh. Because it's present in every single high achiever. That's intentional. Everything they did and I love this part of it, I would ask them why do you do that? Nobody stumbled. Every single thing they do, they have thoughts through. Here's what I need to do. They had clarity and we're going to do this in the closing session tonight as we set goals. They had clarity of this is what I need to do, this is why I need to do it. So they tell me their work hours, I can tell you mine. I literally work 8:30 to 3:30 and then I'm out. I work a six hour block, I'm home for dinner, that's my call. I can tell you why we don't need to go into that. I don't work 10 hours straight ever. So we just don't do that. Every advisor will tell me here's the days I work, here's what I do on Monday, here's what I do on Friday, here's how many hours and they'll tell you why. There is an intentionality to elite performers in any industry, but really in our industry that permeates their entire life from how they manage their family, how they manage their health, how they manage their relationships. The business is just part of what they do. And if you take those advisors out of this business, they'll start another business and they will be successful because that's how they roll. That's the number one takeaway that I got from the series. It was fantastic. [15:44] JD: To what happens if like there's a huge south swell coming and the waves are pumping and it's Tuesday. Cuz that's not a system for me. There's also sharks out there. I got to go by the tides and the waves, man. I can't plan it out like that. [15:58] Mark: So here's the way you. [15:59] JD: I guess I'm not an elite financial professional. [16:02] Mark: If that is one of your priorities, then you're going to know when you can cancel whatever you have to put that in. And if it means you can blow off Tuesday morning, you go for it. [16:11] JD: Thank you. [16:11] Mark: It doesn't matter at all. [16:13] JD: Appreciate your. [16:15] Mark: If you can fit it in. But the key is it's not just their intentional is their schedule. There's many aspects that are non negotiable. [16:22] JD: It's all strategic. It's all by design. It's all well thought through. They're not just taking a stab at stuff. [16:28] Mark: No. And they're not overwhelmed. They're not stressed out because they understand this is my capacity. And our instinct as an overachiever early in our lives is to go over capacity and to work too much. We all do that. [16:41] JD: We need to say that. Look at Chad. Yeah. Stare right at his eyes. [16:44] Mark: Doing more than you can do is bad. Every advisor knows this. Don't laugh at him. I said advisor again. Okay. So over capacity is how we push ourselves. Then the other aspect is competence. We figure out how to get it done. So we do things that we don't always have the competence for. That's how you become successful. But once you achieve success, in order to really go to elite status, you have to understand here's my capacity, here's my competence. Personally, relationally, organizationally. That's what the lead advisors know how to do. And as they build their organizations, they are not working 60, 70 hours a week because they understand you work within your capacity and you nail it. And then you understand your competence. You get help where you need it, you build up your skills where you need it. But those are the two areas I can tell you next year at Recon, those are the two things I'm going to be focusing on most. Organizational capacity. Organizational competence, which also means personal capacity. Personal competence. The elite advisors got that figured out. That's why they dominate their markets. [17:46] JD: You know what the lazy surfer takeaway from that is, and I like this, is that the way I interpret it is you're saying if you plan your time and do it efficiently, which is like we talked about that earlier article, that maybe then frees you up to not be so stressed out, do the things you like and have a balanced life. But I think a lot of humans in general, you know, financial services people aside, maybe mismanage their time and then anxiety and stress is the result of that. Whereas if they would just plan it out a little bit better. Right. And you have a more balance. Right. And then equal more happiness. But I like that you're telling me that these guys are pretty happy guys, girls, they're liking what they do. [18:30] Mark: Absolutely. [18:30] JD: They're not stressed out. They're enjoying what they do. [18:33] Speaker C: And that's all that organization gives them balance. [18:35] Mark: There you go. Well, and it says date night with my wife or husband is on Friday. I do this with my kids here. I work out three times a week. Every single one of them has a health routine. Every single elite advisor that I interview has a health routine. It is intentional for the most part, non negotiable. This is how you actually do that in order for you to be elite. But that's what they have to do. And then when you get to that spot, you also realize I'm not the one who should do everything. And you end up putting space in your week where there's nothing to do. Now you will never be bored, but you're going to block space on your calendar where there's nothing to do. And then you're going to do the things that tend to really move your business forward. That's the capacity issue. Yeah, it's so hard for people who crank to actually have block time where they can be strategic and they can even just catch up on stuff. So yeah, you fill up your calendar all day long, you're going to run hard, you're going to burn out and it's going to be a while before you understand it's actually your problem because it's an accountability world that you really brought this on yourself. [19:37] JD: You're not winning the end game. You're less successful that way. [19:41] Speaker C: I'd be really curious to look at how their schedules lined up. Like do they work a six hour day like you? Do they work an eight hour day? Do they work a nine hour day? What days do they do? Prospecting versus what days are they? I would be really interested to see what that average calendar varies. [19:56] JD: I'm sure it varies, but I'm gonna start moving my calendar. [20:01] Mark: They will. I'm gonna tell you they will. Because I can tell you here's what I do on Monday morning. Of course. [20:07] JD: By the way, Mark, every successful person, not everyone, but most successful people love telling you how they do it. They love to share. [20:13] Mark: They love you thought so much and you're so grateful that I figured out Monday morning a strategy until noon and goal planning Hard block, Right? No appointments. Then Tuesday, Thursday, meet with clients. Those are all client meetings. Don't talk about recon because I'll get run off some rabbit trail right there. Wednesday is a flex day. Friday, I stay home. I work out. You're so grateful that you've actually figured out a rhythm that helps you become productive. Of course you want to tell people. And it's not just, look what I do. It's like, this changed my life. This is really great. And every one of those advisors, they were just as convicted of here's how I roll. And that's how they're able to keep the balance, stay focused, and be as productive as they've been. [20:52] JD: You know, I love the dynamic between the two of you because he very subtly lets the word of the episode out with no stopping, and you suddenly grab your drink and go. It's like a good, like, team working almost every time. [21:04] Mark: I'm enjoying that part. We really are. [21:06] JD: Yeah. [21:06] Mark: No, I'm telling you, 30 years of drinking games, I'm trying to catch up. This is. [21:10] JD: Ross, you. This is exactly why we wanted to have you on the couch. If I didn't say it earlier, you have a unique perspective because of what you focus on so much with these conferences, both regionally and nationally, having your own business and this. This good guy, you know, ethos of trying to help people. I think that's really valuable to the advisors that watch this show to hear it from you. Oh, okay. I'll get that with that. Thank you for being here. We really appreciate it. Thanks for having us here. Thank you so much. And we are the retireholics. You're our guest. We're changing the retirement plan industry one beer at a time. Thanks for tuning in. Cheers. [21:51] Speaker C: Thank you. [21:52] JD: 75 shots. [21:52] Mark: Thank you, guys. [21:53] JD: Yes.