For many of us, “bigger is better” isn’t just a saying. It’s a creed we wholeheartedly endorse. In a land of super-size fries, jumbo mortgages, and family vehicles large enough to have their own Zip code, we find something infinitely exciting about the idea of doing more, getting more, moving up.
So addicted are we to the thrill of endless expansion and growth that we often forget the importance of contraction and rest, an equally vital part of most natural cycles. Many times, in fact, there is value in choosing not to grow or even opting to shrink, to simplify instead of complicate, and to seek more satisfying avenues of growth and development. Here are some examples of what I mean.
My partner wants me to accept a buyout offer we’ve just received from a local bank. He thinks that it’s only a matter of time before our small firm is put out of business by regional or national competitors. But I enjoy being my own boss, and I like our practice just the way it is. Do you see a way to resolve this difference of opinion? If staying small is really your deepest desire, I would not compromise because of a generalized fear of the future.
Remind your partner about your own fears of being swallowed up by a larger company and losing control of your work. Ask if he would be willing to commit to waiting a certain period of time (a year? six months?) before making a judgment about whether or not your firm can survive. Tell him that if he still feels that the prospects are gloomy at that point, you will give your blessing to a buyout.
In this discussion, try to help him see that panicky decisions are seldom the best ones, even if they seem to make financial sense at the moment. By slowing down and working out a more reasoned plan of action, you can create a road map that will be easier for both of you to live with.
If he is unwilling to give you the time you are asking for, your best choice may be to dissolve the partnership. He may then be able to sell his half of the business to the bank or another acquirer, while you continue on with your satisfying solo practice.
Over the past eight years, I’ve built a solid financial planning business in the small town where I live. But statistically, my growth prospects are limited here, so I’m considering a move to a major city about a hundred miles away. The trouble is, I feel uncomfortable about leaving some of my clients, and I keep thinking of what I may lose in quality of life. Am I just afraid to change? Should I push myself to move? I don’t think it’s wise to push yourself into changing solely for change’s sake. Your first step should be to sort out which path will be better for you in the long run. What do your own instincts and yearnings tell you? Is moving to the city what you really want to do, or merely what you feel you “should” do?
If you truly want to remain where you are, give yourself full permission to stay put, at least for now. There may be creative ways you can still prospect for clients who live closer to the big city (if you really want to expand your business, that is).
On the other hand, if you’re itching to see whether you can make it in a bigger market, consider a multiphase plan that will let you continue working with your hometown clients while you relocate to the city. Gradually refer the less rewarding clients to other planners, so you can devote more energy to retaining the ones you truly enjoy.
Above all, I would encourage you not to be stampeded by statistics. When clients lament to me about the mathematical unlikelihood of accomplishing something–finding a job in their field, getting married at an “advanced” age, publishing the Great American Novel they’ve labored over–I always try to remind them that an individual is not a statistic. They only have to find one job, one spouse, or one publisher, which is certainly a less daunting task than moving a statistical mountain! So take heart, and try to keep your business going in a way that fulfills you.
I’ve worked for a big securities firm for the past 10 years, with increasing dissatisfaction. I’m dying to start my own planning practice, but my husband is worried about the financial risk since he could lose his own corporate job at any time. We’ve had many heated arguments over this. What should I do? Finding a way through this dilemma won’t be easy. Your spouse is understandably concerned about a potentially catastrophic drop in your joint income, but there is also an emotional risk in prolonging your frustrating employment.
Without knowing more about your family’s financial requirements, it would be hard for anyone else to advise you whether or not to proceed. Certainly, the more you’re able to reduce the risk, the better. For example, you might find a like-minded professional to share expenses with you. Another possibility would be to plan on outsourcing specialty services to keep your overhead down, at least in the beginning.
At a minimum, I think you should draw up a detailed business plan that spells out what you plan to achieve in a specific time frame, how you will achieve it, and what you will do if it doesn’t work out. Discussing this with your husband may go a long way toward allaying his fears. He may also feel more accommodating if you suggest some concrete ways to reduce the household living expenses until you get your new venture off the ground.
I think many big planning and investment firms are giving small investors a raw deal with high fees, minimums, and breakpoints, not to mention impersonal service. But when I mentioned to my two partners that we ought to target this market, they said it was impractical, that we’d lose our shirts, and so forth. They’d rather join everybody else in chasing after high-net-worth prospects. Am I nuts? If you feel strongly that this may be your calling as well as your personal preference, why not ask your partners for a limited-time trial to see if it could become a viable subspecialty of the firm? Let them woo the wealthier clients while you court the little guys.
Your big advantage, as you’ve already perceived, is that you have less competition than they do. Simple tactics can be surprisingly effective, such as developing seminars and workshops to persuade non-investors or disenchanted do-it-yourselfers to get on board with you. In Washington, D.C., financial advisor Ellie Wotherspoon has helped launch several women’s investment clubs, which she advises free of charge. A number of these club members have eventually come to her as paying clients, after learning to trust her integrity and her enthusiasm for empowering women to take charge of their finances.
Whatever course you follow to serve small investors, I applaud your commitment and wish you success–along with the respect you deserve from the partners in your firm.
As I approach 60, I’m getting tired of working harder and longer just to make more money. My wife passed away several years ago, and my kids are grown. If it weren’t for my 85-year-old father, whose nursing-home bills I pay, I’d be glad to scale down–work less, spend less, and enjoy life more. My younger colleagues, who are still gung-ho on gathering assets, keep telling me, “If you rest, you rust.” I guess I need some attitude adjustment. Help! Actually, your attitude is perfectly normal. But it’s probably quite lonely where you sit, longing to let go and cut back in an atmosphere of escalating consumption and acquisition.
I assume the cost of care for your father is the big hurdle that keeps you from following through on your desire. Are there alternative ways to care for him that would be less costly? Or can you downsize enough in other aspects of your life to keep paying the nursing-home bills? You might, for example, sell your home and buy or rent a smaller place. For ideas on lower-cost living, consider Amy Dacyczyn’s Tightwad Gazette books or Mary Hunt’s The Best of the Cheapskate Monthly.
Even if you’re not ready to join the fans of frugality who saw paper-towel rolls in half, you may find it easier to cope with “affluenza” by joining a simplicity circle in your area. In fact, if you know a few other people who share your desire for more time to smell the roses, you might form a group of your own to foster this lifestyle and buck the societal trend. I really hope you do this. The more people who try to balance work with time spent in relaxation, rejuvenation, and enjoyment of family and friends, the better off I think we all will be.
Choosing not to get bigger may seem counterintuitive when all the talk is of big firms squashing, swallowing up, or ignoring smaller practices. But for many advisors and clients, small is beautiful. If you decide to challenge the conventional wisdom that “bigger is better,” three cheers for you! With a little focus, self-trust, and some creative brainstorming alone or with supportive friends, I believe you can find the wherewithal to do it well and not only survive but flourish. Find your niche. Polish your integrity and your personal touch–they’re the differentiating factors that can help you prosper. And serve your clients so well that they will never dream of deserting you to become an account number at a bigger firm.
Don’t misunderstand me–I’m not saying that big is bad. You may feel that success lies in growing your client list, expanding your staff, or joining forces with bigger firms–not that there’s anything wrong with that (as Jerry Seinfeld once said, in another context). But if all the scary predictions make you feel that your desire to stay small or get smaller is risky or impractical, consider the suggestions I’ve offered. They can give you more energy to go the distance in creating a practice that will suit you better, professionally and personally.