Like many financial professionals, Linda Leitz has an alphabet soup of letters following her name. There’s the CFP, the EA and the CDFA, but the one that catches my attention is the one that’s not there, yet.
“I’m working on my Ph.D,” Leitz tells me at the Colorado Springs, Colo. office of her company, It’s not Just Money, Inc.
Though she’s not yet begun the dissertation portion of the doctoral program, Leitz has a pretty good idea where one aspect of her focus will be.
“The KSU program (Kansas State University, where she’s studying remotely) looks at behavioral finance,” she says. As financial professionals “you can teach concepts, but if the client isn’t motivated they won’t follow through.”
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At the heart of it, she wants to understand what makes the client tick. What’s the psychological background that causes them to dig themselves into deeper and deeper holes of debt? What defines self-image relative to money? Do you see yourself as poor? If so, what caused that way of thinking? “Are you looking at what your friends have? What someone said?”
If you can understand what makes your clients buy then it gives you a better chance at helping them break the bad habits and get on the road to financial recovery. If financial professionals avoid the emotional aspects of their clients, says Leitz, then it’s just numbers on a page.
Another area she’s intrigued by in her studies is the influx and popularity of the celebrity financial gurus. She doesn’t paint them all with a broad brush claiming them all to be evil, but she does have skepticism.
First of all, what are their credentials? That’s a problem with most financial professionals and especially perplexing to those with the ABCs after their name. “They may actually make good points about finance for people,” says Leitz, “but that may not be good for the individual.”
She says we’re all unique. We all have a specific set of circumstances so the advice doled out to one caller on a celebrity guru’s show might be the antithesis to what other listeners need.
“I may want to buy a dress because it looks great on my friend, but it might not work me,” Leitz adds. The basic idea is financial plans, like clothes, are not one size fits all.
Of all the generations, the baby boomers have perhaps been the most discussed and dissected. Who hasn’t seen images of them slogging through the mud in Vietnam or slogging through the mud at Woodstock? And who hasn’t acclaimed or blamed them for every financial peak and bubble that’s occurred over the past 25 years?