Fraser Jack: [00:03] Welcome to the Goals Based Advice Podcast where we have conversations with pioneers of the new world of financial advice.
Fraser Jack: [00:11] I’m your host Fraser Jack, and I want to thank you for tuning in today. I would also like to thank our supporting partner Advice Intelligence for powering this podcast.
Fraser Jack: [00:21] Our superstar guest speaker this week is one of the nicest and most interesting and infectious people that I know. She refers to herself as a new form of geek hybrid, maths and finance nerdness, combined with a passion for communication. She’s on a mission to empower the public to take charge of their finances. She’s a speaker, she’s an author, a financial advisor, a wish activist, financial literacy advocate, innovation and communication tragic.
Fraser Jack: [00:54] In this episode, we unpack her journey to setting up her very own unique financial advice business called Caboodle Financial Services. Our chat with her covers all things from goals-based advice and also takes a glimpse into her future of vision of the advice/client relationship. It’s a great conversation and I’m sure you’ll get a lot out of it. I’d like to welcome to the show Peita Dimantidis.
Fraser Jack: [01:21] Thanks for coming on the show, Peita.
Peita Diamanti: [01:24] Thank you for having me.
Fraser Jack: [01:25] It’s a pleasure. Thought I might just quickly start with you and your business and where you’re up to right now. Do you want to give us a quick overview?
Peita Diamanti: [01:35] Yeah, so our business is called Caboodle Financial Services. That’s the advice business where the clients sit. We’ve been around a while now. It’s well over a decade, which makes me feel a little old, to be frank. I need to be a young whippersnapper in this industry.
Fraser Jack: [01:49] You are.
Peita Diamanti: [01:49] How did I suddenly get old? But the practice actually specializes in working with sort of the reactive part of the client base. I guess the other word people use is passive, but I think reactive might be more appropriate. I think these people sit there and maybe don’t do anything, but when something triggers them they do, and that’s when they react.
Peita Diamanti: [02:14] So, we actually partner with other planners to take over those clients. What it means is we’ve really specialized in the engagement part of working with clients because we’ve sort of got to get them to do more than just react.
Fraser Jack: [02:28] So what you’re saying is you’re actually treating your clients like they’re human beings. Sounds like they’re reacting-
Peita Diamanti: [02:34] Exactly. Exactly. It really does require ... and as somebody whose background is actuarial studies, then thinking less about the numbers and more about the people has certainly been a change in the way that I’ve approached things, but we’ve had to because that’s what they need from us.
Fraser Jack: [02:51] That doesn’t add up, does it, actuarial studies followed by ... Yeah, okay, anyway. But you’re also doing a fair bit of speaking and that sort of stuff at the moment as well, aren’t you?
Peita Diamanti: [02:58] Yeah. Part of it was actually driven by this client base, so part of it was we recognized to connect with them better we needed to find other ways to connect. Podcasts like this are a good way to do it, getting in people’s ears, but another way is to get in front of them.
Peita Diamanti: [03:13] I had already started doing a little bit of presenting within the industry. People might have seen me at a PD day or something like that, but we decided to go a bit hard and present outside the industry and so sort of viewed as a TED Talk style sort of presenter, and so we’re still evolving that, which is fun. And a little different.
Peita Diamanti: [03:31] When you’re presenting in the industry, there’s always a friendly face, like you always know somebody in the audience, whereas presenting out of it, it’s a room of a few hundred people and you have no idea how they’re going to respond to what you say, so it’s pretty exciting.
Fraser Jack: [03:42] Yeah, exciting, and also you did say fun and different, and having seen you speak a few things, I would have to say fun, different. It’s a good way of summing that up.
Fraser Jack: [03:52] So, that’s where you are now, but tell us about how you got here. How did you create this and how did you think of it and start it and get here?
Peita Diamanti: [04:00] Yeah, look, as a lot of what we do we’ve discovered, even though some of it looks like intent, is actually quite accidental. So I had been working in investment banking, for many reasons decided I needed to get a life. I just came across the concept of advice is something that would use the skills that I used in investment banking just for smaller dollars, to be honest, and so when I was working in the first practice that I was lucky enough to get a position in, it was really clear that they were being told to focus on the top end of their business, or their niche, and then get rid of the others, but nobody really had a solution for the others, you know, the rest of the public.
Peita Diamanti: [04:36] So that’s actually how the concept started was how are we going to do that? How are we going to connect with the majority of the public but the ones that aren’t those sweet spot sort of clients that most advisors deal with?
Peita Diamanti: [04:49] Way back then, actually, we saw that as a tech play, interestingly. That’s evolved, and I’ve changed my view, but we saw it as a business that was going to have to use a lot of technology because we were going to be, one, a high touch service that was actually sort of not expensive to deliver, so it was we knew we’d have to get quite effective and efficient.
Peita Diamanti: [05:06] But that’s sort of where we started from and then we’ve worked out over time that actually while you might use technology to deliver it, the engagement piece is the magic pill. If you can get that right, if you can really connect with them on a human level, that’s what’s going to work and the technology’s just a way to get there.
Fraser Jack: [05:26] Yeah, that’s really interesting. Like you mentioned, you pivoted away from your original concept. Is that fair to say?
Peita Diamanti: [05:33] Yeah, and we’ve done that over time continually. I think we have an overarching sort of empowerment agenda. We’re sort of of a view that we just want to empower people that actually make decisions for themselves, and the way we do that has definitely changed.
Peita Diamanti: [05:51] And it’s just about learning more. I think we all make decisions for our businesses in somewhat of a bubble, often, and it’s not until we start to see more inexperience, like, “Oh, well hold on, maybe that’s not actually the challenge here, maybe we need to go a bit deeper or broader or see it from a completely different angle.”
Peita Diamanti: [06:09] So we did looked at technology as the solution. We just weren’t going deep enough. I think it was a bit superficial and we needed to go deeper and understand more about why these people were purely reactive, what had an industry done for decades that meant they sat back and weren’t participating? I think that just evolves from bothering to understand a bit more.
Fraser Jack: [06:30] Yeah, sure. Now, I’m going to take you back a little bit further to when you first opened your doors or started your business. How did that come about with regards to just one business that you were looking at taking some non-converted clients, if you want to call them that, or [crosstalk 00:06:44]?
Peita Diamanti: [06:4] In fact what we did was, like many people have before me, we ended up purchasing a book to start the business.
Peita Diamanti: [06:52] Ideally what was great about that is, of course, most financial planning books, if you take a look at a portfolio of clients, have a lot of those reactive funds in them, so actually it worked well, and so we knew we needed to start and we knew that we needed some economies of scale to do that, and so we’ve actually had acquisition as a strategy to get enough economies of scale size to truly be able to test engagement concepts and technology concepts on clients.
Peita Diamanti: [07:21] So, yeah, we just went, all right, we’ll get a book and we’ll just get started. Let’s get our hands dirty and test some things that we’d purely been imagining on a piece of paper.
Fraser Jack: [07:32] So was it really just sort of dive in and see what happens, or-
Peita Diamanti: [07:33] Yeah, absolutely. Oh, hundred percent. I mean, sorry, there was lots of conversations and lots of discussions over red wine and imagining what it’d be like, but truly, until you start actually working with any type of client, really, or the public, they just surprise you all the time.
Peita Diamanti: [07:50] Look, they surprise you because you’ve pigeonholed an answer, or you’ve pigeonholed a solution, but actually when you reflect later you’re like, “Actually, I should’ve been able to predict that if I’d really come at it from a human angle.”
Fraser Jack: [08:01] Sure, so there’s no silver bullet, if you like, for starting a practice. It’s really getting your hands dirty.
Peita Diamanti: [08:07] I think it is, yeah.
Fraser Jack: [08:08] Great, okay. So you’ve obviously come a long way, and you mentioned you’ve been acquiring businesses along the way. How many of those acquisitions have you made?
Peita Diamanti: [08:19] They vary in size, so the number’s going to sound really big, but actually it can be quite a small portfolio that we’ve taken on, but I think we’ve just done our 14th.
Fraser Jack: [08:28] Wow.
Peita Diamanti: [08:29] But that could be just 50 clients, some of them, in a small little portfolio, so it’s fair to say that we’re getting quite efficient at the process of transferring of books to have a very firm view on how badly that is done for both the businesses and the clients and how inefficient our industry is with that stuff.
Peita Diamanti: [08:53] Systems and commissions and all that sort of stuff, the way things get paid, the way we get product information, we experience that regularly and it’s pretty awful.
Fraser Jack: [09:02] Yeah, it sounds like there’s going to be a bit more of that going on within the industry over the next few years. Sounds like there’ll be quite a few headaches to come.
Peita Diamanti: [09:10] Yeah, I think so. I think big data and things like that is often used to describe stuff that is exciting and inventive, when actually I’m secretly hoping they start apply some of the smarts to some of these problems we’ve all had for four decades. It’s like, can we just fix the fact that I can’t get data feeds for every product? Like, that would be awesome.
Fraser Jack: [09:35] Sounds like everyone’s speaking different languages in that space.
Peita Diamanti: [09:38] Yeah, they really are. They really are.
Fraser Jack: [09:40] Very good, okay. So the business, now growing. What size is it now? How many clients do you think you’ve got?
Peita Diamanti: [09:49] We’ve got, and they vary in types of clients. Some are just we keep in touch with them via phone and some are full advice, but we have about 5,000.
Fraser Jack: [09:59] Wow.
Peita Diamanti: [10:03] In fact with the changes in corporate super, it’s probably a bit less than that now, a chunk less than that now. The changes in corporate super meant that those really aren’t relationships that we hold anymore, so certain providers sort of just moved those clients away, put them in other products, so the number will be a bit lower than that, but, look, that’s a ballpark.
Fraser Jack: [10:23] Yeah, it’s a really interesting thing for me the idea of ownership of clients, obviously that nobody owns another person, but certainly the ownership of the responsibility to provide an ongoing service and relationship with those clients is what you were talking about there, and it’s interesting things changing in the way that requires asking advisors to do things or not.
Peita Diamanti: [10:46] Yeah, I was chatting to somebody yesterday and I’m really seeing a shift in how I think we as advisors are behaving here, because if you think about it, even the ones that have their own license, like we do, or even who have their practice but it was within a dealer group, we were sort of treated as employees. Like, the behavior was such that you were subordinated and treated as employees, whereas what I’m seeing now is a shift to being entrepreneurs, truly being that.
Peita Diamanti: [11:16] I think that’s necessary, but it’s a big shift, and I think that’s reflected in a whole lot of these issues, and it’s caused us all to rethink, well, actually, what is the relationship with a product provider? Now, in any other industry ...
Peita Diamanti: [11:32] You know my husband’s a chippy, and he owns a building firm. His suppliers are suppliers. They don’t define process. So I think there’s a dynamic there that I think will shift over time in the industry as changes come in, and therefore things that have happened before that were sort of a carte blanche decision that potentially wasn’t connected to what the client needed, and certainly wasn’t reflective of what maybe the advisor would’ve wanted, I think that’ll change.
Fraser Jack: [12:05] Yeah, I completely agree, and tell me, is that some of the reasoning why you [inaudible 00:12:05] your own license path?
Peita Diamanti: [12:08] Yeah, look, as you’d guess, just from the description, our business is quite different and has to be different [inaudible 00:12:14] work with us [inaudible 00:12:14] the clients to be as proactive. We call every client every six months, we really want to do things quite differently, then it means that you don’t necessarily fit within the box of a dealer group, and that’s fair enough.
Peita Diamanti: [12:25] They sort of love us because we’re really annually retentive, we’re really organized, we don’t do complex advice, we’re not into all SMSFs or share trading or anything like that, so from a compliance perspective there was never a concern, but they always struggled with the fact that we just did things differently.
Peita Diamanti: [12:40] So it was a square peg in a ... Well, actually it was a frigging star peg in a square hole. We just were never going to fit no matter how enthusiastic they were or we were. It just made sense that we’d be a bit more self-determined.
Fraser Jack: [13:00] Why does that not surprise me? Having known you for a while, I couldn’t imagine there’s any box that you want to try and fit into. You want to try and create your own star shaped box.
Peita Diamanti: [13:11] Absolutely, and look, I think the point I was making about entrepreneurial thinking, I think it’s probably something that we’ve been ... it’s almost been a black mark on advisors, so if you’re in a dealer group and you do have that style where you’re creating new, challenging the way of doing things, sort of reaching forward a little to imagine how things could be done, that actually wasn’t necessarily rewarded, and I think that’s got to shift because that’s how breakthroughs happen.
Peita Diamanti: [13:38] And so I think there’ll be more of us, and given what’s going on with licensing and things like that, I think there’ll probably almost definitely will be.
Fraser Jack: [13:46] Very good. Now I want to try and shift the focus a little bit towards your clients and the people that you look after. Because there’s 5,000 of them and there’s not that many of you there in the office.
Peita Diamanti: [14:00] Sure.
Fraser Jack: [14:00] I’m just wondering how you go about looking after those and engaging and getting clients to actually chat to you or talk to you.
Peita Diamanti: [14:09] So what we’ve done is, and this has evolved over time, we did what everybody imagines you do, so when we first got the portfolio early, on all those years ago, we did the things we ... We offered super consolidations, like every campaign any advisor has every thought of we did. And what we realized was, what would happen is you’d actually get some traction, so you’d get some people responding, but then the minute they had to do something they dropped off. So you got a reaction, but you didn’t get a resolution.
Peita Diamanti: [14:40] What we’ve developed over time is this client journey, and so we’ve looked at how somebody interacts with any type of service, really, or makes progress in their behaviors, and we’ve sort of drawn a client journey and literally the first thing we want to do is get a call back, so we actually measure to that degree their responsiveness.
Peita Diamanti: [15:01] Then it’s about their willingness to give us an email. Then it’s about their willingness to interact about their life, and I’m talking light chat here. You know, it’s the son’s 21st, it’s that sort of stuff. Then it’s about being part of the community, so it’s taking some small actions. It might be a 30-day challenge we’ve got for people or something free that they can just do and take part, and way over on the edge is actually getting advice. Whereas I think in most practices, that’s the thing they measure is how many people are we getting taking new advice or maybe delivering SOAs too, that’s a common pressure, that’s almost an afterthought for us.
Peita Diamanti: [15:36] So we’re more about I’d prefer to get all of them taking a small step than 1% going all the way through to advice, and so, like I said, we call every client every six months, and that was a conscious decision because I think that online and email and all sorts of technology is great, but conversation is where you get connection, and so we wanted to make sure we always underpinned whatever relationship we had these people was some sort of conversation.
Peita Diamanti: [16:06] Now that can be phone, it can be Skype, it could be face-to-face, and we have a mix of all of that, but that’s how we serve. That’s the underpin of the relationship. As anybody knows, we’ve all had those email trial conversations where they’ve gone on for 47 times and if you actually just make a call it gets done in five minutes, so we sort of establish that early on.
Fraser Jack: [16:31] It’s very interesting, isn’t it, trying to get people to be motivated to do something and then that motivation or even the momentum, it sounds like you’ve really worked on the idea of the momentum, trying to move them a little bit first and then slowly get them towards where you want them to be and that conversation.
Fraser Jack: [16:49] I really like the idea that you treat that as a relationship, because a lot of the time we get to this, you know, they’re a client, not necessarily a human, and we almost use the word client in a way that puts a barrier between us and them.
Peita Diamanti: [17:04] And in fact I had a really funny conversation with a good friend of mine and, look, a number of my friends are the sort that you have a lot of funny conversations with. We’re all a bit batshit crazy, so it’s always a bit unusual. And we were talking about this concept of client journeys and the way that it’s easy just to focus on the people that are going to be the ones that go to advice. Like it’s natural as advisors, it’s like, “Oh, I just want to talk to the people that are ready, that are right there, and I’m not going to look at them all as somebody that I could just move a little bit, that I could just interact with and have some sort of relationship with. It doesn’t have to be the extreme.”
Peita Diamanti: [17:38] Her analogy was it’s exactly like being in this world of dating. Some people only see the people that are potential marriage prospects. Like, that’s it. That’s all they see. And they can’t see anybody else that might just be a great mate to have, or somebody that’s nice to chat to at work functions, or somebody that’s nice. All they see is that single thing, and it means you miss out. And sometimes a person comes to your life just to be that friend that gets you through a situation or a particular issue. They’re not going to be your lifelong partner.
Peita Diamanti: [18:08] So it was an interesting analogy, and I think there are lots of gradients of relationship and lots of gradients of client relationship, there’s just not one type.
Fraser Jack: [18:19] Right, so financial dating. We’ll have to mark that one down as a new term.
Fraser Jack: [18:26] So, you’re a goals-based advisor, you love to talk to your clients about their goals and dreams and aspirations, and in fact you do a lot of work in that space. What does that mean to your clients, a goals-based advisor?
Peita Diamanti: [18:38] For our clients, actually to them it means there’s a whole lot of goals and less advice, because the goals part is hard, right? So to me, advice often involves a technical solution. It could be strategy, it could be product, it could be anything, but it’s a technical solution, it’s where we use our nerd to fill a need.
Peita Diamanti: [19:01] But the goals thing is the hard part. That’s in fact where the presenting came from, it’s where we’re developing a whole lot of content, and in fact ourselves will be launching in the next couple of months a podcast to engage with people, because most of us aren’t goals-driven in life, just generally.
Fraser Jack: [19:21] Yeah, absolutely. There’s very few financial goals or goals written down and tracked in those sort of areas.
Peita Diamanti: [19:27] Or any goals about anything, really, and so most of us are the human hamster. We’re just in the wheel. We eat, we sleep, we work, once in a while we might even get a holiday, often that’s by accident, or it’s late and we really should. Like, there’s not a lot of purpose to the way people live.
Peita Diamanti: [19:47] And, look, I fell firmly into that category my entire investment banking career and the years I worked there were that type. I was just surviving. There was no thriving going on at all, and that’s normal, that’s most of the populous, but it makes it therefore difficult to be motivated to change behaviors, to be motivated to achieve something because you’re just stuck in the wheel. That’s why we’ve sort of shifted a lot of energy to the beginning of that goals-based advice expression which is, how do you help them actually work towards goals?
Peita Diamanti: [20:19] In fact, we use the word dreams only because, for me, a goal is more like a milestone. A goal is 20 reps of something when you’re at the gym, or an amount saved. That to me is a goal. Whereas a dream has texture and flavor and sounds and smells and tastes, so it’s an experience, and that drives you. Lots of people can be driven by that to succeed, whereas a flag doesn’t drive many people.
Fraser Jack: [20:48] That’s right. I really love the idea, too, that with dreams and aspirations and those sorts of things, there’s less boundaries, there’s less rules, there’s less reality filters in place and people can actually experience that richness of the dream without actually having them saying, “Oh, it’s not achievable,” and putting a red flag up.
Peita Diamanti: [21:04] Absolutely, and I think in life things aren’t linear, whereas a really specific goal is very linear. It’s out there, I’m here, how do I get between here and there? Whereas we all know you just get thrown all sorts of curve balls in life, and so if you have a dream that has texture, then you can adjust curve balls and you can still achieve that dream, whereas I think lots of us get knocked off the goal, understandably, and therefore automatic reaction is to just stop, give up, procrastinate.
Fraser Jack: [21:39] So when you’re with a client, or you’re talking to somebody, and they’re struggling with the concept of what they’re goals and dreams are, what sort of conversation do you have with them to [crosstalk 00:21:49]?
Peita Diamanti: [21:50] We actually take them a step back. We get them to start to build their dream muscles, so this is literally a skill you’ve got to build.
Peita Diamanti: [21:58] Most of us don’t see opportunity, chances or dreams out there. It’s not the way we’re wired, and it starts back when you’re a kid. So, anybody with children will do the, “Oh, don’t climb up on that because you might hurt yourself,” and you’re kid’ll say, “I’m going to be an astronaut.” “That’s lovely, darling, but do you really think you can [inaudible 00:22:18] the size to get in that ...?”
Peita Diamanti: [22:18] Like, we’re protecting them, but what we’re doing them is teaching them that dreams aren’t achievable, subconsciously, and so we actually need to build that dream muscle for people again. We need to help them think bigger and think broader and start to see stuff, start to see all the opportunities out there, so we literally just get them to write all these things down. It’s not a bucket list, it’s sort of broader than that. It’s just things that interest you, things you see and go, “Maybe one day I want to do that, I don’t know.” So we just get them to start building that.
Peita Diamanti: [22:50] As you start doing it, then you start to see more of them. It’s like when you get a type of dog and then all of a sudden ... Like, we got a Staffy and all of a sudden I saw Staffies everywhere. It’s an awareness thing. Dreams are like that. You’ve got to start to just collect them and then you start to see more of them.
Fraser Jack: [23:08] Yeah, it’s interesting, isn’t it?
Peita Diamanti: [23:08] [crosstalk 00:23:08] list.
Fraser Jack: [23:08] I heard a saying the other day that adults are just children that have had that reality kicked out of themself.
Peita Diamanti: [23:12] Right, and it’s so true. As advisors, if we’re asking people to say, “Hey, I want to do this particular thing, this big dream, this big goal, and I want to work to it,” well, when you do that, what you should be doing is selecting from a range of opportunities, but most people haven’t yet developed their imagination capital they need to actually be able to even come up with the range of opportunities, let alone pick one.
Fraser Jack: [23:38] Is is that they haven’t developed it or they used to have it and then they squashed it?
Peita Diamanti: [23:41] They’ve denied it. Yeah, we’ve all denied ... You know, in life we’re not rewarded for that stuff. Dreamer, being a dreamer is seen as a bad thing, so it’s sort of rewiring that thinking. It’s literally just giving them a notebook that they keep with themselves all the time and they just write stuff down. You know, look, “Oh, I’ve always wanted to do Vivid at Taronga Zoo,” so they just start collecting that stuff.
Fraser Jack: [24:05] How much time do you think that would take for advisors trying to elicit that goal or elicit the information out of them?
Peita Diamanti: [24:13] Look, you can certainly ... I mean, at the end of one of the presentations I do to the public, I have a seven-day dream challenge, and people can come up with over 50 of them as part of that challenge, so if you dedicate some energy to it and some fun, to be honest, you can draw those out quickly.
Peita Diamanti: [24:30] But if you wanted to start to get them to the point where it’s getting a little bit richer, they’re almost subconsciously starting to categorize them in their brain, because what we’re doing is help them build a list and then we’re going to start teaching them how to turn some of those into reality, then you probably do need at least a few months, I think, to be doing that and helping them to break free of the societal dreams, so the things that we’re all expected to want to do.
Peita Diamanti: [24:56] That’s actually, for some people, the hardest part, is the white picket fence, the 2.5 kids, the corporate job. They just can’t get their head outside of that. And so for some of them we have to push harder and harder until you get that secret thing that they’ve always wanted to do. When you crack that, when you get your first one of those, that’s when you know they’re actually rewired. They’re starting to realize this is their choice.
Fraser Jack: [25:24] Yeah, it feels a bit like they get permission to allow their dreams to be true not just what they’re expected [crosstalk 00:25:30].
Peita Diamanti: [25:30] Exactly, and what’s funny with a lot of those dreams is, and in fact it’s not funny at all, to be frank, is that they’re not realistic.
Peita Diamanti: [25:39] So, Sydney, right? I live in Sydney. I live in the inner west. We were looking at the moment at ... We’d been renting for a while because we’d sold a property, and like little single-fronted sort of duplexes, terrace-y sort of things. 1.7 million.
Peita Diamanti: [25:58] Now, that’s just idiotic. And when you think about the typical Australian dream or the thing that young couples maybe would be working towards, 1.7 million isn’t realistic. But that’s the house we’re talking ... We’re talking about these tiny little house.
Peita Diamanti: [26:14] So those things that society, advertising, even big financial institutions are sort of setting as that conditioning of what we’re working towards isn’t realistic anyway, so I actually think we’re setting people up to fail if we don’t get them reconsidering actually what they want ... society wants, not what their parents want.
Fraser Jack: [26:34] Yes. Didn’t we all grow up wanting a $1.5 million loan? No, is that what [crosstalk 00:26:38]
Peita Diamanti: [26:38] What? Like, its insane! It’s truly ridiculous, and I think we get so conditioned we don’t even ... I don’t think people even acknowledge. Like, they say 1.7. 1.7 million. I feel like actually we need to start putting all the zeroes on the end of things so that we all acknowledge how ludicrous this is.
Fraser Jack: [26:59] Yeah, I agree.
Peita Diamanti: [27:01] Is it the market value? Yes, I’m not discounting that. I’m not saying that it’s overpriced. It’s not about that, it’s just it’s a lot of money.
Fraser Jack: [27:07] It is a lot of money.
Fraser Jack: [27:10] All right, I might move us back towards the financial advice practice and have a talk about what you think the financial advice practice of the future’s going to look like.
Peita Diamanti: [27:20] Yeah. I can sort of see it ... it’s not a split, but I can see things moving. So at the moment, there might be lots of types of advisors, but the way in which we operate and the type of work we do with clients is quite similar.
Peita Diamanti: [27:35] I can see that splitting, and I can see it splitting into sort of two key elements, one being technical. So technical advice, responding to all the changes announced in the budget about super, so really deeply technical. Think a tax accountant. That type of person.
Peita Diamanti: [27:51] And then the other side would be lifestyle architects, people that work with the public to build the life. Like, what do you want to do, where do you want to be going, how do you plan that out? And I’m talking not just planning it out from a financial sense, just strategic thinking, critical thinking, how do you get there where the challenge is going to be? So it’s sort of that coaching, almost leadership element, and then the technical. I see those two things splitting.
Peita Diamanti: [28:17] Some people will do both, but I think it’ll get harder and harder to do both because they will both require some dedicated skills that I think will be harder to retain across the board.
Fraser Jack: [28:29] Yeah, certainly I think that what you’re talking about there is a communication and motivation type role of a person, then the technical strategy conversation [crosstalk 00:28:38].
Peita Diamanti: [28:38] Yeah, exactly.
Fraser Jack: [28:39] Obviously the industry’s heading towards profession and profession is looking at that technical side. Do you think it’s missing that motivational or coaching side of it?
Peita Diamanti: [28:48] A hundred percent. I mean, I look at myself. I’ve got a deep background in nerdy financial mathematics, that sort of thing, and my biggest gap is, in terms of training, is that coaching side, and it’s hard to find, to be frank. It’s actually hard to fill the gap. There is some behavioral economic stuff out there, it’s very ...
Peita Diamanti: [29:08] I think the difficulty is most of it is connected purely to money, when in reality it’s ... I mean, when I talk to people, or even when I talk to friends that ask me for advice, a lot of it is the critical thinking. How do you work through a problem and help them get to a solution? And you’re not telling them the answer, you’re helping them get to it themselves, and there’s nuance to that skill.
Fraser Jack: [29:33] Yeah, I definitely agree there’s a piece of work that needs to be looked at there where you talk about actually doing with the client and bringing them on the journey and not just sort of being the person that tells them what to do.
Peita Diamanti: [29:44] Yeah, and I think empowerment is a really interesting thing. So as an industry, I think we tell a lot. We tell in the way we provide advice. It’s literally a document lays out what we think they should do, and understandably. We tell them the way we communicate. You should. There’s almost guilt in a lot of the way we communicate with the public in general, you know, advertising and things like that, whereas we’ve shifted.
Peita Diamanti: [30:05] I think a lot of people end up shifting more to this empowerment piece, and that’s sort of two elements that’s inspiration, so it’s like a moment of inspiration. And then the motivation. So keeping them on track and keeping them going, and none of that requires my actuality degree, I might add. That’s what’s interesting.
Peita Diamanti: [30:22] So I don’t have any issues with the education standards particularly, as a broad sense. It’s always down to the implementation, but as a broad sense I don’t. I think the challenge is we could be doubling down on the very skills we need less of and missing the opportunity. It would’ve been a glorious opportunity to actually delve into this human element and force a whole lot of advisors to get those kills. That would’ve been magical. Hard, and we would’ve all struggled a little bit, but it would’ve potentially transformed the industry.
Fraser Jack: [30:53] Yeah, I agree. Now, speaking of those magical skills that you have, we’re also going to be doing some recordings, coming to offices and recording advisors. Would you be willing to be one of those guinea pigs?
Peita Diamanti: [31:04] Yeah, absolutely, absolutely. It’ll be fun.
Fraser Jack: [31:07] We’ll stick that up also on the academy as we produce those.
Fraser Jack: [31:10] So I might quickly look at the time. We’re quickly running out of time, as we can chat for hours, but I wanted to ask you final five questions. I want you to tell me, because you mentioned a friend of yours just a second go, but if you had a friend, who I’m sure you do, who is a consumer and just wanting or thinking about getting financial advice, what would be your top tip for them?
Peita Diamanti: [31:39] I’d get them to truly think about why. What’s prompted you to do it and why are you doing it? And the reason I say that is the why can help determine what type of person you should work with.
Peita Diamanti: [31:50] So, if the why is, I’m irritated about tax and I want to do something specific, then clearly you can get an advisor that will match that, that’s that technical, whereas if the why is just general dissatisfaction with how you behave with money or frustration or a lack of understanding, so understanding why you’re doing it will then help you get a better match in terms of the advisor you find.
Peita Diamanti: [32:16] Because if you can enunciate that to people, then the right one will start talking you through how they can resolve that for you and you’ll get a better match in the end result, whereas I think a lot of people dive into the technical not understanding their why, and therefore they might get a result and it might even put them in a better position, but I don’t think it satisfies that need they had.
Fraser Jack: [32:39] So you think they might go too granular just on want to solve this small problem.
Peita Diamanti: [32:42] A hundred percent. A hundred percent. And they don’t actually change their behaviors or feel more confident about their money. I find often the why is about confidence.
Fraser Jack: [32:54] Great. Now, tell me what’s your top tip for a friend of yours who is just wanting to start out a financial advice business?
Peita Diamanti: [33:01] I think, early on, I would give some good consideration to the client journey. I think there’s a lot of information out there about the compliance, about the steps we take for advice, but that’s our steps. So I think if somebody’s starting out, if they could just start white-boarding or [inaudible 00:33:22] mapping what experience they want the client to have, or the public, and really mapping out the small steps in that, so not viewing it as a single outcome, viewing it as a journey, I think that could potentially change the dealer group they go with, the system they use, the staff they get, maybe even the skills they’re trying to develop.
Peita Diamanti: [33:42] If you can look at the experience you want the public to have, you’ll start to see some gaps that you can fill, and it’ll probably, in fact I’ll almost guarantee, that they’ll end up with a very different business than they would’ve, had they just started and then having to do, like we did, change the business down the track.
Fraser Jack: [33:59] Yeah, so starting with the client journey I think is a great idea, and actually even running that past a few consumers that don’t have advice and seeing how they feel about it.
Peita Diamanti: [34:08] Oh, hundred percent. I mean, the best feedback or survey you can do is getting 10 people who are potentially a sweet spot in terms of the sort of demographic, getting them to the pub and just chatting to them about what you’re doing, letting them converse about it.
Peita Diamanti: [34:23] I mean, the mistake most people do with this is they just talk. This is what I want to do, and they tell, instead of just prompting conversation and asking some interesting and open questions, and sometimes you’ll find that that journey that you laid out is actually step 47 and you’ve missed the first 46 steps you should’ve put in the journey, and it’s quite common. I think we dive in and really don’t consider some of the value we could give that’s quite simple.
Fraser Jack: [34:49] Excellent, and I love the idea that it’s all done at the pub too. That’s a great idea.
Fraser Jack: [34:54] All right, so, Peita, you’re at the pub and you’re chatting to an existing advisor who runs a fairly traditional advice practice looking at getting into more of a goals-based advice business. What’s your advice to them?
Peita Diamanti: [35:07] Well, honestly I think we probably need to ... This is one of those situations where you need to be doing it yourself. You can’t be that person that’s a great doctor that’s unfit and unhealthy, so I think if you are thinking about going down the goals-based advisor path, I think you need to get a hold of your own dreaming and your own goals and understanding, and really critically looking at that experience, so turning that tap on and then watching the challenges you have, the barriers, the mental dialog, so, “Oh, no, I could never do that. Hold on, why did I think that?” So, I’d start with yourself.
Peita Diamanti: [35:43] Next I’d start with your team. This would be a great thing to do with your team, to work on their goals or where they’re going, what dreams they have. That process in and of itself will help you build out however you’re going to roll it out for the public. But you’ll learn a lot about the barriers, the challenges and what might actually hold people up, and I think actually you will connect much better if you can share your own as you’re interacting with people. Dreams are a great way to connect.
Peita Diamanti: [36:11] I was presenting at a session talking about dreams and the fact that we need to build this dream muscle, and there was a person in the audience who I knew from the industry but didn’t know well. When I did this presentation, I happened to mention some of my dreams. I always go a bit hard on the geeky ones, it gets a laugh, but they’re honestly things that I’d love to do.
Peita Diamanti: [36:32] I finished the presentation, we went to the break, and I’m standing there about to pick up a scone, as we all do, and this guy came running across the room and nearly crash-tackled me. “That’s exactly what I want to do!” He was so excited that there was another human being as dorky as him that wanted to take on those dreams.
Peita Diamanti: [36:53] I think it makes us more human and it makes us more able to connect, so any person considering doing dreams-based advice, do your own.
Fraser Jack: [37:00] Great advice, thank you. I’m going to take you back to the pub this time with an accountant and the mortgage broker friend of yours, and just what would you say to them about how you can work together and how they can work in the space as well with you?
Peita Diamanti: [37:14] So, in terms of interacting with advisors in this space?
Fraser Jack: [37:17] Yeah.
Peita Diamanti: [37:17] I think there’s a more natural fit for mortgage brokers. That makes a lot of sense, because a lot of people do have a dream of buying their own home, or certainly property, so I think there’s some magical stuff where you can get quite creative about the way you do that in terms of the dreams you inspire in people. So, should they be owning property here, should it be with friends? You can really open people’s eyes to all the opportunities. So I think from a mortgage broker angle, that seems natural to me, actually. That’s a natural connection.
Peita Diamanti: [37:51] I think from an accounting perspective what’s interesting is it will require a shift for accountants because they are trained to look back, so what an accounting, what a P&L, what a balance sheet, all those things do is look back and measure. They do less of looking forward and imagine.
Peita Diamanti: [38:07] So I think that requires an understanding of that difference and where they fit and potentially engaging the accountants in the actual helping people track goals and track dreams, because it will be natural to them. It’s what they do. They measure and they record, and so you’re sort of empowering them to acknowledge that’s what they’re good at and bringing them into that part of the process. But then I’d also want to unleash their inner dream a little and getting them and their team thinking about the things they want to do, just personally or even professionally.
Peita Diamanti: [38:39] So, just like I said about for a practice rolling it in, you’d do it yourself. I think if you have business partnerships who are looking at that, you’d want to dreamify them, you’d want to have them and their team getting this. They’re never going to be able to get excited for their clients with their clients to take part in this until they’re doing it themselves.
Fraser Jack: [38:58] Yep, fair enough. And my final question of the day, I’ve sort of nearly running out of time, I just want you to tell me, if you could go back in time, any time, give yourself some advice, what would that be?
Peita Diamanti: [39:11] I don’t believe in regrets, so I figure our lives are our path because that’s what makes us. However, there is one point in time, and it’s actually dream-connected. When I was working as investment banker, I had some clients who were ... can’t tell you who they are but they’re some people that the sort of investment name that you’d know, and they actually had court-side tickets to the Bulls. This was when Pippen and Jordan were playing. And I was given the opportunity to go over to Chicago and sit court-side and watch those two men play, and I didn’t take it. I was busy, it would’ve been hard, I was the human hamster.
Peita Diamanti: [39:54] If I could back in time, I would slap myself silly and then say, “This is one of those chances. This actually has been a dream of yours. You need to learn to take those chances.” And I think that’s something that we all don’t do enough of. We don’t leap when those chances are given to us.
Fraser Jack: [40:15] I do feel that that may have actually motivated you in your current life to leap at all these opportunities that are available.
Peita Diamanti: [40:21] Yeah, and I think also set yourself up so you can. I actually think as advisors, something we can do is actually give people the foundation so that when they have an opportunity to go and see a friend marry in Helsinki, which I just did, you can. It’s not something that derails your life, derails your financial situation. You can do it.
Peita Diamanti: [40:40] So I think that flexibility to be able to leap is a gift, if we can set clients up for that, and to me that’s the ultimate extension of goals-based advice, is where in fact it almost is any goal advice. It means no matter what comes up, we’re going to be able to help you get there because we’ve given you that foundation that’s strong enough to power through it.
Fraser Jack: [41:02] Okay, we’re going to have to leave it there, Peita. Thank you so much for coming on the show today. I really appreciate it.
Peita Diamanti: [41:07] Not at all, super fun.
Fraser Jack: [41:09] And we’ll look forward to recording a video with you and sticking it up on-
Peita Diamanti: [41:12] Yeah, I’ll look forward to seeing you then.
Fraser Jack: [41:14] Great. Okay. Thanks, Peita.
Peita Diamanti: [41:15] Thank you.
Fraser Jack: [41:16] See you.
Fraser Jack: [41:18] If you haven’t already, I’d love you to subscribe to the podcast on your podcast platform of choice, and to continue the conversation, head over to our social media channels. We’ll catch you next time.
Disclaimer: This document is a transcription obtained through a third party. There is no claim to accuracy on the content provided in this document, and divergence from the audio file are to be expected. As a transcription, this is not a legal document in itself, and should not be considered binding to advice intelligence, but merely a convenience for reference.