Doug Bennett

Welcome to the Financial Secrets Revealed podcast episode where Amanda Cassar introduces UK Financial Adviser, Doug Bennett. 

Doug is a laid-back kind of guy, who has definitely come through the school of hard knocks.  Following the receipt of an inheritance on the passing of his parents, Doug’s business was nearly wiped out by the Global Recession of 2008 and he found himself inventing imaginative ways to make ends meet.

We talk about his hard lessons, how he made it back from the brink of bankruptcy, to being financially free today to become an Author, Speaker and Host of the “Goals Do Come True” podcast.

Doug is the self-styled Director of Financial Freedom™ based in Crawley in the UK.

Doug is now married to the lovely Bonnie and has survived marriage breakdown in the past.   He has 2 adult sons and loves walking his dogs and connecting with friends on social platforms like Facebook.

His specialties include Lifestyle Financial Planning, Motivation, Inspiration and Goal Setting.

“Always put aside 15% of your income for the future.  Each pay packet is really to provide for 2 people.” – Doug Bennett

Links
Personal Financial Planning | DB Wealth Planning and Preservation (dbwpp.co.uk) (Company Website)

Doug Bennett – Financial Advisor and Speaker (Speaking Website)

(6) Doug Bennett | LinkedIn (LinkedIn profile)

Podcast – Doug Bennett (Goals Do Come True Podcast)

EP5: Taking Advantage Of Opportunities In Front Of You (buzzsprout.com) Joint Podcast Episode of Goals do Come True – Doug Bennett & Amanda Cassar 

Offer 

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Financial Secrets Revealed: Cassar, Amanda: Amazon.com.au: Books

Purchase your copy of the book on Booktopia:

Financial Secrets Revealed, Collective Wisdom from Business Gurus, Financial Geniuses and Everyday Heroes by Amanda Cassar | 9781925648546 | Booktopia

Purchase your copy of the book on Barnes & Noble:

Financial Secrets Revealed by Amanda Cassar, Paperback | Barnes & Noble® (barnesandnoble.com)

Follow 

Catch up with Amanda Cassar, host of Financial Secrets Revealed on Twitter and Instagram @financechicks or on LinkedIn at Amanda Cassar | LinkedIn

Websites: 

• https://amandacassar.com.au/ 
• https://www.wealthplanningpartners.com.au/ (company website)
• https://trustedagedcare.com.au/ (company website)

Or you can find Doug Bennett on Twitter at @financialdoug

Transcript

Intro: 0:05

Hi, I am Amanda Cassar and welcome to the Financial Secrets Revealed Podcast, where I have collected the wisdom from some amazing people around the world to understand better their money story. I have financial advisors, multimillion dollar corporate executives and those surviving on Centrelink. Even running global charities. I hope you enjoy listening to the episodes as I speak with these incredible people about their stories.

Amanda: 0:44

Hi, it is Amanda from Wealth Planning Partners, and I have dialing in all the way from Crawley UK, the lovely Doug Bennett from True Potential Wealth Management. You've you've tricked me, Doug, you were DB Financials that was so easy to remember so

Doug: 1:01

Well, you know, what can I say? When somebody makes you an offer that you can't refuse?

Amanda: 1:06

Yeah, well, you'd be silly to wouldn't you, so.

Doug: 1:09

Absolutely, absolutely.

Amanda: 1:10

Now, Doug, you and I were lucky enough to meet in Vancouver, Canada at an MDRT conference a few years ago, and have stayed in touch ever since being financial advisors and sadly like minded people.

Doug: 1:27

Sadly likeminded, no no, I think it's for the benefit of the world.

Amanda: 1:31

Well, that's what we try and do, isn't it? Absolutely. Absolutely. And I wanted after I heard your story to interview you for my book, plug plug, Financial Secrets Revealed. Because, you know, I suppose some people think us financial advisors, you must know everything. You've never missed a beat. Life, life's pretty cruisy. And, I think your journey has been anything but, so.

Doug: 1:56

Yeah, I would say it's been a bumpy ride.

Amanda: 1:58

Indeed. So you shared with me a little bit about your life growing up, you lost your parents when they were quite young. You're 1 of 4. Can you give us a little bit of an overview about family for you and how your life started out

Doug: 2:12

Yeah, okay. Well, my dad was in the armed forces for 24 years. And I'm the oldest of four of us. I've got a brother that's 14 months younger than me. I have to say, I believe I'm the brighter of the two of us. So, it turns out most of the schooling that we had was geared around me, you know, there's pivotal parts where you have a couple of years, and it turned out most of the, most of the tours that my father did, worked around my my schooling,

Amanda: 2:42

So you weren't an army brat following around everywhere. You stayed put?

Doug: 2:46

Yeah. Oh, no, no. We had, I had tours in Northern Ireland during the troubles. I lived in Germany on three occasions. Yeah. So we went everywhere, basically with him. So that that was quite cool. Then he joined the police, then suddenly, my mom got cancer. She died when she was 63. And then 12 weeks later, my dad died. Obviously, broken heart, I'm guessing, but he was only 64. That really, really changed my philosophy on things, you know.

Amanda: 3:20

Well, it must give you such a different perspective on your own personal longevity as well.

Doug: 3:25

Well, I'm a glass half full kind of guy. So you know, try to try to keep the pounds off. And try to live reasonably healthy. without becoming too boring.

Amanda: 3:38

I heard your wife would like you to eat more vegetables though.

Doug: 3:42

Yeah, definitely. Definitely. I'm a meat-but-no-vedge kind of guy, in that respect. Yeah so, the money was tight when we were growing up. My mom was looking after the four of us so it was just my dad's income. Philosophy was life's too short now. You know, and that's something I bring through to my clients as well. I like the live each day as if it's your last but plan is if you're going to live forever, which is a reasonably good philosophy, I think.

Amanda: 4:12

Absolutely. I don't think you're going to go wrong with that one. And you like a bit of adventuring. You've done Kilimanjaro, and you've riden motorbikes around the place. So you like to make the most of life as well.

Doug: 4:24

Well, absolutely. If somebody says, shall we, it's why not, you can find the money. And you'd be surprised where you find the money. If you, you know, if you're passionate enough about doing something, well just, you know, make sacrifices in other areas to be able to do things but life is all about experiences, so

Amanda: 4:40

It's meant to be lived. Absolutely. I agree. I agree. Now, one of the questions I asked everybody who I interviewed for the book was, what lessons do you remember either spoken or unspoken, when you were growing up from your parents, and was there anything that, that sprang to mind for you, and I'm guessing you were a one income family. Very traditional with mom raising the kids.

Doug: 5:03

Yeah, I mean, it just seemed that, you know, there was never much money around. I know they did their best come Christmas time. One time, we found all the presents, me and my brother found all the presents and we opened them and played with them and snuck them back in the boxes.

Amanda: 5:21

That's cheating.

Doug: 5:23

I know it's cheating but on Christmas Day, they had one over on us. Christmas Day, all the presents that we had were completely different. We found out much later, we had been playing with our mates toys.

Amanda: 5:34

Oh ok. That worked.

Doug: 5:34

So apparently, they swapped the presents over.

Amanda: 5:40

That worked. So you've ended up a mortgage broker and financial advisor, how did that journey start for you?

Doug: 5:49

Well, I worked for, they used to be called building societies back then. They'd collect the money and then lend it out. But yeah, they're all banks now. So I worked for the Halifax and worked up through, ended up working in London, which I didn't enjoy the commute, but I was a mortgage broker there. So that got me interested in arranging finance for people. And I always seem to do it right. There was lots of scandals back then with people selling endowment policies and the like, but I can never work out, you know, there were I was reasonably principled about, yeah, if you're going to sell an endowment policy, which is a savings plan to pay off your mortgage at the end of the term. You just do a top up to the existing ones. But it seems like all the brokers out there that were just you know, every two or three years rechurning and setting up a new one to get commission, but I could never work that one out. So.

Amanda: 6:42

Oh we've had on massive issues with churning in Australia under our royal commission. So it's a very familiar termf, more for insurers than endowments. But you obviously started at the bank, ended up self employed. I remember you saying it wasn't long after your parents had passed. And I think the GFC was about that time that you had your first huge setback. Can you talk us through what happened there?

Doug: 7:05

Well, yeah, I had set up my business. My parents had passed away, I got a reasonable inheritance from the sale of their property. Bonnie and I invested all of that into a new house, took on a really big mortgage, probably bigger than it should have been. That was, you know, comfortable. That was in sort of August 2007. And then it seemed like October, November 2007, the tap on.

Amanda: 7:34

It all went to pot.

Doug: 7:35

Yeah, It all went to pot. So there we were, I was doing probably before that 10 to 15 mortgages and the associated life insurance for my clients. And then in 2008, I think that was 10 to 15 a month. 2008. I think we did about 25 in the whole year. so.

Amanda: 7:57

A bit of dive in the income.

Doug: 7:58

It's a massive dive in the income with a massive mortgage. And yeah, we started maxing out credit cards, we rented rooms out to pilots because we live near near Gatwick Airport. We even rented our drive out for people to park while they went on holiday, which was like, err, you know, not so much boundaries.

Amanda: 8:16

Well you got very creative, getting extra income

Doug: 8:20

Yeah, yeah, it was stuff that you, one had to do in. basically to, to make ends meet. But we've got to 2010 and it was robbing Peter to pay Paul and, and it just got, there was no room anywhere for getting any more money. So at that point, it was, well, I've got a choice here. I can call it a day, I can hand the keys back on the house. We still had the other house which was fortunate so we could have moved back down to there could, I could have gone. You know, obviously if I'd gone bankrupt, I would have been now a financial services, that's for sure. But just just one thing, my Mum, I just wanted her to be proud of me and giving up at that point, not only would have made Bonnie unhappy, but it wouldn't, you know, my mom wouldn't have had any reason to be proud of me. So, so I sort of picked up on a few ideas go, you know, going back in my past, I'd been to the million dollar round table, which is where we'd met and I managed to renegotiate all my finances into one payment and went to MDRT actually in 2011 sort of just six months after I did the big tidy up and met a few really seriously cool people that gave me some belief in myself. And then yeah, here we are 10 years later and I've recently sold my business for a very very small fortune.

Amanda: 9:40

So I mean that's that's a pretty big journey emotionally to going from you said you sort of considering bankruptcy which would also mean the end of your career. So you're emotionally and financially maxed out,

Doug: 9:52

Battered.

Amanda: 9:53

Battered, and you talked about you met some great people who who helped you through so what sort of positive messages did you need to hear? You mentioned self belief that helped turn your outlook or turn things around for you.

Doug: 10:05

When you're not succeeding, and everybody needs that, they need to be able to succeed in something. But when you're not succeeding, it really just gives your confidence and major battering. Absolutely, it messes with your head, you spend all your time sort of looking at your finances, which doesn't improve it at all, you should be going out there. So, it's really a case of you do need to believe in yourself, it really helps if other people believe in you, too, because it's the opposite spiral, rather than the downward spiral, you can start your upward spiral. And I think it's important to surround yourself with people that are positive. Quite apart from anything else, if you're miserable, nobody's gonna refer you

Amanda: 10:55

Or want to be with you.

Doug: 10:56

Or want to be with you, or want to do business with you or anything. So.

Amanda: 11:00

I think probably even more so for financial professionals, people consider that you must be successful to do what you do. So, I actually like that you've you've had the setback, you've managed to overcome that because I think you can have much greater empathy for people who are struggling, you've got that story to tell, you've had to claw your way back from not even belief in yourself, maxed out cards to I can do this and turn things around. So, that's an epic journey to share with with your clients.

Doug: 11:32

It is and and you're right about the empathy, because when you're in financial debt, people can be easily judgmental, and it's very, very difficult. Well, they've not been through your journey, you've not been through their journey. And it's something I always consider is like somebody has a an opinion or a feeling about something. Invariably, they're right, because their feelings are produced, and they're only produced by their own personal experiences. So unless you've had those personal experiences, your opinion is likely to be different. So I think that's another thing. We should do all give people credit for their opinions, because it's all based upon their own experiences.

Amanda: 12:17

It's like that old saying, isn't it? If you think you can, you can, if you think you can't, you can't, you know, you make it come true to a degree.

Doug: 12:24

Absolutely! And that one's been around for over 100 years now. Yeah. You know.

Amanda: 12:28

Sort of self-fulfilling prophecy, isn't it?

Doug: 12:31

Absolutely.Absolutely.

Amanda: 12:32

There was some financial advice that you thought was very cool that you came across at one stage that Paul Hanson, I think, who's in financial services in the UK, was talking about, can you share that with us and how that made a difference to you.

Doug: 12:49

Well, it was back in 2013, really, I came across his online program. It's called Inspiring Advisors. Now, Paul is an ex financial advisor. And now he uses his skills to train financial advisors. And all all the way through my life. I was doing mortgages for people arranging life insurance for them and doing their pensions and doing their savings. And his bucket presentation, sort of was the thing that pulled it all together. You know, it sort of helped explain how all of the little bits and pieces connected. And it's a good analogy for life.

Amanda: 13:30

Can you just explain for those who haven't heard what the bucket story is, how the bucket works?

Doug: 13:36

Okay. All right. So your bucket is, is where your important money is. It's your liquid assets. And your liquid assets can be stocks and shares, they can be bank, certificates of deposit in savings and the like. It's very, very important money because you can spend it. Outside of your bucket, you have your property, your house, your rentals, if you have them, your pension fund, and if you're a business owner, your business, all of those items are outside of your bucket, they can find the way into the bucket, but only if you sell them, you sell your business. If you take your pension proceeds, if you sell your house and move down market, that's how money finds its way into your bucket. Now your bucket is topped up with your income from employment, dividends, savings, and then one day that stops and then that's replaced by either the rental income from property or your pension income. So that carries on topping up the bucket. Now you think the bucket would just fill up an overflow, but it has a number of... We'd like that. We would like that. Then underneath what

Amanda: 14:42

I think we'd like that. you have is you have these taps or holes in the bucket and the holes in the bucket, the taps in the bucket are your current lifestyle. Okay, so that's your expenditure. So that's your mortgage payments, your socialising and the like. And then we have, one day that tap stops in it, the next one is your retirement tap. Now that tends to have, it's a bigger The frailty years, yep. tap, or at least one would hope that it should be because you've got more time available. So as a consequence that has more drain on your, your bucket. And then you have that one day stops. And then you have your third bucket, which is a much, much smaller one. And that's the latter, or later life bucket when you're, you know, you can't fly across the world to go on holiday because you just can't get up the stairs in the plane,

Doug: 15:36

So then one day you die, right, that's coming to all of this. So there's that third tap. And then you have one last tap, which is on the side, which is the one-offs. It's the dream holiday that you might want when you retire or, or something like that, or a daughter's wedding or that sort of stuff. So as a consequence, you've piling money into the top, and then you've got money coming out of the bottom, now one of two things will happen to your bucket, either they, the value in the bucket will go down and down and down and down, you'll have to turn off those taps or turn them down and change your lifestyle if you start running out of money. Or actually what could happen is you could see the bucket increase, increase, increase, and overflow. And actually that is worse. Because here in the UK, if you've got too much money when you die, you have to give some money to the taxman, an inheritance tax,

Amanda: 16:29

Thankfully did away with that in Australia a long time ago.

Doug: 16:32

So you haven't got that to worry about. But okay, so that's one bad thing giving money to the taxman when you don't have to, but if you don't have to, that's great. But the other thing is, if you go to your grave, and you've got too much money in your bucket, it means that you haven't lived life to the full. So you know, some of those taps that were turned down or turned off, could have been turned up a little bit. So that was a an important analogy for me. And that really helped me change my confidence in who I could deal with. Because before that, I came across somebody with 50,000 pounds to invest, then that was about where my confidence level was. But then with the bucket presentation it'ss universal. So I started seeing 200 300 500 800,000 pounds, people with that sort of money. So it was integral to me, changing the way that I do my business and also increased my confidence because it was a story that made so much sense. And then people just give you all of their money to look after. Because they want to make sure that in their bucket that they don't pay too much tax.

Amanda: 17:35

Yep. love it.

Doug: 17:35

And that they live life to the max.

Amanda: 17:38

Sounds great. So you're incorporating that lifestyle or whole person concept with the finances. It's not just all about the money. I love it. I love it. Now, I did also ask you for your top financial tip. I know you love that story. And that was a great advice you heard but what do you like to share with your clients? Aside from the bucket story?

Doug: 17:56

I love first homebuyers. I like helping them buy their first place just because it's exciting, right? It's a journey, it's it gives me an opportunity to share the stuff that I've picked up over the years. So what I suggest to first time buyers is that they have they keep their own personal bank account when a couple go to buy a property invariably they've got their own personal bank accounts. And then I'd suggest that they open up a joint bank account, which pays the bills and then the day after pay day they do a standing order into the bills account to cover the bills and then essentially that means that they pay all their bills in one go, the day after payday. So whatever's left then in their personal accounts is what they've got left to last the rest of the month until next payday and they know when next payday is. So you know if you've got 400 pounds, dollars in your spends account, and you've got four weeks till payday, well then that's $100 a week that you've got to spend a week.

Amanda: 18:58

I love the idea, especially for couples of maintaining the independence of having your personal bank account. I think that's really really important. Especially in a world where you know, we hear more stories of financial abuse and people not being able to leave relationships because of the lack of funds. So I love that you're maintaining independence but you're still putting in a portion to your family expenses and look whether you work that out proportionally based on income or it's 50/50 or whatever works for your family.I think that's really cool that the couples are sharing it based on what works for them, but you've still got that independence it's a very cool tip.

Doug: 19:36

And there's a couple of other little bits and pieces right? Okay that goes into it is you got this thing called a holiday right

Amanda: 19:43

My favourite.

Doug: 19:45

Favourite, everybody right should go away on holiday.

Amanda: 19:48

Absolutely.

Doug: 19:49

So very often what happens is it goes on the credit card and then you worry about how you're going to pay it back right. So it takes away all enjoyment.

Amanda: 19:57

Well coming back to a big debt after trying to enjoy or we won't go out that restaurant because we'll have to pay for it later.

Doug: 20:04

Exactly. So you know, it's all about enjoying the experience. So make one of the bills, your holiday fund. So you know, if you want to spend two and a half grand on a holiday, that's 200 pounds $200 a month that you tuck away into a holiday fund. And then the last one, this one's been around for, I don't know, around about 2000 years.

Amanda: 20:25

So it's not yours?

Doug: 20:26

It's not mine. It happens on the same day, every single year, the 25th of December, it's Christmas. And we have some kind of celebration, whatever religion you are, you know, so it might be your Chinese New Year or whatever. But you know, if you're part of the Christian calendar, the 25th of December is Christmas Day. So there's invariably a holiday around that. Well, it's been around for a long time. So we know it's coming right? So plan for that, too, and have a little Christmas fund, or little holiday fund. If you do I think they call it a holiday in erm.

Amanda: 20:58

Whatever works these days. So we're not offending anybody. No, great idea to have have all that covered, instead of finding out at the last minute that yeah, someone's got to do without their pressies.

Doug: 21:08

Or praying for January's payday.

Amanda: 21:12

Yeah, or to make a dent in that credit card that you've maxed out again, Another thing I really loved that you told me, I'm not sure where you came across it was that every pay packet has to provide for two people. Can you say who those two people are? Do you remember that tip?

Doug: 21:27

Yeah, absolutely. It's our job as financial advisors, to remind people that when they get paid, it's for two people, it's for the person that they are now. And part of it is for the person that they are going to become in the future. And it's our job to stop them spending the future person's money. Now the person that is the future is either going to be, if you die prematurely, and you have a family, you need to be able to provide for your family. So part of you that money that future money is for life insurance, if you're made disabled or suffer a heart attack, it's for critical illness cover. These are the three things that are going to happen to you, you're going to die one day, you may may be made disabled or suffer a critical illness. Or you might live a really, really long time past when you can continue working, so that's retirement. So one of these three things is going to happen, you're going to die prematurely, you're gonna become disabled, or you're gonna live a long life, and you'll need some money later. So 15% of your income should be tucked away for the future person that you're going to be. And it's our job as financial advisors to take that money away from them, invest it into the pensions, help them by the life insurance, helped them by the disability income cover and the critical illness cover.

Amanda: 22:48

It's the delayed gratification isn't it the or to put away for the rainy day that it's so important.

Doug: 22:53

Absolutely.

Amanda: 22:54

Otherwise, I think we've already seen we're going towards that GoFundMe society. And in some ways, it's a little frustrating when people, if they'd had the right advice or being smarter with their money, we wouldn't need that style of society because you would have a nice payout if you were ill, or a disability pension if you if you couldn't work. So it will save us from being a charity case.

Doug: 23:19

Yeah,no, absolutely right. It's frustrating when you see, we've raised 100,000 pounds, because he died prematurely. And you think, do you know what, you only needed to put 10 pounds a month away.

Amanda: 23:32

Yeah.

Doug: 23:33

And you would have got 100, you would have got 150,000, 200,000 and you would have maintained your dignity.

Amanda: 23:39

Yeah. And your family would be supported. To me that is one of the biggest acts of love that you provide for your family when you can't be there to do it. So.

Doug: 23:48

Absolutely. Yeah. You only buy life insurance if you love somebody.

Amanda: 23:51

Absolutely. good tip. Now you've got two lovely adult sons. You said your parents didn't have any overt or spoken lessons to you. Have you turned that around and shared tips with your sons to educate them financially?

Doug: 24:07

Yes, I on both sides, because I've got Jason and Jake, Jason has bought a place. So he's got his life insurance, his critical illness cover, his income protection. So he's all covered in that respect. He also started from a very young age to put more money away into his pension schemes at work because I told him that you know, that had to be a minimum of 10%. Whereas most people they start in, that it's now compulsory in the UK, but it's 3% or 5% is the maximum that you're expected or that's the contractual amount, which isn't going to do the job. If you're living longer, which you are. Everybody is medical advances. So, 5% of your salary tucked away at the moment isn't going to do the job which isn't going to give you any kind of retirement. You need to be starting at 10% at least every single paycheck or pay rise that you get, try and put half of the new pay rise in to the fund, either for the life insurance for the critical illness cover or, or further retirement planning. And keep half of it yourself.

Amanda: 25:20

Yeah, absolutely. longevity living into your 90s now. If you only work from 20 to 65, you got 45 years worth of income, and you're gonna live for another 30 after that. So anyone can do the math and go, it's not gonna work. So the earlier you're putting away having compound interest on your side, I mean, really, it's the eighth wonder of the world. Super, super important. Now, some clients, you know, you

Doug: 25:43

It is indeed. Yeah. mentioned the word budget and their eyes just sort of roll back in their heads or they glaze over. Do you personally run a family budget? Yes, I mean, I'm self employed. So my business generates income. But from my business, I pay a set amount every week into my personal account to cover my bills and my spending. So where it could be so easy to just draw money out and when I want it from the business, I just take a set amount and then all the rest of the money stays in the business. And then I can make pension contributions. If there's an excess, or you know, we can invest in new hardware and the like, but I have a set amount and I check the accounts every quarter, at least quarterly just to make sure that what's going into there is enough to cover all of the bills and we review bills and the like. Yeah. And Bonnie has her own money. It's a good idea, good idea.

Amanda: 26:43

You don't need to know about that idea. Husbands don't need to know about that.

Doug: 26:49

No, absolutely. Well, that's why you have the independent bank account and goes back to your financial abuse situation. It's keep it, you've got to have your own stuff.

Amanda: 26:59

Yeah, independence, for sure. Now, I have started reading your book, I'm sorry, I haven't finished it yet. But there's a beautiful story at the start, I will get there. And you also shared it to me. And I love it. Because it's to me, it highlights the benefit of using a financial advisor, no matter your experience with investing and you can do it at the beach or the paddle pool, whatever you want. So can you share with me why you think a financial advisor can make a difference to someone's life no matter where they currently are, you know, you'll hear all the time are, you know, financial advisors, they're only for rich people, I'll see you when I've got money. And I think your story is a really beautiful way of answering what value we can add?

Doug: 27:45

Well, it's, it's simple, you've got to start with the first pound, the first pound that you invest is the one that's going to work the hardest. That's the compound interest, the Eighth Wonder there. But when we're talking about investing, so many clients have all of their money in the bank.

Amanda: 28:03

But it's safe Doug, it's safe.

Doug: 28:05

It's safe, it is indeed it is safe, except of course that you have to move it around the different banks to get any kind of interest. And now with the UK, the Bank of England base rate has dropped to 0.1%.

Amanda: 28:21

Yeah we're not far off ourselves in Australia,

Doug: 28:22

You're not going to get much. So the way I put it together is I say to my client, imagine that you went to the beach, for the first time you sat on the beach, and you feel safe. The sun's beating down, you've got to apply suntan lotion all day long, right? That's very much like being in the bank, you're safe. But you've got to move it around, which is the application of the suntan lotion, but you're going to get burned anyway, if you stay there long enough. And that's inflation, inflation is going to erode the money if you leave it in the bank of the building society. But when you're at the beach, when you want to cool off, you go for a bit of a paddle. And if this is the first time that you've ever been to the beach, you're going to paddle you'll get over up to your knees. And then you might feel a little bit comfortable, more comfortable, you'll go for a swim. And then some people, they go and buy their own, the mask, the goggles and the snorkel and the flippers and they take it that little bit further. And then they get to see more. And they take and some go scuba dive, you know I've tried scuba diving my hearings. Not brilliant. I can't really do it. But I think you know, it's one of the big things for you.

Amanda: 29:28

Yeah, I dive. Enjoy it. Yeah, certainly not the first day I went onto the beach though.

Doug: 29:33

Exactly. It's more risky than snorkeling. It's certainly more risky than swimming. And then you've got the people that go really sort of

Amanda: 29:41

Cave diving and yeh, freediving. The risktakers.

Doug: 29:43

They're very, very risky. So that's it. That's a bit like investing. So when I talk to my clients, and they've got all the money in the bank of the building society, I say, look, all we're going to do is we're going to move the amount that you're comfortable with to invest and we're early some in the bank in the building society, we leave, always leave about two years worth of clients capital, their income needs in the bank building society so that we can ride out temporary adjustments in the stock market. And goodness aren't we having

Amanda: 30:17

Well, they do happen. Historically they've been known to happen.

Doug: 30:22

So basically, what we do is we put in of the the amount of money that they might be investing, and we'll call it for ease, 100,000 pounds $100,000. So we take 20% of that. And that goes in the stock market. The other 80% is in guilts, which is government bonds, corporate bonds, and the safer funds. So we've got 20%, that gives us a little bit of sparkle, and 80%, which is good solid investment. So that's having a paddle. And then as your confidence grows, we might increase the 20% to 40. So you've got 40% in equity, and then 60% in the guilts and the bonds. And then if you want them and that's like swimming, and then if you want to go snorkeling 60% if you want to go scuba diving, that's 80%. And, and if your

Amanda: 31:14

Freediving

Doug: 31:15

Cave diving and all the other bits, the yeah, 100%

Amanda: 31:17

Gear it up, 130%.

Doug: 31:19

So that's how we do it. But we have a no diving allowed policy. If you've been sat on the back on the beach, all this time, you're not diving straight in, okay, we're just gonna take you for a paddle. So most of our clients are in the 20% equity or 40% equity. We've got some in 60. I'm in 100, because I understand the risk. And I'm prepared to take that risk. But it's like, that's the way we do it and we ease people into it.

Amanda: 31:44

Yeah, it's interesting. You know, when people are sitting down with us, they're like, well, what would you do now? Well, it's not even close. It's not relevant. My situation is not the same as yours. My education level is different to yours. So I think he who has the best story wins. And I think you've got some great stories Doug for people who are starting off oh, you know, in financial services. In Australia, we have to do what we call a risk profile or risk tolerance test. It's very simple. It's a series of questions. I call it the sleep at night test, you know, so when I talk to people about putting your money away, you're not going to be lying there looking at the ceiling going, Oh, my God, Amanda has put all my money in the share market. It's just tanked. I want to kill her. I'm going to egg her house. So it's that, like you said, it's the safety. It's where I feel comfortable. So yeah, a similar process, but you've got a better story.

Doug: 32:36

People love stories. They love stories that they can understand.

Amanda: 32:40

Makes sense, doesn't it?

Doug: 32:41

It's just a simple story. And it's just that you can make financial services complicated if you want. If you need that to massage your ego right, to make you feel cleverer, than your clients.

Amanda: 32:57

You're not really doing them a service, though, are you?

Doug: 32:59

You're not doing them a favor at all. And nobody cares how clever you are. They only care how much you care.

Amanda: 33:06

Yeah, yeah, good old saying that one. The last one I asked was what is your favorite form of investment, which doesn't have to be a financial tool either.

Doug: 33:18

I used to spend four days a year, once a quarter with two of my peers. And we'd sit and create these portfolios. And we'd look at past performance and citywire ratings and...

Amanda: 33:35

The really sexy stuff.

Doug: 33:38

And then I worked it out that that's not the most important thing. The important thing is the savings, it's the journey, it's the bucket, bringing the bucket clients bucket to life, showing them cash flow modeling. That's the most, lifestyle financial planning with cash flow modeling is the most exciting financial thing, because you can have a look at what's going to happen, get a feel, this is not gonna work. The day after you leave the financial advisors office, things will change. But to have a look at the future, how it could possibly be, throw in a couple of what ifs, it engages the client. And then then I talk about the fact that we can't afford Warren Buffett on our investment committee. Okay, so we have to just look for something relatively straightforward, that's going to do the job.

Amanda: 34:36

And I can see that portfolio management or stock picking doesn't light you up. But when you talk about the buckets and the strategies, and I think even more so the experiences that can come from putting that together, I remember you saying that was to you one of the best forms of investments, the experiences and that you you get over stock picking, it's obvviously much more interesting. So.

Doug: 35:02

Absolutely,

Amanda: 35:04

And you also invest heavily in your own professional development, hence the why we met at a conference that at one stage?

Doug: 35:10

Absolutely, yeah, that's the best investment you can make.

Amanda: 35:13

Absolutely. So thank you for sharing your journey. Doug. I love that you're someone who is a very heartfelt financial services professional, but you've also picked yourself up, dusted yourself off, had to start all over again. You're a rags to riches tale. Yeah, and I love your story. So I hope that other people will get great benefit from listening to those and hopefully applying it to their financial planning journey as well. So thank you for sharing

Doug: 35:42

It's been a pleasure.

Outro: 35:44

And that was another episode of Financial Secrets Revealed. Thank you so much for joining me. I hope you got some nuggets of wisdom out of that guest and enjoyed listening to their story. If you'd like to know more, please reach out to me. My contact details are in the show notes, or hunt down your favorite bookstore to find Financial Secrets Revealed and learn more for yourself. I look forward to hearing from you.