PARTICIPANTS
Mark Brisley
Managing Director and Head of Dynamic Funds
Martha Adams
Certified Financial Planner
PRESENTATION
Mark Brisley: You are tuning in to On the Money with Dynamic Funds, a podcast series that delivers access to some of the industry's most experienced active managers and thought leaders. We're sitting down to ask them the pertinent questions to find out their insights on the market environment and navigating the investment landscape. Welcome to another edition of On the Money. I'm your host Mark Brisley.
My guest today, Certified Financial Planner, financial advocate, and best-selling author, Martha Adams, returns to us here at On the Money as we continue our conversation on the importance of taking real control of our relationship with money by taking back that control through our own understanding, and self-development. This is not the charts or account balance conversation, but it is a dimension of our interactions and relationship with money.
It is an oft-overlooked essential element, how we feel about it all. Experience of living through a pandemic has taxed us all socially, professionally, emotionally; in many different ways. When it comes to money and finances it really has been a divergent experience. Many struggled, yet many thrived. After health, money was at the forefront of the conversation regardless of what side of the spectrum you're on. Martha, it's great to have you back. First, let me congratulate you on the continued success of your book Cleopatra's Riches.
Martha Adams: That's incredibly humbling. Thank you for having me back. It's an honour to be here.
Mark: Well, I'm glad we get to continue this because since you released the book, over a year ago, and one heck of a time to be releasing a book, and wanting to go on tour to promote something, you've undoubtedly had hundreds if not thousands of conversations with people about the book’s focus, their relationship with money – perhaps the pandemic being an accelerant to that conversation, or at least getting a heightened level of attention or awareness. Interested to hear what are some of the common themes that you've been hearing in these conversations, and some of the main takeaways that you're getting from them?
Martha: There was overall one larger common theme, and that was a desire for something different. When it came to the financial conversation I noticed a desire for something not based on the how, but based instead on an individual's own why. That was because money in our lives is much more about our own human experience than it is about the numbers, charts or the graphs. What this means is that this conversation is one that is truly for everyone. It becomes uniquely their own because it was formed through their own life experiences.
If money is so central to our lives it remains so regardless of our life stage, income, or our asset level. This realization came from a greater connection to their own human experience. I'd love to share with you three common themes that I saw. One was a reevaluation of our career paths and lifestyle. This was something I saw in a lot of conversations. It was because, throughout the pandemic, people have been given the opportunity to almost quiet the noise of their busy lives, and focus instead on hearing their own voice, and what they truly wanted to see in their careers.
Often we're lost in the busy, and quieting the noise allowed them the opportunity for change. To see that change that they desired. The second example that I heard a lot of was around financial stress. It was that financial stress was actually about so much more than just the numbers. Whether this was with an individual or with a couple, there was a recognition of the emotional association that was at the root of the stress.
For example, when it comes to the pandemic, we could have felt that it was the pandemic that was actually causing the financial stress, but when we asked why, we could actually start to uncover what the root cause of the stress actually was. In one conversation I was speaking with a gentleman, and he was feeling on the surface financial stress as a result of the pandemic. When we continued to ask why and asking why more than once, he recognized that the source of his financial stress wasn't actually the pandemic, his stress was in not wanting to see history repeat itself with the financial situation that he saw his parents in.
That was actually the source of his stress. When we acknowledged that he could then begin to work through that and come to the other side of that stress. The third example that I saw was that there was a desire for balance, so to see a balance of earn, grow, and enjoy with money in our lives. With some families that I've spoken with, there has been a change in their priorities.
Where before they would ignore or set aside the enjoy part of their lives, focusing really only on earn and grow, they now actively build enjoy into their daily lives, even including their children in the decision-making process. What better way to teach our children than to involve them in every aspect of the financial conversation? Earn, grow, and enjoy. The key was that this all came about from asking the question, why? Not how do I make a career choice, how do I deal with financial stress? How do I talk to my children about finances? Instead, asking why I want those things or why do I feel that way? Answering the why questions clears the path for the appropriate how, the appropriate how for you.
Mark: When we talked last, Martha, we also talked about the difference between needing and wanting or needs and wants. I'm amazed even in my own circles, how many times I often saw people convince themselves something they wanted was actually something they needed. Then I realized I should probably look in the mirror on that same conversation, but when it comes to managing our finances, why is it that need has a negative association, but want has a positive one?
Martha: The key difference is in how we feel. There are different emotional associations with the word need versus want. We can see the results of the way we feel in what we do, so in our actions and the way we go about things. That's not to say that we don't take any action based on need, but there is a difference in the style of action that we take and what our involvement is in the process. Are we going through the motions or are we actively or emotionally involved in what we're doing? Walking through that comes from understanding where those emotional associations came from.
Mark: I want to dive a little bit deeper to that then because I think talking about what the impact of this need versus want having on the financial conversation is an important one. It's the points I got a lot of feedback from the last time we talked. It's something that you talk about in the book. Let's go down this path. What impact does need versus want have when we're talking about finances?
Martha: The focus on need has caused a focus on the how, and that often has us forget to answer the why. To better understand this, let's unpack the how and the why to gain a better understanding, starting with the how. When it comes to the how we've been taught for decades to think about money. That's caused us to focus on the how to of money. How to invest, how to budget, how to bank, how to follow your taxes. These are all great things, but how you feel about those determines if your actions are based on you or based on what you should do.
One of the ways we can see this in our lives today is in the idea of the make, spend, save cycle. You can make money doing anything. You can also spend it or save it based on a prescribed definition. With this idea, we're often fitting into an idea set or financial empowerment from the outside in. All based on external ideas. Our human experience is often completely discounted here. With that, so are our emotions, which brings us to the next question, asking ourselves why?
With the why, there is a very different answer because it's a very different question with a very different feeling, belief and result. The reason is that answering this question requires a different starting place. Everyone's why is unique to them and central to your why is your emotional connection. This now means that you are experiencing the financial conversation emotionally, rather than solely looking to understand it intellectually. This leads to financial empowerment from the inside out. It's through this idea that you can earn with meaning, grow with value and enjoy the money with purpose.
The only person that can define that is you. One of the ideas that we can connect to is that money is one of the most personal topics there is. With this, the idea of money being the most personal topic there is, has led to money being taboo. Something that we don't talk about and often don't see ourselves in because of our formed negative associations. What happens if we shift the association of personal around money from negative to a positive? Let's make it personal because that makes it your own.
Mark: Martha, this concept of the why, how do we do what we do and what is it that we do, but why do we do it? It's the Simon Sinek idea of the why. Hearing you talk about this when it comes to the financial conversation and are feeling more empowered with money, is this really where we should be focused on singularly is the why?
Martha: The key is that there's more to the story. One is not complete without the other. The how is not complete without the why and the why is completed with the how. You see starting with the why means you're starting with you and that the how or the financial structures, strategies, investments, et cetera, are based on you and your why.
Mark: Martha, you talk a lot about this in the book over the period of time that we've just been through. One of the trends we've seen is an awareness to our relationship with money and then the hidden negativity that surrounds it. One of the things that I've noticed is your message is focused on starting a positive financial conversation. How is it, we start the financial conversation from the positive, which hearing you talk seems that the negative just comes so easily? It is ingrained in our thought process when the word money even comes up.
Martha: You are absolutely right, Mark. One thing that I always recommend is to start with what you want versus what you don't want. We're often focused on the negative, which is what we don't want or what we need to stop doing. For example, we can say statements like, I don't want to be in debt or I need to stop spending so much, but how do you feel when you say those statements. You see it's a negative trigger and we do this because in many ways, this is what we've been taught to do.
Just as we've learned to do that, we can learn to do something different to produce a different result. To start from the positive, focus instead on the positive change you want for yourself. For example, I want to start enjoying my money. This means that every decision starts and continues from a positive place. From when the purchase is made to when the bill arrives positive emotions are what are triggered. Through this idea, we can truly see that a relationship with money is a relationship with ourselves.
Mark: I'm not going to let you off the hook here. This is the theory of needing to know this, needing to understand this. That sounds like the easy part, but how do we find the how of the why? What I mean is, if we're missing the why, how do we discover that? Or how do we become more self-aware of that missing element within ourselves? What's the practical application of doing this?
Martha: This is a really important part of the conversation because you find the how of the why by understanding where your emotional associations came from in the first place, and then allowing yourself the ability to work through them. This is exactly why I developed the 4R process of recognize, reconcile, release, and repeat. This allows us to bring an awareness and develop an understanding so we can choose the path forward and shift to our positive emotions by repeating the renewed emotional association.
Mark: I wanted to translate that then to a relationship with working with a professional, to help you along this journey, then let me be fully transparent here. You and I are completely aligned on our belief system that the best way to work through this is to work with a trusted and accredited financial advisor. What are some of the or what's even one of the ways that we can see our focus on this how with an advisor or our advisor, if we're already working with one and how we worked through it using the 4R process that you talk about in your book?
Martha: You're absolutely right. I love the idea of working with an advisor. When I'm reviewing this here, I want to focus on the word 'with' working with an advisor. We can really see this idea explained in a statement that we often hear in our conversation with our advisor. It's the statement of, I trust you. Now on the surface, this sounds positive being spoken. Also, it sounds positive being heard. Would you agree, Mark?
Mark: 100%.
Martha: Now, how do you feel about yourself as you say it? Where did that statement come from? That's the key, that makes the difference. When you say I trust you to an expert, how do you feel about yourself?
Mark: My ability to say, I trust you means I've validated the reason for wanting to have that conversation in the first place and so my trust is real at that point.
Martha: Absolutely. Do you also trust yourself to belong in the financial conversation? A focus on the why allows us to hear and understand the unspoken words that can be a part of the conversation, but not actually spoken out loud so it's what we're really saying. The 4R process gives us the path to work through that.
Mark: Martha, can you give us an example then of working through the 'I trust you' statement utilizing the 4R process?
Martha: Absolutely. Let's start with recognize. With recognize, I bring an awareness to what I'm saying, and more importantly, the way I feel. With the 'I trust you' statement, I can feel overwhelmed from the ideas, structures and strategies, and acronyms that can come with the how. Now I'm going to reconcile. With reconcile, I connect with my perspective and how those feelings of overwhelm were formed. For example, I could say that that came from always learning to leave this conversation, leave the financial conversation to the experts.
Now I can move on to the third R, release. In release, I ask myself, is this idea serving me? Do I feel a part of the conversation when I say I trust you? Am I comfortable asking questions? I can now release with a focus on why I'm there in the meeting and who the meeting is for. Now I can move on to the last R, repeat. Now I repeat the new positive emotional association. This now turns the "I trust you" statement into, "I trust myself." I trust myself to be a part of the financial conversation. I now feel a sense of belonging. Now, you are actively and emotionally involved in the conversation with your advocate and working together in the spirit of collaboration.
Mark: Martha, just listening to the answers to these questions, one of the ideas that is coming through very clearly, and the way we're talking about this relationship with money and the way we feel about it, it starts to make me think there is a direct impact on financial results. I think a lot of times we get mired down in wealth, we work with an advisor or we're seeking to save or create wealth. It's just all about the results. That's the focus of everything.
We understand at Dynamic, the quest for wealth isn't that simple. There is value to investing it with advice. What is one way we can apply this information in our lives to have greater confidence in our finances and get greater benefit out of our relationship with a professional financial advisor?
Martha: It starts with the way we see ourselves in the conversation. That can be exemplified in our views if we're sitting with an expert versus with a specialist. Let's actually utilize a non-financial example here. I'd like you to picture yourself, sitting down with a health professional or a medical expert, and picture the way you can feel in that conversation. Let's assume here that you are not a health professional or medical expert, and that is definitely a different field of expertise than the field that you are in. This is something that I've experienced personally.
When I'm sitting with that health professional, and they're speaking a language that is very different than my own, the key isn't so much in the intellectual information, it's about the way I feel in the conversation. I could say, "I trust you" to the medical professional. The question really is, how do I feel when I'm saying I trust you, because do I trust myself here? Do I trust myself to be comfortable to ask questions? Do I trust myself to muster up the courage to ask for clarification? That is all in the way that I feel, and in my sense of belonging in this dialogue.
What can we do to help that? Well, I talked about the idea of expert vs specialist. You see, when I'm sitting with an expert, how do I feel about myself relative to that expert? When I'm sitting with a specialist, when I shift my viewpoint to the fact that I'm sitting with a specialist, I see myself very differently in the conversation, because if I'm looking at it as a specialist, you see, they specialize in something, and so do I.
Now I have an acknowledgment for myself, and I feel differently about myself in the conversation. Now, I have a very different engagement level in the conversation. Now, I feel much more comfortable asking questions and asking for clarification. Why? Because I belong in that conversation because that appointment is for me and is about me in the same way. The financial conversation is for you and about you.
What's central to this isn't the intellectual information, it's the feeling and the belief that ultimately, create the result. When you see yourself in the conversation, you trust yourself as a part of it and can communicate your goals, life circumstances, and the shifts that take place over time. What you're doing here is communicating what you're looking for. It's at this point that your advisor becomes your greatest advocate as the specialist in the advice that they are sharing with you to help you achieve your goals.
Mark: Martha, this example you're using of, when you go to see a healthcare specialist or expert or whatever the case may be, it's got me thinking about this conversation about an investor working with an advisor and it's got me also thinking about the word outcome. That's what we really want, the outcome of saving, understanding our relationship with money, good portfolio returns, all these things.
This is the outcome that lets us lead a better life financially, but that's hard for a lot of people to understand. I think a lot of people confuse the relationship with an advisor as good returns or low fees. Those are outcomes, but they're really not. Those are means to an end. Do you have anything that you could add to that when we think about this relationship with money and prioritizing what it is we want to get to these outcomes?
Martha: One of the things that I often talk about with this comes from the difference in looking at your advisor as solely an advisor or your advocate. You see, when we talk about your advocate, what is it that they're advocating for? Now, this has you as central, so it's not solely about the returns anymore, it's about your why, what you are looking for, the returns, all of the intellectual information, that is, the means to an end. We're putting you central to the conversation has your advisor, as your advocate, has your plan be your GPS, your path forward and it's all based on you, your goals, your version of success, and what's central to that is your relationship with money, with yourself.
Mark: To close off this conversation, which I hope is the first of many more, then this relationship with money, the importance of continuing to develop our emotional intelligence around money. How important is it in making sure we do get to the outcomes we're looking for?
Martha: It's the combination of the how and the why that brings us true financial empowerment. Without asking the why, there really can be no meaningful dialogue between an advisor and a client. I believe the future of advice resides in the why. If we can show how to recognize our why, this will close the circle around you and your advocate, giving you the best avenue for success in your goals and the 4R process of recognize, reconcile, release and repeat is a key tool in discovering exactly this.
Mark: Martha, this continues to be an incredibly important subject so much beyond the charts, the numbers, the graphs, but it is absolutely integral part of building wealth and retaining that wealth going forward. I want to congratulate you on the success of the book. I encourage everyone to go up and get a copy of Cleopatra's Riches to dig further onto the subject. I also invite you to visit Martha at marthaadamsmedia.com. Martha also has a pretty significant social media profile as well. Martha, just really appreciate you taking the time to share your thoughts and insights with us today.
Martha: Thank you so much for having me.
Mark: Thanks to all of our listeners for joining as well. This has been another edition of On the Money and on behalf of all of us at Dynamic Funds, we continue to wish all of you, good health and safety. Thanks once again.
You've been listening to another edition of On the Money with Dynamic Funds. For more information on Dynamic and our complete fund lineup, contact your financial advisor or visit our website at dynamic.ca.
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