A Man Gots to Know His Limitations By Richard A Balch, CFP
Richard Balch, CFP?, CLU?
Financial Planner at Woodmen Financial Resources
This is my third article on following a financial advisor’s decision to purchase a rundown house next to his office building and convert it to a rental. Feel free to read my earlier articles. I estimate I am about 20% complete with my project and an under budget as of time of this article.
I often get resistance from some client prospects in believing that finance and investing cannot be hard to do. This is particularly true when the stock market is hot and you can make money by throwing a dart at the stock listing taped to a dartboard. The prospects think the financial advisor is supposed to be a stock wizard and if they themselves can do better in returns they question why they need an advisor. Perhaps I may have failed as an advisor to communicate the value add I can provide with my years of education and experience in the areas of retirement planning, tax planning, estate planning, investment strategy, income planning, insurance planning, and even basic personal finance. Talking about those topics put people to sleep immediately and so I need to express my value add in a concise way that allows me the opportunity to prove myself and pick up another client.
This brings me to the fact that most answers to any question are available to anyone via the internet - but how much time and energy does one have to get this information? Also, you may even get incorrect information. Many may assume the internet is gospel. I can assure you the world is not flat despite some documentation on the internet that it is. When it comes to finance, I will sometimes tell the prospects that anyone can do personal finance but it is a very complex subject and you may want to have a professional do these duties much like you may want a car mechanic to fix your car. Yes there are videos on how to do many things. But planning for retirement may be more complicated that changing out an air filter on a new car.
I will admit I am a hypocrite and have fallen prey to believing the internet can give me all answers and I do not need a professional. This blog is about my epiphany.
I am compelled to remember a famous quote from a Clint Eastwood movie from 1973 called Magnum Force. In this second Dirty Harry movie there is a quote: “A man gots to know his limitations.” This quote came in my head after looking into redoing the wooden floors in the house. It all started one night when the good idea fairy came to me and said it would be a fun project to redo wooden floors with my the wife. So my wife and I sat down on a Saturday morning and watched the YouTube videos on how to refinish wooden floors. The montage of short videos covered the processes and different aspects of refinishing the floor. These videos lasted for an hour. After watching the video my subconscious began asking me if I really wanted to do this. So I called my best friend who had experience in remodeling and I picked his brain. He began asking me questions I had not considered in the video such as: how would I handle the humidity inside my home after removing the sealant from the wood, how much sand paper and sealant would I need, what would I do about the squeaky areas, and so on and so forth. Finally he asked if I had even bothered to quote out the project to a professional. I thought that was a brilliant suggestion.
I took my tape rule and spent an hour measuring the different rooms. I calculated 775 square feet of wooden floors; or approximately 50% of my house was comprised of wooden floors. I started recalling that the YouTube videos were more about how to refinish a wooden floor in a single room than half of a house. Now that I had the square footage I could get a quote.
I am very fortunate I belong to BNI or Business Network International. This is a group of businesses that meet weekly and exchange referrals amongst themselves. Only one business per profession is allowed in each chapter. I have been in my BNI chapter since 2009 and have seen many tradesman businesses come and go with their memberships. This included floor restoring. I contacted Jamie from Green Bay Floor Restore and arranged for a quote. I had used his services before and was very pleased with his work. I also put in for a couple of other businesses to get their quotes. Of the four messages I left with the other businesses, only one called back and said he would come to do a quote. He never bothered to show. So I had Green Bay Floor Restore work on the quote.
I did my walkthrough with Jamie and he explained his process to me. He knew I was considering doing the floors myself and pointed issues (many which I did not see on those YouTube videos) that he would take care of if he got the contract or at least wanted me to address. One foolish aspect I was considering was to refinish floors before the bathroom and kitchen remodeling. Jamie pointed out that the mess from the remodeling should be done before the refinishing wooden floors. This would mean the wooden floors would not get finished till spring. The time aspect started to be an issue if I was to have this place open for rent by summer. Learning how to refinish wooden floors and correcting my mistakes would probably take three times longer than what the professional could do. Jamie said it would take him a week to refinish all the floors if he got the contract. I could see myself getting impatient and frustrated if the flooring did not turn out the way I wanted. I therefore came to the conclusion I should let a professional do this.
I got my quote and discussed all these issues with my wife. She agreed wholeheartedly that we should have a professional refinish the wooden floors and have Jamie from Green Bay Floor Restore be awarded the contact. I had worked with Jamie previously and trust the quality of his work. I went ahead and scheduled the project for the third week in March.
Now I can go ahead start smashing the plaster walls in the bathroom for the remodeling. I can be tough like Clint Eastwood and say: ”A man gots to know his limitations.”
Richard A Balch, CFP, CLU, RICP
Woodmen Financial Resources
1234 S Ridge Road
Green Bay, WI 54304
1-920-499-8833 Ext 110
Growth Marketing & Business Development \\ Sr. Marketing Consultant at LPL Financial
4 年A very relevant example Richard. We had a similar experience, and instead of refinishing the floors, we went with laminate throughout. I, too, watched many YT videos, which lead me to believe I could do it in our 900 sf 2bd/2ba bungalow. We repainted our kitchen cabinets, installed butcherblock countertops and a new kitchen sink, repaired broken terracotta roof tiles, repainted the entire interior, and I'm finishing up a custom master closet build this weekend. We started in May. A professional could have had it done in a couple of weeks, but the labor cost here in SoCal would've been very far outside our budget. Additionally, we weren't pressed for time, and I enjoy playing handyman on the weekend... HOWEVER, my confidence ends at electrical and plumbing, therefore the bathrooms will remain as they are. Would I do it again? Yes, but I would do many things differently. For us, the learning curve was worthwhile, and none of the mistakes made were critical. Moral of the story, we understood were taking a risk, and we'd have take it on the chin if/when we made an error. If we were not confident in our capabilities, we would've either worked with a professional or passed the opportunity onto the next homeowner.