Hannah: Well today we have with us Meg Bartelt, at Flow Financial Planning, and she specializes in working with women in tech, in the tech space, and she has started her own firm, it has such a great story. But first of all, thanks for joining us today Meg.
Meg: You are welcome. Thank you for inviting me.
Hannah: When we look at like firms that are starting out, like you have such a great story. And somebody looking in can see you have this great practice that you’re running right now. buT I’m curious, how did you get into financial planning? I believe you’re a career changer.
Meg: Yeah, I am. I actually started my career out of college in the tech industry. I mean I graduated from college in 1998 when, the tech industry was going gangbusters, and if you could fog a mirror they would hire you. So I took my economics undergraduate degree, and entered an IT consulting firm in the Bay Area. And stayed in the tech industry for, I don’t know, 10 11, 12 years. I worked mostly as a technical writer.
Meg: And then in my early 30s just really was done with tech. It didn’t inspire me at all, and people asked me how I discovered financial planning and I never had a good answer for that. Growing up, my dad was very into investing, and you know, watched Wall Street week with Louis Rukeyser, and so I was comfortable with the idea of money and investing, so maybe that helps sort of discover it for me.
Meg: But I was living in San Francisco at the time, which has a really robust financial planning professional community, and it’s got Golden Gate University, which has a masters in financial planning program. So I somehow figured out that this was a thing when I was looking to exit the tech industry. And so then I just started looking around. I did a bunch of informational interviews, I contacted local FPA chapter, the local Napa chapter, and just continued asking questions and talking to people until I got a real sense of, “Ooh, this looks good, I like this.” And that’s how I got in.
Meg: And I actually jumped into a master’s program at the very beginning. I come from an academic family. So getting a degree in something is the natural first step to anything.
Hannah: So you say you started your master’s program, did you finish it?
Meg: I did, yes. So I got through, I don’t know, half of it while still living in San Francisco. And then my husband and I had our first child. Actually, funny story, I remember my very first class was just sort of intro to personal financial planning. And during a bathroom break, I peed on a stick and found out I was pregnant with my first child.
Hannah: But you learned a lot right after that?
Meg: Yeah, I go back to class. So halfway through the program we ended up moving back to my home state of Virginia. And I was to finish it out virtually because you know, they offer, I don’t know, a lot of their classes virtually. And so that’s what I did for the rest of the master’s plan. And you know, it took me forever because I was working part time at the time and had my first child. And so I was taking one class a semester, but a few years in, I got the masters.
Hannah: So you get your master’s degree, you have a young baby. How did you kind of find your next in into getting a job or getting experience in financial planning?
Meg: Yeah, that was some combination of just luck and privilege I would say. So I started out, as I mentioned living in San Francisco, and I was doing sort of a bunch of informational interviews there, and definitely got the sense that that is a robust professional community. And had I stayed there I probably would have just ended up interviewing for some sort of paraplanner, associate planner, you know, entry level planning role.Because there are enough big firms there that can offer something akin to a career track.
Meg: But part of my moving back to Virginia, which I wanted to do because you know grandparents were there for my kid. My mother herself had a financial planner, and this financial planner was, from what I can see, sort of from that first wave of Fee-Only RIAs, where you know this financial planner had cut her teeth, you know, selling insurance, being in the broker dealer world, I think she was a teacher for a time, and eventually at the age of 59 she set up her own Fee-Only solo shop, very investment oriented.
Meg: All of her clients were retirement age, sort of very traditional, that first wave, I think, of Fee-Only financial planners. And this planner was in her upper 60s and had no succession plan, and knew of me enough to know that I was some minimum level of competent and trustworthy. And got very excited when she heard that I was entering this profession because she was looking for successor.
Meg: And so that was my first job, was working part-time for this planner, looking to get out in the next several years. And with the idea that I’d work with her for a year to get my feet wet as I had zero experience in the career. And then at the end of that first year signed a contract to obligate me to buy out her practice. Clearly that did not happen, as I’m know living on the opposite coast running a firm focused on women in their early to mid career in the tech industry.
Meg: But, that was how I entered the field professionally. And eventually her farm actually got bought out by a slightly larger local Fee-Only RIA. And I just went with that transition into this slightly larger firm.
Hannah: So having worked with somebody who you were going to be like their succession for a lot of people, they’re like, “Well you kind of hit the jackpot with that.” But clearly like you didn’t kind of go down that path. So I’m curious, was that just dynamics within that firm that you didn’t want to stay there, or was it more of like you discovering what you wanted, or kind of what was that decision point knowing that that was an option on the table for you?
Meg: Probably the largest part was just outright fear of, “Geez, I am going to sign a piece of paper that commits me to effectively a half a million dollars worth of debt.” I’m far too much of a weenie to do that sort of thing. And it also became obvious over that first year of working with her, I mean, remember this was my first work in the field, that it was not surprisingly in retrospect, it was a very idiosyncratic practice.
Meg: She actively managed her client’s investments, and I was and still am a die hard passive investor. And one time we’re preparing for an annual meeting with one of her clients and, she’s trying to sort of teach me how she invests. So she gives me her client’s current portfolio and says, “Hey, how do you think we should change it?” And I’d seen her, you know, using Morningstar reports to do this process before.
Meg: I said, “All right, I’ll try my best.” And so I come up with a proposal and she reads my proposal, basically red lines, the whole things. The whole thing says, “This is in fact how I would propose we change her portfolio.” And I said, “Well, okay, how did you come up with that?” And she said, “Well, it’s kind of by the seat of my pants.” And it was that moment I realized, “Oh, I can’t do this.”
Meg: Because this is an idiosyncrasy of hers, and no one else will be able to reproduce that. And investing was not primary motivation for me getting into this business in the first place. So taking over from that was primarily investment focused, and also focused on people who at that point where three decades and more older than me, it just wasn’t interesting enough work.
Meg: And so the idea of going half a million dollars into debt, to take over a firm that was sold largely on an active investment management story, working with a clientele that I didn’t quite resonate with or it didn’t resonate with me, it just made me feel funny inside, basically. And it was that feeling funny inside that made me say no. And I’m I’m too risk averse in that way.
Meg: I’m really glad I didn’t do it. A, I’d still be in Virginia and we eventually decided Virginia was not for us. And two, I eventually started this farm where I get to do exactly the kind of financial planning I want to do, with exactly the kind of people I want to do it with and I get to invest the way, I believe was the appropriate way to invest. So it took more years, and I took on a risk of a different sorts starting my own firm. But no regrets at all.
Hannah: One of the things that you’ve talked about is, Fee-Only, I’ve heard you say it several times. And so it sounded like you had from a very early point, had a strong conviction that you wanted to be a Fee-Only planner. How did that come about? Like what was kind of the driver behind that, especially knowing that it was from the beginning?
Meg: Yeah. I don’t have any specific notion of like, “Oh, it was this moment that I realized that Fee-Only versus commission versus fee based versus whatever, was a “ah ha!” The light bulb went on. I’d probably describe it to a few things. One, I started investigating this profession while I was in San Francisco, and there are a lot of big successful Fee-Only firms there, so that was simply what I was exposed to primarily.
Meg: Then one of the informational interviews I did was with a fellow alumni of the college I went to. She worked for, I think Morgan Stanley at the time, and she was very successful at Morgan Stanley. And I went to her, lovely like dark wood panel office, to talk with her and she said something like, “Well, just make sure your husband understands that he’s basically not going to see you for the next five years, because you are going to be studying for all your series exams, and you’re going to be basically out there hustling for customers or for clients.”
Meg: And frankly, I’m too lazy for that. I can’t work more than 45 hours a week before I just start to shut down. Ooh, I was so turned off by that. So I at least knew that I couldn’t go with a place like Morgan Stanley, because I just got the sense like that was the lifestyle I was signing up for, and that was utterly incompatible with me.
Hannah: You know, it’s funny you talk about this and, being a mom, now I have a 14-month-old little girl now. What you’re saying absolutely resonates with me. And my favorite quote, I have it on my monitor, on my desk is, “Constraint inspires creativity.” Of saying like, “No, I don’t want to work that many hours.” You can still find a way to get it done. It might look different than what’s kind of the standard norm.
Meg: I always want to be sure to mention this, that it took me several years to hit my stride in this career. Right? You know, I started taking a master’s program, paying for it out of my own pocket before I had a job. And then the first job I had was a part-time internship, and that turned into other part-time work. I was married and I’m still am married, at the time to a person making a really nice salary.
Meg: And so he totally floated the financial boat for several years, as I was finding my footing and the profession. And the results of his end, my savings is what floated the financial boat through the first few years of starting my firm also. You know, I didn’t start my firm until I was 40, because I was far too much of a weenie to take on the financial risk earlier, before we’ve had a really strong financial foundation.
Meg: And I know that all of that financial support is a form of luck and privilege that not everyone has. I just want to make sure to get that out there. That following my path might just be impossible for people who don’t have this secondary source of income in the house.
Hannah: Well, and it’s also realizing like if you’re in that part-time role, that’s okay. That’s part of the journey maybe perhaps, I mean that’s just part of your story. And more opportunities may come in different ways.
Meg: Yeah, absolutely. I mean I just sort of slow rolled at the beginning of my career, because it coincided with becoming a mom.
Hannah: Yeah. You’ve talked to a handful of times about this idea of risk, and you didn’t want to buy this practice because of the risk of taking on half a million dollar loan basically to fund it. And so knowing your story that you started your own firm, can you talk about the different risks that you intentionally decided to take on, and kind of what your thought process was, knowing that… I mean you’ve made several comments that make you kind of seem a little bit more risk averse. So kind of what was your thought process and what were those risks?
Meg: Well, the story of starting my own firm is, my husband and I and our two young children, we decided we didn’t want to live in Virginia anymore, so we figured out where we wanted to live. And we ended up in Bellingham, Washington, which is where we are now. And he was still working full-time as a software developer. He was just working from home, which was very nice. And I was primarily a stay at home mom.
Meg: And I did some contract financial planning work for RIAs that were much more traditionally focused on investing. And you know, once a year maybe a client wants a written financial plan. So I was doing some contract work providing that written plan. And occasionally I would get asked by people locally in Bellingham like, “Oh, you’re a financial planner, can you work with me?”
Meg: And I said, I’d have to say, “Well no, not for money because I’m not registered,” so I can’t actually get paid to give investment advice. And I should back up a little bit and say that there are some Fee-Only financial planning firms in Bellingham, but they are again in my views, the more traditional investment oriented older clientele, not really growing in a way that would allow someone to sort of enter in an entry level position.
Meg: So there weren’t really employment opportunities for me in Bellingham, in a firm that I would want to work in. I was left sort of the background here. So I was doing this sort of occasional contract work, and then people asked me if I could work with them. I thought, “Well let me just register as an RIA so that I can at least legally say, “Sure I’ll do this one off like financial plan for you, and get paid for it,, and I would get arrested.””
Meg: And that was, I don’t know, the fall of 2015. And in my research sort of figuring out how to register myself, I came upon XYPN, XY Planning Network, it’s not quite turnkey, but it definitely is sort of an organization that will hold your hand, and lead you through all the bits and pieces of launching a firm, and growing it. And I would never have lost my firm without an organization like that, because again, “No, I need someone to hold my hand, I’m too much of a wuss to just strike out on my own.” Always impressed by people who will just do that.
Meg: And this also coincided with my husband who after over 20 years as a software developer, was excruciatingly sick of working as one. And had been talking about quitting his job for a few years and I thought, “You know what? Why don’t you quit your job and I’ll start this firm and we’ll see where it goes.” And we’ve got this really nice financial foundation from our years of savings, and he had also had a very nice liquidity event in the tech industry.
Meg: So we’re coming out of this from a very strong financial perspective, and I had sort of very loosely done the calculations that a, if we didn’t save to retirement for three years, and if we actually lived on savings for those three years, that’d be fine. I was only 40 at the time. Hell, if we have to detour from our own financial journey for five years, I’m only 45 at that plenty of time to make it up.
Meg: And so that’s why I felt okay starting the firm because we we were way ahead of the curve in terms of our financial situation at the time. So we could afford sort of fall backwards a bit and still be okay. And, he’s a technical guy, I’m a financial person, if this didn’t work out, we can go find other jobs that were reasonable. So I have lots of fallback positions, lots of resilience built into the plan.
Meg: That said, I didn’t go into RightCapital and run some exquisite financial planning projection out for 20 years. I just sort of did some very basic numbers in my head, and then put on blinders in my fourth.
Hannah: As you were talking, I kept thinking about we talk FPA about how do we be better planners, right, with working with clients? And I just love how you kind of approached this and I just imagined so many of our clients are like this too. They’re like, “You know what? We’re going to start our own thing. We stopped planning for a couple of years for saving for retirement,” and like that’s okay.
Hannah: I feel like in so much in the academic stuff, it’s just like you have to save every year all the time, like on this structure. And it’s like, “no, life’s a lot more fluid than that.”
Meg: Yeah. Yeah. I think it has helped me be a better planner. Some of my clients have in fact wanted to quit their full time job to launch their own firm doing what they had been doing as an employee. And my basic attitude is, “You’re 33 years old, you can do whatever the hell you want to for the next n years, because there’s plenty of time to figure it out afterwards.
Meg: Like if this path doesn’t work, just choose a different one, which maybe is a little weird because we do like to be able to write a stream of numbers on a piece of paper. “Like, look, this path will inevitably lead to success.” But what I’m mostly concerned about is let’s just make sure the downside’s protected and then go for it.
Hannah: It’s okay to take those risks if that’s… Like you said, your downside’s protected.
Meg: Yeah. And I think even for more broadly, because most people don’t start their own businesses. But yeah, I think this is a concept I first sort of read about explicitly from Michael Kitsis, was this idea that when you’re earlier in your career, your money is better spent being invested in your career than it is invested in a Roth IRA. You know, that $5,000 you put into getting a new designation or taking a class or going to a conference or what have you, that’s going to pay off financially way more in terms of permanently boosting your earnings capacity.
Hannah: So it’s interesting because you were at this RIA, this Fee-Only RIA, realizing that it wasn’t the type of firm that you wanted to be in, were you actively thinking of like the type of firm that you would want to work in or that you would want to start?
Meg: To an extent, yes. I remember at the second Fee-Only RIA that I worked at, which is the one that acquired the first one, most of their clients were the retired demographic. But one of them was a mid-30s couple who had two kids. And I think maybe the both of them worked at IBM, and so they had companies stock to deal with, and I was fascinated by this. And I wanted to do all this planning around it, and what I wanted to do for the client wasn’t a fit for what the firm provided.
Meg: But that was my first taste of getting to work with people who were more or less my age, who were dealing with all the storm and drawn of that sort of early to mid career, early to mid life stuff. You know, wanting to buy a house. What I do about saving for college for my kids? Having kids, changing jobs. So it was my first real taste of working with people in that stage of life.
Meg: At that point in my life however, I could not have imagined starting my own firm. That is what other people do. That is not what someone from my family does. So I really had not thought of starting my own firm until I moved to Bellingham, five years ago or something. And discovered XYPN and I’m not trying to advertise XYPN, but just having some entity out there that has some credibility basically say, “yeah, you can do this and, and here’s this sort of checklist or this structure of framework for how you can do it. You don’t have to figure it out on your own.” Because I was never going to figure it out on my own.
Hannah: And so this opportunity, how long before you decided that this was really… You moved to Bellingham, and how long before you decided like, “I’m going to start my own firm”?
Meg: Yeah. So we moved to Bellingham and I was for all intents… Yeah, that’s okay. You pronounce my last name right. So you get lots of naughty points there.
Hannah: Thank goodness. I have lots of linguistic challenges.
Meg: I was mostly a stay at home mom. I mean, I was doing this contract work, but it was very few and far between. And so we moved there in late 2014, amusingly bought my first house in the summer of 2015. And got this really short, short term mortgage because they’re like, “Oh my husband’s making plenty of money. We’ll just pay this off in five years.” So we got this five one arm and then like six months later decide, “Oh he’s going to quit his job and I’m going to start this business where we’re going to have no income for awhile.”
Meg: And yeah. So I think it was about a year after we moved to Bellingham that it just dawned on me like, “Oh this is a thing. This is a thing I could do. This is realistic. This is not just fantasy.”
Hannah: This isn’t for other people.
Meg: Yes, it might be for me.
Meg: Yeah. But you know, my kids were a little bit older by then. My older one had just started kindergarten. My younger one was three, or two, something like that. No longer in like the baby phase where my brain is mush most of the time.
Hannah: When you decided you could do this, did you have a full formal business plan laid kind of did you know who you were going to specialize? Like how, I don’t want to say prepared, but maybe prepared is the right word, when you filed the paperwork to get your RIAs?
Meg: Yes. When I first started investigating it just to register as an RIA so that I could work with neighbors or something if they happen to want to work with me. Absolutely not. There was no preparation at all. No real thought process. But when I latched onto this idea of, “Oh, this could be like a thing, this could be my full time job. I could start a legit business.” Then yes, I started thinking business plan no.
Meg: I mean I think I might have written one that had no connection to reality whatsoever. Because I was like, “I’ve never run a business before. I’ve never been exposed to anyone who’s run a business before. Let’s just put some arbitrary numbers down.” But I did take very seriously the idea of a target market and so I did that. I would say the two things that I did best at the very beginning were getting very clear on who my target market was, and spending good time and money on making my online presence awesome.
Hannah: Let’s talk about that. What did you do to make your online presence awesome?
Meg: I found a graphic designer. I found her because she had done a website for, Ingrid Timmerman who was another… She’s down Southern California. She’s another financial planner who also happens to be like a professor of financial planning. But I really liked her website, and I contacted the designer who’d done her website. The designer, her name’s Karen, I don’t know how to pronounce her last name actually, I’ve never said it out loud.
Meg: She’s Swedish, so they were like some umlauts in there, Haggard, Hagan or something. She had an amazing process for coming up, not just with a website but for a full brand. So she actually helped me in to think about messaging and branding. I am a good writer, so that helps. I wrote a lot of my own copy, even though she helped a lot with, “Those are too many words, make it shorter,” or, “Good Lord who understands what that word means.”
Meg: But yeah, by luck I guess chose a designer who was very good, had a very good process, a defined process and was very focused on overall brand instead of just, “Let’s make this look pretty.”
Hannah: And a pro-tip for anybody listening is that you can go to websites that you like and almost all of them at the very, very bottom, the designer’s name is usually on there. Like I’m looking on your website right now and it’s there.
Meg: Yep, yep, sure it is.
Hannah: That’s one way to start networking. If you’re like, “I don’t know, a good designer.” Find a good website that you like and you can reach out to that person.
Meg: Yes. Well actually that’s funny. That is advice I’ve given to whoever’s asked me over the years, “How do you find a good designer?” I said go find some websites of other financial planners or firms that you like and just start with their designers.
Hannah: So you built a beautiful website, and it was clear what you wanted clients to do. Kind of who you’re serving. Were you blogging on a regular basis?
Meg: Oh yeah.
Hannah: Was that part of your strategy?
Meg: Yes. And I don’t remember if it was… When and where I drank the blogging Kool-Aid, I don’t know if it’s because XYPN was very big on blogging or just content marketing in general. But as I mentioned I like writing. My former career was as a technical writer. So yeah, I actually queued up like five blog posts before I even launched my firm. Just so on day one it would look like it had some amount of track record.
Meg: I wasn’t starting from scratch. My first, I don’t know, 10, 20 blog posts were complete crap. They were just like the equivalent of should do invest in a Roth IRA or a traditional IRA? Just the same BS that you would find a thousand times on the internet. But yeah, I was dedicated to the blogging thing. It was the only way I knew how to market. Right? Because I was working virtually women in tech don’t really live where I do, and so I had to have an online presence.
Meg: I had to have some form of marketing and sales, and I am so not a traditional like, “Hey, I’m Meg, I’m a financial planner, I want to work with me,” kind of person. I was-
Hannah: Tow 30 second sales pitch.
Meg: Yes, I was not going to be able to sort of actively sell. I was going to have to do this approach where people would come to me and ask to work with me. I can handle selling in that way. Yes I was very dedicated to blogging. I probably blogged weekly for, I don’t know, two years, and now I still blog. But it’s more like when the inspiration hits.
Hannah: So you talked about you had these blogs that you started out with that you’re like, that weren’t hitting the mark of what you would… That bar that you would have for yourself now. You’re talking about like a Roth IRA. How would you describe the content that you put out now versus what you did then?
Meg: A lot more curse words now.
Hannah: I do love it.
Meg: They’re not curse word related, but there are occasional asterisks. They’re just much more my voice. People have said, “Hey, when I read your blog, I totally hear your voice in my head.” And that makes it a lot easier. Right? I just hear what I’m thinking in my head and I put that on paper. So it’s a lot easier. It’s a lot more fun. And also now that I have a sort of long enough track record with clients, and with prospective clients, and just with the larger women in tech community, I know exactly what questions they have, because I’ve heard them ask them. And so I just answered those questions in my blogs more or less.
Hannah: Is that the primary way that you found clients to start your firm, is through your website, or, how did that kind of progression, because I know that’s one of the biggest struggles for people starting out?
Meg: Yeah, I think I have very, very few people say, “I became your client because of your blog,” but the blog and the website were the home base. I mean very recently, I didn’t expect people to just stumble upon me on the intertubes, but I wanted to have a good home, so that I could invite them there effectively. So I would say the most effective things for me at the very beginning were getting involved in online women in tech communities.
Meg: These were mostly Facebook groups. I would say my alumna group. I went to a Wellesley College, which is an all women’s college, very active alumni network. They’ve got approximately 6 million Facebook groups on different topics. One of them is on personal finance, another one is for alumni who work in the tech industry. So I participated heavily in those two.
Meg: There is also a very active online group called Tech Ladies, which I joined their Facebook group, spring of 2016 when there are about 500 members, and now they’re over 50,000 because the women in tech thing has just developed so quickly over the last few years. And so I would participate in those groups, and I was oftentimes the only financial person in the women in tech forum.
Meg: But when people would ask questions about like, “I’m being offered stock options or RSUs, or more stock options or more salary, how do I make those decisions?” Or those sorts of questions. And I could then answer from a point of sort of professional wisdom as opposed to just anecdotal, “Hey my brother does this or whatever.” And through getting exposed through those forums, then people started to… You know, sometimes I would post a link to a blog post I’d written on that topic that they’re asking about, and they would follow that blog post back to my website and I would give webinars through those forums.
Meg: I wrote occasional articles for Women 2.0 through their Medium blog. Again, just going to where women in tech lived online, and sort of trying to participate and contribute value in those existing communities.
Hannah: So you go all in, your husband quits his job, where were you at as a family at this point?
Meg: Yeah, no, the was for him to quit and become a stay at home parent. And he did and he still is, and it’s awesome, and I don’t know how parents have two full time jobs. We’ve never had two full time jobs, but I don’t know how people do it. I mean clearly people do. I’m very glad that we’ve been able to avoid that because, I get a home cooked dinner every night. It’s awesome.
Meg: You had asked me a question earlier, which I didn’t fully answer and I wanted to be sure to get this out. That I do this online marketing and I’d mentally budgeted for not really making any money for three years, and then at about eight months into launching my firm, you know, that business plan that I’d written, I think I only budgeted for like I’m going to get five clients this first year.
Meg: And I’d already gotten I think five or six clients by eight months in, but I just fell into this. I just kind of had a nervous breakdown about eight months in, it’s like a whole week I can do nothing but cry and curl up in a fetal position. And say, “Maybe you need to go get a job dear,” to my husband. And between him and my business coach and my therapist, they pulled me out. And that was the lowest point I would say. No there were still ups and downs, but that was pretty much scraping the bottom.
Hannah: So it’s interesting because I know a lot of people who started firms, and a lot of them have maybe not that extreme or maybe even more extreme stories of kind of hitting that point of like, “Oh my God, what have I gotten myself into?”
Hannah: If you were the therapist for somebody listening who’s hitting one of those points, what would you tell them?
Meg: Take care of yourself first. Put yourself before literally everything else in your life. Because that is what pulled me out. I remember talking to my therapist and like who could barely understand me, because I was like blubbering the whole time. I was like, “I really want to be able to model for my two little girls that, mommy can run her own business and manage money.”
Meg: And he said, “You are going to model having a heart attack to your children if you continue this way. What you should really be modeling is self care.” And just the way he phrased it, he was probably a little more articulate than I just was. But the way you phrased it really hit me. And so I think the next day I just got really serious about exercise, for me. Exercise was what worked for me, making sure I exercised every morning, and that just had a tremendous impact on my mental health and just sort of shifted my perspective.
Meg: Like the reality hadn’t changed at all, I just felt a little more hopeful about it all. And self care continues to be a struggle. I can tell when I am not putting myself first enough. And you know, my husband and I have figured out what I need. You know, every day when I get home from work, I take 15 minutes to myself to read every weekend I need two hours to myself at the coffee shop to read.
Meg: And when I don’t get that it’s really obvious. But it’s just a long slog. So the answer is not go out and hustle some more in my opinion. It’s just going to take time. The answer I think for a lot of people is going to be make sure you’re taking care of yourself, make sure you’re replenishing yourself physically, emotionally, spiritually, every day. That is the only way you’re going to survive this.
Hannah: It’s such an important message and it’s for everybody. But especially as a woman and now a mom, I mean this is resonating with me. And I’ve seen so many people get so burned out and they leave, especially women. Because we have this narrative that we have to do it all. And so I think that’s such such an important message to share with people.
Meg: Yeah. I will say one of the most awesome things I have ever said, I said about a month ago when my 10-year-old daughter said, you know, “Hey mom, do you want to do this fun game with her or something?” I said, “I would love to darling, but you know what, first I need to spend some time by myself at the coffee shop.” And I was like, “Ooh, look at that. I am taking care of myself and I am modeling for my daughter that mom comes first sometimes,” it was amazing.
Hannah: That’s really mean. So you hit this low point at eight months into starting your practice. I can only imagine, especially being the sole source of income at that point. At what point did you realize that you’re going to make it?
Meg: Probably in about a year in, I think I got requests from a prospective client and they said something like, “I read one of your blogs or I saw you in this tech ladies forum,” some indication that all of that content marketing work, I’ve done all that focus on the women in tech space was now finally paying off in this complete stranger, and had reached out to me.
Meg: And then that just started happening more, more people. Not a lot, a few a month, but people started signing on, people who are in my target market whom I had no connection to other than the content I put out there started contacting me. And that started happening about a year in.
Hannah: And so is that how people find you now? Is that the main source of like your new clients and kind of that new clients coming in?
Meg: Honestly, at this point probably referrals is the biggest. Referrals from existing clients. And I think part of that is because I am fairly narrowly targeted in who I work with, that my clients have lots of friends just like them. And when their friends say, “I’m looking for a financial planner,” my clients can say, “Oh my planner works with people exactly like me and therefore with people exactly like you.”
Meg: So that is probably my biggest source of new clients now. And pretty much everyone else is through, “Hey, I googled Uber RSUs and I found your blog post.” So it’s the content marketing is sort of the second biggest source of prospective clients at this point.
Hannah: So I’m always curious about people, especially when you start your own firm. And you were able to work under another CFP and another financial planner. But I’m curious about your progression of how you worked with clients, and how you became a better planner in that process, or what you’ve learned in that space.
Meg: Yeah. One of the most memorable points of working under… You know, as an employee for this slightly larger RIA in Virginia, was when the founder and CEO and boss man said, “Your technical skills are amazing. You’re probably better technically than anyone else in the office.” But two things. One, it’s only with experience with clients that you learned the word he used was discernment, sort of reading the client’s.
Meg: Like, “Yeah, I can tell you to do this technically optimized thing, but if you don’t do it, I might as well not have said anything.” So what less optimal piece of advice but still helpful can I give you that you actually implement. And also the fact that his firm didn’t need all my technical expertise. I was not a good fit for them. And so I’d always had a role as support. And then when I started my own firm, all of a sudden I am the lead planner.
Meg: I am in charge of this client’s entire experience. And that was scary. And so I started out with… You know the process and the deliverables I use were just modeled on what I’d seen in the previous RIAs I worked for. And then I just iterated like a mad woman based on what I saw my clients needing from me. Because then my first clients were like a 26 year old couple in the Bay Area who had just started high paying tech jobs, had never gotten this much money before, had a net worth of $10,000. Their needs had nothing in common with the clients I had previously seen.
Meg: So I just started with basically a template, and then just changed it madly based on what I thought would be most helpful for the client I am now working with.
Hannah: And so have you seen that evolve? Like how you work with clients?
Meg: Oh good Lord yes. I think it’s slowing down now three and a half years, in part because I’ve gotten a lot closer to what I think my clients need. And also because, I don’t know, we have 40-ish clients now, and it’s just harder to make changes at this point. Yeah, yes, it absolutely evolved very rapidly for the first two years, and the evolution has just slowed, but we’re still making changes.
Meg: I mean currently I’m trying to actually go back to a one page written plan. I started with one page written plan, got away from it to a more robust thing, and now I’m going back to it. And that’s hard to do when you’ve got 40 existing clients and you’re starting with two new clients a month. And so the changes definitely are slower now. But when it’s clear that what we’re currently doing isn’t meeting a client’s need, there’s still an attention to, “Okay, could the process be better in a way that would serve all clients?”
Meg: Just constantly paying attention to little tweaks that we can easily make or bigger tweaks that we will have to prioritize and schedule and that sort of thing.
Hannah: You know, you’ve talked about being a Fee-Only firm, so I’m curious, how are you charging clients, especially if they’re coming to you possibly with starting at like a $10 million net worth?
Meg: Yeah. Well, when I first started, I charged a fairly low $150 a month retainer, and quickly figured out that I was working way more than $150 a month worth. And so sort of bumped it up quantitatively. But I would say not qualitatively, maybe she should like $250 a month. Since then, I’ve raised my fees a couple times, and the biggest raise when I raised it to $5,000 minimum per year was to other more established financial planners.
Meg: I spoke with them and they just said, “Look, just raise it. I promise you the perspective clients will still come. It’ll be better even.” And I was like, “Okay man, I’m just going to take your word for it.” And so I did it and lo and behold they were right it’s like having the higher, higher price somehow signaled I was worth more. So there’s been some difficulty in my firm because I’m in the state of Washington, they’re very thumbs up on AUM models, but the only other model they allow is hourly, they do not allow a retainer model.
Meg: But I still wanted to be able to… I want my messaging to be this fixed fee, like very transparent. Your fee is $5,000 a year. Your fee is $10,000 a year. Even if behind the scenes rather, the calculation is AUM based at this point. And the minimum is a $5,000 for a single person, $7,000 for a couple. Regardless if your AUM zero or small, that is still what you’re going to be paying. And obviously just then the emphasis of the work is going to be less about investing and more about all of the other pieces of the pie.
Hannah: And so I know that there is some regulatory issues. Are you able to do that now or did you have to kind of finagle how, how it’s structured?
Meg: Yeah, I mean I’ve gotten the explicit… Oh, I hesitate to say blessing because they never actually say yes, they just say, “I see nothing wrong with that at this point.”
Hannah: At this point.
Meg: Yeah, exactly. But the way that my fee model is structured now… Because I had just a very sort of typical, “Hey your retainer model your retainer is 350 bucks a month,” and the regulators came in and said, “We can’t assess whether or not that’s a real value. If clients are getting value for that, unless you’re able to match that up to either assets you’re managing, or the hours you’re working for a client.”
Meg: And some of my clients have plenty of AUM, and so I can charge the fee I need to and not have to worry about sort of regulators saying that’s an unreasonable compensation. But a lot of my clients don’t have enough AUM, which is totally reasonable given their stage of life. And so for them, I need to be able to justify it to the regulators in terms of hours work, so we do have to track hours worked for those clients.
Meg: But I still quote the fee and they pay it in terms of a fixed annual fee that they pay monthly, and just every six months I then have to send them a special invoice saying, “Okay, in the last six months you’ve paid x dollars and we’ve worked Y hours, here are the tasks we’ve done for you. Now the hourly rate, we’ve earned Z dollars. So you’ve paid X, we’ve paid Z… I mean we’ve earned Z as long as what we’ve earned is greater than what you’ve paid, we’re all good.”
Meg: So it’s a little bit convoluted in this sort of every six month hours reconciliation, but I’m still able to quote them a flat annual fee that they just paid 1/12th of every month. And I’m still able to sort of maintain transparency, ease of understanding what their fee is and, not go to an hourly model because I really don’t want to impose that sort of transactional relationship on clients.
Meg: I want them to reach out to me when they have questions, and not feel as if like, “Oh God, no, I’m going to incur an hourly charge from Meg.” I want sort of the buffet model of you’ve paid once, eat all you want.
Hannah: I like that buffet model analogy. And I really admire that. Like you’re really saying like, “What’s best for my clients?” And then building around that. I think that’s a really important element. I feel like so many of the few conversations we get are all about us instead of about our clients.
Meg: Yeah, and I must say necessity being the mother of invention, sometimes the regulators did make me think a lot about how to arrange my fee models that were both satisfy regulations, and still convey the message I wanted to convey to clients.
Hannah: Well, what’s next for you? Where do you see yourself going in the next five or 10 years? Where do you want them to go?
Meg: Oh, good Lord. I’m so bad at those questions. I can tell you where I think I’d like to be in a year. Very early on, I think about six months in, I had this revelation that I wanted to become the premier financial planning firm for women in the tech industry. That was my Beehag, and that was what motivated me to hire a business coach. And so I still think I have that goal, but I don’t know what that looks like.
Meg: Does that mean I’m huge and we’re serving thousands of women in tech? Or does that just mean that we’re boutique as it were, and just happened to have that cache of being the best firm for women in tech. And I get to speak at conferences about that topic and that sort of thing. Right now, we just hired our first associate planner in September, so now we’re a team of three.
Meg: Yeah, thank you. It’s been amazing. She’s been amazing herself and, I think that’s going to be it for the next, you know, definitely for the next year, and I hesitate to plan beyond that. I mean, honestly from a business perspective, my goal right now is to increase revenues so that all three of us are being paid adequately. Because I’m still not getting the salary equivalent that I’d like to.
Meg: But I think with a team of three we should be able to scale the business, and work on the processes and the client service in a way that will allow us to get there. And I’m really just focused on that right now, because thinking beyond that just gives me hives.
Hannah: You know, it’s so funny. I am such the visionary, like I just have so many ideas all the time and it’s so refreshing to hear somebody being like, “I’m just doing the work, like where I’m at.” And I think that’s really cool.
Meg: Yeah. I sort of marvel at people like you, like how can you possibly know where you want to be in five years? I don’t know.
Hannah: Well is there anything else as we kind of wrap up, any other final pieces of information or knowledge or wisdom that you want to leave the listeners with?
Meg: Well, I’d say the one thing… Because you had mentioned that this podcast is largely targeted at people sort just entering the career, career switching or coming out of school or something. Is that, how much use I found in informational interviewing? Just asking people take them out to coffee, which they of course never take you up on. They’re like, “Yeah, just come to my office.” Yeah.
Hannah: Just getting me to leave my office.
Meg: Exactly. Just getting a really broad perspective from a lot of people about what the possible paths are. And when I lived in San Francisco, I got involved in local professional organizations, and that gave me exposure that I would have been hard pressed to find otherwise. Right now, living where I do in Bellingham, Washington, there’s no real feasible way for me to get involved because there, there is no local professional organization.
Meg: But especially if you live in a place where there are local FPA and after the chapter is just start going and getting involved to the extent you can. Because that’s how you stumble upon those opportunities and those connections, or those dumb luck things. It’s just by putting yourself out there and making connections with a whole bunch of people.