Monday, February 2, 2009

Boomer’s Wake Rule #6 – Build a Team of Advisors, a Group of Peers and an Army of Soldiers

Boomer’s Wake Rule #6 – Build a Team of Advisors, a Group of Peers and an Army of Soldiers
Although this is the least investment specific rule of them all, it is still valuable to think about whether you have a powerful network capable of assisting you in growing your business or portfolio to the next level.

In business and investment, you need 3 types of people in your network to be successful. You need:
A Team of Advisors
A Group of Peers
An Army of Soldiers

Team of Advisors
Everyone “knows” that they should have advisors in their lives, but if you aren’t fortunate to know and have access to seasoned pros to call on to help you figure things out, you may feel stuck. Where do you begin?

Your team of advisors should consist of the following:

A “Proven” Financial Planner – How do you pick one? Well, it isn’t as easy as you might think. The HR department or 401k salesperson your company provides for you may or may not be such a good choice. Does this person have a strategy that aligns with yours? Do they understand today’s complex markets or do they simply want to put you into a formula they learned in the first week of training back in 1996? Whether this person is a trusted friend with experience making money in good times and in bad or an actual financial planner who has been successful in good markets and bad, make sure they are aligned to your concerns and not putting you into a boilerplate strategy for a quick commission.

A “Great” Accountant – As nice as Turbo Tax and other on-line services are at helping you process your taxes, finding an accountant that is aligned with your current and future needs is critical. Your accountant should have experience dealing with the investments and businesses concepts that are most important to you. Otherwise, the accountant will give you bad advice and cost you money. Everyone has a cousin, uncle or friend that has been doing taxes for years. Keep in mind that just because they can get tax returns done doesn’t make them a great match for you. If the following concepts mean anything to you (Google each if you want to learn something valuable), make sure they mean something to your Accountant: Practical differences between LLC, S-Corp and C-Corp, double taxation, AMT, tax deferral, management companies, living trusts, Traditional, Roth, Sep IRAs, 529 Plans, 1031 Exchanges, Property Depreciation, Loans, Dividends and Bonuses.

The “Big Picture” Advisor – It is very important to honestly assess who you really are. Do you come up with the big idea and can clearly see the vision of ideas carried out in the future? Are you more the manager, who works great with others to make sure that goals are being met? Are you a salesperson that just needs to be out there selling? Or are you the super skilled “doer”, who just gets things done, period! The world needs all of these so there is no shame in being one or the other. But it is dangerous to your investments or business if you mistakenly think you are the big picture person when you are not. You can easily get caught up in tactical issues when a global solution could completely save you time and money. You can mistakenly drive the company or investment in the totally wrong direction. Therefore, it is helpful to have a big picture advisor on your side. This advisor is great to plant seeds in you and for you to bounce ideas off of.

Don’t know any big picture people? How about using some of the on-line newsletters for ideas?

Here are just a few I recommend in the investment arena:
Elliot Wave (Downward Market Bias): http://www.elliottwave.com
-- Subscribe to the Financial Forecast Service at least
HS Dent (Demographics Based Investing): http://www.hsdent.com
-- Subscribe to the HS Dent Forecast
Agora Financial (Mixed Biases, US, Global): http://www.agorafinancial.com
-- Check out the Web Resources Section. 5 Min Forecast, Daily Reckoning, Rude Awakening are all great. And either inexpensive or free to subscribe.
The Street (Generally Bullish Bias): http://www.thestreet.com
-- Lots of free content. Or subscribe to Cramer’s Action Alerts Plus to trade with Cramer. Filter his research and investment ideas against your own philosophies.
And of course, Boomer’s Wake (Demographics, Investing, Global Discussion): http://www.boomerswake.com


Other Advisors – Based on what you are doing, you will need different people. A great and creative lender is important if you are buying real estate as well as an honest RE Agent that keeps you in the loop on good deals and away from bad ones. A Board of Directors or Business Advisor has tremendous value for your business. An expert Lawyer, preferably one who left a large firm to start his own practice, can be more important than you may realize and can save or make you millions. A Life Coach, Fitness Instructor and Relationship Coach can all help round out your life and make sure all areas working to your advantage.

Group of Peers
Peers are so important in business, investment and in life. Having people you can bounce ideas off of (over a beer and in a non-formal setting) is priceless. Of course you need to understand the expertise of your peers and make sure it is compatible with yours. Your friends telling you how you can’t make a dime in this or that market because the blindly bought a mutual fund in their 401k in 2001 isn’t exactly the best candidate for investment peers. Find people who are also committed to fighting the fight, who are having some success as well as failures to share and who aren’t afraid to evolve their ideas over time. Make sure you setup specific time to meet with them on a periodic basis and in an environment that promotes real discussion.

In addition to people you know, the Internet makes it so easy to find more peers. Search for blogs on topics you are interested in. Start discussion threads or e-mail people directly. Find videos on YouTube that lead you to your peers. Go to tradeshows and meet top people in your industries or areas of focus.

Just make sure you establish a periodic system of staying in touch with the right peers. They will not only be extremely helpful when you are stuck, but can also turn what sometimes feels like a lonely endeavor into a fun and interactive process.

Army of Soldiers
When ideas grow from concept to reality, you need an army of skilled people to help you do the work. One of the greatest things the Baby Boomers gave us is their kids. The Echo Boomers are hard working, creative and think out of the box. And many are hungry to learn, grow and become successful, considering you their advisors. It is a win-win.

Whether your idea is sales oriented and you need sales professionals to help close some business, or your idea is technical and you need programmers to write you code, you need to be able to staff up when the timing is right. Before it gets too late, start to collect business cards, build networks (Linked In/Facebook) and even make connections with outsourcing firms in Asia, Europe or Latin America, who can scale up on demand and at rates much more affordable.

Conclusion
Everyone has great ideas or strong desires to make money as a contractor, to build a business or to make a killing in the markets. Successful people execute powerfully, learn from mistakes quickly and use wisdom of other successful people to fly through the investment or business climates much smoother than those going at it alone. Start to build your teams now, before you need them and make sure to periodically take a hard look at how your current network of Advisors, Peers and Soldiers line up against your investment and business philosophies today and your plans for the future. As with anything else, take some risk, get into action, find good teams and you will start to succeed and even thrive.

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