Lucy Shair is a Financial Advisor in Grand Rapids, Michigan, and our guest for the February Workshop on Money Mindset in the Fempreneur Forum. Join us at noon EST on Tuesday, February 27. Here I interview her about her work and how Money Mindset can hold her clients back from financial success.
What got you interested in becoming a financial advisor?
I have a financial background, and when I worked for an accounting firm, I used to do taxes for lower income families, and I was always passionate about providing financial education and helping them sort it out. I always had [advising] in the back of my mind as something I’d like to do, but I hadn’t done it because of the bad rap the industry has. It’s a little like a used car salesman. It’s very white male dominated, and it didn’t look like an industry that I would fit in.
Then I got cancer, and when you are faced with that, you stop caring about what other’s think. I decided I’m going to make my place. So right after I came out of recovery I jumped in with both feet and haven’t looked back.
Why do you focus on women?
I like working with women because, for one thing, I am a woman, and I get women. I think it’s really important for people to see themselves when you need to have a trusting relationship. Financial advice is so based in trust. I wanted to be the person paying attention to the women. There are tons of male advisors out there. I like to think of myself as the financial advisor for the rest of us. Because they aren’t going to come to me, and I don’t want to them to come to me.
What do you love about what you do?
It sounds really silly, but I love the people aspect. I really love getting to know the people and what they’re really passionate about. And the problem solving. It’s really creative work. Every person is different and every life is different, and what is important is different to each of your clients. In each case you’re problem solving directly around them in order to improve their situation. I really like that. I love the problem solving – that’s left brain for me. Getting to know the people is the rewarding part. You can take them into a meeting and tell them jargon, but then I ask ‘ok why do you want this money’ and they change. They go from a place of fear to a place of possibility and excitement. So then I say ‘hold on to that, and let’s get you there’.
Tell me a story from your work.
I’m working with this client currently. They’re very interesting. They’re both financial professionals, but they don’t have time to deal with their finances. They’re financial professionals and have so much money just sitting around. Just losing money to inflation. The woman is very much yes let’s [invest] and maximize our wealth and have this money work for us, but the man isn’t there yet. It’s been a process of finding out what’s driving each of them and finding out how to bridge that gap.
So much of the money stuff isn’t about money. It’s about feelings and blocks. In this case she’s very [ready] and she’s getting angry at him because he’s on this other side of this chasm. He’s like, ‘we worked really hard for this money and it’s ours. Let’s not lose it,’ and it goes back to his childhood, I think. It’s my job to take him by the hand a little bit, because you cannot beat someone over the head with logic when it’s emotional or fear based. Yes, the best thing is to maximize the money and build the wealth, but we have to lead him around the block to the healthy choice.
It’s astonishing to me that the people who you would assume have their money most together are making unwise decisions. The opportunity loss for these people last year was in the tens of thousands of dollars.
Expand on the ‘money mindset’ work you with your clients.
For the record, those words never come out of my mouth. It’s a little too ‘woo’ for a financial advisor. I tend to call it emotional baggage around money, which sounds a little more negative — money mindset is cute.
Don’t be afraid to invest in yourself, and the opportunities that will bring money to you. We talk about the emotions we all have around money and how that can lead to not making the best choices. Part of my job is to acknowledge where my clients are and gain an understanding of the emotional baggage of where their money mindset is. Then help them come over from it to a place of health with money. I don’t want to leave you with the fear. I want to take you to a place of opportunity. That’s how I do the best I can for you.
I had a client who said she doesn’t want to invest in anything risky because her parents lost everything and she wants to be secure. I have to tell her that they didn’t have someone like me to help them, and walk her around the big chasm of fear.
What do you suggest an Entrepreneur do to safeguard their work financially?
I will begin by saying that everyone’s situation is going to be different. I really think one thing that I see a lot of Entrepreneurs doing that worries me is they invest so much in their business but they forget to invest in their own future.
From my perspective as an advisor, when I recommend life insurance for people, I recommend it for people who have people depending on them. Then look into term life insurance. If you are doing something that requires you physically to use your body or you’re concerned you’re not going to have the ability to support yourself if you were to be injured or disabled, you could consider disability insurance, but it’s not my first recommendation.
My first recommendation is that you start saving early for the future. I know it’s hard to carve out money from your business, but you can actually reduce your tax liability by paying into a step IRA or other options. That will reduce the amount of tax that you owe.
The reason I say it’s so important, even though it’s so hard to set money aside during the nascent period of your business, the earlier you start, the better off you’ll be. I know many people think they’ll sell their company and be taken care of in old age, but that’s not always the case. In so many cases the business is themselves, and it’s not sellable. So save for the future early so you take advantage of the time value of money. It’s the whole idea of compound interest. So if you invest 50,000 dollars over the course of your 20’s and then you don’t save at all before retirement, you’re still better off than someone who didn’t start saving until their 40’s.
If you are an Entrepreneur and you’re not making money yet, you can’t start saving out of your business. However, if your partner has income, you can put money into an IRA. So there are other options available to you if you have other income in your family. It’s important to not forget about your own retirement. This happens more often with women. Women are more likely to take breaks from employment, and we are also less likely to earn less in traditional employment, and we live longer!
Join us in The Fempreneur Forum for our Money Mindset Workshop and other Monthly Workshops!