Starting your Financial Planning Business: what to do and where to find support with Clayton Daniel – Transcript

Gwen Lazarito
Hey, guys, welcome to another episode of the financial planners Southeast Asia podcast going here. And today, I’m with Clayton Daniel, who is a former financial advisor and author and managing director at x y advisor. So, welcome to the show clay.

Clayton Daniel
Hey, thanks for having me, Gwen.

Gwen Lazarito
No problem. So I think I mentioned this a while ago that this has been one of my bucket list for the podcast to have you on board. So very much welcome. For, for you to be here. And I guess my first question is that a lot of financial advisors whom I’ve already interviewed, asks about what is x y advisor? So from the one of the founders of x y advisor, like, can you tell us what it is?

Clayton Daniel
Yeah. I mean, it’s, it’s the most obvious question. If you really think back to its roots, it was a couple of advisors who were sharing learning with one another, to get better at financial planning. And then we realized that if we put it, like a label on it, if we gave this the sharing and learning and then that we could then invite people who were far better than us at financial planning to come in and teach us how to be even better at being your financial plan. And so ultimately, I think, at the time I had a blog, it was called XY advisor.com. And no one was reading it and wasn’t very good to begin with. And I think just to say, he’s, like the $10, or whatever it is to register, you know, a new URL, I just said, Hey, I’ve got this name already. It’s called XY advisor. Let’s just use that one. And, you know, we can begin inviting great advisors to come and teach us how to be better at what we do. And so really, it started as an event. And that and that events, sort of, you know, it was one event that was to event and then there was three events. And then the, you know, the events were kind of six months apart. So we thought, how can we sort of speed that up. And so we started meeting up digitally, like to have a discussion, and we’d get sort of maybe 10, or 20, or 30 people on a zoom call. And we would discuss different things from there. You know, that was only happening once a week. So we thought, how do we accelerate this more? And then, so we started a LinkedIn group, and then that LinkedIn group grew to about five, six, or maybe 700. And then we moved across the Facebook, because the conversations were were better on Facebook than they were on LinkedIn. And then the LinkedIn group got to 4000. Sorry, the Facebook group, that’s 4000. And then we two years ago, we launched the X Y platform, and we’ve already grown to 5000. And yeah, so ultimately, it is an ecosystem now of events, podcasting, and sharing and learning on a platform where advisors can simply just get better at what they do for work. So long explanation, but thorough.

Gwen Lazarito
Yeah, so Well, exactly. And that’s why we’re here now. Right? So this podcast, the financial planner, Southeast Asia podcast is, is part of that ecosystem, where our goal is always to drive the positive evolution of financial advice. But yeah, so let’s back up a bit. So x y advisor was created for financial advisors. And you when you started out, you were a financial advisor. So can you tell us how did you get into financial advice in the first place?

Clayton Daniel
Yeah, good question. So a lot of people struggle to ever learn what financial advices and even less, learn how to give financial advice or financial advice is a really peculiar career path. It’s a kind of a peculiar topic in general. I mean, money is so emotional, right? It’s like, it’s like the most emotional you know, besides health. Besides say the health of yourself and your loved ones money is probably the second most in You know, emotional topic. And so as soon as you get into the realm of something so emotional, it becomes almost peculiar that you would go to someone for help with, right, or, although we are the world is slowly changing that, you know, a lot of people these days have a personal trainer for their fitness, or they might speak to a psychologist for their mental health. So I guess the growth of those professions is designed to help health and wealth and things like that are growing, it’s it’s a relatively new professions. So compared to accounting, which has been around for a long time, you know, and that is dealing with the financial outcomes of the business dealing with the financial outcomes of an individual has really only been around the guests for about, you know, kind of 40 years max. So it’s kind of like a new profession. And the way that I stumbled upon it is through accounting. So I was an accountant, a personal accountant, with a company, accountants, I was a personal accountant. And I was sort of meeting with people on a year to year basis. And then I was sharing an office with some financial planners, and they were dealing with clients over the scope of their lifetime. And I sort of looked at my situation, and I thought, how, how, I guess more of a grand vision, it was to work with someone over the course of a lifetime, rather than a on a year to year basis. And I sort of swapped careers from being a personal tax accountant across to a personal financial planner.

Gwen Lazarito
Wonderful. And so once you became a financial advisor, I knew that later on, you started your own business. Yes, right. Why did you start your own business in the first place?

Clayton Daniel
Yeah, well, I always wanted to start my business. So it was it was a need a desire and drive, I would say, to build a business was probably my core premise. It’s actually how I got into tax accounting was, uh, you know, I, I was doing music to begin with, and then I went, Yeah, yeah. And then. So the only way we’re doing music is unless you sound like, you know, Justin Bieber, which I didn’t, there’s not a huge chance of making a career out of it. So. So as a failed musician, I ended up going to University, studying accountancy. But the reason I went to university study Accountancy is because I wanted to get into business. And I didn’t really have any idea on how to do that. So I started with what someone described to me once as learning the language of business, which is accounting. And I mean, I kind of agree with that concept. At this stage, which is, you know, there’s much more to it than understanding galaxy. But yeah, it was where I started. And so my desire to grow a business started with, you know, going to uni and becoming an accountant, the accountancy led to financial planning, that sort of at that stage, you know, I’d sort of made the decision to move into the world of business at about 22 into the journey from, you know, the journey from university tax to find your planning took about eight years. And then, so when I was 30 years old, like two weeks before I turned 30, I started my financial planning business. And so it took me you know, eight years to get there. And interestingly, I sort of four years later, I then sold that business and then cross into tech startup land, which, which, I guess goes down the path of being an entrepreneur even more so because now I’m sort of in a in a product rather than service. But interestingly, I’ve kept my service background as a huge part of what I do now. And I’ve chosen to work in tech startup land, but only in the financial advice room. Yeah, kind of combining everything at this stage. Yeah. And

Gwen Lazarito
that’s wonderful, right? So that means that you all those eight years, that you’ve had, were never put to waste because now you’re still doing like all the things you love to do you love financial advice and helping people throughout their journey. But now it’s the journey of financial advisors in this ever changing landscape, because so financial advice in Australia started about, like 40 ish years ago. So it’s, it’s still relatively new, although older than in most countries, especially here in Southeast Asia. And so I guess, like, What was the atmosphere like in the financial advice industry where when you started years ago, and how has it changed over the years, especially now? Like, I know, there are a lot of changes in financial advice just this past two years.

Clayton Daniel
Yeah, yeah. Yeah, absolutely. So I guess in terms of changing financial advice does change a lot. There’s two things that change it there, there’s one element of the bottom up. So the bottom up approach is really financial planners independently all over the world over the last 40 years have come to a very similar similar conclusion. And that is, how important financial advice is, when you really, I guess, spend time to become a great financial planner. Yeah. And what’s kind of interesting is in every single territory, so yes, financial planning is more mature in Australia than it is Southeast Asia. And I’m expecting the same journey of, of finance planning Southeast Asia to follow what’s happened here in Australia. And what happened in in Australia sort of followed what had been happening in America as well. So realistically, if you think about it, that bottom up approach is just advisors all over the world at different stage over the last few decades, have come to these independent conclusions, which is, I can do so much more for a client than then just give them a product. Now, price of products are extremely important. I’m a massive fan of them. And they’re pivotal to every single piece of financial planning. So I’m not I’m not, I guess one of these people that says, Oh, you don’t need financial products, the good faith, plenty, I believe you do. And it’s pretty obvious that that’s the case, at least, to my mind, in each territory, financial planning always starts out with financial products, it’s a very easy reason to this is the it’s the easiest and best way for large product providers to make money when they enter new territory. So they entering new territory, they create a sales force of people who sell that product. And that’s where financial planning starts. And then out of the group of those out of the initial Salesforce, there’s, you get the first people that go, Hey, wait a second, when I’m speaking to clients about, you know, getting to their, their sister’s wedding, in two years time the savings that they’re achieving what they need to achieve here. Maybe the product that I’m selling doesn’t solve that, for that goal. Yeah. And so now all of a sudden, I need to do something else, do I need a different product to sell them? Or do I need to sit down and tell them how to manage their money in a better way, so that there is money on, you know, available to them in two years time. Now, it’s not as simple as just turning around one day and saying, Hey, this is how you do it. There’s a journey that each financial planner kind of goes through, where and it’s often on purpose, where you arrive at a point in time, and you think I want to be able to deliver more than just providing a product. But then the journey on how to get to where you need to get to is very difficult, because there’s not a lot of places or people, you know, publicly available, that it’s easy to go to where that information is getting shared. And hence when you come back to X, Y, hence why we started this podcast, and the platform and the events is we wanted to produce a way for advisors all over the world, to turn around and say, Hey, this is a way to get better at my job by simply learning from other experts. And the thing about learning from other experts is really interesting, because the further or I should say the more you learn or the more of an expert you become in a particular field, the less likely you are to learn from and the more likely you are to learn from someone else. And so and because a lot of this sort of expertise, knowledge is very difficult to codify and put in a book. So it comes down to the sort of individual situation that people find themselves in, where they find a particular thing is difficult. And the only way to solve it is to really flesh it out with, with peers with like minded experts. And so, you know, when I started my company, I realized there was so much I didn’t learn. And I also realized is very difficult to find a place to learn how to get better at these things. Hence, why the events every six months, the digital catch up once a week, and now the 24/7 platform, which is dedicated in its purpose, rather than being on another search platform is really the best solution that I could imagine as that guy who started the company, you know when I did, yeah, that’s

Gwen Lazarito
I totally agree with that claim. Because when my husband’s Started in financial advice. And because here in the Philippines financial advice is still relatively new, like I thought, an insurance advisor or a risk specialist was the same as a financial advisor. So when I was speaking with Christian, my husband, we, I would tell him, so like, you know how to do this, and you know how to give advice for this and that, and then later on, and he thought as well that it was the same thing, right. Later on, as he went through his trainings and all that he realized that there are still limitations that he, he has as a risk specialist. But ultimately, he really wants to be a financial advisor. And he realized that there are so much to do, and then so will people to talk to so because, like I said, the industry is still very, in its early stage here, it’s still growing. And that’s why it’s really nice to have that community because it’s, it’s sort of like, you have this assurance at the back of your head, that if you have questions in the future, and you will have lots of questions in the future. There’s always like a group of people who you know, can answer these questions, or if not answer these questions have the same sentiment towards a certain topic. And I think that’s very powerful. The sense of like, a reassurance that someone’s got your back right in, in your in your profession?

Clayton Daniel
Yeah, no, absolutely. And it’s, it’s always, it’s difficult when you feel like you’re out on a limb by yourself. Yeah. And so if you can see people who are successful, who are experienced to a capable, who are great at what they do, sharing common threads with you, Now, everyone’s going to be slightly different. But if you can sort of find a uniform approach to a certain situation, yeah, it’s reassuring, but more so than reassuring, it’s actually operationally helpful. So on x, y, you know, there’s, there’s hundreds of these kind of files that you can download, that gives you a structure to at least stop the process on starting to deliver a new, a new type of financial planning. And I will say, so, in I am sensitive to this, like, x y right now, because we’re still in our infancy is very Australian focused, however, in I would say, I guess, the next 12 to 24 months, we’ll see a, a focus in on the different territories. So right now, we have a podcast that is dedicated to financial planning in Southeast Asia, but then shortly, we’ll have a platform that’s dedicated to it as well. And so and so, you know, like, with Kristian, who who I know, he, you know, like the conversations in the territory of Southeast Asia and the Philippines specifically, is a little bit different to Australia, and is a little bit different to America. And Australia is a little bit different to South Africa, during the UK is differences, Canada, and all of it, like each of these territories are different to Brazil and Italy, and like, you know, Japan and so, so we are conscious of this, and were sort of in the process of solving that problem from from a systemic route. I would say issue. And once that solved, I’m expecting sort of each territory to to improve holistically what financial planning is, at a much rapid rate.

Gwen Lazarito
Yeah, for sure. And that’s, I guess, a very appropriate way of segment into my next or segue. That is to my next question, which is a lot of financial advisors that I know, especially in Malaysia, they try to when they start their own financial advice, or financial planning business over there, they tried to model their advice in in a way that it’s, they take a lot from the Australian financial advice model. And I wondered about that, like, why not in the US or why not in the UK or Japan where, you know, it’s, it’s in Asia, it’s closer, but they tried to model it in, in the Australian financial advice framework. Why do you think that the Australian financial advice works, or why does the model work?

Clayton Daniel
Yeah, really good question. I think that’s because where You know, x y is the first community of its type in the world. Right? So where else? You know, where else do you go? I still, especially if it’s free, right, like, show you can join, you can join me Yeah. So that you can join these amazing courses and sort of private communities all over the world that you can pay a bunch of money to join it, and they will go through a certain framework and a certain belief system, and, and, you know, use certain technologies. And and I guess it’s a prescribed framework. And I want to be clear, a lot of these companies are doing amazing stuff. Yeah. So I, the reason why I would imagine places like Malaysia, of following Australia is because the XY model is different. It’s free. I mean, sure, there’s like a 10% of people who do the paid for options, which is great. But that’s only, you know, 90% of people currently aren’t doing it. So it is free to join. And, and it is an open environment where you can kind of pick and choose what it is that you want to adopt, and what it is that you want to ignore. And I think that sort of that loose environment, if you will, or the need to, or the ability to learn and get better, without having to commit to a particular framework is sort of helpful. Like, at the end of the day, I would always recommend at some point in your journey, paying to be a part of, you know, like a framework and but if you if, if if the affordability is there sure, like it’s a great way to excel. But in terms of a great place to always come back to whether you’re 12 months in or 20 years in a place to come back to and explore different ideas that aren’t in a particular framework, were the only place that I’m aware of in the world where this is occurring. So it makes sense to me that Malaysia or, you know, we’ve got members from 20 different countries, yet, it doesn’t surprise me that Australia is now seen as a bit of a guiding in, you know, especially xy is a guiding environment, because, well, realistically, we’re the only ones doing it.

Gwen Lazarito
Yes, that’s true. And the thing that I like, big, I feel like x y advisor works big because of its free model, like a lot of people want to test out like a product, right? Yes. And then. So before they commit to something, they’d like to check it out. And because x y advisor is free, they can always look in and then check and see what the conversations are and see what’s happening. And that’s where they can say like, am I going to commit? What kind of commitment Am I able to give to this platform? And that’s why I feel like it works for a lot of people

Clayton Daniel
across the board, average user spends a little less than 10 minutes per day on so the commitment is relatively small, I would say one of the things that we pride ourselves on is the ability to increase someone’s professional expertise without a large monetary or time cost. Yeah. So that’s kind of one of the key things that we’re trying to achieve.

Gwen Lazarito
Yeah. So like the user comes in, checks around has a particular question in mind, and then looks for it in in the conversations and if he can’t find it, that he asks.

Clayton Daniel
Okay, well, yeah, precisely. I mean, that that would be one use case is if you have a specific question, there is existing conversation, there are downloadable documentation. And if nothing exists, yes, of course, you can ask. However, that’s not the early use case. A lot of people are going on without a particular question in mind, and simply going on to look at what other questions are being asked. So so it doesn’t have to be specifically to solve an immediate problem. I mean, just by simply going on and spending a couple of minutes a day reading, what other advisors what other advisors challenges, you’re kind of opening yourself up to an environment where you’re learning vicariously through other people’s problems. So you might not even realize that something is a problem yet So by looking at what the other problems are that are being experienced, you’re first of all being informed of what problems exist. And then you’re also looking at what those solutions are. And so that’s the second use case, a third use case is you might be the kind of advisor that is looking to build their reputation within their peers. Yeah. And so these kinds of advisors are actually just going on and answering questions, not even asking questions, but contributing to the body of knowledge of what kinds of planning is, they’re uploading documents, they are answering questions. And their goal is to be seen as a thought leader, their goal is to attract really good talents. So the best way imaginable to sort of get the best advisors to work for you is to be known as being a great advisor, Ram. And then, of course, the other option in this category is just because a lot of people like to be generous with their knowledge. So they might not even have any incentive other than the desire to drive the positive evolution financial of us to contribute in a way that is scalable, so they answer one person’s problem. But you know, 1000s of financial planners all over the world are learning from them. And that’s a great way to contribute to your own profession.

Gwen Lazarito
Yeah, that’s true. And I think I would take in this to like, when I started using LinkedIn, right, so I, when I, this sounds funny, but when I try or if I want to feel professional, I open LinkedIn. And I look at, yeah, so I look at, like, the posts, especially from the ones that I follow, like all of the, the professionals out there that I feel like are doing such a great job. And then they post or ask excellent questions, or they post excellent stuff. And I feel like I just become a more professional person after getting into LinkedIn and reading all their posts, all of everything that they’re sharing, and I feel like x y advisor is like that. So if you get into the platform, 1015 or 30 minutes later, you come out, like a better financial advisor or a better paraplanner, or a better financial coach. Yeah, so yeah, I guess that’s what I would like to think that x y advisor is for so thank you so much clay, I guess my last question for you would be like, What is your advice? If if a financial planner wants to grow their business here in Southeast Asia, where we’re still in the process of growing and figuring things out?

Yeah, I think the same strategy works well all over the world. And this is only a realization I’ve come to even since selling my original financial planning business. Now, I learned a lot in the four years that I owned the financial planning business. But I tell you, I’ve won a lot more in the hundreds of conversations of average financial planners, for years afterwards, right? So I’m in a very unique position where I’ve had the chance to ask fantastic financial planners, how they have grown their practices over time, right. And so what I’ve kind of pieced together through my own experience, and then from asking better financial planners than myself, I’ve come to a certain conclusion. And that conclusion is being very specific in who you deal with. Does one thing and one thing early, it attracts the people that you want to work with, in a way that they can’t ignore. So let’s say if you’re a financial planner, and you do regular financial planning stuff, right, and you’re a financial planner for everyone, and then there’s 100 other financial planners who work with everyone, and no one’s different, right? So everyone just says they deal in investments and insurance and taxation and cash flow or whatever, right? You were either, but then someone out of that 100 Guys, I’m a financial planner that deals specifically in people that work in technology. Yeah. So now what’s going to happen is out of those 100 potential advisors, you’re going to have, let’s say 100 potential clients. Now, now 99 Out of those 100 clients only want to, like work in technology, right? So so you think oh, no, I’ve only got one point. sent chances getting this client that you’ve actually, if you’re the only financial planner that says that you work with people that work in technology, then then the likelihood of that person coming to you is almost like 100%. Yeah. Now, the other thing is, there’s a really good saying around this, and that is your target is not your market. And what that means is, if you say you work only with people in tech, what you’ll actually find is there’ll be another out of that 100 potential clients, the one that works in tech will definitely come to you. But then there’s going to be a couple other people that work, maybe not in tech, that maybe consider themselves as the kind of person that that is in tech. And then you’ve got a really high chance of getting those people as well. So for example, like, let’s say to podiatrist, like people that work with feet, or work next to each other, right, and let’s say one says, Hey, I’m a best podiatrist in the area. The next one says, I’m a podiatrist that works with the national sporting team, right? Like, I’m just a regular guy, but I walked past and I see, sure someone says that they’re the best that this person says they work with professional athletes. Now, I’m not a professional athlete. But I say to myself, well, actually, I’d prefer to get looked up to by someone who does work with professional athletes. So even when even if you’re a little bit scared about being in a niche, or deciding like being making a decision on who you want to work with is a small amount of people, what’s really interesting is you will it you’ve got a high likelihood of attracting people that are like that. But also, you’ve got a high likelihood of attracting people that would it would aspire to be the audience that you’re attracting. And so what that so your target is not your market, your target is, is like it is like a dartboard right in the middle is your is your is your exact people that you’re wanting to get. But there’s, you’re still going to get people that are that exist around that target in the middle that so. So the number one is choosing and being clear on how to deliver great advice to a certain segment of society, then, you know, all this other stuff that you that you can get good at in being a financial planner is getting good at the stuff that is relevant to that particular audience. Right. So one of the things that people that work in tech, often have is shares or officers options have shares in the startup companies that they work in. Right. So you need to become an expert in that. Yeah. Right. So now all of a sudden, you’re talking about being an expert in in options, that that people get when working in startup tech companies, or that’s an interesting thing, right. So now, you are working with a niche. And you’re you’re you’re improving your skill set that’s required to work with that particular audience. Now, a couple of things happen here, A, because you’re attracting a certain audience, you’ve got a higher likelihood of getting more people. Yeah, to because you’re offering a specialist skill set, you can afford to charge more money. Three, because you’re offering a special skill set, your clients are going to receive more value. And as a result, earning more money because you’re offering more value to your clients. The end result is that you’re going to enjoy your work more. Yeah. And so and so the key is picking a niche, attracting those people getting an expertise in the lifestyle, like like what common problems they experience is going out and actually becoming an expert and earning more money and enjoying your work. All of that, collectively is one step. Right first step and then second step to the second step to the first step is this. Now that you have a niche, now that you can offer more value, go and speak about it publicly in as many different ways as possible, start a podcast start and then from that podcast, write articles from those articles, right LinkedIn updates from those LinkedIn updates and the articles and the podcasts, write a book. And all of the all of the all of these different mediums are all centered around the fact that you’re an expert in a particular field, and that you can solve the key problems from them, no matter how what kind of content you share. I get those people to come to regular events that you’re hosting by putting on one event per month. So the point of all your content is to attract people to an event, where you’re just going into more detail about that client, that you’re attracting the problems that they frequently see that they suffer, and solutions that that you know, can help them. And then, then all of a sudden, you’ve got content that’s drawing people in, you’ve got a way to meet with people, whether it’s in person or over zoom. And then from there, they can book in for a one on one meaning.

Clayton Daniel
And so you’ve got this entire ecosystem that is constantly set up to attract people further and further into your service. And they will opt in or opt out based upon the message that you’re giving. And by the time that they opt in continuously, and turn up at their first meeting with you. They already know who you are, they’re consuming content. They’re familiar with you so that there isn’t that sort of uncomfortableness in the first meeting. So again, it’s because you’re enjoying your hurt more. If you’re not experiencing that uncomfortableness in the first meeting. They already know who you are. They already know what problems you can help them solve. When you put you know, when they understand how much it’s going to cost, there is a much less likelihood that that fee is going to be prohibitive, prohibitive, because they’ve already bought in. And then the best part is when you get to work with them. And you see all these fantastic results. They’ll turn around and thank you. Yeah. So that whole situation took me years to figure out, but that is without a doubt. The best way to grow a successful, enjoyable, profitable financial planning advice process.

Gwen Lazarito
Right. Thanks so much clay. So I definitely with everything you said, and I know that this came from not only you, but from the knowledge that you’ve also learned from other financial advisors and from my community as well. So thank you so much for coming to the show clay. That’s one thing off my bucket list for specially for this year. Now, if listeners in this podcast would like to get to know you more or would like to have a chat with you, where can they reach you?

Clayton Daniel
Yes, certainly. So I am on the x y platform. So x y advisor.com. Join there, I contribute sometimes there. I also contribute sometimes on LinkedIn. But if you want to hear me discuss financial planning, as you know, like strategically and tactically that it’s on x, y. And if you want to hear me talk about financial planning, I guess, you know, on my soapbox, so to speak, then you will find me you can follow me on LinkedIn. So yeah, in and x y.

Gwen Lazarito
All right, wonderful. And I will go ahead and put all of those information in the show notes. So thank you so much again for coming to the show, play. Have a wonderful day.

Clayton Daniel
Thanks for having me, Gwen. Appreciate it.