Solin’s Wealthier Teaches People How to Invest on Their Own – That’s Not a Bad Thing

sarah charlesAdvisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

A magician never reveals her secrets. It doesn’t matter if the audience fundamentally knows that there is a logical and rational explanation for how that rabbit got pulled out of a hat. Mystery, intrigue, and allure must be preserved at all costs. That is the magician’s code.

Many financial advisors have their own version of that code, designed to keep clients dependent on our advice and reliant on our expertise. We alone hold the keys to having a successful investment experience, and much like David Copperfield walking on water, we maintain the illusion that it’s magic.

But while people instinctively know that Criss Angel can’t levitate and Harry Houdini didn’t actually saw anyone in half, the financial services industry remains an enigma to the majority of investors. Until now.

In his new book, Wealthier: The Investing Field Guide for Millennials, Dan Solin has pulled back the curtain to reveal that a successful investment experience is a combination of an academic approach to investing, behavioral awareness, and patience. Nothing magical about it.

Solin, a New York Times best-selling author known for his “Smartest ______ Book You’ll Ever Read” series, wrote this book with the next generation in mind (as evidenced by the title) but Wealthier can benefit investors of all ages and stages.

Wealthier explores a wide range of topics including good investing vs. bad investing, DIY financial planning, and how to define the idea of “enough.” It includes a brief section on neuroscience and the role our brains play when it comes to investing, as well as why AI is an investor’s new best friend. Solin even gets philosophical, illustrating how taking a Stoic mindset can lead to a successful investment experience.

Robust yet digestible, Wealthier is the ultimate investing playbook, revealing the not-so-secret “secrets” of the financial advisory community and equipping investors with all the tools they need to effectively invest on their own.

A tool for financial advisors

If you’re a financial advisor reading this review, you might be wondering: Why am I, a financial advisor, endorsing a book that teaches clients how to navigate their financial world without us? Because fears over our professional obsolescence are overblown and misguided. And because in my opinion Wealthier represents the next evolution in our industry.

For one thing, Wealthier is an opportunity to strengthen client relationships – not eliminate them – beginning with Solin’s target audience. There are approximately 72 million millennials in the U.S., and millennials and Gen Z are set to inherit an estimated $84 trillion through 2045. Yet they represent only 14 percent of advisory clients, “demonstrating a significant gap.” There is an opportunity to begin building relationships with the next generation – and good reason to as well. According to Fidelity, “firms with a younger client base are growing nearly 10 times faster than their peers.” Want to connect with the next generation? Encourage them to read Wealthier.

In addition, for those who view a world full of DIY investors as a threat to your job security, you are overestimating the “Y” in DIY. In my experience, the majority of DIY investors are still seeking guidance and advice. They want a second set of eyes to confirm their spreadsheets. They want another perspective to serve as a sounding board. They have the knowledge and the passion – but they don’t always have the time or energy. The DIY investors I know aren’t against professional advice – they just don’t want to pay one percent to turn over full control. Knowledge alone doesn’t diminish the need for guidance.

Finally, we all benefit if the financial health of the global population improves. So how do we do that? We educate and empower. We share knowledge and teach people the skills they need to be successful – on their own.

Education over dependence makes for better outcomes

Imagine if doctors wanted a world full of sick people so that they would always be needed. That’s crazy. Yet our industry is still rooted in the idea of dependence. We want our clients to believe that they need us. But that isn’t healthy, nor is it sustainable.

Doctors teach patients the skills they need to improve their overall health outcomes with better decision-making and behaviors. But no one would suggest that trying to improve overall health outcomes eliminates the need for doctors.

As financial advisors, we should view improving the financial health of our clients in a similar vein. In my opinion, this is the future of our industry, and by embracing Wealthier rather than dismissing it, we have an opportunity to be at the forefront of the next great wave of change.

In 1997, Breaking the Magician's Code: Magic’s Biggest Secrets Finally Revealed aired on TV. It was unthinkable that a magician was willing to go on national TV and violate his industry’s most sacred code. But that’s exactly what Val Valentino did. Spoiler alert: it wasn’t a tragic end to the magic industry. Quite the contrary. The magic show business in the United States is estimated to be over $1 billion and continues to experience steady annual growth of around seven percent. That is proof that the demand for mind-blowing tricks and death-defying feats doesn’t disappear because spectators have had a glimpse behind the curtain.

I doubt it will be much different when it comes to Wealthier. This is not a book designed to put us out of business. But it does disrupt current industry norms and challenge us to rethink the advisor/client relationship of the future. And that’s not a bad thing.

Kudos to Solin for writing another book poised to have a significant impact for investors everywhere, with the potential to reshape the financial advice industry for all.

Sarah K. Charles is the co-founder of Sanctuary Financial Planning, an advice-only firm based in Charlotte. She is on a mission to change how financial advice is delivered and believes the world would be a better place if people had less money stress.


A message from Advisor Perspectives and VettaFi: To learn more about this and other topics, check out some of our webcasts.

More Financial Planning Topics >