David Peters: 5 Things To Look For When Hiring a Financial Planner or Financial Adviser

An Interview With Tyler Gallagher

Do you feel pushed to hire the advisor right away? — If you feel like the advisor is pushing you into hiring them immediately, that is usually a bad sign. If the advisor is looking for a long-term relationship, he/she will let you work through your evaluation process. If they are looking for a quick sale, then they may try to rush you along. Hiring a financial advisor is a big decision. You are trusting someone with your money and your livelihood. You need to take your time and be confident in your decision.

As part of our series about what one should look for when hiring a financial planner or adviser, I had the pleasure of interviewing financial advisor and CPA David Peters.

David Peters is the Founder and Owner of David Peters Financial Group and Peters Tax Preparation & Consulting, PC. David has over fourteen years of experience in financial services, including 3 years in the hedge fund industry and six years in the insurance industry. David was the first-ever Chief Financial Officer at Compare.com — a position he held for more than three years. Currently, David is a National Instructor for the AICPA, Surgent, and Kaplan. He regularly teaches courses in accounting, finance, insurance, financial planning, and ethics throughout the United States. David holds four master’s degrees and is currently pursuing his PhD in Financial Planning. He contributes regularly to various CPA publications, including NCACPA’s Interim Report, SCACPA’s CPA Report, and VSCPA’s Disclosures. David was also a co-author of the 2018 Virginia CPA Ethics course — a required course for all CPA’s licensed in the Commonwealth of Virginia. He is a registered representative offering securities through Cetera Advisor Networks LLC, member FINRA/SIPC, as well as advisory services offered through Carroll Financial Associates, Inc., a Registered Investment Adviser. Carroll Financial and Cetera Advisor Networks, LLC are under separate ownership and are not affiliated with any other named entity.

Thank you so much for doing this with us! Our readers would love to ‘get to know you’ a bit more. Can you tell us a story about what brought you to this specific career path?

I have always had a passion for helping people with difficult problems, but it took me a while to really figure out where I was headed in my career. I passed the CPA exam after finishing up my master’s degree in taxation, but I didn’t go into financial services right away. I enjoyed the challenge of trying to understand difficult tax code sections and the technical aspects of the profession, but something was missing. I wanted to do something that wasn’t just technically difficult. I wanted to do something that made a difference in someone else’s life.

Instead of going straight into the profession, I decided to go to seminary instead. I wanted to explore this passion that I had for helping people and that seemed like the right way to do it at the time. During my time in seminary, I worked as a hospital chaplain at University of Pittsburgh Medical Center (UPMC). I loved the people that I met during that time, but I found the work to be emotionally draining. You would go from one difficult conversation to the next — day after day. I felt good about what I was doing, but I just felt exhausted at the end of the day. I didn’t think it was something I could do over the long-term, so I decided to look for something else.

I went back to finance after graduating from seminary and took a full-time job working as a staff accountant for a hedge fund. I worked there for 3 years before the 2009 financial crisis happened. After that, I began working for a start-up insurance company, Elephant Auto Insurance, in Richmond, VA. Elephant is the US subsidiary to Admiral Group PLC, one of the largest auto insurers in the UK. That’s where my career really started to grow. I began to move up into management roles and take on more complex financial problems. After a few years at Elephant, I was asked to be the first CFO of Compare.com — another start-up company in which Admiral Group was the majority owner. I loved the challenges of being a CFO in a growing and thriving company, but I always felt like there was a piece that was missing.

While I was still at Compare, I began teaching accounting and finance at the college level. I also began teaching more and more continuing education classes for financial professionals. I loved teaching and helping students. I loved the moment of clarity on someone’s face when they finally understand something. I loved that “ah-ha” moment! I realized it was that connection with people that was missing from my career. My work as a CFO was technically challenging and I loved it, but I wasn’t connecting with people at the foundational level that I really wanted to.

After a few fantastic years at Compare with some great people, I reached out to a friend of mine who had his own financial advising practice. I worked for a few years at Carroll Financial, and then went out on my own. Financial advising was really a culmination of all of these experiences. It is the perfect blend of highly technical work, teaching, and working with people directly on challenging financial problems. For me, it was the perfect fit!

Can you share a story about the most humorous mistake you made when you were first starting in the industry? Can you tell us what lesson or takeaway you learned from that?

In one of my first client meetings, I remember being very nervous. The client was a friend of mine and I knew him well. However, I was scared of all the things I didn’t know. I was worried that he was going to somehow think less of me if I didn’t show him that I knew everything that there was to know about the world of finance.

During the meeting I basically talked the entire time. I talked about markets, tax law changes, and how to price life insurance. I was bound and determined to show the client how much I knew. After a good 30 minutes of me prattling on, I finally paused for a minute. My friend looked at me, smiled and said, “All I asked was if you could review my tax return.” I was completely embarrassed! I had missed the entire point of the meeting. The point of the meeting was to help him with a specific problem! Instead, I was telling him everything about the world of finance. I didn’t answer the question! I immediately apologized and told him that I would be happy to look through his return for him!

The big lesson that I learned that day is that the goal of every client meeting is to be there for the client. It is all about them. As an advisor, it is your job to be an advocate, coach, and source of information. In short, be helpful! Don’t push what you want talk about. Ask them what they want to talk about!

Are you working on any exciting new projects now? How do you think that will help people?

Yes! I am very excited about the projects I am working on! I have a video series on YouTube called Demystifying Finance. It is a series of short videos on basic financial questions that people have. For example, we have posted videos on the difference between whole life and term life insurance, how to deduct business mileage, and rules of thumb for budgeting. We have even started doing some videos on more complex topics, like the Qualified Business Income tax deduction. The videos are all about 3 minutes or less and are meant to be fun and easy to understand. My hope is that these videos will inspire people to take an interest in their financial lives and help them to feel more in control of their money.

I also just started a new podcast called Accountable, which focuses on issues and trends relevant to financial and business leaders in companies across a broad range of industries. Over the next month, I plan on interviewing the owner of a recruiting firm about the difficulties faced by companies in trying to hire during the Great Resignation. I am also planning on having an expert on the show to talk about mental health in the workplace.

We bill the show as “the podcast for CFOs by a CFO,” but what I have found is that these topics are not just issues for financial leaders. They are really issues and challenges for all people in the business world from staff members to executives. We are all struggling to hire good people. We all want to do something to help those who are struggling with mental health issues. These are important topics for all businesses. I would like to think of the podcast as a way bringing the conversations that businesses are already having internally out in the open. If we are all facing the same things, let’s talk about them in an intelligent and open way together.

Lastly, I just recently started a new website called www.petersprofessionaleducation.com. The website offers courses on a variety of topics for CPA’s, financial advisors, and insurance agents who need to meet their continuing education requirements. Recently, we added courses on Social Security & Medicare, partnership taxation, and financial planning. We are adding new courses all the time! I think this will be helpful to my colleagues. Not only will it help them to meet their CE requirements, but it may also spark some conversation on developing topics in our industry, such as how to think about data analytics or deal with client behavioral biases.

Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Is there a takeaway or lesson that others can learn from that?

It is hard to identify a single point in time and I think success can be judged in various ways. I remember waking up on a Monday morning during tax season a few years ago and looking at my calendar. It was filled to the brim with client meetings. Instead of being overwhelmed and stressed though, I remember thinking that I couldn’t wait for the day to start! I genuinely looked forward to meeting with all the people I was going to see that day. I couldn’t wait to hear how things were going with them, their families, and their lives. I couldn’t wait to see where I could help and where I could make a difference to them. Don’t get me wrong. I didn’t think it was going to be an easy day. My clients were going to ask me challenging questions. They were going to stretch me. However, I was going to love every minute of it!

I would like to think that everyone who enters the financial advising industry does it because they ultimately want to use their skills and abilities to help other people. They want to use what they know to make a difference in the world around them. When you are able to see that happen, you know that you have made it. I knew on that day that I was going to help some people. I knew that I was going to have the opportunity to use my knowledge and abilities to help them make a positive and real change in their lives. At that point, I had achieved a dream.

From that time on, I began to measure success in a different way. In financial services, we have a lot of metrics for success — assets under management, revenue per client, and many others. While those metrics may define financial success to some degree, they really are disconnected from the whole point of the profession — which is to help people! Yes, financial advisors need to make a living — just like everyone else. However, I have met many financial advisors, accountants, and insurance agents who have money and are absolutely miserable. They are miserable to be around, and they can’t figure out why. In many cases, it is because they have become so disconnected from the real reason, they wanted to become an advisor in the first place — to promote real change and growth in other people.

At the end of every day now, I measure success by how many people I have helped that day. On the days where the tally is at zero, I typically look back and realize that I got too caught up in the tasks of the day. I lost sight of the point of what I was doing. Those are the days I typically feel run down and tired. On the days where I helped a lot of people through teaching, talking with them about their financial problems, or getting something done for them, I typically feel the most energized — even if it has been a 16-hour workday.

What three pieces of advice would you give to your colleagues in the finance field to thrive and avoid burnout? Can you give a story or example?

1. Don’t take on clients that you don’t click with — Financial advising is about relationships. You don’t have to necessarily be best friends with your clients, but you do have to genuinely like working with them and being around them. If you don’t get along with someone, then you won’t do your best work for them. They are better off finding someone else who can help them. Bad relationships wear you down and make you not like your day-to-day interactions — which hurts your performance even more. If you love your clients, you will love your job. If you love your job, you will thrive in it.
2. Tell People What You Are Doing — When I first went out on my own, I remember sitting at my kitchen table thinking — “Okay…. Now what?” I didn’t really have much of a plan — just a passion to help people with financial problems. I decided that I was going to do one thing — talk to the people that I ran into throughout the day. Just tell them what I was working on. When I went to get my morning coffee and the same barista who I talked to everyday asked me what was new, I was going to tell her. When I went to lunch with friends, I was going to tell them. When I talked to neighbors, family, or anyone else, I was just going to tell them. I am a financial advisor, and I just went into business for myself!
   — It was a simple plan, but it worked. If you tell people what you are working on, they typically want to tell you something about themselves. That’s how relationships start. Aside from having some great conversations and learning a lot about the people around me, it opened some doors for business opportunities. People began to tell me that they needed help with taxes, investments, or insurance. To be clear, I am not talking about “hard selling.” I don’t really think hard selling works. I am talking about just having the same conversations you always have every day — except tell people what you are up to. If you do that enough, relationships start to grow, people trust you, and they want to be your client — not just now, but for the long-term.
3. Listen more. Talk less. — One of my mentors used to say that he judged how well a client meeting went by the percentage of time he spent listening. He found that he had better, more productive meetings if he was listening over half of the time. Financial advising is often more about relationships than it is about money. Your clients don’t want to know the depths of your knowledge. They know you are smart. That’s why they hired you. They want to know that you care about them and their problems. They want to know that you are going to make every effort to help them. If you are going to send that message, you must give them the verbal space to tell you what is going on, what they are worried about, and what they are looking for. Financial professionals tend to be very good at the analytical part of the job — the numbers part. They see a problem and they want to offer a direct solution — get from point A to point B as quickly as you can.
   — If you really want to understand what is going on with someone though, you need to go beyond that. You need to really listen to what they are saying. Listen to the words, but more importantly, figure out what the clients means. These may not always be the same. If you can do that well, you will form better, longer-lasting client relationships — which is really the key to successfully building a business.

Ok. Thank you for all of that. Let’s now move to the core focus of our interview. As an “finance insider”, you know much more about the finance industry than most consumers. If your loved one wanted to hire a financial advisor (not you :-)), which 5 things would you advise them to find out about before committing? Can you give an example or story for each?

1. When you first meet the advisor, what does your gut tell you? — If you are going to have someone manage your money and guide you in your life goals, you need to trust them. I tend to believe that most people can sense when someone is giving them a line. Trust your gut. If something seems off or not right, you need to find someone else.
2. Figure out who you will actually be working with — When you hire a financial advisor, most of the time you are not just hiring one person. You are hiring their team. For financial advisors that have a significant client base, you may actually spend more time talking and working with the staff persons than you do with the advisor. That’s not a bad thing — just a reality. If that is the case, you should get to know the staff you are working with. Who does what? How long have they been with the firm? Who do you call when you have a problem? Getting to know the team in many ways is more important than getting to know the advisor.
3. Figure out the advisor’s areas of expertise — It is rare to find an advisor who truly practices in every single financial area. Many advisors claim to do “comprehensive financial planning.” This may not necessarily mean that they are personally going to help you in all the areas of your financial life though. Often what it means is that the advisor will help you in one or two areas, and then call-in other people in his/her team to help you in the other areas. There is nothing wrong with this approach, but you should know that going in. You should know when you are going to work with the advisor you are hiring and when you are going to work with other people.
4. Does the advisor talk to you in ways that you understand? — No one likes to feel like another person is talking over their head. It is a bad feeling. I remember walking into a store to buy a new laptop a few years ago. I had accidentally dropped my last one on my kitchen floor. The salesperson came over to me and began a long-winded technical explanation about all of the features of every laptop on the shelf I was looking at. I stood there politely, but I only understood about half of what he said. I believe he truly thought he was being helpful. To me, it was just a frustrating experience though. I walked out feeling like I had wasted my time.
   I would imagine that many clients feel that way when financial advisors start babbling on about rates of return, index funds, and load fees. If you are going to hire someone, you need to make sure that they can meet you at your level. Ask them to explain their process and how they work. If they can’t explain simple things to you, they won’t be able to help you with any important things. It doesn’t matter how smart the advisor is, if you can’t understand a word they are saying!
5. Do you feel pushed to hire the advisor right away? — If you feel like the advisor is pushing you into hiring them immediately, that is usually a bad sign. If the advisor is looking for a long-term relationship, he/she will let you work through your evaluation process. If they are looking for a quick sale, then they may try to rush you along. Hiring a financial advisor is a big decision. You are trusting someone with your money and your livelihood. You need to take your time and be confident in your decision.

I think most people think that financial advisors are for very wealthy people. This is likely not actually true. Can you explain who would most benefit from hiring a financial advisor and why? Can you give an example?

It is not just a specific segment of the population that can benefit from a financial advisor. You don’t really have to have a certain amount of money or live a certain way to benefit from a financial advisor. For example, my primary client base is working-class families — not necessarily the ultra-rich. However, you do have to care about improving your financial life. You shouldn’t hire a financial advisor because you want to outsource your financial problems. You also shouldn’t hire one just because you think you should. You should hire a financial advisor because you want to work with them on building a better financial future for yourself. I have told many clients in the past that I can help them with many things, but they need to be a part of the process too.

The client who wants to sit down with you after the tax return is finished to see what they can do next year to lessen their tax liability would benefit from a financial advisor. The client who wants to understand why you are investing their portfolio the way that you are so that they can understand the methodology being applied will benefit from a financial advisor. The client who wants to understand how we determine how much life insurance they need will benefit from a financial advisor. If the client is really just looking to make a quick dollar and they don’t really want to change any of their current habits, they won’t benefit from a financial advisor. Financial advisors really can’t change someone’s financial life by themselves. The client must take an interest and do their part. That’s the only way the client-advisor relationship works.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?

One of the people who really taught me about leadership and passion was the former CEO of Compare.com, Andrew Rose. I was a very young CFO. I became CFO of Compare.com at 31 years old. Being the CFO of a start-up organization is tough. There are a lot of expectations and pressure. Investors want a return on their investment, so there is pressure to grow quickly.

I was not a good manager when I first started. I was feeling pressured and stressed and I took it out on my colleagues and teammates. After a particularly rough day, I remember Andrew pulled me aside and told me a hard truth. He said, “You are a smart, talented guy. And you are too smart to be managing in the way that you are.” That hit me to the core. He was not saying it out of anger. He was saying it because he cared about me and knew I could be better.

I went home that evening and decided that I was going to change my management style. First, I was going to start saying thank you more to colleagues, friends, and business partners and tell them I appreciated the work they were doing. Second, instead of just barking out orders, I was going to start asking my teammates how I could better support them in their job. It didn’t happen overnight, but eventually my teammates and colleagues and I began getting along better and we became more productive.

Andrew always had a way of being able to motivate others in a positive way. He found ways to challenge and stretch me — not until I broke, but to the point where I could step up to the next level. He was really good at that. I don’t know that I have ever met someone more passionate about what they did either. I try to motivate my clients, colleagues, and business partners in the same candid, but positive ways that he did. I will always be grateful for the day he pulled me aside and said those words!

You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

Have a day every year where every financial advisor in the country has to provide at least one piece of financial advice on social media to the general public. There is a lot of bad information out there from people who really don’t have any experience or credentials. People don’t really know who to trust, yet they really need help. This one day would create a huge repository of credible information for the public to turn to if they want help. Also, it would serve as a reminder for advisors of our obligation to the public. We are supposed to be helping people form good money habits and meet their goals. That’s what the profession should be, and that’s why people should choose to go into the profession.

How can our readers follow you on social media?

Website — https://www.davidpetersfinancial.com/

Professional Education Website — https://www.petersprofessionaleducation.com/

LinkedIn — www.linkedin.com/in/david-peters-financial

Facebook — https://www.facebook.com/davidpetersfinancial

Twitter — @DavidPFinancial

Thanks for the opportunity to share my thoughts about my life’s work! I greatly appreciate it!

Thank you so much for joining us. This was very inspirational.