Gold, CPP, and Marketing
I wrote a long post about the finance profession yesterday. I always ask people I trust for feedback first. What I wrote was a bit too contentious, so I had to turf it. I’ll rework it and post something soon. It was about marketing, authenticity, and what I think is wrong with how advisors and firms articulate their value.
Because it’s now on my mind, I have a comment to make about financial and investment marketing below. I also want to quickly talk about gold and the Canada Pension Plan (CPP).
Gold
Here’s the headline from Reuters: Investors flock to gold ETFs as metal's price shatters records. And here’s the most important part of the article:
Globally, inflows into gold ETFs hit $64 billion year-to-date, according to data from the World Gold Council, with a record $17.3 billion in September alone.
That is a dramatic reversal from recent trends: over the last four years, gold ETFs have seen outflows totaling $23 billion, the World Gold Council calculated.
Remember a few weeks ago when I talked about how humans understand and respect the relationship between price and value when it comes to everything but stocks? Well, shame on me, I should have said “…when it comes to everything but investments.”
Gold has been on a tear all year, and now investors are buying. This type of behaviour is one of the key reasons I have a job.
- Cars double in price? I’ll find an alternative.
- Gold doubles in price? Gimme, gimme, gimme.
And if you’re wondering about my own views about gold as an investment here it is: I’m agnostic. I don’t write anywhere near as well as Josh Brown, so let me share his piece. It’s more than ten years old. If you want a more recent piece, give this a read from Ben Carlson. I hope to one day write as well as those two gentlemen.
CPP
A few people shared a reddit thread and a YouTube video with me all about when you should elect your CPP payment. Quick review: you can take CPP as early as 60 (it’ll be a lower amount) or as late as 70 (it’ll be a higher amount). If you take it at 65, you’ll receive what you’re entitled to.
The absolutism online about “the optimal time” to take CPP is abhorrent, so I won’t link to reddit or YouTube.
Decisions about CPP, OAS, converting your RSP to a RIF, drawing income from your corporation, and other factors are nuanced. And you have to consider every moving part of your financial situation.
You can’t say, “Everyone should take CPP at 60,” and you also can’t say, “Everyone should take CPP at 70.”
Here’s a starter list of what to consider before electing to receive your CPP entitlement. These are in no order.
- Your employment status and whether you anticipate working part-time in retirement.
- Your life expectancy.
- Your risk tolerance.
- Your marital status.
- What your spouse elected.
- Your current and projected tax rate.
- The balance in your RSP/RIF.
- If you have other retirement income sources.
- If you’re charitably inclined.
- Your RRSP contribution limit.
The list goes on.
No absolutism. Only nuance.
Advisor Marketing
This was a small piece of the contentious post I turfed. But I think it’s important. It came to mind after I read a piece at Investment Executive titled, Investment dealers should get out of the content business. Link here.
People work with people they like. Advisors must, above all else, have knowledge, expertise, empathy, and good communication skills. And a lot of them do. But let’s say I have a twin sister with all the same credentials, education, and experience as me. She also provides the same advice.
The only difference is that she doesn’t communicate the way I do. She’s more formal. I’m more conversational.
How would you decide who you want to work with? Before meeting us, here are the options:
- Be introduced by someone who already works with us.
- Meet us or know us in a different capacity.
- Look us up online.
Let’s focus on the third point. Look us up, and you’ll find that our websites are identical. We post standard content curated by the firm we work at, and nothing else. To you, we’re just another person who provides financial advice.
How will you know if you’ll like us? We don’t want to waste your time, so the more you know about us as individuals - before meeting us - the better (those are my em dashes).
That is why advisors need to create their own unique content while speaking in their own voice. It’s one the reasons I write. And I think a lot more advisors should do the same.
If you’re an advisor and you’re reading this, let me know what you think.
