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Q & A session with Michal Bodi

We ask the advisers a series of questions to help our readers to better understand what makes them tick. Click to Contact Michal Bodi

Why did you choose a career as a financial adviser?

With the information overflow these days, it is easy to lose focus. When it comes to money decisions, we make them every day. Unfortunately we get influenced by too many options, we act emotionally and we are busy. This cocktail is way too harmful when it comes to making choices. And the price we pay down the track is just too high.

When I chose my career it was a lifestyle choice. I felt there needed to be a holding hand that would show people right decisions which would be perfectly in tune with their own financial reality, their values and their plans.

It wasn’t until five years into my career when I was introduced to the Behavioural investment counselling. It was one of those things that strike you immediately. I knew right away that I found the right fit for how I can carry out my coaching and make a considerable difference.

What do you find most rewarding and frustrating as a financial adviser

Behavioural investment counselling allows me to connect with my clients on a very personal level. It is very counterintuitive but very enlightening. When it is followed it often changes peoples’ lives. Seeing this and having my clients living with less stress in their lives and being on track with their financial plans at the same time, is to me the reward.

Frustrations happen when you know you can help someone but they are already so twisted and turned (and hurt) by their previous experiences that they simply walk away.

Why do people choose to seek advice from you?

People want good advice. But confusion and past experience have left them feeling quite skeptical.

I offer something very different to what they know. I talk to people more about their feelings and emotions and explain to them what impact these have on their decision making.

I deal with the only variable I have a good chance of controlling and predicting – client behaviour. It is the dominant determinant of the real life investment outcomes real people actually get.

The real advisers build portfolios based on their client’s goals, not on a view of the economy or the markets. They deal with planning and a long term perspective, not with predicting and prognostication of variables they cannot control.

What are the biggest challenges that people face when trying to secure their finances?

Their greatest challenge by far is their own psychological battle to overcome fear of a new experience and become ready to accept new concepts. This often means ‘unlearning’ a lot of things. Most people would already have some kind of investment or a portfolio but they would not have any plan in terms of where they are going with it and what their investment should achieve. Having a date and dollar specific plan (which is perfectly in tune with one’s values and goals) is hard. That is why most people don’t have it.

For anyone starting with a goal to become financially independent – what should be their first steps?

I’d say first thing is to look for good advice. If you don’t find it after seeing one or two advisers, continue looking. Be prepared to invest in your future, good advice costs money.

Just about every book, magazine, blog etc these days talks about managing your investment portfolio on your own, without the involvement (and cost) of a financial adviser. I cannot disagree more.  There is no such thing as one off advice when it comes to your financial independence. Remember, your worst enemy is your own (emotional) investment behaviour - year in, year out. Most investors will achieve far superior lifetime results – with less pain and suffering – working with a caring, competent and above all trusted financial coach.

Strike an ongoing advice agreement which will govern the ongoing relationship with your coach and hold you both accountable and it will subsequently govern your success.

Do you have any investment golden rules that you live by?

Absolutely. There are six golden rules - three investment principles and three investment practices that form the basis for every successful investment portfolio.

The first three principles are more behavioural or attitudinal and people can’t move forward unless they accept them:

-        faith in the future (you can never be a successful investor with a negative outlook on future)

-        patience (waiting things out regardless of what is going on in the world)

-        discipline (believing in what you hold and sticking with it)

The three practices are more about the way a portfolio is constructed:

-        right asset allocation (understanding the power of growth assets)

-        diversification (never get a killing, never get killed)

-        re-balancing (buying and selling at the right time, without trying to time the market)

Investing is simple, in fact simplicity is one of the keys. However, the acceptance that it is almost impossible doing it on your own is the important bit.

Click to Contact Michal Bodi

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