It can be said that kids who climb out of poverty stricken neighborhoods tend to grow up with a certain determined drive.
Angela and her husband Marshel
grew up together in a Metro Detroit neighborhood called Shacktown by the kids on the block. She studied cultural anthropology and history at Eastern Michigan University. At age 21, Angela was managing the Biz Resource Center for the Michigan Small Business & Technology Development Centers
(MI-SBTDC) at Eastern Michigan University's College of Business. She and Marshel used the skills gained to do promotion and marketing in the local music scene on the weekends.
In 2002, after a chance encounter with a local independent advisor, Angela spent two years in apprenticeship at his firm and then five years at a large firm managing upwards of $235 million. She eventually went on to manage a branch office in Livonia, taking care of 125 clients. After witnessing the devastating events of 2007-2008 (while having been warned about the impending doom during her apprenticeship five years prior), Angela went back to her independent roots as she picked up more research and experience in the monetary, energy, and food systems with the original independent advisors.
In December 2011, she launched Reconsider
, a firm dedicated to fundamentally changing the way financial advising is done.
Aside from working on this passion of economic freedom, Angela enjoys biking, hiking, backpacking, kayaking, road trips, reskilling, growing food, and generally being outdoors.
She lives in the West Willow neighborhood of Ypsilanti where she currently serves as the President of the New West Willow Neighborhood Association
. She also serves on the AATA (Ann Arbor Transportation Authority) District Advisory Committee for their 5 Year Master Transit Plan
, and served for 2 ½ years on the board of directors for Growing Hope
, a local nonprofit that increases access to healthy foods.
Ten years ago I was having lunch at a local Ypsilanti restaurant, reading Ayn Rand's The Fountainhead
at the bar, when a gentleman next to me commented on the book. That comment sparked a conversation that sparked an apprenticeship that sparked a 10-year career as a financial advisor. At that tender age of 21, I had been set on taking my idealist "I want to change the world" mantra to local government, thinking that was the best way to make the biggest impact. Here, another avenue opened.
This mentor of mine was determined in teaching me that if one does not learn how the money system works, if you do not know how to generate wealth, how to protect it, how to grow it, then your efforts to better your world are fruitless. His solution was to become an advisor, as he had been for 30 years.
I initially thought that was crazy, but eventually relented. I remember having a revelation at the time that I could "change the system as a mole from the inside." In 2004, I became licensed and embarked on an experience that was shockingly difficult, appalling, but magnificently helpful in that original idealist aim of changing the world. Eight years later, that's what I'm doing
This week I'll be sharing lessons I've learned from the inside, so to speak. They're coming from my direct experiences, and those I've worked with over the years. There is a whole flock of well-intentioned advisors who have turned whistleblower
over the last five years as the industry became more and more grotesque and abusive to its clients and employees. Some advisors have had a better experience – I speak just for what I've seen and heard.
For this first post, let's tackle the most fundamental truth that is almost non-existent in the client-advisor conversation – financial advisors are paid to sell, not to think. This bears repeating – financial advising firms pay their advisors to sell…not…to…think.
You may be thinking that I'm making some gross generalization, but I pull this line from direct experience. Throughout 2008, I was informed exactly five times by various levels of management in the large firm I worked for that they "don't pay us to think, they pay us to sell," in questioning the "everything will be fine" party line (as the markets continued to tumble
. When you hear an exact phrase more than a couple times, can't you officially call it a conspiracy?
So here's just one implication of this philosophy, an implication that I believe is at the heart of why the traditional financial advising industry is insufficient to meet the needs of a new generative economy
If advisors are not paid to think, then who is?
This is what happens to your money when you hand it to an advisor – if you're like any of the 80 million other Americans
whose advisors put their money into mutual funds. The advisor read the glossy sales materials for the funds, maybe they pulled a Morningstar Report
and saw how many stars it has, what its performance has been and maybe what the top 10 holdings were in the fund. That's probably where your advisor's research stopped.
When your money was sent to the mutual fund company, they handed it over to a management team who is managing maybe $2 billion other dollars along with your $10,000. They split up the research among their team, so that each person is researching only specific types of businesses like transportation or consumer goods.
The board of directors for the fund also oversees 120 other funds
, maybe even 170 other funds. They have to read an annual report larger than War and Peace
on each fund, along with quarterly reports about its performance. How likely do you think it is that they're reading all this material?
Meanwhile the people that oversee the team of analysts, the investment advisors, are often paid based on performance and the board of directors hardly ever replace them (they are the ones with the power to do so). There is a built-in incentive for the advisors and their team to take on risk. Hence the multitudes of funds that had (and still have) mortgage backed securities, credit default swaps, and other such nasty things in their portfolios.
So if your financial advisor isn't watching your money, and the board of directors isn't watching your money, and the analysts are only watching their industry stocks, and the investment advisors are looking for the highest returns to keep money in the fund, then who is really watching your money? Is anyone watching your money?
In my last post, I exposed a philosophy that exists in the financial advising industry – that advisors are paid to sell, not to think; a heinous accusation, to be sure, but one that I directly experienced.
In this post, let's talk about who should be watching your money and why.
I'm going to go out on a limb and say that it's you.
Previous to 1974
, Americans didn't have IRA or 401k accounts because the laws to create them didn't exist yet. People bought stock directly from the companies they liked. People invested in their brother's mill business, or loaned their kids the seed money they needed to start their dry cleaner. People saved their money in safe deposit boxes and tin cans. They converted it to other currencies like gold and silver.
Fifty years ago people were far more connected with their money, and their community. Today we live in a bit of a twilight zone, where some of our actions don't match our other actions.
Here's a common example… (It's common, so don't feel too bad if this is you.)
If you've watched Food, Inc.
or Fast Food Nation
, you may have begun shopping at the local farmer's market
for fresh locally-sourced produce or maybe you even set up a CSA
with a local farm to get your meat from there instead. You just couldn't stand the thought of how chickens and cows were being caged into contained feeding arrangements that left them lame, diseased and dying. The thought of eating that food now makes your stomach turn. So you took action. And you spread the word to others.
I'm willing to wager a bet though – that you never checked your investment portfolio to see if you owned Tyson or Monsanto or any of the multitude of industrialized food companies whose cheap and nutrition-deficient products are directly responsible for the rise in obesity and other health related diseases – and chances are you do.
My colleagues and I have noticed, and are now part of, a groundswell of action that's centered on reconnection. If we want real change, we have to become reacquainted with our money, with our neighbors, with our businesses.
We have to learn how to think with a bigger perspective, especially when it comes to our money. If we abhor the industrialized food companies, then we shouldn't own them in our mutual fund portfolios. If we are concerned about a potential collapse in the global financial systems, then we shouldn't have all our money tied up in those systems.
Why is it your job to be reconnected with your money?
Because no one else cares about your assets as much as you do. I've had a lot of people tell me over the years as I've worked with them, trying to educate them and help them be good stewards of their money, that they simply don't have the time. "That's why I pay you," they say.
I think of money management as the same as working with healthcare professionals. I go to the doctor when I have an ailment, to get their opinion on what they think the cause is. I then do my own research, I read the materials they give me, I may even get a second or third opinion, and I make my own decision about what route to take.
When we go to doctors for an ailment, and they prescribe four medications with a short descriptive sentence on each one and a hefty book of fine print legalese about each one, how many of us would just take the meds and go on with our lives? Yet that's what happens with investments. Clients and advisors alike don't read the fine print. Reconnection starts with you.
In the last two posts I've made the case for how no one else is watching your money, and how no one else will care about your money the way you do, so you should ultimately be responsible for its care.
In this post, let's discuss what is happening as people begin to reconnect with their money.
Last year I attended the annual Slow Money
conference in San Francisco. I had just found out about Slow Money and BALLE
(Business Alliance for Local Living Economies) during the summer, and was astonished to see the action that people were taking in their pursuit to create a new generative economy
There were over 800 people at that conference – financial professionals, entrepreneurs, film makers, activists, farmers. You could sense this energy throughout the event, in the workshops, in the small conversations huddled around tables in the after hour parties.
There were over 400 at the BALLE conference
in Grand Rapids in May of this year – same outcome. You could taste the energy in the conversations.
There is something exciting happening in this country.
It turns out that when people take back control of their money, they start to take back control of everything else in their lives.
Talk of revolution became synonymous with redefining our financial systems. History supports this claim. Mayer Rothschild is often quoted as saying, "Give me control of a nation's money supply, and I care not who makes its laws."
The amount of power that is transferred to a people who control where their money goes, what their money is, how their money is created, is enormous.
I believe what we are witnessing with the local investing
movement, with the sustainability
movement, with the preparedness
movement, with the local food
movement, with the Occupy Wall Street
movement, with the political independence
movement – is nothing short of an awakening.
If these posts have gotten your attention, then I encourage you to turn that attention into action. Here's what you can do in your part of the revolution:
1. Launch a family investigation into your investments. What do you own, why do you own it, and how do you own it.
2. Take the time to educate yourself. Yes, we do provide education http://timetoreconsider.com, but you can learn on your own as well. Start with this book
, and this book
3. Start aligning your finances with your values, dollar by dollar.
4. Turn off the network news. CNBC
is Wall Street's best buddy. Their job is to keep your money in the markets. Doing anything with your money that they are not involved in means no way for them to make money.
5. Start talking to other people who share your values. Reconnect
with your community, and lend a helping hand to the people in your life who want to take back control also.
6. Spread these facts in particular: Less than 1% of our $30 trillion in investment dollars get invested into small businesses, but half of our GDP
comes from small firms, and 2/3 of our jobs come from them.
I hope you the reader found these posts helpful. If ever there was a time ripe for action that can truly lead to a better future, it is now.