When to use a coach

What do Lee Iacocca, Bill Gates, Warren Buffett, Eleanor Roosevelt, Paul Newman, Vince Lombardi, Oprah Winfrey, Michael Jordan and Tiger Woods have in common? They all used coaches and mentors to help them get from good to great.

The first week of May, I will be going to Las Vegas to work with the brilliant speech coach, Patricia Fripp. Her services certainly don't come cheap and the expense comes at a time when it's hard to bring myself to take a financial risk.

But here are three things I know: Profit is the reward for risk, the time to make money is when everyone else is curled up in the fetal position and the best are never cheap. The reason Patricia can charge the fee she does is because the value she brings far outweighs the fee she charges. If that were not true, the market would vote with their feet and people would have stopped paying her long ago.

Like most businesses, my business has not been immune from the economic downturn. So why would I take a week away from my business when it needs me most and spend money that is not exactly falling off trees right now, on a coach?

I have been asked to give a keynote address at the annual convention of the National Speakers Association, in Phoenix, this July. This is a big honor. Being asked to speak to several thousand professional speakers demands my very best. And so, I have hired the very best coach to help me.

So when does a coach make sense? Whether we are talking about a sports coach, a speech coach, a life coach or financial success coach, I think the criteria are as follows:

• The outcome is important to you
• You want or need to shorten the learning curve
• A fresh approach is called for
• You need help getting started or staying on course

If all you want to do is learn to play tiddlywinks, then a coach is probably not appropriate. But if the outcome will have meaningful consequences, however you measure that, then a coach or mentor is probably a good idea.

When I decided to start a new career as an options trader, I had three different mentors who helped me learn my craft. That made sense. The financial consequences had the potential to be either very catastrophic or very lucrative.

Being a good polo player is not going to make or break my career, nor is it going to make me rich. But it is something I place a very high psychological value on. It is important to me. And so, over the years, I have hired professional players and coaches to work with me so I could get better.

Rocking this speech at the NSA convention could have both financial and psychological consequences. Clearly, I want to be wildly successful in front of such an accomplished group – NSA is not the place to fall flat on your face. Not to mention, there will be meeting planners and speaker's bureaus in the audience who have the potential to book me and those audiences have the potential to become clients. Again, the outcome is important to me so I have hired a coach.

One of the benefits of hiring a coach is to shorten the learning curve. Tiger Woods has spent his career playing golf. His coach, Hank Haney, has spent his career studying the perfect golf swing and how to teach it to others. Tiger Woods is, without question, a better golfer than Hank Haney. But Haney's skill set is different. He is a coach. He is able to help Tiger improve his swing - something that even a golfer as great as Tiger Woods is unlikely to accomplish on his own. And even if he could, it would take him much longer, diverting his time and attention from where it is better spent - which is winning golf tournaments.

Could I write and deliver a brilliant speech for the National Speakers Association. I think I could. But how many weeks and months would it take me? What is the opportunity cost? What is lost by taking all that time and psychic energy away from doing what I do best? What is the benefit of all the little tips and tricks I can get from a coach, gained over years and years of study?

Years ago, I had a coach pound on me about what he called the Law of Marginal Return. "Think of it like this," he said. "What is the difference in the paycheck collected by the professional golfer who wins the tournament compared to the paycheck for the guy who takes second? How much does the winning horse at the racetrack pay compared to the horse that finished second? A lot right? And what was the margin of victory? A nose? An extra putt?"

The Law of Marginal Return says that the one little bit of extra effort or preparation that puts you over the top pays a huge dividend relative to the time or effort spent. I believe hiring a coach is often a great way to get that little extra edge that creates that marginal return.

Sometimes we just get stale. We get in a rut. There is an old saying, "We cannot see our own eyes because we see with them." Sometimes, to get out of that rut, what we need is a fresh set of eyes - or a fresh set of ideas - to energize us.

There is a phrase in sports - "mailing it in." It is when a team who has a shot to win or contend obviously does not put forth their best effort. One job of a coach is to keep their team energized - to make sure they are never accused of mailing it in.

The other important benefit of a coach is accountability. The path of least resistance - especially in today's plugged in, always on, 24/7, multi-tasking world - is that good is good enough. To get those marginal returns I talked about earlier requires us to start a little sooner, work a little longer, think a little harder or accept a little more discomfort than the next guy or gal. That is so much easier when there is someone you are accountable to - someone looking over your shoulder, giving you that little nudge.

I not only employ coaches, I am one. I am a financial success coach. My definition of financial success is the ability to support a reasonable standard of living, indefinitely into the future, without work or worry. Should you hire me? That depends.

Is financial security an important objective with meaningful consequences worthy of paying a coach? Do you want a systematic transfer of the knowledge I have accumulated from over a decade of study and working with thousands of clients similar to you? Are you working hard but feel like you aren't getting closer to your goals? And could you benefit from a sounding board for your decisions and honest feedback when you are about to make the wrong one?

The other way to look at it, of course, is what is the downside? Can it be any worse than what you are doing right now? When you are playing probabilities, an action with little or no downside and a lot of upside is almost always the best bet.

Studies show the average investor underperforms their investment by 50% because they consistently buy and sell at the exact wrong time. The higher the return of an investment, the harder it is to actually capture that return because your actions are likely to shave off a large portion of the return.

So back to the Law of Marginal Return - look at the difference between $10,000 growing at 5% over 30 years versus growing at 10%. Would you rather have $43,000 at then end of 30 years or $174,000? If my helping you get on track and then stay on track is the difference between the successful investor and the not-successful investor, what is that worth? Sometimes the real value of a coach is in avoiding the cost of a mistake.

We all place different value on different things. Your decision about whether or not to hire a coach, any coach, really depends on the value you place on the outcome. For me, I am a big believer in finding someone achieving the results I want and learning from them. Experience has taught me that gives me the highest probability of succeeding at something that is important to me.

So I am off to Las Vegas soon. I'll let you know how it goes.

No statement in this article should be construed as a recommendation to buy or sell a security or to provide investment advice unless specifically stated as such.  All investments involve risk including possible loss of principal.  Our goal is your financial success.  Individual results may vary. Complete information can be found on our website or by calling 1-888-6SNIDER.

What does she mean by ...

The definition of words is not usually something we give a lot of thought to. But when you really think about the meaning of certain words, or the words someone uses and the context in which they use them, it can be quite instructive.

 

Here is how I define some of the words and phrases you will hear me use frequently:

 

Customer - someone with whom you exchange money for goods and services.

 

Client - someone who is under the care and protection of another (props to Jay Abraham for this definition which I immediately made my own).

 

Capital Appreciation - the money you receive when you sell an asset.

 

Cash Flow - the money you receive as a result of owning an asset.

 

Financial Success - the ability to support a reasonable lifestyle, indefinitely into the future, without work or worry.

 

Financial Advisor - someone who looks at all the products and ideas created by others and says, "How can I sell as much of this as possible, to as many people as possible, with the minimum amount of effort."

 

Coach -  one who instructs or trains; especially one who instructs players in the fundamentals of a competitive sport and directs team strategy (From Merriam-Webster)

 

Financial Success Coach -  one who instructs or trains others in the knowledge, skills, behaviors and strategies necessary to achieve financial success.

 

Competence - the ability to do something well or effectively. (From FreeDictionary.com)

 

Expert - the ability to creatively combine existing ideas together in a new way that adds to or improves upon the existing level of knowledge or skills in a particular area.

 

Investment Method - a complete set of rules about what and when to buy and sell, which is so comprehensive that there is never a time where you do not know exactly what to do.

 

Snider Investment Method - a long-term approach to investing with the goal of exchanging the long-term 8 to 10% capital appreciation of the stock market for a more immediate 1% per month cash flow or yield.

 

The definitions of these words create obvious questions. For example, are you a customer or are you a client? Which is a better fit for your investment objective -- capital appreciation or cash flow? Do you want to work with a financial advisor or a coach? Is your advisor merely competent or an expert? Is the way you're investing today systematic or ad hoc?

 

Words are cool. When used precisely, they convey a lot of meaning. (Cool is not one of those very precise words, is it?) Can you think of any words to add to this list? If so, e-mail them to me at kim at kimsnider.com.

 

 

All investments, including the Snider Method, involve risk including possible loss of principal. Please see our Performance Discussion and Owner’s Manual - they are an important part of this discussion. In particular, the yield measurement we use is different than the total return measurement often used by other advisers. These documents will spell out the differences. Information on how an investment has done in the past does not tell you exactly how it will do in the future.

Tax Cuts Explained

A friend emailed this to me the other day, and I thought it was worth sharing. The piece has been attributed to several people, but nobody seems to know the original author. In any event, I found it interesting:

Tax Cuts Explained

Because it's the election season, let's put tax cuts in terms everyone can understand.  Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this: 

• The first four men (the poorest)  would pay nothing.
• The fifth would pay $1.
• The sixth would pay  $3.
• The seventh would pay $7.
• The eighth would pay  $12.
• The ninth would pay $18.
• The tenth man (the richest) would pay $59.

So, that's what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement until one day the owner threw them a curve ball. 'Because you are all such good customers,' he said, 'I'm going to reduce the cost of your daily beer by $20.'

Drinks for the ten now cost just $80.  The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?' 

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.  And so:

• The fifth man, like the first four, now paid nothing (100% savings).
• The sixth now paid $2 instead of $3 (33% savings).
• The seventh now paid $5  instead of $7 (28% savings).
• The eighth now paid $9 instead of $12 (25%  savings).
• The ninth now paid $14 instead of $18 (22%  savings).
• The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant the men began to compare their savings.

"I only got a dollar out of the $20," declared the sixth man. He pointed to the tenth man, "but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar too.  It's unfair that he got ten times more than I!"

"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two?  The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all.  The system exploits the poor!"

The nine men surrounded the tenth man and beat him up. The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our Tax System works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

---

Kim Snider is the President and Founder of Snider Advisors, an investment adviser registered with the SEC, focused on teaching individual investors a sensible, long-term investment approach focused on maximizing cash flow. For more information on Snider Advisors or the Snider Investment Method, please visit snideradvisors.com. Her book, How to Be the Family CFO: Four Simple Steps To Put Your Financial House in Order, will be in bookstores October 1, 2008.

Snider Advisors makes no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 888-6SNIDER to request the Snider Investment Method® Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments, including the Snider Investment Method™ are subject to risk, including possible loss of principal.

Bora Bora, Alaska

More than 60 Snider Method workshop alumni and Snider Advisors staff members are traveling together this week in beautiful Alaska. A couple of years ago, we asked our alumni if they'd be interested in taking a trip together. Everyone would pay their own way, but we would help organize it. To our surprise, lots of our alumni said yes -- and the Bora Bora Society was born.

(The name "Bora Bora Society" comes from an inside joke of sorts. We tell our clients that they should only pay attention to the markets one day out of the month. The rest of the time, they should turn off the financial TV networks and ignore the market news in the paper -- there's nothing in those news outlets that should change what they do with their investments. Kim once said, "I don't care if you go to the caves of Bora Bora, just get away from everything." So the term "going to Bora Bora" stuck.)

Here are a few pictures from our trip so far. As of the time I'm writing this, we're in port at Juneau, the only U.S. state capital inaccessible by road. Over the next few days, we'll visit Skagway, Icy Strait Point and Ketchikan and then we'll take the inside passage down to Vancouver. Internet access on our ship is spotty, but we'll post more when we can.

Wish you were here!

(our ship, the Celebrity Millennium)

Hubbard Glacier (from afar)

Hubbard Glacier (up close -- the ship's crew told us that this was the best weather they've seen here in a long time and were thus able to get us closer than usual)

Yin and Yang Need a Home

The Best Friends Animal Society is my primary charity. In fact, my Mother and I will be headed to Kanab in October to volunteer for a few days at the sanctuary. They are probably best known for taking the Michael Vick dogs, which groups like PETA felt should be destroyed, and working to rehabilitate them.

 

From their site:

In the late 1980s, when Best Friends was in its early days, roughly 17 million dogs and cats were being killed in shelters every year, and the conventional belief was that little could be done to lower that number.

In the early 1990s, Best Friends' No More Homeless Pets campaign began as a grassroots effort to place dogs and cats who were considered "unadoptable" into good homes, and to reduce the number of unwanted pets through spay/neuter programs. Since then, the number of dogs and cats being destroyed in shelters has fallen to less than five million a year. There has been much progress, but there is still much more to do.

Most of the animals who find a safe home at Best Friends have special physical or behavioral needs, and our expert staff of veterinarians, trainers and caregivers offer them all the help they require. Most of them are ready to go to good new homes after just a few weeks of special care. Others, who are older or sicker, or who have suffered extra trauma, find a home and haven at the sanctuary, and are given loving care for the rest of their lives.

In addition to the sanctuary itself, Best Friends does wonderful work around the country and around the world including public education and disaster relief. Occasionally, they send out alerts about animals in a local area that desperately need a forever home. If you are thinking about a dog, please consider rescuing dogs like Yin and Yang, rather than buying from a breeder. There are so many wonderful dogs outs there, like my German Shepherd Dritte, who need homes.

 

 

Dear Best Friends Member,

 

Yin & Yang, who reside in Greenville, Texas, don't come with a great deal of history.  The boys are both under two years old and were turned over to a shelter when a gentlemen discovered that they have been dumped on his property.  These gorgeous boys have been evaluated by two trainers and a veterinarian who all agreed that Yin & Yang are very sweet and adoptable.  They have even spent the last month with a trainer who is brushing up on their manners!   

 

As I'm sure most of you know, this breed and breed mix can many times be hard to place.  We are asking our members to help by passing their information on to others and by posting their flyers in your community.  Click here for  Yin's Flyer and here Yang's Flyer.

 

Yin & Yang are young boys with so much love to give.  Please help them achieve the happy ending that they both deserve. 

 

Please direct all questions and/or inquiries to Annie at:  stuart.mcclintock@mwsu.edu

 

Thank you for your continued support Members!  Together we are making a difference. 

 

Sincerely,

Ms. Troy Lea

Animal Help Specialist

Best Friends Animal Society

5001 Angel Canyon Road

Kanab, Utah 84741

(435) 644-2001 ext. 4800

troy@bestfriends.org

www.bestfriends.org

http://network.bestfriends.org

 

"A Better World Through Kindness To Animals"

 

This email was sent to: kim@kimsnider.com

This email was sent by: Best Friends Animal Society

5001 Angel Canyon Road, Kanab, UT 84741

Shane needs a loving, forever home

Warning! This has absolutely nothing to do with investing but everything to do with being a good human! I am re-posting this in hopes that someone out there might be able to provide a loving, forever home for Shane.

Dear Best Friends Member, Marquita, from Canine Compassion Rescue in Houston, Texas, contacted Best Friends about Shane, a magnificent dog who has stolen her heart. Marquita is hoping to find a loving home for this boy. Shane is a strikingly handsome American Pit Bull Terrier. He is a white, 2- to 3-year-old, neutered male with a great, big smile. This bundle of energy is a playful, gentle boy with a very sweet disposition. He passed his basic obedience course with shining colors and has proven to be extremely intelligent. Although Shane did not have a happy past, he doesn’t hold that against us humans. He is a real lover who enjoys giving sweet kisses. As with all large dogs, he would do well in a home with no small children, due to his strength, boundless energy and general goofiness. And please, no cats. Shane is fully vetted and has his obedience training down pat. This big softy's greatest wish is to have a loving person of his own who enjoys the great outdoors. He would be overjoyed to help you jog off a few of those winter pounds! He's in his prime and ready to go, go, go! Giving Shane a forever home would be wonderful Valentine’s Day present to yourself. Is your heart big enough for this sweet boy? Marquita has remained dedicated to finding a special person to offer this joyful boy the loving home that he deserves. If you or someone you know can help find a foster or forever home for Shane, or if you would like more information about him, please contact Marquita directly at 713-397-7170 or email Marquita at caninecompassion@yahoo.com. It would also be very helpful if you would post Shane’s Flyer at businesses, pet shops, veterinary clinics and other areas in your community where pet people gather. Just Click Here to view Shane’s Flyer. We just need to reach one special person with room in their heart for this sweet boy. In whatever way, large or small, you might play a part helping to find a forever home for Shane, we at Best Friends thank you, and Shane thanks you too! Together we can make a difference for the animals. Meg Meg Fiorina Animal Help Specialist Best Friends Animal Society 5001 Angel Canyon Road Kanab, UT 84741 435-644-3965 x4856 megf@bestfriends.org http://network.bestfriends.org www.bestfriends.org A Better World Through Kindness to Animals

Happy Thanksgiving!

Dear Friends, Clients, Colleagues and Faithful Readers,

Christmas lights are going up all around my neighborhood. I was told KVIL, a local Dallas radio station, has already switched its format to 24 hour Christmas music. And around here, Jim and I are thinking about how to decorate the house for Christmas.

But first ... there is Thanksgiving! And we all have much to be thankful for ...

I am thankful for all the men and women serving in our armed forces who won't be with their family this Thanksgiving so I can live free and without fear.
I am thankful for a wonderful husband who loves and cherishes me.
I am thankful for my good health and the health of those I love.
I am thankful for my family and friends who support me when things don't go well and cheer for me when things do.
I am thankful for a job that challenges and inspires me every day.
I am thankful for all the people whose paths I have crossed.

Which means ... I am especially thankful for you.

Happy Thanksgiving everyone! And Go Cowboys!

Kim

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

Investing Groups for 55 and Over Crowd

A member of the press is looking for investing groups made up of folks 55 or older. He says it doesn't have to be terriby formal. It could just be some folks who get together for an online chat once in awhile. If you know of a investment group made up of the 55 and over crowd, please email me - kim (at) kimsnider.com and I will pass it along. Thanks.

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

Going Away From Blog For Awhile

If you are a regular reader of this blog, you may have noticed that my posts have been getting less and less frequent of late. I am finally getting down to business and am determined to get my book written. I have been saying I was going to do it for several years now. Now it is time to put up or shut up.

 

I have realized I can only write so much in a day and something has to give. So for now, it is going to have to be the blog. I will stop posting to the blog on a regular basis so I can get the book done. That doesn't mean I'll go totally silent but don't be surprised if there are long periods where I don't post.

 

If you don't already use FeedBlitz to get email copies of my posts sent directly to your inbox, now might be a good time to sign up. Just enter your email address in the left sidebar. That way, when I just get the urge to post something, you won't miss it.

 

Also, our podcast will continue to be posted here each week (as well as on iTunes). And our staff will continue to post items of interest specific to the Snider Investment Method™ on the Snider Insider blog.

 

Finally, I strongly encourage you to sign up for our weekly email newsletter, the Kimmuniqué, which will be published every Thursday as normal. That way, you can still get your weekly dose of practical advice for Family CFO's. The Kimmuniqué will also keep you up to date on all our events and everything we have happening at Kim Snider Financial Communications.

 

Finally, I just want to say thanks, in advance, to all my regular readers and commenters. I appreciate your support and patience while I try to get this monkey off my back.

UPDATE (7/28/07)- Ding! Dong! The witch is dead! I am happy to report I finished the first draft of the book last night at 8:47 PM. There is still much work to be done but it feels like the hardest part, for me at least, is done! Hooray! Thanks for your continued patience and support.

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

BusinessWeek Stories

The folks at BusinessWeek are looking for people who fit two story ideas. Details and contact information is below. Please contact the writers directly if you think you are a fit.

 

I have two requests for reporting help—one from me, and one from my colleague Anne Tergesen. Feel free to forward this anyone you know who may fit our needs.

 

First: I’m working on a story about early retirement, and I’m looking to interview people who are obsessed with retiring early. Obsessed may be someone, say, who has given up premium toilet paper to save money. Or someone, say, who found all of her kids college scholarships, and used money earmarked for college to buy a retirement home. These are made-up examples, of course, but you get the drift.

 

I prefer to be contacted by email with a short explanation of your (or your friend’s) early retirement obsession! I will do my best to respond to everyone who is in touch in a timely fashion, but this list contains more than 1,400 contacts, so I apologize in advance if it takes me a few weeks to sort through the avalanche of leads and replies you (hopefully) send my way.

 

My email is: lauren_young@businessweek.com

 

Second: My colleague Anne Tergesen is writing an article about some of the interesting or unusual ways in which people have decided to divide up personal property.

 

Please note: This is NOT financial assets such as stocks, bonds or real estate, but the objects of sentimental value heirs fight over just as often—for example, grandma’s antiques or grandpa’s ancestral Civil War sword.

 

Anne says: “I’m looking for people who are willing to share their methods and stories of dividing items everyone wants in a way that preserves the peace. The decision about how to divide the items may have occurred before the owner’s death or after and it could have been initiated by either the owners or heirs—I’m not picky! If you’re willing to share your story with me, please let me know. I prefer to be contacted by email – and a short explanation of your situation would be helpful. Thank you!”

 

Please contact her directly: anne_tergesen@businessweek.com

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.