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I Don't Want the Bit, I Want the Hole.

Apr. 29, 2011 7:09 AM ET
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As I am sure readers can all agree that we are in challenging economic times.  Markey volatility and political unrest has affected our economy both domestically and abroad.  I wanted to highlight a story I once heard that I feel sums up the best advice I feel is available in our industry today.  Story goes a consultant was speaking to a group of sales representatives who happened to in fact be tool sales people.  he asked them why should he buy a 1/4" drill bit from them why not the other guy.  The reps responded will a number of reasons "well our steel is hand crafted from Germany its the finest steel in the world" another said "our drill bit is tempered to 1500 degrees its not brittle it wont break".  Maybe all that's true responded the consultant, but it doesn't matter.  Point of the story is customers and clients don't want drill bits, they want 1/4" holes.  When a guy walks into a hardware store on Saturday morning he's not going to ask the clerk where he gets the steel from, he doesn't care what the resistance temperature is he wants to pay $5 go home and drill a hole.  He doesn't even want the bit he wants the hole, but to get the hole he has to buy the bit.  You see its the same here in financial services.  Everyone gets caught up in this investment that investment this strategy that strategy, but what they neglect to realize is what it is they are actually buying.  In my experience everyone wants 1 of 3 things either its college education for their children, saving money on taxes, or a comfortable retirement.  It doesn't matter what stock bond or mutual fund gets you there what matters is that you get there.  So my suggestion is this; work with your financial professional to develop a comprehensive plan on what you need to do to reach your goals (your proverbial hole).  Then fill in the blanks with high quality investments that have a track record of achieving the results you seek.  The best kept secret in all of finance is that getting wealthy and achieving your goals is much easier than you think.  All it requires is a plan, discipline to stick to it, and the time to realize the benefits.  So start early ladies and gentlemen and let me know how big of a hole you want, and I'll find you the right bit.


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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