Who Is Your Neutral Voice?

Unbiased Advice in a Transactional World

by Dr David Phelps

by Dr David Phelps

“When taking investment advice from anybody, often delivered in the form of good marketing or sales pitches, are you considering their incentives? ‘Why do they want me to invest with them?’ ’’

A neutral voice comes from someone who gives you unbiased advice without an agenda behind it. A neutral voice gives a better perspective or way to approach something that ultimately only benefits you.

It’s important to have people around us that we look to for advice, but it’s equally pertinent to choose them carefully and understand their reasoning for giving such advice.

For our finances, we typically seek advice from a tax accountant, an attorney, a CPA, or other financial fiduciary. When doing so, you must consider their agenda or their incentive to give you advice.

That incentive is how they get paid, assuming they are not just a friend, but someone who gets paid for their services. There's nothing wrong with that. That's the way the world works.

When you bring value and solve problems for people, you get paid. There is nothing wrong with that. You just need to understand the incentive for advisers, even as much as they want to be as unbiased as possible in guiding or driving a client in a certain direction.

The “Perfect” Opportunity I Left Behind

Many years ago, when I started Freedom Founders, I was told it was the “perfect” opportunity for me. “David, you could go out with your contacts and understanding of dentists, high-income earners, and the real estate markets, put together real estate funds or syndications, and profit significantly from the commissions.” 

Syndications and funds are commonly used by accredited investors to invest “passively” in real estate alternative investments. And no question, a lot of money can be made doing that. However, when creating your own fund or syndication, you will always have an underlying incentive to push investors to your opportunity.

The temptation to promote the opportunity regardless of its performance would be inescapable. As a real estate investor for 40+ years, I always had to consider the incentives for the sponsor I was looking to invest with.

Based on wise advice from my neutral voice, I decided not to pursue that path. Would it have been profitable? Yes. I don't need or want more money. I want to be able to sleep at night, knowing that I have no incentive other than to speak the truth.

How I guide my members today is entirely different and without an incentive for any particular investment. I don’t sell anybody else's services, products, or real estate.

I don't take any affiliate commissions. Everything I do is based on a flat membership fee to be a part of the community. That's it.

This allows me to be agnostic to whatever the members of this community want to invest in. I can guide them without having any preconceived notion of some kind of benefit for me. 

There’s an underlying behavioral instinct with any commission gained in any specific investment. No matter how much you aspire to be unbiased, it’s just human nature to want to push people in that direction, sometimes without even realizing it. That’s why I don't do it that way.

Are You Considering Incentives?

When you take investment advice from anybody, whether through good marketing or sales pitches, are you considering their incentives? “Why do they want me to invest with them?”

Hopefully, they believe in what they're doing. Hopefully, they know what they're doing. But hoping is not what I base my investment strategy on, and I don’t think you want to either.

Hope is a good sentiment here, but I prefer knowing the incentive and hedging for it in any investment. One way to hedge is to have a neutral voice advise you on any worthwhile opportunity.

Where is Your Neutral Voice?

Who's got your back and can help you ask the right questions about investments? Who can help you ask the right questions about your business? These same principles apply to navigating an exit transition plan from your business or practice… Do your advisors stand to benefit from a certain course of action regarding exiting your practice? 

Everybody has, at least, an inner desire to see transactions completed because most people get paid on a transactional basis. That's the way most of the world works.

I don't work that way. I'm glad to be different. Transactions are not bad as long as you understand the incentive. Transactions are made better when you have neutral advice from a perspective looking out for your best interest. Think about this closely as you make your decisions today.

Transactions are not bad as long as you understand the incentive. Transactions are made better when you have neutral advice from a perspective looking out for your best interest.

To your freedom!

– David


P.S. Whenever you’re ready, here are some other ways I can help fast track you to your Freedom goal (you’re closer than you think) :


1. Schedule a Call with My Team:

If you’d like to replace your active practice income with passive investment income within 2-3 years, and you have at least $1M in available capital (can include residential/practice equity or practice sale), then schedule a call with my team. If it looks like there is a mutual fit, you’ll have the opportunity to attend one of our upcoming member events as a guest. www.freedomfounders.com/schedule

2. Become a Full-Cycle Investor:

There are many self-proclaimed genius investors today who think everything they touch turns to gold. But they’re about to learn the hard way what others have gained through “expensive” experience. I’m offering a free report on how to become a full-cycle investor, who knows how to preserve and grow capital in Up and Down markets. Will you be prepared when the inevitable recession hits? Get your free report here.

3. Get Your Free Retirement Scorecard:

Benchmark your retirement and wealth-building against hundreds of other practice professionals, and get personalized feedback on your biggest opportunities and leverage points. Click here to take the 3 minute assessment and get your scorecard.

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