What is value?
Recently I had to do a task I dread doing every couple of years. (I know I’m not alone on this one!)
Get a new cell phone plan.
I honestly would rather go through the process of buying a new car than contend with the three-card Monty of seeing a million phones, plans, and options.
It is always a frustrating process, because the salespeople never LISTEN.
“For only $4 more per month, your plan includes 180 gigabytes of data per month…it’s great value!” the salesperson advised.
I sighed.
You see, two years ago the only option was a phone plan for 75GB per month – far in excess of what I needed. Now, it had more than doubled.
But is more than double of what you don’t need actually give value…TO YOU?
I believe people only spend money when they perceive what they are receiving to be of equal or greater value. (And value isn’t based on price alone or what other people think is value for YOU.)
Being a finance nerd, I made this belief a simple formula:
Value = Want+Need+Quality+Price
So when the phone plan price went up by “only $4 more per month” without any increase in the quality (and a huge data plan I didn’t need), this actually decreased my perception of its value.
And I was secretly annoyed at how clueless the entire process was.
It’s why I couldn’t resist the cartoon for this blog post!
Investment Fees Fall Into The Category: What Do You Value?
I’ve observed the same thing many, many times over my decades of helping doctors.
Let’s say you have $500,000 with your investment advisor.
You’re likely paying 1 ½ %, or $7,500 per year in investment fees. You might not see this directly, as it’s often buried in the investments themselves.
How could you increase the value of what you’re paying for?
Well, let me ask you a question.
For the same price, which would you rather have?
Option 1:
Investment Advice only (what I typically see from investment advisors), or
Option 2:
Investment advice, tax and cash flow planning, risk management, retirement and estate planning and debt elimination strategies that are integrated and consider HOW you want to achieve them, not just WHAT you want to achieve. And also someone who connects with your accountant to make sure your entire plan is in alignment.
I know which option I’d pick.
More of what I actually want and need.
As for the cell phone plan provider?
I went with the lowest data plan that was closest to our needs. (Even then, still waaaaaay too much data!)
And as soon as a different phone provider smartens up and creates something better?
Option 2:
Investment advice, tax and cash flow planning, risk management, retirement and estate planning and debt elimination strategies that are integrated and consider HOW you want to achieve them, not just WHAT you want to achieve. And also someone who connects with your accountant to make sure your entire plan is in alignment.
I will jump ship.
Because I’m just like you.
I want the best value in everything I spend my money and time on.
Enjoyed this article? I’d love to hear from you! I’m always interested in hearing about the unique financial situations doctors have. Send me a note! And make sure to check out my Amazon bestseller, The Doctor’s Handbook: 5 principles of wealth you weren’t taught in med school.
