Yard Work and Investment Management
August 31, 2005By Dave Polstra, CPA, CFP®, CIMA®
My partner, Chris Dardaman, has a beautiful yard. In the spring, it blooms with magnificent color. In the summer, the Bermuda grass is so short and lush and green that you’d think it was the 18th hole at one of the nicest golf courses in town. And in October when the leaves begin to turn, his horticultural varieties of trees and plants radiate with the colors of fall. And you know what? Chris doesn’t own a lawnmower or an edger, he never uses his shovel or spading fork, and the work gloves that he keeps in his basement look brand new.
By now you’ve figured it out — Chris uses a professional lawn service to manicure and maintain his lawn. But this insight did not come quickly for Chris. Many years ago, I remember stopping by Chris’ first house on a Saturday afternoon. He was out in the yard, sweating in the sun, attempting to trim his bushes. His yard looked ok but not great. The lawnmower was on the driveway and his electric trimmer and extension cord were on the sidewalk. Many kinds of yard tools were scattered near the flower beds. And in spite of his good intentions and earnest efforts, his yard still looked only mediocre, and it stayed that way until he moved to his current house. Chris had neither the time nor expertise to grow and maintain the landscape at an excellent level. Chris wanted to have one of the best looking yards in the neighborhood. He realized that if this were truly going to happen, he needed to either 1) spend every weekend and several weekday evenings working on it, or 2) find a professional whom he could trust to do the job for him with excellence and distinction. Wisely, he chose the latter.
Now, when Chris comes home from the office, he doesn’t worry about his yard. To him, whether his yard company applies 30-0-0 or 10-10-10 just doesn’t matter. What’s important to Chris is that the yard looks great! Why does it look great? Because his yard maintenance company services hundreds of well-maintained yards. They understand yards implicitly. If a yard develops Brown Spot, they know what to do. If it needs an extra dose of nitrogen, they know the exact amount and best brand to apply. If it’s not getting enough water, they can adjust the sprinkler system accordingly. And if the fire ants move in, they know precisely how to eradicate them without poisoning the Dardamans' new puppy in the process. Without yard work, Chris now has more time and the freedom to enjoy his family and participate in the interests and activities that mean the most to them.
Believe it or not, investment management has a lot of corollaries to yard work. After being in the business of advising hundreds of wealthy families for over 24 years now, we often chuckle inside when we’re asked certain questions, particularly by certain prospects or our newer clients. “David, why does this prospectus state that foreign derivatives may be used in a rising interest rate environment? Why do you have only 10% of my portfolio allocated to TIPS? Why did you choose Manager A instead of Manager B?” Of course, we answer these questions with interest (we enjoy discussing the detailed aspects of our work). After all, we spend our time focused on these matters so that we can deliver the utmost excellence in advice and service to our clients. This allows them to have peace of mind as they enjoy the journey of life without having to worry about their financial affairs.
Sometimes it takes awhile for clients to realize that they don’t need to be concerned about the minute details of their portfolios unless they enjoy it—that’s what we’re paid to do. So the next time you’ve got questions about your portfolio, give us a call so we can gladly answer them, and remember … we spend hours and hours every week servicing and maintaining hundreds of investment “yards” year in and year out, in all kinds of investment “climates,” while continuing to investigate new tools and innovative investment “fertilizers” that should create the best result for your financial success over time.
