At the outset I have to confess that I am a SMSF nerd. I love talking about strategies, reading legislation and – as my wife will attest – I have even been known to take cases and my CCH super legislation book to bed.
I started my first business in 1996 providing technical advice to accountants and financial planners. Fairly early on I discovered I had a real passion for strategising. But that’s where the problem starts, and for many ends.
Being a SMSF Strategist is fun and challenging, but it’s not a business.
I learnt this from Michael Gerber – the man who wrote the E Myth, rightly points out that many of us started out working somewhere, for someone else and then had an entrepreneurial brain snap which sent us charging into our own consulting or advising business. Everything goes well for the first year as we run around town telling every man, woman and their dog about our brilliance in providing strategic advice. But as we get busy, the wheels start to grind and we employ someone to help carry the increasing workload. However, this proves to be a short term solution because in a matter of months, we are once again overwhelmed with the work flowing through our entrepreneurial venture. Funnily enough, to help cater this rapid growth we seek out someone like we used to be – an employed adviser.
This is where the fun really begins. In little to no time at all, our focus shifts from the things we love, such as strategising, to the business activities often overlooked – like managing employees, cash flow, administration and all the tasks that are necessary; but don’t actually make us any money. And this is where our entrepreneurial venture hangs like a millstone around our neck. We have created a great place to employ one, two or more employees and keep the economy spinning, but we have not created a successful business.
SMSFs are the same. In some fit of excitement, we get immersed in the world of SMSF advising – we learn the strategies, get a specialist stamp from SPAA and even have a card printed saying that we are a specialist adviser. But lo and behold the same thing happens and we are back in the same morass.
Is it any wonder that many planners that have ventured into the SMSF advising space go back to the warm cocoon of financial planning, where dealer groups and fund managers provide a whole business on a plate? It is also why many accountants don’t venture out from their SMSF administration models to run an advice business. It is because they do not know the SMSF Business Model. In the same way that Ray Kroc saw an amazing hamburger business decades ago in a small US town and turned it into a global behemoth – there is a SMSF business model that works time and time again, releasing great strategies to clients consistently with secure compliance and for profit.
At the No More Practice Strategy Day I will talk through the model and give my insights on running a tight SMSF business while still being a SMSF Strategist – the best of all worlds.
Grant Abbott is one of Australia’s leading SMSF advisers, authors and presenters. He is also the owner and principal of SMSF Strategies.
