What You'll Learn In Today's Episode:

  • What a lifestyle practice really is and the key parts of one.
  • Why you need to know your ‘why.’
  • What Parkinson’s law is and how it relates to a lifestyle practice.
  • How to use forcing mechanisms to your advantage.
  • Why you need to get out of the office often.
  • How to determine profitability in a lifestyle practice.

There’s a question Matt and Micah get more often than you might think: What do you do if you don’t want a lifestyle practice? Today the guys are answering this question and diving into why it’s not so much about creating a lifestyle practice as it is about creating an intentional practice that works for your life.

Listen in as they share some of the key things you should be doing whether you agree with the concept of the lifestyle practice or not, as well as why working more will (surprise, surprise) not make you more successful. You’ll learn how to get out of the office more so you can create a business that can run independent of you and free you up to work less and play harder.

  • We hear all of the time being in the RIA space is lonely. It is hard to find like-minded individuals who want to help you to achieve success.

    And most likely, you often ask yourself the same question (we all do)  – Where do I start?

    The TPR’s Starter Kit offers you access to the One Page Financial Plan, 5 Mistakes Keeping You From Getting More Clients & How to Stop Playing Office, our most popular power sessions of all time!

Resources In Today's Episode:

Read the Transcript Below:

This is The Perfect RIA, in case you didn’t know. Bringing you all the strategies to help your business grow. Are you happy? Are you satisfied? Are you hanging on the edge of your seat? Sit back and listen in while you feel the beat. Another myth bites the dust…

Micah Shilanski: Welcome back to the Perfect RIA podcast. I’m your co-host and co-founder Micah Shilanski, and with me, as usual is the legendary Matthew Jarvis. Jarvis, how’s it going, bud?

Matthew Jarvis: Micah, I’m doing really well. It’s a happy 2021. Riots are—

Micah Shilanski: I know.

Matthew Jarvis: 2021. I’m really excited for today’s episode, excited for every episode, which by the way, is a fun thing. People run into you and I all the time, they say, “how’s the podcast going?” And I say, “yeah, it’s a heck of a lot of fun” and believe it or not, tens of thousands of people are listening to it every month, which is fun. Thank you to the TPR audience for keeping this alive for us.

Micah Shilanski: And we really got to do a shout out to our listeners. I don’t know if you guys know a gentleman by the name of Benjamin Brandt, great guy, but one of his goals is to always have more downloads in his podcast than ours. So hopefully he’s not listening to this episode. Really need your help in crushing him this year. He has a great podcast, but we just want to smoke him in downloads. That seems fair, right?

Matthew Jarvis: That’s right. That’s right. Different market, different goals, but a win is a win.

Micah Shilanski: That’s right.

Matthew Jarvis: Micah, today we want to talk about a question that we get more often than I would suspect, which is, “Matt, Micah, what if I don’t want a lifestyle practice?” Or we also hear it as a statement like, “Hey Matt and Micah, I don’t want a lifestyle practice.” Micah, I’m curious how often you get that question, if at all, and what are your thoughts when you hear that?

Micah Shilanski: I do get that comment and question. I think it’s from two ends of it, perspectives that are there is number one, there is a stigma or a theory out there that a lifestyle practice is a lazy practice. And I know we’ve talked about a pod on this before, and we’re not going to talk about that the same way today. It was a much different approach. But there’s that aspect in there that it’s just the lazy practice, it’s a retirement practice, you’re really not crushing it, you’re not doing it. So there is that stigma. Then there’s also the people that are out there that says, “I love what I do. I have nothing else. My life is my business. I want to spend my time in here. This is what I want. Maybe my kids are in school. Maybe my kids are out of the house. My wife has her own thing going on…”

Matthew Jarvis: Right.

Micah Shilanski: Your spouse has your own thing going on and you really want to focus just in your business, right? And those can all be legitimate justifications for not running a lifestyle practice. Now I want to say justification because not everybody has to run a lifestyle practice, but let’s peel this onion apart a little bit more. We’re saying lifestyle practice so it instantly communicates a little bit what we do, but maybe it’s not very clear because a lifestyle practice is more than just time out of the office. It’s running your practice at a peak efficiency level for you. This is a key part of a lifestyle practice, is it implements forcing mechanisms, implements surge calendars, implements things that allows you to step away from your business. And us as entrepreneurs, one of the key things we have to be able to do is step away from our business and let it run because if you step away from your business and it collapses, if it has to have you there, that is a job, that is not a business.

Matthew Jarvis: Micah, it makes me wonder if we need to stop using the phrase lifestyle practice and really switch to intentional practice, and not in a cliched way, but really you and I didn’t set out to say, “we want to solve the lifestyle practice game.” We said, “here’s how I want my practice and my life to look.” And they happened to fit the definition of lifestyle, but it’s really about having an intentional practice. And Micah, I think all the points you made, obviously I totally agree there. Interesting to me and you, and I talked about this before we hit the record button, a lot of times when people say, “Hey, Matthew, I don’t want a lifestyle practice,” I think two things.

One, I think, “who cares?” Then ignore that part of it, right? Take the stuff that works for you, ignore the stuff that doesn’t. But the real one, the question I always want to ask, and I have to confess I’m less and less polite about this is, “Perfect. If you are working twice as many hours as I am…” Micah and I take roughly six months off a year, so if you’re working in an entire year, you’re working twice as many hours, surely you are making twice as much money. Not gross because that doesn’t count. Net. So your take home pay is probably double mine because you’re working twice as many hours. And of course, Micah, the answer is…

Micah Shilanski: Correct. A resounding no, right? It’s no, that is not the numbers when we start going through it. And this brings up an interesting point about that intentionality of the lifestyle practice and a lot of the people in the TPR, especially the backstage pass., I mean, they are dedicated to this concept of intentional practices. But before we jump into some of the things that you need to be doing, whether you agree with the lifestyle practice or not, and actually, I’m going to do a sidebar here real fast.

Matthew Jarvis: Please. Please.

Micah Shilanski: It’s super interesting when I’m talking to advisors and I can quickly identify the success. The mental success of an advisor when I’m chatting with them is if they can see how something doesn’t apply 100 percent to them, but how they can take pieces of it and apply it to their office. How often do we meet someone else and say, “wow, they’re doing something else. Well, that’s a totally outside niche, therefore, it’s not going to work for me. Well, he’s on the East coast, therefore, it doesn’t work. He’s in Alaska, therefore, it doesn’t work.” And we start blowing credibility of other people away entirely because it won’t work for you.

Where I see very successful advisors that goes, “okay, well, great. Micah is in Alaska, so all right, they work out of igloos. That part doesn’t work for me, but what’s another part that does?” And they can quickly jump in there and pull out pieces to apply to their life and their business and that’s the same thing here. I don’t care what you call it. A lifestyle practice, an intentional practice, a why practice, right? A traditional practice. Anytime you’re meeting with an advisor that’s doing something well, we should always be pulling out great things that you can improve your life. Sorry, total sidebar on that one.

Matthew Jarvis: No, no, that’s a really good point and it is a real delineation between successful people and unsuccessful people that the successful people are looking for “what lessons can I draw from this?” And sort of our default thinking as humans, not to get too deep into this, it’s sort of like do agree or disagree with what this person is saying. Ans one, they don’t care, and two, it really doesn’t matter if I agree or disagree with Micah. I’m looking and saying, “is there something that I can take from this that I can apply to my life to improve what I’m doing?”

Micah Shilanski: What do you mean? Somebody disagrees with me? What? All right. So let’s go back to one of the key parts of what we’re still saying is lifestyle practice or that intentional practice, right? The first thing you have to focus on, and I’ll give a shout out to coach Joe Lucas because he chats about this a lot. What’s your why? when you’re building a practice, when you’re building a marketing plan, when you’re doing something, what’s your why? If you don’t have a big enough why or extreme accountability, that can definitely fit your why category, you’re not going to get it done.

So what’s your why in putting this together? Jarvis, let’s rewind that clock for us, right? Because we didn’t wake up and all of a sudden start taking six to eight months out of the office. We were in that same camp as a lot of advisors working 60 to 80 hours a week, going through things. Seven days a week, I was in the physical office and I was working and my mentality going back a decade was the more time I spend in the office, the more successful I’m going to be. More time my butt is in that chair, the more successful I’m going to be. And that is not correlated.

Matthew Jarvis: No.

Micah Shilanski: And so we had to shift from that and we had to have a why. Why do we want to make a change? Now for us, it was very much a family and a personal thing, right? The gift of our daughter, Aviana, our life change. We had to do so many things dramatically different. It was a wonderful forcing mechanism and a wonderful why for us to change our practice. And Jarvis, you looked at it from a perspective of saying, “look, I don’t want to do this for the next 40 years. I have to make a change.”

Matthew Jarvis: Yeah. Yeah. And I didn’t want to just grind. And we have to keep in mind that Parkinson’s law is all encompassing, right? So a Parkinson’s law says an activity will take as much time as allocated to it. If you allocate seven days a week to your practice, you will be busy seven days a week. Your team will be busy as much time as you give them. Your budget will be full as big as your budget is. So this will always be there. For me, Micah, it was almost just a challenge. It was almost like a dare.

Micah Shilanski: Sure.

Matthew Jarvis: Can I take every Friday off? What will happen? Can I take three weeks off and travel with my family to China? This was several years ago, pre-COVID, though we are trying to schedule another one. But anyway.

Micah Shilanski: I saw, right?

Matthew Jarvis: Yeah. Yeah—or something crazy. But again, it’s this intentionality and keeping in mind, again, that Parkinson’s law says that you’re going to work as much time as you give to work. And as Americans, and I know we have a worldwide audience, but sort of this American mindset of “the more I work, the better person I am, the better results” And there’s certainly a case for that, right? If you’re just a bum sitting at home, that’s not going to work, but you working 50, 60, 70 hours is not going to give you more results than if you work 40 hours or 30 or 20 or 10.

Micah Shilanski: Absolutely. So what’s that why? what’s that Parkinson’s law that’s going to be there? And this is where these forcing mechanisms come out and this is where I think the why is important, right? So if yours, Jarvis, in your case was like, “look, you want to take every Friday off. Okay, sweet.” Maybe it’s from the challenge aspect of it, right? Another way, and this one, I hear this resonate with advisors a lot, it doesn’t resonate super well with me, but it does with some other advisors so I want to share it. Do you really want to be doing your practice the exact same way for the next 40 years? If retirement wasn’t an option, pull this out of the 10 or 15 hour work week, if retirement wasn’t an option, what would you do different now? And what’s the way we can spin that lens a little bit.

And that’s one of the benefits of putting a why in with this lifestyle practice, because now we’ve just incorporated several amazing things. We’ve put in Parkinson’s law, which we’re going to talk about more in just a minute. We’re going to shorten down our work schedule. We’re going to become more efficient. We’re going to have a forcing mechanism to get out of the office. We’re going to improve our family life. And if you don’t care about improving your family life, then quit listening to our podcast, right?

Matthew Jarvis: Yeah. You’re in the wrong place.

Micah Shilanski: Yeah. Family can mean friends as well, by the way. So it’s a more inclusive thing. It should mean those things. But we should always be trying to develop those relationships. And are you being intentional about that? And that’s what a lifestyle practice gives you.

Matthew Jarvis: Totally. So many good points there. I think one of the big ones I want to drive there is this forcing mechanism, which again is a counter, if you will, a defense against Parkinson’s law. Taking that time out of the office forces you to get better, right? Micah, you being gone in your RV, me taking a trip to China, doing our boat trip, whatever it is, it forces your office to become a true business and not just it dependent on you.

Micah Shilanski: Oh, let’s pull something out of there. You just said it very, very casually, but this is such a great point. With all those examples, I was gone in my RV, it’s an international trip, you were on your boat trip, right? Something of that nature. What is that? That’s a physical thing forcing you to be out of your office. If you just say, let’s say you’re a habitual workaholic, you love doing that type of stuff, and you just say, “well, I’m going to stay home on Fridays. I’m not going to go to the office.” Well guess what? After 2020, everyone works from home, as if we didn’t before, so that’s not going to solve this issue. You have to create an activity. You have to create an event that’s going to force you to get out of the office. Dramatic, right? When I was first doing this a decade ago, I rented a forest service cabin for one. It was within my budget. It was 10 or $12 a night, so it was there.

Matthew Jarvis: So it was—

Micah Shilanski: It was, yeah. It was outside of cell range, it was outside of internet land, and that was my forcing mechanism because when I was there, I couldn’t work. I had to get things done and sure enough, I was able to get everything done before I left just like you are every single time you go on a trip. So a key part of this, force yourself to be out of the office. Book a trip.

Matthew Jarvis: Yeah. Yeah. And by the way, you’re already doing this. Everyone listening to this podcast is doing this because I would assume that when you’re asleep, you’re not somehow tied into the internet and you’re doing work and your asleep. Hopefully that’s not really a thing. So you’re already taking—

Micah Shilanski: …productive you could be, your subconscious just getting everything done by the time you wake up.

Matthew Jarvis: That’s right. You’re already taking six to eight hours a day that you’re unplugged completely. We’re just saying stretch that out a little bit further. And again, this time being out of the office forces your office to be more productive. If you’re saying, “Hey, my team is always asking me questions.” Great. For a week, disconnect your telephone, turn off your phone, turn off your laptop, leave them at home and be gone completely for a week. And if the office burns down while you were gone, then good riddance. It wasn’t a very good office. Otherwise, everyone’s going to figure out how to survive without you. And that’s the beauty of a lifestyle or intentional practice is it forces an office to run like an office, not as an extension of matter, Micah.

Micah Shilanski: Kind of a fun thing recently that I was doing, it turned out to be more of a punishment, but then it ended up being a fun thing, is I like my screen time on my phone to be very low. About an hou a day is kind of my max on my phone screen time.

Matthew Jarvis: Good for you.

Micah Shilanski: And so weekends, Sunday comes around, if that reports more then I have to do something. So it went up to two hours a day and I was like, “this is too much.” So I started leaving my phone at home when I’d go out with the kids. Oh my gosh, we grew up this way. It can still happen. The office didn’t burn down. Everything was fine. I let my wife know I didn’t have my phone just so she knew and wouldn’t get worried, threw it in a drawer, and we just left for the day and we went out and everything was fine and I was able to be more intentional with my family. So we can do a little forcing mechanisms. If you’re out on an event but you keep getting on your phone, leave it at home. Leave it in the car. Don’t bring it with you.

Matthew Jarvis: Now, I want to pivot this discussion, Micah, to try to tackle several different types of advisors. So this podcast is called the perfect RIA, but it applies to practices of all shapes and sizes. So we had a backstage pass member, guy named Garrett, great advisor, and he says, “Hey, Matthew, in my office, there are other advisors, and if I start leaving for days or weeks at a time, they’re going to think that I’m being a bum.” This is especially true in family practices. Micah, I don’t know if you’ve ever experienced a family practice—

Micah Shilanski: Best thing in the world and the worst thing in the world.

Matthew Jarvis: So, one thing is you need to be able to manage the expectations of your team, of your coworkers, of your family and the Tim Ferriss 4-Hour Work Week, which Micah and I are both big fans of, talks about this quite a lot. For example, I started taking Fridays off because I didn’t have to report to anybody. If you have other people that are going to say, “geez, Matt is really a bum for taking Fridays off,” great, take Wednesdays off, take Tuesdays off. Better yet, set a KPI measurement for your office that your team agrees to and says when these things are accomplished and our work is done for the week so that you can then report to everyone else, “Hey, I did my things for this week and therefore I’m going to take Thursday off or Friday off.” But that way, it’s not just, “Hey, Micah has gone. He’s being a bum. His work’s not getting done.”

Micah Shilanski: Yeah. And this really takes the accountability side of it, right? So if we do that in our office and let’s say I’m going to take Thursday, Friday off, Wednesday comes around and I don’t have my stuff done, guess what? I don’t get Thursday and Friday off. You have to show as the leader that you’re willing to do that and be at that same token. Now the reality is just get your crap done. If you’re that committed to leaving, you will get everything done in advance. And I love that. Have those KPIs, especially on your team. If you’re worried about your team viewing how you’re going to look and what you do when everything goes through… We actually had a team meeting a couple of years ago talking about this when we were taking more and more time out of the office and I still remember one of our RMs at the time, Amanda, we were explaining and says, “look, this is the time we’re in the office and I was out this other time. Is this been a problem?”

And Amanda argued with me. She was like, “Micah, get you weren’t gone that much.” And I’m like, “yes. I was.” She’s like, “no, you weren’t.” And we went back through and looked at the calendar. She’s like, “it never felt like you were gone because we were never waiting on you for a lot of things.” Everything was done. I was adhering to my deadlines. I was getting things done. I was touching base with the team like we were supposed to. So there’s no team animosity that happens on either Jarvis or my office because we get our job done, which empowers our team. And then to an extent, our team is able to take more time off when they get their stuff done.

Matthew Jarvis: Yeah. Let’s talk about the team aspect a little bit more. We get asked by advisors all the time, “Matt, Micah, doesn’t your team get irked that you get all this time out of the office and you don’t?” And Micah ,to your answer, my answer is no they don’t, but for a couple of reasons. One, I manage those expectations. So when I’m interviewing people to hire them, I say right away, “I take a lot of time out of the office” and I make sure they’re really clear, like, “I take months out of the office. Is that going to be a problem for you?” And if they say, “well whatever,” great, then they’re not a good fit for our team. The other is I just manage the expectation of I take a lot of risk as the owner of the company, therefore I’m paid more and I get more benefits because it’s all on me.

Micah Shilanski: Right.

Matthew Jarvis: Their job is different than my job.

Micah Shilanski: Yeah. My employees have never missed a paycheck. That can’t always be the same, that was not always the same with me in growing the practice. And I wish you could see Jarvis’s face right now.

Matthew Jarvis: Yeah.

Micah Shilanski: Flashbacks, right? So that is the difference between the owner and the employee in how are you setting yourself up? Are you treating yourself as a shopkeeper that when the office opens, you have to be there? Now when it’s surge week and when I’m working in the office, I am there. I am there about six, 6:30 in the morning because it works for me. This isn’t what you need to do. I like doing seven, eight meetings a day, so I get there early, I pound through a ton of meetings, and then I’m gone by 4:30, 5:00. So what works best for you? What’s your why and start creating it. And this is where your surge calendar is going to be such a key element in implementing this.

Matthew Jarvis: Totally is. Totally is. Micah, another thing I hear from advisors, this one is never mentioned in front of a group, it’s usually kind of an assigned discussion, they’ll say, “Hey, Matthew, I don’t know what I would do with more time out.”

“When I have time off, I’m anxious. I’m thinking about the office. If I’m being honest, I’m not a good spouse. I’m not a good parent. I’m not a good friend.” It’s like an addiction, if we’re being honest with each other.

Micah Shilanski: Fair enough.

Matthew Jarvis: So Micah, I’d be curious one, if you ever run into that or have run into that. I think the biggest solution to that is finding a really good hobby that you like, find a good group of friends. Like anything else in life, that’s not easy to do, it takes real work, but you need that balance in your life. You need that forcing mechanism of being out of the office. But if you being out of the office is creating hell in your personal life, the solution is not more time in the office.

Micah Shilanski: It’s not. You have to address that. So this is where personal development comes in. So we’ll talk about this, but we have a PD budget, a personal development budget. We take X percent off the gross, we put it inside of a PD budget, and that is for professional and personal development. If I am a better husband and a better father, this is going to make me better in my practice. I fully believe all of these things are connected. So what does that mean? Great. I need to work out. Good, bad, right or wrong, I need my own time. I need to zone out. I need to just go to the gym away from the family or if the family’s there, I need to be in my own world. Is this being a bad dad? No. This makes me a better me that’s going to be there.

I need that dedicated time. So what is this for you? Jarvis, I love that idea of your activities, and this is where the PD budget can come in. So what did you want to do somewhere between when you were seven years old and 12? Once you start getting into teenage years, let’s not focus on that. So before you were a teenager, what were activities that you wanted to do and you wanted to enjoy and you never have? Go do those activities. Go explore. Go learn those things. I like to hire multiple coaches. Whatever I’m practicing, I love to have a couple of coaches in the queue. I use a PD budget for it. It helps keep me accountable, helps give a forcing mechanism for me to get out of the office to be responsible to a third party, to improve in my personal life. Where do you have these?

Matthew Jarvis: Totally. This again stresses the importance of masterminds and going to mastermind style events. So some of my hobbies I’ve taken up because I talked to other advisors I respect and say, “what are you doing in your spare time? What do you do for fun?” They say, “I do this or that.” “That’s interesting. I’m going to take that hobby up. Tell me how you got involved in that.” Micah, your example of what did you want to do when you were pre-teen, for me, it was I always wanted a dirt bike and that just wasn’t feasible or I thought it wasn’t feasible when I was a kid. So I bought a dirt bike. I ride it almost every single week. I have a great group of friends I’ve built and it’s something I look forward to every week. And there’s no way I’m not going to get my work done at the office and cut into my dirt bike time. That’s a great forcing mechanism for me.

Micah Shilanski: Exactly. And again, that energy release makes us better so many other areas of our lives. And if your marriage is having issues, I’ve talked to advisors that have that, that says they don’t want to spend that much time with their spouse, I’m like, “that’s a bad plan.” You need to address this, the marital counseling stuff, how do you set things up, et cetera. Now, we always have to balance not getting in our spouse’s way. Well, at least I have to balance this. So outside of surge, I’ve got all these plans for stuff to do, but my wife still has her own life and kids still have things they want to do. So how do you intermix that, but how do you create this phenomenal dynamic between your family that so many people choose not to have? You can choose to have it.

Matthew Jarvis: Totally. Totally. Micah, I want to go back to something we started off this episode with, which is measuring some numbers. And maybe this is me, just want—I confess, I originally started tracking my time out of the office because I wanted to know what my revenue per day was, both gross and more importantly, net, because I wanted to see how that compared to advisers who worked a ton. Now, is that a good motivation? I don’t know. It worked for me. So I would very carefully count the days I worked and the days I didn’t work so I could divide my gross and my net income into that. And as I mentioned earlier in this episode, I discovered that a lot of people that were working far more than me were making a lot less. And Micah, I want you to touch on this, stress on this, the net was the number that we’re looking at here, not the gross.

Micah Shilanski: Yes.

Matthew Jarvis: And why is that so important?

Micah Shilanski: That’s so important that’s there because it shows how profitable a practice you’re going to run. For example, I know several advisors that completely outproduced me, but then I started peeling back their practice, like five to 10 X outproduced me, but then I started looking at their practice and they have eight, 10, 12 advisors under them and they use one roll up advisor code and one guy gets all the credit. Okay. We’re not comparing apples and apples. So AUM is also not comparing apples and apples, and we talked about this so many times. There’s so many people that don’t charge on AUM, right? That literally don’t charge an AUM. Well, how do you compare that to someone that charges, two percent on AUM that does active management? These are not the same things that are going to be there. So what is the only same things that we have across our board?

At some point we charge a fee and that’s going to be a gross revenue and at some point we have a net. And this is the reason that Jarvis and I focus on these things because it’s universal between all of our practices and as good business owners, we should be doing things to increase our profitability. What do we need to do in order to generate more revenue as a gross? What also do we need to do to be more productive in our practice, more efficient, in order to have a higher EBOC earnings before owner’s comp. Now the way Jarvis and I define earnings before owner’s comp is basically what’s on your personal tax return for your take home pay plus your retirement contributions. That’s your take home pay. That number divided by your gross, that’s your EBOC, earnings before owner’s comp percentage, so you can start seeing how profitable is your practice. This is a very important number to track because it shows how are you being rewarded for the risk that you’re taking.

Matthew Jarvis: Totally. And it’s the number that’s the easiest to compare apples to apples. Yes, we can debate are you expensing your cell phone through the office? Is that trip a personal vacation? Those are minor things. It’s a lot different. That gross number and the AUM number, those are vanity numbers. Yes, they’re interesting to see, they’re fun to pound your chest over and say, “wow, we’ve got 500 million in AUM.” But we boil back and we say, “Oh, but your personal comp’s $100,000, so you have 500,000,000 of risk and you’re getting paid 100 grand.” So yeah, the EBOC, earnings before owner’s comp, that’s your pay out to you that shows up on your tax return. Doesn’t matter if it’s salary or S-corp distributions plus retirement plan contributions. That’s it. That’s the only number that we look at.

Micah Shilanski: Yeah. And so now we start getting this number. Now you can start tracking it, that with how much time are you in the office, and now we can start making decisions based on these numbers. Because once we have the data, now we can make educated decisions. Am I increasing or taking away? This is the biggest thing with any goals. This is why goal setting is so important. This is where we do goal setting with clients, by the way, is because when they become at a crossroads and they’re starting to make a decision, then we always go back to, “great, does this help us achieve our goals? Does it get closer to them? Or does it take us away?” Well, guess what? The same thing in our lives as advisors as well. When we come up with a decision, does it help us get closer to our goals or take us further away? This is why tracking that EBOC is so important. When you go to do something, how does that affect your EBOC?

Matthew Jarvis: Totally. Totally. A fun note, I used to have this on the wall behind me, but it started showing up on webinars and stuff, but I always keep a wall calendar where I can see it, one of those ones that there’s a picture on top and there’s the numbers on the bottom. And I started from day one of the year, I put an X on any days that I’m out of the office and I write below that the total tallies. So on January 1st, I took that day off. That’s obviously not a big surprise. So I would X January 1st and I write below that one.

And then I keep a running tally throughout the year so I can at any time look at that calendar and say, “Oh, I’ve had 47 days off this year. I’ve had 107 or whatever the number is.” But it keeps me accountable. And it’s not me at the end of the year saying, “well, I kind of think I took that Tuesday off. Maybe I worked a little bit.” It’s either… And again, my definition is I either opened my laptop and did work, in which case that’s now a Work day, or my laptop stayed closed, in which case that’s not a work day for me. Now, Micah, you count yours just a little bit differently, and there’s a hundred ways to do this. The key is that you’ve got to have integrity with yourself about it.

Micah Shilanski: Absolutely. So if you’re like me that wants to get up in the morning and check on things and see how things are going to go and respond to inter team communication, that’s fine. For me, does my work interfere with my family life? So if all of a sudden then if I got a call and I missed a client meeting, I can’t imagine how that would happen, and I’d have to reschedule and go into the office, well clearly, even if it was only for a one hour client meeting, that’s an entire work day that would be there. But if I get up in the morning and the team has a couple of questions and I do it before the family is up and going, I don’t consider that a work day. So what is your consistent numbers that are there?

And the neat part about this, and let’s go back a little bit to the three tenants of the perfect RIA, Jarvis, because if you’re relatively new tuning into this, you might be thinking, “well, these guys are a little bit of slackers. They just focused on time out of the office.” No. One of the key tenants of the perfect RIA is DMV, delivering massive value to our clients. So we’re creating a forcing mechanism that says, “great, we have to deliver more value to clients in a less amount of time than most advisors take.” And the funny thing is, when that happens, Parkinson’s law, right? We get everything done. Our clients are happier with us. They are getting tons of value in our life, in their lives, based on the things that we’re able to deliver for them while we’re doing other things. And by the way, clients love to hear that we’re doing activities with our families.

Matthew Jarvis: Totally. Totally. I think one of the last angles I’d put on this, Micah, is this idea of what if it’s possible, which is a phrase that’s had some real power in your life as well.

Micah Shilanski: Yeah,

Matthew Jarvis: But say, “Hey, what if this is possible?” So there’s some listeners that are saying, “great, this is fine and dandy. Maybe Matt and Micah are somewhat superhuman or at least they have superhuman sized egos, whatever it is, great.” What if it was possible for you to take off one week a month? What if it was possible for you to take off one day a week? Well, we know that several people do it. In fact, Micah, you and I know dozens of people who do it, so we know it’s possible.

What’s the worst thing that’s going to happen if you try it? So if you say, “Hey, for the next three months, I’m going to take off every Friday and I’m going to take off one week a month,” what’s the worst thing that’s going to happen? Well, I don’t know. I mean, some thing’s going to happen, but nothing that’s irreparable, right? No catastrophic harm will come from that. Maybe you’ll get to the end of the three months and decide, “that’s really a bad idea. I want to go back to numbers.” Or you might be like the dozens and hundreds of advisors we’ve worked with that say, “wow, this was life changing.”

Micah Shilanski: Amen. So this podcast is all about action items, so let’s transition to some phenomenal action items that you can implement today in your practice to make a difference. Number one, I’m going to kick it off, I’m going to take Jarvis’s, be honest with your numbers. This is really, really key. We have a bunch of action items, I think, for you guys on this one, but you have to be honest. What are your days work? Create your written definition of what is a day worked. What’s your gross? That’s going to be there.

Gross should be what was the gross amount debited from your client’s accounts, assuming we’re on AUM billing, right? What was debited from the client’s accounts not after your BD, not after the custodian. What was the gross taken out of your client’s accounts? What’s your EBOC? Again, that’s the amount paid to you that shows up on your personal tax return plus retirement contributions because that’s a direct benefit for you. What’s that EBOC number? Start tracking. I’d even say go backtrack it the last couple of years and really going forward, this should be on the top of your head. You should know that this number.

Matthew Jarvis: Yeah. In fact, Micah, I have a spreadsheet, I’ve got it pulled up here in front of me that tracks it since 2008. So I started in the industry in 2003. 2008 was when I really started tracking it. I didn’t start tracking days off until 2013. That’s when it became a priority for me.

Micah Shilanski: Got you.

Matthew Jarvis: But it’s fascinating to go back and look at that. And I’ve looked at that with advisors. In fact, if you were an advisor listening, if we ever meet each other in a personal setting, I’d be glad to show this to you. But you’ve got to track it so you can see your progress and you can be honest about those numbers. Perfect. Next action item. This has got to be a core tenet of the perfect RIA. At some point, we’ve got to just put this on here, which is surge meetings, You have to have search meetings. I feel that every episode we talk about could have some kind of plug for surge meetings. If there’s something that makes a bigger difference on an advisor’s practice, their profitability, everything, they’re delivering massive value besides surge meetings, I don’t know what that is, Micah. I don’t even know what a close second would be to surge meetings.

Micah Shilanski: And I got to say, I am absolutely loving hearing the TPR language out there in the nation coming up on other people’s podcasts of, “Hey, you’ve got to do surge meetings” or people saying you’ve got to do massive value items and whatnot. Absolutely love that. It’s taken off like wildfire and yes. And no one I’ve talked to, and if you are the exception, we would love to hear from you, please. If you are the exception that surgery meetings did not work, not because you took on too much and you scaled it down, right? But the entire concept of surge completely sucked for you and was completely horrible, I would love to chat with you and find out what went wrong, because everyone we talk to, and who can really say that, right? Everyone we talk to, surge meetings are absolutely phenomenal.

Matthew Jarvis: As a quick reminder, the person who came up with surge meetings was God.

Micah Shilanski: That’s right.

Matthew Jarvis: It is Genesis chapter one, God created the earth in seven days, six days, right? So we can’t claim credit for it. There’s a lot of other people who can’t claim credit for it either despite trying. But yeah, the book of Genesis takes the cake for surge meetings. Seems to worked pretty well.

Micah Shilanski: Amen. He can take credit for a lot. All right. So number three, find a hobby or a friend group that’s there. Really important. Spending time with family is phenomenal, but what’s a friend in a hobby group that you can go and hang out and spend time with. And we talked about COIs from this as well. This is a great referral network because also, there’s two types of people, especially if you’re taking off time midweek. They’re either bums without jobs that are hanging out and doing the activities, which totally fun to hang out with. We’ve all got them. Then there’s people that are really wealthy and doing a good job and taking off middle of the week as well. So it’s a nice referral network. But the main purpose of this is to get you out with a group of people to do things to increase your personal development.

Matthew Jarvis: Yeah. I would really make a plug that you as much as possible find other entrepreneurs, but that’s a whole discussion on its own. Actually I have number four, work on your head trash. So if you have a voice in your head telling you you can’t take time out of the office, that it makes you a bad person, that you’re lazy or whatever else, you need to work on that. That’d be a great time to call coach Joe Lucas, coach John Barron. There’s a lot of resources for that, but that is head trash. There is endless studies that show that the amount of output declines dramatically as hours increase. So that’s head trash 100 percent.

Micah Shilanski: Number five, PD budget. You have to have a personal development budget that’s there. So how much do you take? You can take it off your gross. You can take it off your net. I don’t care. But again, these are fixed the laws, right? So what’s your formula. Ours is five percent. I take five percent. It gets stocked away into a PD budget. Well, five percent is kind of a small percentage, but man, when those zeros start coming on the gross, that makes a huge difference in personal development and what you can spend to become a better you. So create that every time you’re paid. Put money in that PD budget and make sure you spend it.

Matthew Jarvis: Yeah. I’ve always liked that you do that, Micah. I have to confess, I’ve never set up a PD budget. My philosophy has always just been, yes, if I find something that I think I can learn from, the answer is just yes. But I like the PD budget approach.

Micah Shilanski: I like the spending requirement for me. And again, what are we solving for? I’m solving for a system that works for me. You have a system that works. I need a forcing mechanism that money is set aside because I prefer to save it, quite frankly, and so I need money that’s set aside to make sure I spend on it. But again, if you don’t have that issue, which is perfect.

Matthew Jarvis: The system works. Last action item. If you’re listening to this podcast and you’re saying “lifestyle practices are baloney. I work twice as much as Matt and Micah do and I take home twice as much money,” please send an email to lifestyle@theperfectRIA. In fact, if you think you make twice as much money as we do in general, we would love to meet with you. We will gladly pay whatever your daily rate is because we want to learn how it is that you’re crushing it. I know this probably sounds like a giant ego stroke for us. It’s really not. We’re constantly looking for people who are doing a better job than we are because like you, we want to be better advisors. We want to deliver even more value to our clients, to our life, to our family, et cetera.

Micah Shilanski: Super exciting. You have the power to make a difference. We have the power as advisors to make 2021 the best year for our clients ever. If you’re not doing DMVs, delivering massive values, make sure you are. We’re to have an upcoming webinar talking about our Q1 DMVs that Jarvis and I are going to do. Make sure you get signed up for that. We have some awesome things happening in the backstage pass, including the launch of our tool kit, which is amazing, which is a nice little piece of technology. It gives guardrails, buckets, some other great value as predesigned for clients. And until next time, happy planning.

Matthew Jarvis: Happy planning.

Hold on before we go. Something that you need to know. This isn’t tax, legal, or investment advice. That isn’t our intent. Information designed to change lives. Financial planning can make you thrive. Start today. Don’t think twice. Be a better husband, father, mother, and wife. The Perfect RIA. The Perfect RIA.

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