Financial Planning for Everyone
Updated: Oct 14, 2019
Hey, real quick... there's an audio version of this blog with Louis Barajas. Have you heard it yet?
Louis Barajas is an author and nationally-recognized consumer money and small business expert. He’s written about many different financial topics for business owners. His focus is on minorities, celebrities, and the Latino community.
I was inspired after hearing him describe the story of his journey and how he developed his business. It illustrated the passion he felt for the people he was serving.
I remember thinking, “I want to do that”. It’s been two years since I heard that talk, and I’m doing some of the things that he encouraged me to do!
It was with great pleasure that I was able to sit down with him for a chat. I wanted to know something about his background and business.
How did you get into your career?
My dad started a business and we didn’t know how to run it. We had no idea how to do the paperwork. I was filing his tax returns at the age of 13 (he read a book about how to do it).
I was going through this whole process of helping my father, and out of necessity, and responsibility, I made a commitment to him that one day I was going to go to college and learn everything about running a business.
I ended up going into UCLA and getting my MBA. In 1985 I went into financial planning and worked for three years. I wanted to learn about stocks, bonds, and mutual funds. I worked with a firm that's a big national firm, and they really disappointed me. I felt pressured to do things that I wasn't comfortable doing.
That’s when he started trying to get his CPA, and he also started working on his CFP. It was because of his prior financial planning background, that he was asked to help do some financial planning for wealthy clients.
What were some of his thoughts on financial planning?
Louis states he thought “This is real financial planning, we're billing for the time and the complexity”.
He wasn't selling any products, and he could help his community by bringing this type of financial planning to them.
It was a thought that came true!
It was in 1990, during an unhappy period in his life, that he decided to quit his job. He decided to go back to the barrio, where his career became a passion.
Let’s hear him tell the story:
I started working with the underserved, and poor. I stayed there for 15 years. That taught me a huge lesson. I ended up writing books because of my experiences working with the poor in the underserved. It was the community that I had been born and raised in.
Louis describes himself as a financial life healer, and he started The Institute of Financial Healing.
Can you tell us about that?
Here's what I've seen in communities that don't have access to financial planners of color. There's a tremendous amount of mistrust.
There's also a tremendous amount of stress, worry, concern, anxiety, sleepless nights, and panic attacks. The stress causes cancer. It causes all kinds of physical problems.
The problem is the profession has not come up with a solution to work with people of color. We're trying to create a completely different paradigm on our approach with them.
An example is before jumping in, and directing our clients to start putting away money in a 529 for your child’s college, Louis said we need to ask the family about their situation.
He asked these questions:
How engaged is your child in his education?
How engaged are you in his education?
What's your child’s confidence level?
How's he doing in English?
How's he doing in Math?
What is his GPA?
He stated the problem is that even if the children graduate from high school and go to a community college, they may not transfer to a regular college or graduate. In this case, even if the clients have a fully funded 529 plan, it won’t help out some families.
Louis was adamant that whoever is working in underserved communities needs to take a step back and ask:
What are we trying to do?
Louis says when a family has a dream for their child to graduate from college, it’s time to ask:
Do we need to send the children to self-esteem courses?
Do we need mentors or tutors to bring their GPA up?
It’s these things that will give students the chance of graduating.
What is financial life healing?
Our own financial planning industry has taught us to work with the top 10% of income earners or asset people in the entire country. You and I are dealing with probably the bottom 90% and probably maybe about 50% that really need help.
The way you approach financial planning needs to be completely different. In a way that's going to heal these communities. There's a tremendous amount of scarcity, worry, and mistrust.
There are people in the same community, of the same color, hurting each other. We need to heal these communities. The Institute of Financial Life Healing is going to create programs that will be rolled out in the next couple of years. We need to retrain financial planners who work in these communities.
Only 3.5% of certified financial planners are African Americans and Hispanics.
Louis said that most of those are not working in the communities that really need help, and financial planning can heal a lot of lives.
How can we save ourselves from our own financial worries?
Like any kind of worry, it's the anticipation that worries you the most. You haven't taken the time to sit and talk through what you're really trying to accomplish and see what kind of resources are available.
Sit down and take a look at what actions you’ve taken (or haven’t taken)
Look at what you have (paperwork)
In other words, face your fears, and they probably won’t be as big as you’re making them in your mind!
You have a book called From Wall Street and Main Street to My Street. What does that mean?
I once told a person who was interviewing me, “Honestly, I don't know too much about Wall Street or Main Street, but I can tell you about what's happening on my street:
On my street, people don't have 401k.
On my street, people don't have Roth IRAs
On my street people don't have IRAs on my street, people have social security. That's what they're counting on.
People don't have health insurance on my street. People are afraid to buy life insurance because they think that if they get life insurance, they’ll die on my street.
They buy homes because the financial planners are real estate agents.
The houses are tangible, and people can touch the property, but if they die, they don't have trust.
That's what’s happening on my street.
I took the Latino journey to financial greatness, and I expanded it, and I anglicized it. Now, it's for everybody.
I write to people who are intimidated or overwhelmed by reading financial literature that they don't understand.
This is a great book for meeting people where they are on their financial journey!
Hey, hey... thanks for checking out the blog and the show with Louis.
By now, I hope you know I'm here to support you on your journey of being on solid financial ground.
If you want or need to reach out to me, please visit:
my firm site at GenNext Wealth