Every financial advisor likely has moments of extreme frustration with clients’ poor understanding of investing. Ken Weber got so fed up he wrote a book about it.
In Dear Investor, What the HELL are You Doing? Smart and Easy Ways to Fix the Mistakes You Make With Your Money, Weber, a 20-year veteran financial advisor and president of Weber Asset Management in Lake Success, NY, pulls no punches. In echoing what many financial professionals are probably thinking – but reluctant to say out loud – he decries the many ways people act against their best financial interest.
(The image on the front of the book, in fact, shows someone setting fire to a $100 bill).
Those mistakes include trying to forecast the direction of the markets, selecting the wrong investments for their particular stage of life, and micromanaging their investments based on short-term movement.
Weber says that investors, in general, over-react to what they see or read in the news and don’t ask themselves the purpose of the money they’re investing. They also pay too much attention to short-term fluctuations in stocks and mutual funds. And he’s seen plenty of investors in the wrong investments for their life stage: young investors in a portfolio of conservative bonds, or older investors in all stocks. Weber frequently blogged about these topics before deciding to write a book in 2013.
“It took me two years to write it,” Weber says of the book. The 68-year-old former Hofstra speech and drama major adds that his inspiration for writing the book came after hanging up the phone with a client who was paying too much attention to the headlines, and lobbying Weber to time the market.
“She was a physician with the Mayo Clinic, a bright woman, a lot smarter than me. But she didn’t understand the basic tents of sound investment,” he explains. She was frequently asking us to change her portfolio based on what she was hearing in the news, about the U.S. going into a recession or depression. She wanted to go to cash with her entire nest egg. It started in the 2008-09 downturn and continued over the years that followed.”
Weber says clients who attempted to go to all cash – even during the downturn –ended up with terrible track records. In contrast, “The ones who didn’t move their assets, they went down but then they doubled or tripled when the market rebounded.
“People who panicked doubled their pain. There will be another 2008-09 out there. Markets go up and down,” he says.
Published in January 2015, Weber’s book draws from his conversations with thousands of investors throughout his career – although the stories are slightly disguised to avoid embarrassing anyone.
Weber says the book was cathartic for him to write. And while he can’t exactly refer his wayward clients to specific chapters in the book for fear they might recognize themselves, he hopes that his book will help investors at large reign in their expectations and make smarter choices. He knows there are millions of people just like his doctor client.
“Our philosophy at Weber Asset Management is ‘No one knows the directions of the market,’” he says, adding that the 24/7 nature of financial news has changed people’s expectations and time-tables. “When I first started, people had to wait for the Sunday section of Barron’s to see how their investments performed. Now we can access that information day or night.”
Weber says that he has to realign people’s expectations like a chiropractor realigns people’s joints, asking investors, “What is this money for? When do you think you’re going to need it? If it’s in three years, you’re not going anywhere near the stock market.”
The writing process
Weber invested $50,000 in writing, designing, publishing and marketing the book, which made it to the shelves of Barnes and Noble. After an initial problem with a ghostwriter, he hired a co—author,Gene Walden, an experienced financial journalist to help “keep him on track” and polish his writing. He spent about one hour per day writing, conducting interviews with financial experts, and researching the latest statistics he uses throughout the book.
Weber considered hiring an agent to pursue a traditional publishing contract, but ultimately, after attending a three-day publishing conference in New York, decided to use the publisher, Greenleaf Book Group, the “Cadillac” of hybrid-publishing imprints. Greenleaf only accepts 5-10% of submissions,” Weber says. “While the costs are higher than a typical self-publisher, which accepts every title submitted, the benefit of going with Greenleaf is that you receive a much higher level of service. The result is that Barnes & Noble will look at your book.”
The highlight for Weber was when he learned that every Barnes & Noble had at least two copies of his book, and his local Barnes and Noble sold out of it.
“When I made the decision to invest my time and money into a book, there were two factors I considered: this would give my clients comfort that their investment guru is someone with the gravitas to be a published author. And secondly, for prospective clients, a book is way better than a brochure.”
While not anticipating selling a lot of books, Weber has been pleased by the positive response on Amazon, and the opportunities he’s had locally to speak about his book to organizations. The book currently has a five-star rating and 16 positive customer reviews.
One review came in from a dentist: “The author does a superb job at directing the investor away from common errors and misconceptions.. The tone and philosophy of the book is very honest and refreshing.”
For Weber, that’s got to feel like mission accomplished.