115 – Henry Daas – FQ: Financial Intelligence

In Ep. 115, Tim interviews Henry Daas.  Henry is an entrepreneur, a business coach, and the author of FQ: Financial Intelligence.  Henry offers insight for small business owners to help them weather the storm of the coronavirus.  He also reminds listeners of personal finance areas not to overlook during tough times.  He shares personal money lessons learned the hard way, the importance of having a unique vision for your business, and more!

Show Notes

Henry Daas

Daas | Knowledge

FQ: Financial Intelligence – Course

FQ: Financial Intelligence – Book

Henry Daas – FQ: Financial Intelligence – Transcript

Tim Mullooly: Welcome back to Living with Money. This is Tim Mullooly. On today’s episode, I’m joined by Henry Daas. Henry is an entrepreneur, a business coach, and he’s the author of the book FQ: Financial Intelligence, which was released in September of 2019. Henry, thanks for coming on the podcast.

Henry Daas: Thank you.

Tim Mullooly: Before we get started talking about the book and some of the other things that you do, let’s start with just the background about you personally. How did you first become interested in finance and money and entrepreneurship? Was there an aha moment where you knew that this was something interesting that you wanted to pursue?

Henry Daas: I was always interested in money as a young child growing up in the ’60s. I was pretty much left to my own accord as far as making money. I had my first job when I was 12 cutting lawns, washing windows, if you can believe that. I had a W-2 job when I was 15. I didn’t even have a driver’s license. My mom had to drive me down there. So it was always what I was interested in. My parents, my mom was a school teacher. My dad was a chemical engineer. They loved the markets. They always traded the markets. They always invested. From a very young age, they said, “Invest in America. Invest in companies.” I just learned it from them.

Tim Mullooly: So would you say that starting so young with jobs, like you said, 12 years old, mowing lawns and stuff like that, would you say that that has morphed into your interest in being an entrepreneur and helping people with their businesses and their personal finance? When did you know that that was something you wanted to do for your career?

Henry Daas: I would say when I was in college. I come from a family of professional people, entrepreneurs. In fact, other than my dad, there are very few people in my family, and my dad was one of seven and my mom was one of five. They pretty much all were either doctors, lawyers, or they had their own business. So it’s what I grew up around.

But I also thought that it was a good idea for me to work for somebody else for my 20s. Some degree, it was like free training, right? Let them train me up. And then when I was 30 I said, “Okay, you know what? I’ve seen what I call cubicle world, and it’s not for me. It’s just not. It just doesn’t fit with my vision.” And so one day I started a business, and I never looked back.

Tim Mullooly: I’ve heard a handful of people say that you have to try out things to figure out what you don’t like to do before you can settle on what you do want to do. And so that’s the case for you. That’s what happened there?

Henry Daas: To some degree. You have to learn that it’s okay to make mistakes. I’ve founded six or seven different businesses. Some have done fabulously well. Some have been ignominious failures. I mean, just how it works. You dust yourself off and you keep on going. You’re working without a net. But for me, I don’t want to work any other way.

Tim Mullooly: Right. Yeah, I hear you on that. So before we dive into your book and some of your other work, I wanted to address the current situation of what we’re all facing right now, especially for entrepreneurs. What kind of challenges are entrepreneurs facing right now with the coronavirus and parts of the economy being shut down, and how can they weather the storm and make it out to the other side once we’re all past this?

Henry Daas: Wow. That is a weighty topic. A thing I did recently, actually last Thursday, I decided that for the next three months my business coaching is going to be free to any and all.

Tim Mullooly: Wow. That’s great.

Henry Daas: So I put that out on one network that I belong to, thinking that maybe two or three people would take me up on the offer, and I was overwhelmed. 20 people have signed up calls with me. And so I’ve probably done … I did three or four of them on Friday. I did a bunch of them yesterday. Some people, their business has gone from doing quite well to zero, to a literal zero. People in the travel business. I mean, it’s shocking. I mean, you’ll get whiplash from that. That’s sort of one end of the spectrum.

And the other end of the spectrum is really, “We’re okay for now, but we don’t know what the next 90 to 180 days are going to hold for us. So what do we do? Do we lay people off? Do we cut people’s salaries?”

Now, I have an international clientele, so interestingly, not every country allows you to cut people’s salaries. In fact, in some countries you can’t. Once you’ve given somebody a salary, you can never reduce it. You would have to lay them off and rehire them. And so there are interesting nuances depending on the governing body. What happens in Southeast Asia versus Europe versus the US versus South America, all very, very different. I think we’re still, to some degree in a little bit of a shock mode. People are just shocked that this happened.

Tim Mullooly: It just happened so quickly. I mean, it seemingly overnight for some of these businesses. Just a matter of weeks.

Henry Daas: For some of them, it literally stopped on a dime. Like one day everything was good and the next day affiliate sales dried up, advertising revenue dried up, everything went away. So they’re still in that shock. So some of the calls I’m having is getting people to understand that the quicker that you can get past that shock and anger stage, the quicker you can start making proactive decisions.

I’ve been quoting Winston Churchill who said, “Never let a good crisis go to waste,” and it really is true. We have to look at this and say, “Okay, it’s horrible. People are suffering. It’s unimaginable.” However, that doesn’t give us cover to say, “I’m just going to bury my head in the sand and I’m not going to deal with it.” So I have to wake people up to say, “This is the time to take action.”

Now, you don’t want to be tone deaf and pretend like everything is just the way it was, send out your email funnels and stuff, because people will recoil from that. They’re like, “No. You’re not reading the tea leaves here.” But you can still do some soft marketing and some other stuff, because eventually this is going to end.

Tim Mullooly: Right? Yeah. I feel like that’s the tough part for people right now is they’re trying to plan out their next moves, but it’s hard to do that when the timeline for how long or short this might last is very unclear. Would you agree?

Henry Daas: Agree. I’ve been telling people, “Look, you need to have a plan A, a plan B, a plan C, and what I call plan Zed.” So start with the worst case scenario. Think to yourself, “Okay, I’m not going to make any income until January of 2022.” Can you weather that storm? Do you have the resources? Do you have the balance sheet? Most businesses won’t have a balance sheet, even large companies, that could handle that. They just don’t. But personally, can you pay your mortgage? Can you pay your rent? Can you pay your healthcare? All of those things.

And then work backwards. From plan Z work back, and you’re going to find a high probability plan. Maybe we’re out of business or slow business for six months. What does that look like and do I have a plan that can weather that? Because we can’t plan for the worst case scenario. Our nation is not going to mothball a million respirators for the next time a pandemic comes. It’s just not going to happen. And insurance companies don’t do that. Most people don’t, unless you’re a prepper waiting for doomsday building a bunker with five years of supplies. Most people are not going to do that, because it’s a sunk cost. It’s dead money. You just want to plan for what’s the most likely scenario, and can I live with it? You’ll get a lot of solace out of thinking to yourself, “Okay, I can live for six months.”

Tim Mullooly: Right. Absolutely. That just being able to buy them that sense of peace of mind, even if it’s like you’re saying, just for a few months, maybe just for six months. But I feel like I agree. Getting them out of that shock stage and into, “Okay, what can we actually do? What can we plan for?” Just get them into action is probably the best thing for them right now.

So when it comes to entrepreneurs, they have their businesses, but then other people have their personal finances, too. What would you say would be one or two of the more important things for someone to remember in terms of their own personal finances during a time like this?

Henry Daas: Well, one of the things I talked about in my book is the greatest existential headwind for anyone is the loss of their primary income source. So we’re seeing that right now. We painted a 3.2 number on unemployment, which is five or six times the greatest number ever recorded, right? That’s 3.2 million people who went from having a job to not having a job. So their primary food source is gone.

I went even further with that in my book to say that what’s even beyond that is the complete destruction of classes of jobs. As I say, ask any toll taker. Toll takers are gone. It’s all easy pay. It’s all automated, but we put that aside. If you’re looking at your life and your personal finances, you have to ask yourself a question. Which is more important, my P&L, my cashflow, or my balance sheet? My assets versus my liabilities.

When you’re analyzing companies as an investor, I start with the balance sheet, because a strong balance sheet will give you the opportunity to weather a storm. Now, people say, “Oh, I don’t want to dip into my savings.” It’s like, well, that’s what your savings are for.

Tim Mullooly: Right, exactly.

Henry Daas: Right? I mean, it’s there to backstop you in a case like this. But if you’re just running paycheck to paycheck, like something 40 to 50 million people do in this country, you’ve got no backstop. And if you’re expecting the government to backstop you, even $2 trillion is a drop in the bucket.

Tim Mullooly: Yeah. I mean, just trying to plan for even just the next month or so when you have no savings in there, it can be pretty scary and overwhelming. So I feel like a lot of people are scrambling right now. Like we saw, all the 3.3 million unemployment claims. People just, that’s what they need right now, because similar to the business, their income dried up overnight.

Henry Daas: It disappeared. I spoke to somebody last week. They have a bunch of rental properties. So I asked the pointed question. What’s going to happen when April 1st rolls around and people can’t make their rent? “Well, we’ll see what happens.” It’s like, no. I don’t like that answer. You think about that plan and you need to be proactive. What can you offer them? Can you defer their rent? There’s a pretty good likelihood that they’re not going to have the money. Do you want to have that conversation then or do you want to proactively go to them and say, “Listen, you may not have the money. Let’s talk about …” I don’t know if it’s a forgiveness plan or a deferment plan. You need to figure that out and get ahead of that as opposed to being reactive. Be proactive.

Tim Mullooly: I feel like in the years leading up to this, entrepreneurship had been booming and there had been new businesses, small businesses opening up pretty much every industry around the country. Once we put this virus and some of the economic effects behind us, do you think that entrepreneurship will take a hit or do you think it would be more popular coming out of this?

Henry Daas: I think initially it’s going to take a hit. It’s the same thing that happens when you have a waterfall decline in the market like this. People who’ve never seen it before. Now this is the fourth one. I’m 60 years old. This is the fourth one in my lifetime, and they seem to come about every 10 to 12 years apart. This one’s a little bit different, but for a lot of people, this is the first time they’ve ever seen it. They may take such a bad beat from this that they never get back into the market again, because I know that that’s happened for people in the past.

And it’s the same thing with entrepreneurship. Some people may use this time to reassess their priorities and decide whether this really is for them. And I would submit that that’s a good thing. Use this time for a little quiet reflection and figure out whether this is really the path you want to be on.

And conversely, people who are working into what I derisively call cubicle world, they should really do the same thing. “Hey, is this really what I want to do? Commute an hour in a tin can? Now that I’ve actually gotten those two hours a day, those 10 hours a week, maybe I could put those to better use.”

I guess to answer your question in a rather long-winded way, which is how I do it, is there’ll be a dip and then there’ll be a boomerang. Just like the stock market, there’ll be a dip and then there’ll be a boomerang.

Tim Mullooly: Yeah, I agree with you on that. There’s going to be, like you said, people scared out of the market, but then people coming to realize that what they were doing before all of this wasn’t making them happy. So I definitely feel there’s going to be people on both sides of that side of the spectrum.

I mentioned it in the beginning. You published a book in September of last year titled FQ: Financial Intelligence. If you could have readers just take … Someone reads the book. If they could take just one thing away from reading the book, what would you want that to be?

Henry Daas: One of my readers who sent me a really, really nice note said it best. He said, “I got to make my money work for me and not the other way around.” I’ll give you a little bit of a backstory. It didn’t start out as a book. It started as a course. I had always wanted to write a course in financial literacy. I tried it a few years ago. I tried to teach my niece and nephew, because I actually managed their money. They were in high school at the time and I figured, “You know what? Uncle Henry’s not going to be around forever to manage your money. Might be a good opportunity for you to learn.” I was unprepared. They were a little bit too young, so I abandoned the project. And then a couple of years later I sort of had this light bulb moment and I said, “You know, I got to do this.”

So I wrote it as a course, 18 modules, and then I tested it with a dozen volunteers. We were doing Zoom calls and all sorts of exercises. I tested them pro bono. I didn’t charge them for it, and they allowed me to kick the tires on the curriculum.

It wasn’t until I was very, very close to launching it that people said, “Hey, you know what? You should make it a book. A book will be the lead magnet.” A friend of mine in one of my mastermind groups said, “A book is the new business card.” And so I drank the Kool-Aid. It took me a long time. It was a Herculean effort to hire a copy editor and a designer. And I have about 250 infographics in the books, so those needed to be turned into what are called vectors so that they would print properly.

So the book really came after the fact, but then once it was done, I was very proud of it. I said, “This is a really, really good book.” I want it to be. Even if people didn’t like it, I didn’t want anybody to ever say it wasn’t professional. That was important to me, because it’s forever. My grandkids one day will read their dead grandfather’s book. I think it’s important.

Tim Mullooly: Absolutely. I like that line, that the book is the new business card, and I agree with that in a sense. You get people to read the book, and then if they want a more hands-on in depth version of what they read in the book, then you have the course for them. So I agree with the statement that the book is a new business card. I like that.

Henry Daas: To add onto that, I believe firmly that you can get something out of the book, but you really do need a person to teach you. My course is 20 weeks long, very in depth, go into extreme detail. It’s essentially we start with your personal net worth, balance sheet, all that stuff, a deep dive into expenses, and then we talk about places where you can invest your money, and then we talk about all the other moving parts, like insurance and 401Ks and Social Security, all the headwinds that you’re facing, people trying to take your money from you. I really tried to cover everything from cradle to grave so that when you’re done you’ve got all the ammunition necessary to build and execute your financial plan.

Tim Mullooly: That’s great. So the book is kind of an introduction, and then it gets the people’s feet wet, so to speak, and then you really dive into things in the course. That’s great. It says that the book is sort of a money memoir, in a sense. For you, are there any money memories and lessons in there that you learned throughout your life that maybe you could share a couple with the listeners here today?

Henry Daas: Oh, yeah. Well, one of the other things that I talk about, besides worrying about whether your job is going to disappear, is risk. I paraphrase Vince Lombardi. “Risk isn’t everything. It’s the only thing.” It’s hard to find the right balance of risk. People are either under risked and therefore they’re underperforming. So talk about getting your money to work for you. We’ve had a a 10-year bull market, but I know people who’ve been out of it. There’s no politic way to say that. You left money on the table.

On the other side are the people who get enamored with return and then forget about the risks. So they’ll buy all sorts of high flying stocks, never taking into account the beta, the risk that they present. They get seduced by the return and ignore risk.

There was one particular case that I wrote about where I was in the real estate business building spec houses back in the early 2000s, and that was a case where I ignored risks, I was in a partnership with someone that I trusted, but I was a little bit risk blind, and I was seduced by the parabolic move in the real estate business. And then he committed suicide and I was left holding a multimillion dollar bag on an unfinished project, and I was basically sued by anybody and everybody. That was a decidedly negative story, but I thought it was important to illustrate that to people, that even someone who considers themselves very financially intelligent can make a colossal blunder.

Tim Mullooly: In terms of talking to people for the book, what would you say is one of the more overlooked parts of someone’s personal finances? Is there something that people don’t pay enough attention to that they really should?

Henry Daas: The first part of my course is for you to sit down and figure out your personal balance sheet, your net worth. It’s amazing how many people have no idea. They don’t have the slightest clue of where they stand, and to a large degree, they don’t want to know. I was on a call with, I have an entrepreneurial group that I belong to that was part of EO, which is Entrepreneurs Organization. We’ve been meeting for the last 21 years. Every once a month, every month without fail, in-person nine of us meet.

So we had a Zoom call to have our regular meeting because we couldn’t meet in person, and a couple of guys said, “I haven’t looked at my portfolio and I don’t want to look.” And I’m like, “You need to snap out of it. There’s stuff to be done here.” And these are smart entrepreneurial guys. And I’m like I was a little taken aback. It’s like you got to grab the bull by the horns here, because there are going to be opportunities coming out of that. Forget about the diamond that’s been won. Look forward. So that happens a lot. People just don’t want to know. So part of the exercise that I’m going through is maybe shaking them out of that slumber and saying, “It’s incumbent upon you. It’s required of you to know this stuff.”

Tim Mullooly: Absolutely. I mean, there’s no way that anyone could improve on their personal finances if they don’t actually know what the numbers are. We’re financial planners here in our office, and that’s where we start with people, too. It’s people are trying to make goals for retirement or something later in life, and you really need to start at step one with figuring out where you are right now in terms of net worth and in terms of the balance sheet and the cash flow that you have coming in. So I definitely agree that even though people don’t want to look, it’s imperative that they do.

Henry Daas: Well, that’s your job. As a money manager, you’ve got to wake them from their slumber and say, “Hey, we need a snapshot.” Even if it’s just a snapshot from today, we have to have a starting place, especially if you’re talking about retirement.

Now, one of the things … The chapter two of my book is called The Thick Green Line, and I created this thing where I compared your net worth to your age. And interestingly, many, many, many people, millions of people will get to be the age of 30 and they will have a net worth of zero. My wife and I were in that situation when we got married. They get out of college, they work, they have student debt, and before you know it, you’re 30 years old and you have a net worth of zero. And now that’s your starting point and now you’ve got to look down the line and say, “Okay, I’ve got to fund my kids’ college education. I’ve got to fund my retirement. I may have to subsidize my parents, because they didn’t plan.” I know a number of people who are subsidizing their parents.

So you’re getting hit from all sorts of different directions, and these are on a timeline. You kind of know when these are going to come. If your child is a baby, 18 years from now, they’re going to go to college. Do you want them to graduate college with a couple $100,000 of debt, and I know a lot of people who are, or would you like them to get out of college debt free? Our goal, my wife and I, were to get my three boys out of college with no debt, and we’ve accomplished that. Well, one’s still in college, but he has the money put away. That’s important. If it’s not important to you and you don’t care, build that into your plan. Use that money for retirement then.

Tim Mullooly: Right. I read on your website that you help them form a unique vision for their business. How do you help them do that and why is it important to have a unique vision for their own business?

Henry Daas: Great question. If you don’t have a unique vision for your business, if there is not some specific value add to doing business with you, then why are people going to do business with you? Then you’re in a commodity business. If you’re doing the same thing that everybody else is doing. Sometimes people talk about the secret sauce. Some businesses don’t have a secret sauce. They just don’t.

If you are what’s known as an FBA, a fulfilled by Amazon reseller, you may be selling some commodity product on the web. There’s no differentiating factor maybe other than price. You’ve got to dive deeply into that, because eventually you’ll just run out of business if you’re just a commodity. That’s a race to the bottom, because then it’s just price, price, price. You get to the point where margins get compressed to where you can’t do business anymore.

I mean, you only really need to know two things in order to run a successful business. You need to know the cashflow and you need to know your gross margin. If you can sketch those things out, you can determine before you’ve even spent a penny on a business idea whether it’s viable. That’s an important thing to really get into people’s head. Think about what motivated you to start this business, right? What are you bringing to the world that is uniquely different than your competitors that really sets you apart?

Tim Mullooly: That value add there is super important, because there are probably competitors or other businesses doing something similar to you in your industry. So if you don’t have that unique value add there, then your clients and customers can just go elsewhere and get it from someone else. So I agree. That’s really important to distinguish right off the bat.

Henry Daas: Well, I’ll take it one step further. There better be competitors, right? I’ve had people come to me and say, “My idea is so unique.” They want me to sign an NDA and do all this stuff, because they think their idea is so unique. I said, “Well, I have a phrase. You ain’t that smart.” Right? “You ain’t that smart to invent something that doesn’t exist. If you did, there’s probably a reason, because somebody else tried it and it didn’t work. So your job now is to go out and analyze all of the competition.”

This is something I do with new clients very early on. Analyze, come back and give me your five biggest competitors. Tell me what they do well and where they fall down. And if you can’t find five competitors, you’ve got to ask yourself, “Is this market niche so tiny that even though I’m going to be the greatest company to ever do this, there’s only six people on planet earth who want it.” That’s not a formula for success.

Tim Mullooly: Right, yeah. There needs to be a market for what you’re selling. I totally agree. So I also saw on your website there was a quote. It said, “As coaches, we live a world of judgment-free awareness.” I was intrigued by that, judgment-free awareness. Can you explain what that means and how you apply that term to your coaching?

Henry Daas: So I’m trained by a company called Coachville, which is based in New Jersey, run by a guy named Dave Buck, who’s a really terrific master coach. So I went through all of their curriculum they have. In fact, I was just on a call the other day, because as an alumnus you can jump on calls all the time. And that’s a term that comes out of their coaching playbook, so I have to give them credit for that.

Judgment-free awareness. As coaches, it is not our job to really offer advice per se. I follow the gestalt of sharing my experiences, which is why my book is the money memoir. I want to share my experiences. I don’t want to tell you, “Don’t go into the real estate business. Your partner could jump off a bridge and leave you in a very, very difficult spot.” I’m not going to tell you that. I’m going to tell you that this is what I did. This is what happened, and this is how I picked myself up after it happened, right? Storytelling, right?

The judgment-free part of it is it is not up to me to judge anything about what it is that you want to do with your business. If you’re telling me you want to build a rocket ship in your backyard, I’ll coach around that. I might advise you at some point in time that when you launch that and this plume comes out, your neighbors might get angry with you. I’m going to leave that up to you to decide whether, and again this is a Coachville phrase. They call it an unwinnable game, right? Are you building an unwinnable game for someone?

I don’t have an agenda. I’m not here to judge you. I’m here to help you, and that’s super, super important, because nobody wants to be judged. I’m not going to tell you your business idea is no good. What I’m going to do is ask probative questions so that you can analyze it and you can decide for yourself. And if you decide, “No, Henry, I’m going to go through it,” it’s like, “Great. Let’s coach around it.”

Tim Mullooly: Yeah. I feel like that probably builds a better trust in the relationship, and people can be open and honest about what they want to do with their business. Do you find that that’s the case? Just not judging what they want to do lets them be more creative or be more open with their actual intentions for the business?

Henry Daas: You hit the key word, trust. Without trust in our relationship as the coach and the coachee, we’re done. We have nothing I can tell you if you don’t have trust. Now, that doesn’t mean you’re a doormat. That doesn’t mean that you have to do everything that I say. In fact, give me some pushback, because I’ll give my clients pushback all the time. That’s all part of a constructive conversation. I’m not here to judge. I may point out pros and cons of a scenario so that we can talk about it, but otherwise it’s your business.

Tim Mullooly: Exactly. At the end of the day, it’s about them getting their business off the ground and running. So working with a coach, being an educator, I feel like there’s clear value there for the recipient or for the business owner who’s growing their business. But for you, what does coaching and educating people give to you? What kind of value does that bring for you and why do you do it?

Henry Daas: I believe it’s what I was put on earth to do. I believe it to a large degree, it’s a calling. Everything that I did in my first … I started this about 10 years ago. Everything I did in that first 50 years was setting me up for this. Like I said, my mom was a school teacher, so I think I have a natural school teacher’s tendency. I’m a storyteller. One of the things I do on the side is I write screenplays, so I’ve written 11 screenplays. That’s kind of my right brain exercise. I like sharing stories with people. I love hearing other people’s stories. I mean, this is not work for me. Right? They say if you love what you do, you never work a day in your life.

Tim Mullooly: That’s right. Yep.

Henry Daas: The bumper sticker or a t-shirt or whatever it is, but it is absolutely true.

Tim Mullooly: Getting back to what we’re all going through today. If you could pass along just a piece of advice or maybe words of encouragement for a small business owner who might be going through a tough financial time with the coronavirus and everything going on, what would you say to them?

Henry Daas: There’s a seminal book that was written back in the 1960s by a woman named Elisabeth Kubler-Ross. It’s called On Death And Dying. It’s about terminally ill patients, the phases that they go through, and I use this a lot as a model. The five phases are anger, denial, bargaining, depression, and acceptance. Now, she’s talking about people who are terminally ill, but I use that for the death of almost anything: a relationship, a business idea. You can apply it to anything.

You will go through those five phases. We talked about it earlier, how people are in shock. The people who are not looking at their portfolio, they are in denial, right?

Tim Mullooly: Yeah.

Henry Daas: They’re slowly going through. Even look at our government. Our government was stuck in the bargaining mode. They started with denial. There’s no problem with coronavirus. Then they got angry that this was upsetting the apple cart. We want to get on to other things. Then they tried to bargain around it. We’ll get everybody back by April 12th. They may have finally gotten to the point past depression to acceptance.

So what I would say to people is think about where you are, what phase you’re in, because you want to get to acceptance as quickly as possible, because you can’t think clearly if you’re in any one of those four phases. And if you don’t think clearly, you’re going to make dumb mistakes. Let’s just call it what it is.

If you’re emotionally heightened, one of the things I talk about in the book is trading should be incredibly boring. If you’re trading, if your money management and your trading of your stock portfolio, as an example, is not incredibly boring, you are doing something wrong. You don’t want exciting stock trade. If you want exciting, go to Vegas. Go play craps. Go play roulette or whatever. You can get excitement there. Your personal finances, your business finances should not be exciting. It should be dull, boring, and methodical.

It’s a tough sell, trying to sell planning to people. You know, if you’re in the money management business. It’s a tough sell, right? A lot of people, they don’t want to do planning. It’s boring. You just don’t want to do all the grunt work. So get to acceptance as quickly as you can, and if you’re not there, own the fact that you’re not there yet, but also be aware of the fact that you may not be in the best decision making position until you can get to that acceptance stage.

Tim Mullooly: I agree. Having that self-awareness right now is really crucial for a lot of people. For you and your personal experience, I mean, throughout the years in your career and the different lessons that you’ve learned, what would you say has been the most impactful financial lesson that you’ve ever personally learned?

Henry Daas: There isn’t one that really jumps out at me. It seems to be like a thousand cuts. What I will say is you could make $10,000 on a trade and forget about it the next day, but lose $500 on a trade, we’ll remember it forever. Pleasure/pain principle.

Certainly the situation that went on with my dear departed partner, that was a huge lesson. And I think that lesson was really, what it really came down to is people use this. There’s the overused phrase where people say, “Stay in your lane.” I’m mainly a financial stocks and bonds and options and stuff like that. That’s kind of my lane.

I was in the real estate world, and I’ve made money in the real estate world, but it wasn’t a natural place for me to operate. So I had a conversation a couple of years ago at a trade show with a guy who said, “Can I buy you dinner? I want to talk to you.” Young guy, talked to you for an hour. And what we finally concluded was he wanted to know where to invest his money. And I said, “Well, what do you like?” “I really, really like real estate.” I said, “Well, invest in real estate, then.”

Tim Mullooly: Right.

Henry Daas: Right? That’s your natural inclination. Don’t think to yourself that you’re losing something by not being in the stock market. There’s plenty of opportunities out there to make money. There will be plenty of opportunities after this coronavirus has passed, and it will pass. And I’ve been trying to raise people’s awareness that not being predatory. We’re not looking to take advantage of people’s misfortune.

Tim Mullooly: Right.

Henry Daas: But the world is going to change. And if we can take the time to look at the tea leaves and anticipate where the opportunities are going to be, there are going to be great money making opportunities coming up.

If you go back to 9/11, and a number of people have mentioned 9/11 as a model, and I was right on the front lines. I actually witnessed the second plane hitting the tower with my own eyes. There will be a timeline to recover. In New York, for at least the first year afterwards, people were nice to each other. I lived in New York City for 30 years. It’s the only way I can say it. New Yorkers all of a sudden said, “I’m going to be nice for a while.” For me, it actually, this is maybe not the best thing to say, but I’m going to say it. When people started to be nasty again, like New Yorkers, then I knew that we might have recovered. Right?

Tim Mullooly: Right.

Henry Daas: So when the rhythm starts to return, but in the meantime, while we’re in this weird state of abeyance, keep your eyes and ears open to what’s going on in the world and try to anticipate things that are going to change. Social distancing will go away. Humans are social creatures. It will go away. We’re not going to live the rest of our lives six feet apart. We’re just not going to, but other things might become more permanent. Try to think of what those are and think about how they’re going to impact your life.

Tim Mullooly: Yep. Absolutely. I think that that’s great advice. So the last question that I had for you is a similar question, but it doesn’t necessarily need to be a financial answer. So whether it’s something from your personal life or something from your professional career, what would you say is the best piece of general advice that someone has ever given to you?

Henry Daas: Okay, so this one I actually do have an answer. So it was 2008. I was with my entrepreneurial group in, believe it or not, Reykjavik, Iceland for our yearly retreat. And my friend John, I was complaining to my friend Jonathan, who’s in the real estate business, that about all the slow payers I had. And he looked at me and he said, “Henry, are you a bank?” And I said, “You know I’m not a bank.” He said, “Well, stop acting like one.” Boom. Right there. Caught it all. Right? And from that day forward I said, “Okay, I am not going to act like a bank.”

So what do I mean? I deal with clients all the time who have slow payers, bad payers, all that stuff. Right? They have to sue them or go to collection. I said, “Why do you do that to yourself?” “Well, I need the business.” I said, “You don’t need that business. That’s bad business.” Doing business with people who don’t pay you is not good business. You’re better off having no clients than have a client where you actually laid out a whole bunch of money and then you never get paid on it. That was huge, and pretty much since then I’ve really tried to operate. I don’t act as a bank for anybody other than myself.

Tim Mullooly: Right. Yeah. I think that’s important to remember, in that sense, especially for business owners. It’s you’re dealing with humans and other people, so trying to keep that human relationship there is definitely very important. So I think that’s a really good piece of advice to pass along.

So Henry, that was the last question. That’s all the questions I had for you. Thanks for taking time out of your day to come on the podcast and talk. I appreciate it.

Henry Daas: Thank you so much for having me as a guest. This was fantastic. I really enjoyed every moment of it.

Tim Mullooly: So for the listeners, I will link in the show notes to where you can find Henry’s book. Again, it’s titled FQ: Financial Intelligence. I’ll link to everything else that we talked about here during the episode. Thanks for tuning in, and we will catch you on the next one.

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