The math part of money is the easy part. The emotional part of money is the hard part, and it’s where people need to spend time.
James Lenhoff has been a certified financial planner since 2004 and is the president of Wealthquest, a comprehensive financial planning and wealth management firm. Based on a coordinated approach, the company aims to help people forge healthy financial paths that take into account the wide variety of investments and experiences they want to plan for. It has grown to more than 1,200 clients and more than $1 billion in assets under management. Prior to Wealthquest, Lenhoff spent five years as a financial representative at Northwestern Mutual Financial Network.
Lenhoff is also the author of “Living a Rich Life,” the no-regrets guide to building and spending wealth. When he’s not advising others on financial matters or leading his team, he spends time with his wife and three children. He also works to give back to others through church service projects, including financial literacy programs, as well as missions work abroad.
Where did the idea for Wealthquest come from?
The main idea really launched out of this awareness that the financial services industry is broken. Everybody’s working in these siloed functions where they don’t talk to each other. Accountants, lawyers, and other advisors are all involved in their clients’ investments, with money invested in different places. Nobody is coordinating those efforts and aiming toward the client’s end goal. The client ends up being in this confused space of advisors giving conflicting advice, so the client has to navigate as the quarterback, but the client’s not the expert. We saw an incredible opportunity to step into that quarterback role and meet a need we felt everybody had.
What does your typical day look like, and how do you make it productive?
I would love to say there’s a typical day, but I think it’s a combination of answering lots of different questions coming from completely different roles. I have a role as an advisor to our clients, helping them make smart decisions and helping with their tax planning and financial planning; I also meet with clients for reviews. Then, there’s my role as president of the company, which means answering employee questions, managing people, getting status updates, and finding out what others need. The only typical thing is that there’s no downtime. There’s typically a line of three or four people waiting to talk to me. It’s a hodgepodge, which I love, because I’m super high energy and I like variety and being helpful to as many people as possible.
I make it productive by being really intentional about rest. When I’m “on,” I’m 100 percent on, full tilt. When I’m not, I do nothing. It makes me more productive because I’m rested when I am on. I don’t deal with email or calls, taking intentional time with my wife and family.
When I coach people or work with our church’s men’s ministry, I recommend resting well; when things aren’t getting done, it’s because we’re not resting. We end up overworking because of this constant state of overwhelm, feeling there’s too much to do and not enough time to do it. When we wall off work, we can focus on the things and people we enjoy, but most people miss that daily recharge — they try to do it all on the weekend. That stretches the workweek even longer, and then they still have the Sunday night blues.
How do you bring ideas to life?
We’re very entrepreneurial as a firm — we like to incentivize people to be thinking about what else we could be doing or how we could be doing it better. If we’re batting .1000, we’re terrible businesspeople — we’re not innovating, not pushing the envelope. We should be failing because that’s how we learn. We have to focus on putting that into the culture so employees see opportunities and we can say we’re glad we did it, whether we succeed or fail.
Most people are afraid of failure, which means they don’t try anything. You bring things to life by someone identifying an opportunity, talking about it with others, gaining momentum within the organization, giving it resources, and shutting it down and talking about what we learned if it doesn’t work. Those who initially brainstormed the idea are certainly most connected to how they thought it was going to be, so we circle back to check in, coming from a place of “What are we figuring out? Do we need to make tweaks? Did it do what you thought it would?” We don’t want people to be discouraged to take another swing.
What’s one trend that excites you?
What’s most exciting to me in our space is the growing awareness of behavioral finance. We’re starting to get more aware of how we operate as humans around money and how emotion and relationships — those things that are really hard to turn into equations — play into our decisions. I think it’s a healthier understanding, moving people away from investment advisors who simply buy and sell and instead toward money coaches. That’s the whole idea of my book: helping people connect to their motivations and invest in the things they care about to live a richer life.
What is one habit of yours that makes you more productive as an entrepreneur?
My whole routine is blocking off time to have my own space. My daily routine is to get up at 5:30 and drink coffee in a quiet space, without anyone else awake, so I can be contemplative and journal and get ready for what lies ahead for the day. I then exercise and get ready to go to work. When I come back home, as soon as I walk in the door, whatever was going on at the office is dropped. I engage with my kids and wife, and they know they can count on it. I don’t want to still be chewing on stuff at home. Compartmentalization has been the best habit for me.
What advice would you give your younger self?
Spend a whole lot less time worrying about the future. Dan Zadra has a quote: “Worry is a misuse of imagination.” I tend to think God gave us the gift of imagination to wonder, to figure out how to improve things — instead, we use that gift to make up stories about how badly things could go. It’s a terrible waste of that ability to be imaginative and creative. I spent way too much of my life doing that in the early stages, and none of it came true. It never happens — or sometimes, it’s the best thing that could have happened!
Tell us something that’s true that almost nobody agrees with you on.
The math part of money is the easy part. The emotional part of money is the hard part, and it’s where people need to spend time. The industry still mostly disagrees with that and wants to convince people it’s all math. It makes people feel bad when they make an emotional decision and “disappoint the math.” Math is great because there’s an answer, a formula. Clients want that; they don’t want to face the hard stuff without a formula. A computer can do the math part. The emotional part is where important changes happen, and we’ve got to be willing to go there.
As an entrepreneur, what is the one thing you do over and over and recommend everyone else does?
One thing I constantly try to remind myself of is remaining authentic and vulnerable. It’s hard to follow a leader who never seems to make a mistake, never has any doubt or fear. They don’t seem real, they’re super intimidating and untouchable, and people can’t be real with them. I disclose my failures, limitations, and mistakes. If something fell through the cracks because of me, I tell my team because I want them to see I suck sometimes. I don’t want to put pressure on them to be perfect. Studies have shown that if people are watching over our shoulders, we make more mistakes. People will follow a visionary — “Let’s try this hill; I think we can do this” — over the person who says, “Don’t do anything wrong, or you can’t stay with me.”
What is one strategy that has helped you grow your business?
Writing the book gave people a sense of what I’m about and, by extension, what Wealthquest is about. It’s a view into our take on money that allows them to self-select; that’s how I think or how I want to think, and I want to work with them. There’s the other side, too — they figure out they don’t want to work with us, and that’s OK. It’s about the best fit for everybody.
The other thing has been creating a message and brand that’s really approachable. We started the company with a logo and style that was formal: We focused on how people should trust us because we were powerful and strong. Now, we tell people to trust us because we’re approachable and real. That change in messaging really helped us connect with people. Our old slogan, “Managing wealth with integrity, vision, and purpose,” was about us; the new slogan, “Invest in your life; we’ll do the rest,” is about them.
What is one failure you had as an entrepreneur, and how did you overcome it?
An awareness hit me that all our clients were the same age; we were moving up in age brackets because we were moving up in asset level. All our clients would die at the same time, which is obviously bad for asset and business planning. We had to figure out a way to service younger families and provide them value because there are millions more of them than other clients.
We failed at that five times — the tech failed or the staffing wasn’t right or the method wasn’t profitable or sustainable. I don’t think of failure as the opposite of success, but as part of the path to success. This effort was critically important to our company — we didn’t want to serve only the elite or wealthiest of clients. We started working on this in 2014, and those four years of tweaking, changing, and rearranging symbolized the hardest thing I’ve ever done. Any other firm would say, “This is dumb; there’s no money in it.” The only way we overcame it was by staying committed that this hill was worth climbing. We finally landed in a space where I think we’ve got it figured out, but it cost us a lot of time and money, and we haven’t recouped any of that yet. It’s still a huge success.
What is one business idea that you’re willing to give away to our readers?
All the time, I say, “I need to find the Wealthquest of this industry.” I would see service industries with fragmented experts who leave the client in that painful role of quarterbacking something they don’t understand. One industry I think of is marketing/advertising for small businesses: Big companies have marketing departments that manage every different form of media, but smaller businesses don’t have that coordination. We deal with this all the time; we’re constantly managing different aspects of marketing with several different vendors. A business built to serve as an all-in-one team that covers digital, print, TV, radio, etc., would be really valuable because most small businesses don’t know how to run those separate components of a marketing strategy, and they don’t have the resources to have a full-time team dedicated to it.
What is the best $100 you recently spent? What and why?
I recently bought a smoker. It’s a pain in the butt that takes hours and hours to smoke meat, but when you use the smoker, you smoke a tremendous amount of meat, way more than you’ll ever eat as a family. When I turn this thing on, by definition, we’re inviting people over. I was standing on the deck with it running with my brother-in-law, and he says, “Man, it’s crazy how this smoker has brought our family together. We hang out way more because of this.” This random thing that has caused more relational connection.
What is one piece of software or a web service that helps you be productive? How do you use it?
There’s one web service that’s cool that’s just getting started: Sorc’d. It allows our team to “clip” news so we have a central repository where people can look at a specific piece of information or quote or the whole article and get on the same page. It saves so much time on research.
What is the one book that you recommend our community should read, and why?
My book, of course, because all entrepreneurs are in business to do well for ourselves and our families, but understanding what it looks like to live a rich life helps you map out your trajectory. If entrepreneurs read the book and did these things to connect more deeply with their families — and allowed their employees to do the same — they’d see it impact their company culture and a lot of the things in society we’re frustrated with: overwork, overconsumption, etc.
Another that’s dense and academic but so valuable is “A Failure of Nerve” by Edwin Friedman. It helps frame what we’re supposed to do as leaders in our relationships. He basically looks at what chronically anxious families look like and how problem children and parents interact with each other. We tend to adapt to and accommodate immaturity; he expands that and shows what it looks like in an organization and in society as a whole.
What is your favorite quote?
Dan Zadra’s quote about worry being the ultimate misuse of imagination!
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