There are a lot of ads for insurance and financial advice out there. With so many ads, and so much clutter in the financial marketplace who should you do business with?

The reality is there is no real magic at all. The financial products everyone is selling are pretty much the same anywhere you go. You can buy from just about any agent out there and get the same stuff from any other agent. As long as it comes from a reputable company it is hard to go wrong. So why so much hype and advertising about "my product is better than your product" or "my company is the best"?

The truth is that there is much more to it than product alone.

If you were to go out to the golf course with Tiger Woods and you traded your set of K-mart $50 blue light specials for his top of the line Nike clubs, who would win? Why? You are using the same clubs Tiger uses. Why can’t you keep up with him?

The “coaching vs. clubs” concept is absurd when looked at through the analogy of the sports world. Nobody would seriously claim that an athlete was great simply because of the product (shoe, club, gloves, bat, ball, helmet, etc.) he wore or used. If that were the case becoming a great athlete would be as simple as buying the magic product then signing your multimillion dollar contract.

So is it the clubs or the coaching that makes the difference? That’s kind of a no-brainer question, right? When asked in this context nobody ever gets it wrong.

It’s the coaching (Just in case there was any doubt for anyone out there.)

If this is so obvious in the sports world, why do we miss the same concept in our financial lives? Coach or product? What do most advertisements regarding insurance, investments, mutual funds etc. deal with? They all deal with product. I’m sure you’ve heard before:

“My product is better than your product.” “My company is rated AAA Super Best by Some Great Ratings Agency.” “My company has been in business since the dawn of man.” “My company has so many assets under management we use dollars for tissue paper.”

Nearly all of the financial advertising focuses on comparisons between products and companies. It’s like saying Tiger Woods is a great golfer because of the Nike clubs, but if he used Callaway clubs he would suck. Guess what? Both companies make great clubs!

So what should you be looking for? A great coach! You want a financial advisor who can teach you how to be a good investor. You want someone who can show you macro-economically how all the pieces of your financial world fit together, and how to make them as efficient and effective as possible. Find an advisor who has actually used the products he talks about. Perhaps even one who has made a few bad investments with his own money and bloodied his nose a bit in the market. A financial advisor knows what to do is valuable. One who also knows what not to do is probably even more valuable.

So, where do products fit in? Obviously you will be using financial products to build your financial future. Product becomes important only after you have a good coach and a good financial model to build with. Then, and only then, do you discuss the particular merits of one product vs. another.

In reality though, as long as the financial product comes from a good company, it is really hard to go wrong. The top financial companies all produce excellent financial products. What you need to know is how to use those products in your life.

Callaway vs. Nike. They are both great clubs and Tiger Woods would probably still beat everybody no matter which one he chose because he knows how to use them for his game. That kind of knowledge comes from coaching.

Which insurance policy or mutual fund should you buy? It probably doesn’t matter until you have the right coach.

The salesman was so good. I have never heard anyone talk that well before. I was in the market to refinance an investment property, and this guy said all the right things. At the end of our meeting I was convinced that he and his company were the greatest thing that had ever happened in my life. The process was going to be easy, smooth, and fast. Not only that, but they were going to help me be a better real estate investor by passing on their mortgage expertise. Great! Easy, smooth and fast are exactly what I needed, and who wouldn't want to be a better investor? Well, 4 months later there was still no loan in place, the loan product we had originally applied for had been canceled 3 weeks prior to our first meeting (news to me four months later) and rather than feeling like an investing pro, I felt I knew less than I did before I met the guy. But boy, could he talk! He was the type of salesman who could probably sell water to fish.

Sound familiar? We've all had this experience before. And while most of the time it is nothing more than a minor annoyance that may cause some buyer's remorse, when it happens in your financial life it can be very costly. I wish that I could say the mortgage experience was the only time that this has happened to me, but it isn't.

Hopefully every one of your financial professionals will help you become a better investor. But with so many different approaches or recommendations out there how do you know which ones are going to help you and which ones are better left untouched?

Well, there are two questions to you can ask that will cut through 99.5% of all the financial approaches you get from now on. By consistently asking these questions, and getting good at listening and learning from the responses you will be able to save thousands of dollars in wasted money, time, and energy, as well as potentially make millions from the information you gather in response to these questions. Pretty powerful tools huh?

So here are the two most powerful questions you can ask of anyone in any area of the financial industry. It is important that you ask them in order and that you listen and learn from the responses.

1. Do you believe it is the investment or the investor that determines success?

2. What do you have to show me, independent of product that will make me a better investor?

That's it! Very simple tools. Yet the benefits to you of asking them consistently are enormous. Let's take a deeper look at each of these questions:

1. Do you believe it is the investment or the investor that determines success?

Most financial professionals should be astute enough to recognize that this is obviously a pretty loaded question and will probably answer it correctly. The correct answer, by the way, is that it is the investor that determines success. If you ever encounter anyone that says it is the investment you should immediately end the conversation, turn around and run like mad to get out of there. The advisor who believes it is the investment has nothing of value to add to your life! That is a bold statement, yet the truth of that is so easy to prove.

The biggest lesson to learn in the world of investing is that there is no such thing as a good investment. They do not exist. Let me repeat, there is no such thing as a good investment! This will obviously contradict most all of the financial media and talking heads you see on the money shows on TV. They are all trying to convince you that their product, or their process, or their system is the determining factor for investment success and riches. But this mindset is a tool for disaster and failure.

In any industry you care to look at you can see that the investment has almost nothing at all to do with the ultimate success or failure. In every industry there are plenty of examples of two people investing in exactly the same thing yet achieving very different results. In any industry you will find plenty of examples of one person nearly going bankrupt in an investment only to sell it to the next person who proceeds to make a fortune, or vice versa: one person makes a fortune only to sell it to the next person who nearly goes bankrupt with the same investment. Here are a few real life examples I've witnessed recently over the past two years.

A couple years ago a client of mine came to me and asked if I knew anybody who would be interested in buying their house. I started asking questions and learned that they had declared bankruptcy a few months previously and could no longer afford the home and had to move into something more affordable. I purchased the home from them, sold it within 3 months to a family who had recently moved to the area and made $20,000 in the process. This type of example is so common in the real estate world there are hundreds of educational courses devoted to the various aspects of the transaction.

The company who makes my signs for my business was bought by a young entrepreneur a couple years ago. The original owner had worked that business for many years with moderate success. The last few years of his ownership, though, saw sales and revenue plateau with no real growth. No up, no down, just stagnate. The guy who bought it was an employee of the company who had been there for about two years. Within the last 18 months he has recaptured market share, expanded beyond the local area to make signs for businesses all across the country, outgrown the old facility and moved into a much larger building and hired new employees. His revenues have seen a sharp increase over the previous owner.

Another recent example is an acquaintance of mine who owned a summer door-to-door marketing business that was a huge cash-cow for several years. One of the partners decided it was time to move into another venture and sold his shares to my acquaintance. Over a period of 18 months this company went from a multi-million dollar cash cow all the way down to nothing. He recently liquidated the business, sold everything else that had any value, and bankrupted out of his remaining liabilities. The company that bought the building he was in happens to be another summer door-to-door marketing company that sells the same type of product as my acquaintance. The new company is making a ton of money and is growing rapidly.

Examples like this are so common that they have become completely unremarkable. Nobody even thinks twice about it when it happens. Many very wealthy people have made their entire fortunes on this one fact alone and have become experts at buying struggling companies or assets and turning them around into phenomenal successes. Just as many, though much less well known "wannabe" wealthy people, have lost fortunes buying successful companies and assets and turning them around into phenomenal failures.

If this is common in every industry, in every asset class, and everywhere in the world, obviously it is not the investment that determines success. If the investment was the determining factor then the secret to success would be merely to find that one investment, buy it, and retire into the life of ease and luxury that all the late night infomercials extol.

So let me repeat again: there is no such thing as a good investment! The corollary to that statement is that there are no bad investments either. Neither one exists. Investments are neither good, nor bad. They just are.

There are, however, good and bad investors. In each of the examples above the determining factor for whether the investment succeeded or failed was the person running it, not the investment itself. So as you begin to seek your financial fortune, the very first place you should start is learning to be a better investor. If you can master the mindset, principles, character, thinking, reasoning, and decision making abilities of the good investor you will have dramatically increased your chances of success.

Unfortunately very few people do this. Usually they start off by seeking the hot tip, the hot technique, the hot strategy, or the hot product. This fact alone is the reason there are so many late night infomercials. Even if they find it and can make it work, most often it is short lived and they eventually become one of the examples cited above. There is nothing wrong with seeking techniques, strategies, skills etc. but when done out of order it can be disastrous. Without the proper education to accompany these skills any success that comes from them is more a matter of luck and will not last.

This leads into the second question:

2. What do you have to show me, independent of product, that will make me a better investor?

If you ask this to the average financial professional, most of the time they will launch into a thinly veiled sales pitch for whatever product or service they happen to sell. If you encounter one of these people you know immediately that they are simply selling a product and nothing more. There is nothing wrong at all with product salesmen; they are a great asset to society. However, you know for sure they will not make you a better investor. They will simply sell you a product.

If you ask this of a financial professional and they actually have an answer that does not immediately go into a product pitch, spend the time to listen to them, they probably will become a very valuable resource in your life. Also, if you find someone that has an answer to this question, please forward their contact information to jerem@livelightsource.com. I would be very interested to see what they are doing.

So what will make you a better investor? Knowledge. Knowledge. Knowledge. Do I need to repeat it again? By knowledge I do not mean the type you get by going to school and sitting in a classroom listening to an old tenured professor lecture. Though there is a place for this type of knowledge and some of it is actually useful, it is not what you are looking for. What you want is knowledge of principles and paradigms that can be applied in any financial endeavor you are considering. Once you have this type of knowledge then you can seek specific application techniques, or strategies. It is only after you have this type of knowledge that techniques and strategies become really useful anyway.

Examples of this type of knowledge would be principles of economics such as: velocity of money, how money is created how it moves and flows and how to utilize it efficiently and effectively. Or even, what is money in the first place and is it even real. Another example would be how to think like an investor, how to manage your thoughts to attract the most favorable circumstances to you. What are the different asset classes and what order should you go in as you begin investing?

Examples of techniques that would follow are how to pick a stock, how to structure a lease option purchase, what type of life insurance policy to own and how to use it, how to sell a property quickly etc. Can you see the difference?

Now that you know the two questions to ask you can use them in almost any encounter with financial professionals regardless of their particular product or niche. Use these questions with your insurance agent, use them with your mortgage broker, with your real estate agent, with your stock broker, with your financial planner, with your benefits coordinator at work, with your 401k manager, with your brother-in-law trying to get you to loan him money etc. You will be surprised at how often these two questions are applicable. You will also be surprised at the different answers you get in response to these questions.

As you gain experience asking the questions and paying attention to the answers you will gain incredibly valuable abilities to discern when someone really knows their stuff or when they are faking it. You will be able to tell quickly and easily when someone actually has valuable information to teach you or when they are just trying to sell you a product. The skills you develop just by asking and listening will save you thousands and thousands of dollars over the years and could potentially make you millions as well.