One of many interesting anecdotes I came aware from Dan Gardners 2008 book Risk: The Science and Politics of Fear was that 45% of Canadians are unaware of how many millions are in a billion. There were many other very calming reality checks in there as well. In particular for parents.
This ‘millions in a billion issue’ in itself is not exactly a serious thing, although it perhaps points to a larger issue.
It is interesting as, to some extent, it makes clear that we humans are really not so great with numbers. Other than the numbers with which we interact daily.
Making sure we get the right change back at the coffee shop for instance, although that skill is surely in decline as we become increasingly cashless and further detached from our actual money and wealth. That is another topic altogether though.
My takeaway from this anecdote and from my daily experience with clients is that we, the trusted advisor, are heavily relied upon for our own mathematical skills. We are believed to have such skills based on the role we have chosen to play. So we best have reasonable ones.
With very little exception there is no such thing as ‘not being a numbers person‘ other than by choice. If one wishes to learn then one will learn.
I enjoy checking in with the Kahn Academy periodically and taking some basic math lessons. Time well spent for any Broker.
Also having a cheat sheet handy with basic formulas such as; @ ~3% over 30 yrs your payment will be $400.00 per month per 100K of mortgage money, or $40.00 per month per 10K.
You can work out the 25 yr AM figures.
This is the basic sort of numbers translation that clients use and appreciate. It keeps mortgage calculators out of the picture which themselves can be misleading and problematic, it also gives the client the power to easily calculate payments on the fly without sending you 19 requests on a Sunday afternoon to calculate every so slightly different payments.
Add value, be the expert, and know numbers.
Be the number. 🙂