By Ronald W. Rogé, MS, CFP®
Chairman & CEO
Red Adair (1915-2004)
I spotted the quote above on LinkedIn the other day. It’s attributed to Red Adair, a well known and experienced oil well fire fighter. It reminded me of the story below that I recently read in a quality online publication called Farnam Street.1
A giant ship engine failed. The ship’s owners tried one expert
after another, but none of them could figure out how to fix the
engine. Then they brought in an old man who had been fixing
ships since he was a young [boy]. He carried a large bag of tools
with him, and when he arrived, he immediately went to work. He
inspected the engine very carefully, top to bottom. Two of the
ship’s owners were there, watching this man, hoping he would
know what to do. After looking things over, the old man reached
into his bag and pulled out a small hammer. He gently tapped
something. Instantly, the engine lurched into life. He carefully
put his hammer away. The engine was fixed! A week later, the
owners received a bill from the old man for ten thousand
dollars. “What?!” the owners exclaimed. “He hardly did
anything!” So they wrote the old man a note saying, “Please
send us an itemized bill.”
The man sent a bill that read:
Tapping with a hammer………………….. $ 2.00
Knowing where to tap…………………….. $ 9,998.00
Effort is important, but knowing where to make an effort makes all the difference!
The Red Adair quote and story above made me think about the many real life experiences I personally have encountered related to expertise and cost. One example took place several years ago when we needed to hire an attorney to help us with regulatory compliance, which was becoming more complex. We asked for recommendations from other financial advisors and industry experts. At the time most attorneys with this skill set (they are called 40’s Act Attorney’s) were charging $350 per hour. We received one recommendation who charged $500 per hour. It seemed a little steep to me considering the competitions price.
The person who made the recommendation said, “Don’t worry about the hourly fee. This attorney really knows his stuff and gets things done in half the time!”
That made sense to me, and in the end we achieved the desired results in less time than expected. As a matter of fact, it ended up costing much less because he was experienced and knew the subject matter (where to tap the hammer) so intricately. Because of his acquired expertise, knowledge and wisdom we were not billed for the research time we probably would have been charged had we gone with a less expensive, but less experienced attorney.
In my experience the old saying, “You get what you pay for,” holds true most of the time. The moral of this story is to hire the right, experienced professional for the job at hand. Whether you’re choosing a financial planner, attorney, plumber, or repairing a ship, it can certainly be tempting to save a few dollars up front. Unfortunately that objective could end up costing more time and money in the long run, and perhaps you still won’t be satisfied with the results.
If you need help hiring the right professional for your financial future, please feel free to give us a call at 631.218.0077 to arrange a no obligation, complimentary meeting. You can also visit our Web site at www.rwroge.com where you can send us a message to discuss how we can help you plan, achieve and live the life you want.