315: [Andrew Gold] The Generational Wealth Shift
In this episode, we’re joined by Andrew Gold, a wealth strategist and father, who shares his insights on instilling financial wisdom in the next generation. As we explore the impending transfer of wealth estimated to be between $60 to $80 trillion, Andrew emphasizes the importance of teaching kids about money management early on. He discusses practical strategies for parents to help their children understand the value of money, the significance of starting investments young, and the importance of balancing saving and spending. From 529 plans to Roth IRAs, we dive into various investment accounts that can set children up for financial success. Andrew also shares his personal journey, highlighting the lessons he learned from his own upbringing and how they shaped his approach to wealth management. Tune in for actionable tips and a fresh perspective on financial planning that prioritizes both present enjoyment and future security.
Takeaways:
- Teaching kids about money management early can lead to healthier financial habits later in life.
- Investment accounts like 529s and Roth IRAs provide great opportunities for children to start building wealth.
- Balancing saving for the future and enjoying the present is crucial for a fulfilling life.
- Understanding the cost of living and the value of money helps children make informed financial decisions.
- Proactive financial planning can prepare the next generation for the challenges ahead.
More about Andrew Gold:
Chapters:
- 00:00 - Introduction to Wealth Transfer
- 05:15 - Instilling Financial Lessons in Children
- 12:45 - Investment Accounts for Kids
- 20:30 - Balancing Saving and Spending
- 30:00 - Andrew's Personal Journey to Wealth Management
- 40:15 - Planning with Purpose
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Disclaimer:
The information provided in this podcast is for educational purposes only and should not be considered financial advice. Please consult with a financial advisor before making any investment decisions.
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Episode 315
Transcript
This episode is sponsored by Prestige Wealth Management.
Speaker B:You know, there's about, I think, 60 to 80 trillion dollars that is going to be handed down from parents to kids, from grandparents to parents, over the next 20, 30 years.
Speaker B:But what they found is that the younger generation, if they inherited wealth in their 30s, they were the first people to say, I'm going to take a couple years off, take this money and live off it, and go and do these things that I don't want to wait 30 years.
Speaker A:Welcome, everybody, back to another exciting show of the about that Wallet podcast, where we help the sandwich generation build strong financial habits so that they can talk about money, spend money, and enjoy their money with confidence.
Speaker A:The beautiful thing about today is that we have somebody who is well versed in finances.
Speaker A:He's a wealth strategist, tax repair planner, husband, father, and also an investor.
Speaker A:He is on a mission to educate people on their finances and finding new ways to grow and keep more money for themselves.
Speaker A:Welcome to the show.
Speaker A:Andrew Gold, how you been?
Speaker B:Thank you so much for having me.
Speaker B:Yeah.
Speaker B:Doing well today.
Speaker A:As a, as a father, what is one of the life lessons and finances that you are instilling into your children?
Speaker B:Yeah, I think for me especially, like, my daughters are 2 and 9, and we got one on the way.
Speaker B:I think that for especially the youth, we look back at especially just the cost of things, and it can be really an uphill battle or it seems something that's unattainable to really build wealth over the course of a lifetime.
Speaker B:We look at how expensive college is right now, just being able to come out of school and be able to look at apartments and how expensive those are.
Speaker B:So I think that the.
Speaker B:The piece of advice that I've gotten that I try to instill in my children is to start early, start early, and start often, do the things that are extremely manageable for whatever is in your situation and then just be patient.
Speaker B:I think if.
Speaker B:If we can all try to instill that into some of the younger youth, life becomes a whole lot easier.
Speaker B:You know, whenever you have to start seeing that nest egg build and you can start seeing your money work for you earlier the better.
Speaker B:Yeah.
Speaker A:We always told what time in the market versus timing the market.
Speaker B:Yeah, that's right.
Speaker B:That's.
Speaker B:That's a financial advisor line.
Speaker B:So that's good.
Speaker B:Good for you.
Speaker A:Yeah, because we go through a lot of this stuff and it's interesting to see how we grew up and our parents had instilled information in us that we still use today as we are getting older, because usually what, age 8 is kind of like where we kind of have our.
Speaker A:Our money alignment.
Speaker A:So for your child to be at 9, have you noticed any trends that she's doing right now with her finances?
Speaker B:Yeah, yeah, we talk about it in our office quite a bit, actually.
Speaker B:We call it financial genetics.
Speaker B:And, you know, looking at our parents and how they manage money as kids growing up, I mean, more often than not, we usually end up managing money like how we saw money be managed and, you know, for the better or worse and, you know, you know, for those like myself that grew up in a household that didn't really kind of use themselves as examples of managing money, well, you know, it's one of those things you.
Speaker B:It's your.
Speaker B:It's up to you as an adult to kind of break that curse and restart some things.
Speaker B:My daughter sees us very early, you know, being frugal, being able to talk about savings, getting her a debit card, talking about spending cash and what you have in your pocket rather than on credit, and starting to see the.
Speaker B:The value of what, you know, the time that you exchange for the money and then what you exchange the money for, I think is the earlier that you can instill that in your children, the better.
Speaker A:That's really good because it helps understanding now far as getting into, like, the investment.
Speaker A:So obviously you invest in your children, obviously through education and also with your.
Speaker A:Your dollars and cents.
Speaker A:Is this a wealth strategy that you and your wife kind of came together about early on?
Speaker A:Was this, like, early talks?
Speaker A:How did this come about?
Speaker B:Yeah, so obviously she gets, you know, the first.
Speaker B:First row view of everything, you know, around wealth and investing and things like that.
Speaker B:So that's always kind of a good point.
Speaker B:But, you know, I think early on trying, and I know that we try not to kind of materialize our children, the world is going to do that enough for them.
Speaker B:But we wanted her to understand how much things cost.
Speaker B:And that can sometimes be a very, you know, hard topic to have because they have no perspective.
Speaker B:But what I think happens is that if we don't talk about how much things cost and the expenses on going to this trip or going to this movie or this dinner or this present, by the time that they're starting to work at 15, 16, 17, they've already had the comfort of life for so long that there is a really hard disconnect between, you know, how much I have to exchange my hours for and, and, you know, what this cost.
Speaker B:This, this little piece of instant gratification may cost a day of me working as A server.
Speaker B:Yeah.
Speaker B:So with, you know, my daughter being nine, I think one of the hardest things as parents to talk about is how much things cost.
Speaker B:And so they instantly get the.
Speaker B:The world is gonna really condition them to kind of understand the difference between nice things from what they have and kids in their, their class and, you know, other kids that are in the different activities and whatnot.
Speaker B:But understanding exactly what money goes into those things can be some of the things that as a parent, a lot of the times, in my opinion, we wait too long to really get them exposure to it.
Speaker B:So whenever we're going out and we're talking about, oh, we're going on this trip, or, oh, we're going to dinner, or we're buying this present for our friend that we're going to the birthday party this weekend, it's important to talk about expenses because if we wait too long and then they start working and they realize that I remember for myself, you know, I would work an entire day at, you know, an eight hour, ten hour shift at my restaurant if I made a hundred bucks.
Speaker B:Like, that was a great day.
Speaker B:And so nowadays, you know, we look at these little video games and you know, last, I haven't played Xbox in probably like eight years, 10 years, but they were $60.
Speaker B:I was like, am I going to exchange an entire day of work for one game?
Speaker B:So it kind of puts it in perspective.
Speaker B:The other thing that we do and is as we're saving for our children, I actually show her her account balances over time and I'll show her what money we put in for her and then what it's worth today to show her the value of compounding and, you know, what it could potentially look like in 5, 10, 15 years.
Speaker B:Sometimes seeing the fruit of our labor is a lot more difficult than imagining the work.
Speaker B:And so, like, I think that the earlier we try to put that into perspective, the better.
Speaker A:Now, there's used to be a saying when I was growing up and said children should not be an adult's business.
Speaker A:And it's usually like, you know, mind your business while you, in adult conversations, go out and play.
Speaker B:Yeah.
Speaker A:And I'm noticing that there's a shift.
Speaker A:Have you noticed that as well?
Speaker B:Yeah, no, absolutely.
Speaker B:I think as parents, you know, they always say that, you know, strong men raise weakness children and weak men raise strong children.
Speaker B:And so I think it kind of goes along with that same kind of perspective piece, is that if we keep our children out of our business early on, they don't really start that financial maturing process.
Speaker B:Until they get on their own, whether that's 18, 19.
Speaker B:They're trying to figure out how much money they can spend for what they want instead of using dad's credit card when they're in college.
Speaker B:You know, things like that.
Speaker B:The earlier that we can get that exposure down, the better.
Speaker B:I mean, I think that that's why parents are shifting, is because they see the uphill battle ahead and they see exactly how much maybe if they thought about planning for college what it was 10, 15 years ago compared to what it was today, it's completely different than even parents expected.
Speaker B:So being proactive like that is going to be extremely beneficial and hopefully, you know, fingers crossed it over prepares this next generation for what's going to come over the next 10 to 20 years.
Speaker A:Yeah.
Speaker A:So, like, what got you into, like, even starting this wealth business in the first place?
Speaker A:Because it seems like you seem like you got it all together, like you just kind of woke up, you know, everything's working out.
Speaker B:Yeah, thank you for that, by the way.
Speaker B:I will have to clip that one.
Speaker B:But no, you know, it's.
Speaker B:It's kind of funny.
Speaker B:It really originated around financial education.
Speaker B:Whenever I was in college, I was actually, I was on a full golf scholarship.
Speaker B:And the ironic thing enough is that I wanted to major in architecture, and my school didn't have an architecture major, so they put me in an art program and then just told me to draw buildings instead of people.
Speaker B:It was really kind of like, you know, figure it out as you go.
Speaker A:Right.
Speaker B:But when I got.
Speaker B:When I was in college, I actually the.
Speaker B:My roommate at the time was getting an elective surgery, and so I was on my way to the hospital to drop off his phone charger, and I got hit by a car on the way there.
Speaker B:And I ended up getting know, two floors below him in the emergency room.
Speaker B:And luckily I was, you know, by the grace of God, like, I was.
Speaker B:I was okay.
Speaker B:But what ended up happening is a few months later, I ended up getting a check for my insurance.
Speaker B:And I was like, like I told you before, you know, my parents weren't really the greatest examples of handling finances.
Speaker B:Even though my mom was in banking for 50 years, she was very frugal.
Speaker B:My dad was the reckless spender kind of thing, fly by night kind of guy.
Speaker B:Maybe that usually boomer.
Speaker B:So I was like, I want to.
Speaker B:I want to do something for.
Speaker B:For myself and my future self is kind of how I view it.
Speaker B:And I went around and I tried to talk to advisors, and I kept getting the same wall, which was you don't have enough money to work with me.
Speaker B:And that really hit me hard because I'm, like, here trying to break my generational curse, right?
Speaker B:And I'm continuing to get this weight on my shoulders.
Speaker B:And so I went down the route of I'm just going to learn everything from the ground up and.
Speaker B:And, you know, providing a little bit of context.
Speaker B:We've got the boiler room, we've got the Wall street movies coming out, all these other things.
Speaker B:And so I'm like, this is.
Speaker B:This has got to be the way to financial freedom for me.
Speaker B:And so I just kind of learned the hard way I couldn't do it right away.
Speaker B:So I was still working my job, trying to learn to invest and trade on the side.
Speaker B:And then I finally got the opportunity, you know, to.
Speaker B:To be able to change careers.
Speaker B:You know, God really put me in a.
Speaker B:In a situation where he kind of made the.
Speaker B:The decision for me where, you know, I was like, it was going to be a 50 pay cut for me to go and leave the career.
Speaker B:Yeah, I had had a one year old at the time, was married.
Speaker B:You know, I was.
Speaker B:I was in a. I was in one of those situations where, like, you're good at what you do, but it doesn't really, like, fulfill you kind of thing.
Speaker B:And so we were.
Speaker B:We were going to go on a vacation, and I was going to talk about it with my wife, try to convince her that this was the right thing to do.
Speaker B:I was on vacation.
Speaker B:Somebody had started this rumor in the office that I was going to quit while I was gone.
Speaker B:And so I came back, and they're like, hey, I heard you've got another opportunity lined up, so we wish you the best of luck.
Speaker B:And I was like, all right, well, I haven't really won over the wife yet, but this is a great opportunity.
Speaker B:Thanks for, you know, kind of taking care of it for me.
Speaker B:So.
Speaker B:Started from the ground up, and it was.
Speaker B:It was a blessing in disguise.
Speaker B:And, you know, the thing that I always tell my interns and the younger kids that I work with is, you know, if nobody else believes in you, you know, if you believe in yourself, that's good enough.
Speaker B:Right?
Speaker B:And just.
Speaker B:Just be patient.
Speaker B:Try to do the right thing every step of the way.
Speaker B:And here we are 10 years later.
Speaker B:So that's.
Speaker B:It's amazing.
Speaker A:Nice.
Speaker A:And you also talk about, like, planning with a purpose, and that is something that seems like it's going along the lines of your life now.
Speaker A:It's just like everything has a purpose for what you're doing.
Speaker A:Can you expand on that?
Speaker B:Absolutely.
Speaker B:Yeah.
Speaker B:That's our key phrase in our office.
Speaker B:You know, I think that, you know, when it comes to working with professionals, I think we're all taught, you know, things about like inflation.
Speaker B:We're, we're taught things about diversification when it comes to building wealth and don't have too much and cash, don't have too much in one company and like those types of things.
Speaker B:But I think that a lot of the times people are just planning to plan without any, like, real direction.
Speaker B:What I've learned in my experience in working with the hundreds of individuals that we help every day is everybody's plan is just a little bit different than another person.
Speaker B:And if we're just planning based on how old we are or what our friends said, what we find down is later down the road, whenever our plan is somewhat built, we're not fulfilling ourselves the way that we want to.
Speaker B:If you don't plan on, you know, traveling first class to all around the world, like, why do you need to stress yourself out and put away all this money?
Speaker B:Because I've had a different perspective now on money than I did even five years ago is that I feel like there's people that save too much and they're focused on so much gratification 10, 20, 30 years down the road that they're missing out on a lot of those small moments with their kids while they're young.
Speaker B:And, and you know, we have a, a phrase for it that's, that's, that's kind of like negligent gratification, you know, or it's, I like that too much planning for the future, but not enough of join today.
Speaker B:And if, if you're going through life and dealing with all the things that life can throw at us and you're not having a good time, at least along the way, then it makes it that much harder to kind of, you know, postpone all these different things that are coming on your plate.
Speaker A:And when it comes to that, because a lot of people are hoarding money because when they grow up they didn't have it, so they.
Speaker A:More so inside that scarcity mindset, what is one of those negative phrases that kind of grinds your gears that somebody who has that type of mindset is like, you know, I just really wish you'd get this out of your vocabulary.
Speaker B:Yeah, yeah.
Speaker B:No, I think that I don't know if I have like a key phrase for it, but, you know, really looking at a lot of people that have been doing what they've been told is like the American dream, which is settling down as early as possible.
Speaker B:You know, buying a house, maxing out your 401k as early as you can.
Speaker B:And what I've seen is that people will overcompensate because of the pain that they've seen from their parents or their household growing up, and they'll overcompensate to those types of things where they're essentially living paycheck to paycheck for 30 years.
Speaker B:And there's got to have a balance, right?
Speaker B:Where now a lot of our clients are retiring and they've been hoarding money in their 401k, and now the IRS gets to decide on how much money that they have to pay tax on every year in the RMD or the required minimum distribution at 73 years old.
Speaker B:And where you have that deferred gratification for a long period of time.
Speaker B:But maybe because of the line of your work, maybe some of the lifestyle things that you have, health catches up to you.
Speaker B:Where you've been wanting to go and tour Europe for your entire life, but now all of a sudden your knees hurt, your back hurt, you know, your kids are all over the place, you want to spend time with, with your grandkids, and now you can't do the one thing that you've been slaving away for for the last 30 years.
Speaker B:I mean, those, those really hit hard sometimes in those kind of conversations.
Speaker B:Even if you have the money, I mean, that's not necessarily the only way.
Speaker B:So we're kind of like that, you know, work hard, play hard mindset in our office.
Speaker B:And I think we surprise people sometimes too, about, you know, encouraging them to go spend the money and go on that trip with their kids for the graduation or helping out with the wedding or, you know, that pass down to wealth.
Speaker B:And.
Speaker B:Because that's what the kids remember for their entire life.
Speaker A:But that brings up the toughest question is when do you start cashing in?
Speaker B:Yeah, no, that's a great question.
Speaker B:Everybody's situation's a little bit different.
Speaker B:I mean, there was a study that came out recently that was talking about, you know, there's about, I think, 60 to 80 trillion dollars that is going to be handed down from parents to kids, from grandparents to parents over the next, you know, 20, 30 years.
Speaker B:And it was trying to understand exactly how that's going to change the thought process of the younger generation, but also the parents, the boomers that have been hoarding money for a long period of time.
Speaker B:And what they found is that the parents are inheriting this money in their peak earnings years.
Speaker B:So rather than needing it to spend for debt management or raising kids, they're just essentially letting it sit and grow.
Speaker B:And that's creating this giant concentration of wealth, which isn't getting down to the younger people going into the workforce.
Speaker B:But what they found is that the younger generation, if they inherited wealth in their 30s, they were the first people to say, I'm going to take a couple years off, take this money and live off it, and go and do these things that I don't want to wait 30 years for.
Speaker B:Especially if I'm going to be in this situation where the IRS is going to force me to take out this money over a 10 year period.
Speaker B:Why would I, you know, slave away and put myself in the 35% bracket?
Speaker B:Let me have that balance, let me maybe spend some more time at home with my young kids, helping them with baseball practice and things like that and all that, different kinds of stuff.
Speaker B:What we really like to talk about with especially people that are getting over 50 or over 60, is starting to have three phases of retirement where the first one is the day that you realize that, hey, if we continue doing everything that we're doing right now, we're going to be good at some point, whether it be at 62, at 65, at 70, we're there.
Speaker B:It's not a question of if anymore.
Speaker B:The second one is when you start to really focus on your lifestyle.
Speaker B:So it might be reducing hours in the workforce, it might be, you know, spending all of your vacation time for the first time in the last decade, you know, and really focusing on planning those trips a year or so in advance to taking care of that.
Speaker B:And then the third one's when you hand over your key card and you really start to live that full 40, 40 hours a week retirement lifestyle.
Speaker B:And everybody's plan's a little bit different.
Speaker B:Some people like to have those, those moments early on with their kids and, and that forces them to catch up a little bit later.
Speaker B:Other people are like, I want to spend time earlier and retire at 60 and be with my kids when they're getting married and they're starting on in their life.
Speaker B:But again, tying into planning with purpose, whatever their goals are, we need to be able to listen and be able to figure out the math behind it.
Speaker A:That is really good to have that strategy in there also.
Speaker A:It's like, because we don't know.
Speaker A:And there was a book that I was reading called the Dial was Zero and they were talking about having two different lists.
Speaker A:So Obviously you got your bucket list on things that you can do at any age.
Speaker A:But then there's also, I think it's called like an age list.
Speaker A:Almost like things that, like you said, you can't go out and enjoy those things because now you got knee surgery or you got hip surgery or what other health issues that you have.
Speaker A:Is there something that you looking forward to do or that you haven't done yet that's on your age list?
Speaker B:Yeah.
Speaker B:So, I mean, coming from my background, I mean, we, we try to really live.
Speaker B:Motto of the work hard, play hard.
Speaker B:And you know, I tell some of our younger advisors is you gotta, you gotta bleed.
Speaker B:You gotta bleed the brand and the thought process behind everything that you do.
Speaker B:And because life comes at you in seasons, right, there's gonna be periods of time where your workload or your capacity is gonna have to be more than 40 hours a week.
Speaker B:And you're gonna have to have the tenacity to be able to, you know, put in the extra effort.
Speaker B:But on the same flip side, when you're working.
Speaker B:I used to love to have the opportunity to work more than 40 hours whenever I was growing up because that meant time and a half.
Speaker B:That means I could work 80 hours and then next week I could, I could go ahead and work 30 and not lose a, lose a dollar, you know, out of my paycheck.
Speaker B:And so being able to find those types of opportunities in your life and my daughter, I think, is the only one that we've really tried to build out on.
Speaker B:We made this promise to her because we're big, you know, car trip people.
Speaker B:We made a goal together that we were going to visit every national park.
Speaker B:She goes to college.
Speaker A:That's awesome.
Speaker B:And I mean, it doesn't have to be luxurious.
Speaker B:I mean, there was a time where we spent a week in Seattle or around Washington, going to different places, sleeping and camping in the back of the car because it was so dang cold at night.
Speaker B:So it doesn't have to be luxurious, but it's those little experiences that, you know, you get to reflect back on.
Speaker B:And at the very minimum, if it was a bad experience, you could say, I already did it.
Speaker B:Let me go focus on something else.
Speaker B:But that's about as close as I can get.
Speaker B:I've coming up with a hit list of things to do.
Speaker B:But yeah, hopefully that makes sense.
Speaker A:Yeah.
Speaker A:Because that's one of the things that some people do forget is like, yeah, we getting older.
Speaker A:And tomorrow is like you said, it's never promised, but at least try, you know, Put some money aside and really try to live your life the way you want to while you can.
Speaker A:Because I think when people who go through or have seen a lot of death in their family, they don't know, the perspective about life usually changes.
Speaker A:And because of that it's like, okay, life is short.
Speaker A:Let me go down and sack away money to go ahead on and start worrying about the funeral costs.
Speaker A:Because I've seen so many people complain about funeral costs.
Speaker A:Okay, roughly about $10,000 at the time of this recording.
Speaker A:Then because, you know, the kids jack up and then it's like, okay, well what do I want to do with my children?
Speaker A:Set them up for school, get them into the different investment accounts.
Speaker A:And that's one of the things I did talk about different types of investment accounts for children.
Speaker A:Can you talk about that a little bit?
Speaker A:What can a parent do?
Speaker A:How soon can they actually start investing with their children?
Speaker B:Yeah, no, these are, these are great questions.
Speaker B:Now we're getting into the nitty gritty.
Speaker B:So I love this.
Speaker B:So, yeah, a couple different accounts that we can use.
Speaker B:So I'm really hit on, on three.
Speaker B:So are the ones that allow parents to save for college.
Speaker B:And it's not just parents.
Speaker B:A lot of people have conversations with grandparents, aunts, uncles, different pieces of the family, and they're like, hey, instead of buying us that $50 toy for their three year old birthday, just write her a check to go towards her college and we'll go ahead and deposit in that 529.
Speaker B:Anybody can put it in there.
Speaker B:You invest it, it grows, you know, until they use it for college, tax free for education expenses.
Speaker B:It passed out some different legislation recently that allows parents and kids who have unused funds in their 529s.
Speaker B:I think it's up to $30,000 or $35,000 to go ahead and convert that out to Roth IRAs to continue that compounding, which I think has just been fantastic.
Speaker B:The next one is going to be a UTMA or ugma, depending on what state you live in.
Speaker B:Those are accounts that essentially you're putting in a trust for your kid that you're going to manage and be the steward of that money for them on their behalf as a custodian until they turn 18.
Speaker B:Allows all different types of people to deposit money in there.
Speaker B:It grows just like a typical brokerage account.
Speaker B:A lot of flexibility there for different things.
Speaker B:If you have like club sports or you have like private education and elementary school, high school, you know, things like that before college gives you some flexibility.
Speaker B:I do really like to point out the fact though, is that if you're putting a lot of money into these accounts, the UTMA or UGMA becomes an asset of the child on their 18th birthday.
Speaker B:So if you're looking to go to a prestigious university and not fund it all, that can be a hindrance of people applying for financial aid.
Speaker B:Because now this child may have 20, 30, $50,000 in their name that can affect their eligibility.
Speaker B:Okay, the last one is going to be the Roth ira.
Speaker B:And this one's a little bit tricky just because one of the IRS stipulations is it has to be earned income, right?
Speaker B:So you can't necessarily quantify your, your toddler having earned income at, you know, 18 months old.
Speaker B:A lot of parents are using, you know, family photos, modeling, as you get older chores, you have a small business helping with handwritten Christmas cards, or as they get older, marketing, social media, things like that.
Speaker B:But being able to go ahead and utilize that.
Speaker B:You know, we use the mentality of 30 by 30 in our office.
Speaker B:That's $30,000 by 30 years old.
Speaker B:If you, if you don't add another dollar to it and just compounds at the S&P 500 at 10% a year, that's your first million dollars in retirement.
Speaker B:So, okay, when we start breaking that backwards, which is, you know, as numbers people, we like to do even at 18 years old, if you're putting in, you know, 100 bucks a month and you're getting a match from your 401k from your employer, that's 30 grand by 30.
Speaker B:If we're just letting it invest, if you can start that earlier with a Roth IRA, 100 bucks here, 200 bucks here, the number just are outrageous.
Speaker B:And so whenever we have kids come through our office in the summer trying to understand these concepts, we use a lot of these types of methods just to be able to show again that end result to help quantify and defend the effort that goes into it.
Speaker B:So I think perspective matters a lot of the time.
Speaker A:Okay, so we got the investment at least know what type of accounts to get into.
Speaker A:Obviously everybody's situation going to be a little different.
Speaker A:So this is for educational purposes only to cover both of us when it comes to, okay, now we open up this account, a lot of people just be like, well then what do I invest in?
Speaker A:Usually depending on the brokerage, I think it kind of varies for each one because I always try to say low cost.
Speaker A:Yeah, ETFs, usually.
Speaker A:Yeah.
Speaker A:Do you have any other, like, broad suggestions?
Speaker B:Yeah, so I kind of like to start in buckets, you know, early on.
Speaker B:The worst thing that you can possibly do is take on too risk too early.
Speaker B:So having like the psychology of money conversation with clients is extremely important to understand the difference between saving and investing.
Speaker B:Because in saving you can put $5 here and you know, you know it's going to be $5 a year from now.
Speaker B:You don't get that necessarily like peace of mind, especially early on.
Speaker B:So where I see a lot of people, especially with social media is they'll see a Tesla or an Apple or a Robin Hood commercial or like whatever.
Speaker B:They're like, oh my gosh, I want to get on this AI scoop and they'll, you know, over fund with, you know, the best expectations out there and you know, then all of a sudden, you know, three, six months from now, when, if it doesn't work out now, they've got less than the money that they put in.
Speaker B:And not only did they lose money, but they lost the positive momentum towards investing long term.
Speaker B:And that can delay people quite a bit in terms of progress.
Speaker B:So I usually start out broad, start with something that do a little bit of the Dave Ramsey, get some cash, you know, build up that little bit of a safety nest egg, thousand dollars, $2,000, whatever the case may be.
Speaker B:But then start broad with a low cost ETF of the S&P 500.
Speaker B:You're betting in the top 500 companies in the United States.
Speaker B:So if Tesla does well, it may lead in correlation to the rest of the 500, but it's not, I can almost guarantee, and again, education purposes only, I can almost guarantee you that you're not going to lose your money by investing in a low cost ETF like Voo or spy or any of those things.
Speaker B:500 of the top companies are not disappearing overnight.
Speaker B:So that could give you some peace of mind there.
Speaker B:Once you build up and you get a little bit of the taste of the volatility year over year, you know, time is our best advocate there in history.
Speaker B:Any given year that you put money in the market, you've got a 50, 50 chance of making money.
Speaker B:After five years, you know, that goes up to 60 after 10 years, it's 75 and 20 years, it's about 95%.
Speaker B:So the longer that we can have those expectations and build those things out, the better success that we're going to have.
Speaker A:So as we get into the future of investments, we sign into the future, the third segment of the show, what is your thoughts on bitcoin and crypto or even the blockchain man, you're good.
Speaker B:This is a hot take right here.
Speaker B:So you know, I guess I'm more of the bear in my office to be honest.
Speaker B:I was really late to adopt and I really was waiting for institutions more than anything to be able to start adopting and putting money where their mouth was.
Speaker B:I think speculation can be extremely costy costly if we don't do our research.
Speaker B:And the problem that I had with Bitcoin for a long time is that one, there's no tangibility to it.
Speaker B: w, essentially like you know,: Speaker B:If we're resorting back to dicing up gold and exchanging it for goods, you know that we're already pretty gloom and doom where it started to wake up as you see hundreds of millions and billions of dollars that are going into Bitcoin.
Speaker B:I heard an interesting earnings call and a thought process from the the former CEO his of MicroStrategy, Michael Saylor.
Speaker B:There we go.
Speaker B:He said he's like the view on gold isn't necessarily about anti equities or about anti dollar or anything like that.
Speaker B:He's like the problem with the US dollar is that every year we print more of it.
Speaker B:And so you have one of the largest currencies in the globe that's constantly being devalued on purpose year over year.
Speaker B:Bitcoin on the other hand there's a finite supply.
Speaker B:Every three years they do a burn which is limiting supply and you're having more and more adoption globally.
Speaker B:So then it just comes down to the law of averages.
Speaker B:My perspective long term on of it is is you know, everything in moderation.
Speaker B:But what we talk to our clients about is if you have 1 to 5% of your portfolio in a cryptocurrency like I'm just going to throw out a name here.
Speaker B:This isn't advice of BITW is a Fidelity ETF that is a top 10 cryptocurrency coin manages similar to like an S&P 500 fund where 80% of the money in that is going into Bitcoin and Ethereum the two big players that have been in the industry for a long period of time.
Speaker B:The other 20% is going to the next eight coins out there that are trending that are in market cap size.
Speaker B:So if you can have 1% of your portfolio and something like that, the US dollar is going to continue to be printed and devalued.
Speaker B:If bitcoin does go on the run that they say it's going to, that 1 to 5% could be 10 to 50% of your portfolio 20 years from now.
Speaker B:But if all of the naysayers are correct and all of a sudden, overnight, bitcoin gets wiped out with an aha, gotcha moment, you lost 1% of your portfolio.
Speaker B:You know, it's not necessarily the end of the world.
Speaker B:So everything in moderation.
Speaker A:I like that because I was even thinking the same thing of like the 1%.
Speaker A:Maybe like I was being more modest of like 1 to 3%.
Speaker B:Yeah, yeah, I know.
Speaker B:Absolute.
Speaker A:Yeah, it's, it's a tough market, especially when it's still new and fresh.
Speaker A:What's out there?
Speaker A:So in this segment, I like to talk about you as yourself is like, what are the habits that you feel is going to improve your life going forward?
Speaker B:Yeah, that's hard.
Speaker B:I, I think that one of the biggest things of myself that, you know, has led to a lot of the success that I've had is, you know, my willingness to be patient.
Speaker B:I think in terms of, of decades rather than I do in years.
Speaker B:One of the things that I've, you know, for good and bad, for good and bad, I've always been willing to kind of put myself in the sand and my head in the sand at least and say, in 10 years, am I going to think about this moment today?
Speaker B:Am I going to think about this decision?
Speaker B:And so I think that some people would say that it takes a little bit of pressure off of you because you don't necessarily feel like you're always walking on eggshells that are going to be life defining, you know, kind of decisions.
Speaker B:But also I think that as you get older and you mature, I think you realize that in the grander scheme of things, things just tend to kind of work themselves out.
Speaker B:And so at the very minimum, bet on yourself and be patient.
Speaker B:One of my favorite quotes is this too shall pass.
Speaker B:And there's a great video that has, you know, some of a lot of thought provoking leaders and actors and famous people.
Speaker B:Denzel Washington, Tom Hanks, Jamie Foxx was around this table and Tom Hanks brought this up and he said, you know, this too shall pass.
Speaker B:He's like, when you feel like you're on top of the world, this too shall pass.
Speaker B:Have some humble pie, you know.
Speaker B:But when you feel like everything is going wrong, you Know, and you can't make a single decision.
Speaker B:Right.
Speaker B:You know, this too shall pass.
Speaker B:It can only get better from here.
Speaker B:Having that kind of, you know, perspective and tenacity allows you to, you know, kind of keep pushing.
Speaker B:I like that.
Speaker A:All right, is there anything that you want to leave the listener today before we get into the final four questions?
Speaker B:I think that when it comes to finances, I think that there's a lot of, you know, advice out there.
Speaker B:I would really just say that, you know, we're in a world that, you know, there's so much information you can go and find yourself.
Speaker B:Even with my clients, I tell them all the time, I was like, you can find all the things that I'm going to tell you.
Speaker B:It's not any secret of this system or the institution or the government or the know and not know kind of things.
Speaker B:We've completely gotten out of that situation.
Speaker B:But what I will say is, before you make a decision, whether it's working with a professional or putting any really big decisions in place, do your research.
Speaker B:Ask a lot of different people.
Speaker B:Look up some different things online.
Speaker B:The hardest thing is to try to find something that is custom to your situation rather than just a blanket advice that you see, you know, on a.
Speaker B:A Reddit thread or something like that.
Speaker B:So.
Speaker B:And everything in moderation.
Speaker B:Love those two things.
Speaker B:All right.
Speaker A:Awesome.
Speaker A:All right, ready for the final four?
Speaker B:Yeah.
Speaker B:Let's do it all.
Speaker A:Question 1.
Speaker A:What does wealth mean to you?
Speaker B:I think wealth means balance.
Speaker B:So, you know, here in our office, you know how we typically talk to clients as, you know, the five, the five pillars of financial planning or wealth management we see is financial planning, which is kind of budget, debt, things like that, investments, taxes, estate planning, and risk, which we kind of quantify as like, life and health insurance, understanding those things that get thrown at you.
Speaker B:The wealthiest people in the world have figured out the system to have all five of these pieces work together where, you know, you see headlines every day of celebrities that pass away tragically, and all of a sudden, all of their wealth doesn't have a beneficiary, or it wasn't funded properly in their trust, or they didn't have life insurance or a will.
Speaker B:Those can happen to any of us.
Speaker B:Those are just the biggest examples.
Speaker B:So we try to, you know, promote balance in everything that we do.
Speaker B:And it's not necessarily just a dollar amount.
Speaker A:That's great.
Speaker A:Got to have balance.
Speaker A:I like that.
Speaker A:Number two, what is mean?
Speaker A:What was your worst money mistake?
Speaker B:Worst money mistake?
Speaker B:Man, I don't know if that.
Speaker B:It was a.
Speaker B:Necessarily a money mistake because it didn't work out poorly per se.
Speaker B:But, you know, we.
Speaker B:We built a house.
Speaker B: moved into and bought was in: Speaker B:And the reason why we were going to rent it out is because if you remember trying to sell the house during COVID it was not a great and great market.
Speaker B:And so we had a lot of stuff thrown on our plate that could have really put us in a bad situation where we would have actually had to come to the table with money just to sell our house and get rid of the obligation.
Speaker B:That was during that period of time where I was kind of restarting my career, and Covid came at us and all that stuff, and we made the decision that, you know, this may not be the right move for us right now, but a year, two years down the road may be different.
Speaker B:So we ended up renting it out for about 18 months, found some good people that could take over the payments essentially for a year.
Speaker B:And even though we were losing money a little bit per month because, you know, of the market at the time, it made sense versus putting it to market after Covid was over.
Speaker B:And we ended up selling the house and dodging a big bullet there where we didn't have to come with any money to the closing table.
Speaker B:But that.
Speaker B:I feel like when you let emotions drive your decision, sometimes that can put you in hot water.
Speaker B:Luckily, we were able to avoid it.
Speaker A:That's awesome.
Speaker B:Yeah.
Speaker A:Emotions and money really don't mix.
Speaker B:That's true.
Speaker B:Yeah.
Speaker B:And family.
Speaker B:Family and money.
Speaker B:We.
Speaker B:We say that people are funny when it comes to money.
Speaker B:So I've seen a lot of, you know, good, positive stories and a lot of unfortunately terrible stories of families been being ripped apart over finances.
Speaker B:And those are things that we want to avoid as best we can, sir.
Speaker A:All right, number three.
Speaker A:Is there a book that inspired your journey or changed your perspective?
Speaker B:I think the Robert Kiyosaki books, you know, like his.
Speaker B:His early.
Speaker B:What is it?
Speaker B:Richard Poor.
Speaker B:Is that one of his first?
Speaker B:Rich dad, Poor Dad.
Speaker B:That was one of the ones that's been, Gosh, probably like 15 years since I read that one that was given to me by a mentor.
Speaker B:There's a.
Speaker B:You know, a book that came out recently.
Speaker B:I think it's called Atomic Habits.
Speaker A:Yes.
Speaker B:Yeah, that was really great.
Speaker B:I actually listened to it on a digital ebook while I was on a.
Speaker B:On a.
Speaker B:On a plane and you know, it's just an amazing book.
Speaker B:It's not necessarily about finances, but it's just about behaviors and habits that you have in every aspect of your life, which I think can.
Speaker B:Can, you know, kind of apply to a bunch of different areas.
Speaker A:Yeah, Solid.
Speaker A:Two books, if you're listening to this, definitely, you need to read those.
Speaker A:Number four, what is your favorite dish to make?
Speaker B:You mean like, culinary wise?
Speaker B:Yeah, man.
Speaker B:So I'm Italian, so we.
Speaker B:We like to cook.
Speaker B:Now, I think, you know, being in Texas, you know, you can't.
Speaker B:Everybody's got their own best brisket, you know, so I think that that's got to be one of them.
Speaker B:But if I think we're going og recipe book, man, I think lasagna.
Speaker B:Lasagna is like a sneaky one to be really good at.
Speaker B:But I think, you know, when we talk about cooking and we talk about cooking as a family, we have a lot of fun in the kitchen.
Speaker B:Different.
Speaker B:Different palates, different things kind of hit you.
Speaker B:Different.
Speaker B:Different moments.
Speaker B:But you can have a good lasagna.
Speaker B:I mean, I'm there.
Speaker A:Nice.
Speaker A:All right, so we have the very last question of the show, which is where could people find out more about you?
Speaker B:Oh, yeah.
Speaker B:So pretty active on social media.
Speaker B:So if you're on Facebook, you can go find my Facebook business page.
Speaker B:It's WealthMgmt.
Speaker B:Or you can go to pwealthmgmt.com is our website.
Speaker B:We have a lot of free information out there.
Speaker B:You know, financing calculators, different things like that that can answer a lot of questions about what it's like before ever going on that deep dive with work at anybody.
Speaker B:You know, we work with people all over the country, so we do free consultations as well for taxes as well as retirement planning.
Speaker B:So happy to spend an hour with anybody, have coffee virtually or in person.
Speaker B:I always love it.
Speaker A:Awesome.
Speaker A:Thank you, Andrew, for being, you know, taking time out of your day, especially spending time with the family on the road trip.
Speaker A:Really can't wait to see how things fare out with you and all the adventures.
Speaker A:So look forward to seeing those posts.
Speaker A:So for you as a listener, I want you to make sure and remember this whole thing was really, really talking about balance in your life and things that really matter to you, like, how do you see yourself in the future?
Speaker A:Are you actually going out and doing the things that really matter to you?
Speaker A:Are you doing things that matter to other people?
Speaker A:So I want you to take time out, think about that, and start taking some action today.
Speaker A:All right, everybody, we out.
Speaker B:Peace.
Speaker B:Yeah, I love that.
Speaker B:Awesome, Sam.
