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Episode 148: Planning for Very Long Happy Retirement With Steve Vernon

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People are living longer. Much longer. How should that change how we plan for retirement? Steve Vernon, President at Rest-of-Life Communications and Consultant for the Stanford Center on Longevity joins us today to talk about the financial and emotional issues we all need to consider.

Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.

We hope you enjoy the show.

https://www.linkedin.com/in/svernon/

Steve Vernon

Don’t Go Book in Retirement:

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Ashley SaundersEpisode 148: Planning for Very Long Happy Retirement With Steve Vernon
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Episode 147: Preparing for Life 2 With Don Ezra

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Planning for retirement should not be just about figuring out how to pay the bills when the paychecks end. Planning should be about finding a new identity, purpose, and direction that is fulfilling in later years. Don Ezra, investment expert and author joins us to talk about his own journey into retirement and the guide he has created to help people learn from his own experiences.
Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.
We hope you enjoy the show.
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Transcript

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[Paul Tyler]: hi this is paul tyler and welcome to another episode of that annuity show ramsey

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[Paul Tyler]: another great guest this time do you want to do the honors and introduce us

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[Ramsey Smith]: absolutely i’d be happy to so we’re joined today by don ezra from sunny toronto

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[Ramsey Smith]: canada

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[Ramsey Smith]: and this is a fantastic opportunity today for a number of reasons but the primary

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[Ramsey Smith]: reason is

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[Ramsey Smith]: that don spends a lot of time talking about what we do and how we feel about

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[Ramsey Smith]: retirement both the transition into retirement and and life

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[Ramsey Smith]: in in retirement or graduation as he likes to put it which i think is a fantastic

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[Ramsey Smith]: word so don spent many years at russell investments and has a phenomenal

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[Ramsey Smith]: background was an actuary but

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[Paul Tyler]: thank

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[Ramsey Smith]: this very interesting thing that that don does he’s forward focused and we’re

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[Ramsey Smith]: going to talk about that and that’s something that all of us in our lives will

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[Ramsey Smith]: have to face and and that annuity show is about more than just the money and so

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[Ramsey Smith]: that’s why is this is really a fantastic opportunity for us so

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[Ramsey Smith]: tell us

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[Paul Tyler]: help

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[Ramsey Smith]: tell us a little bit about your about your journey and and how you came to the to

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[Ramsey Smith]: the conclusion that it was worth it made not just worth it was it was worth it

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[Ramsey Smith]: was an important time opportunity to focus on life after graduation if you will

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[Don Ezra]: absolutely thank you for the the very generous introduction and it’s an honor to

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[Don Ezra]: join the past list of guests you’ve had on your show it’s fantastic thank you

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[Don Ezra]: so i actually retired as the word goes i hate it as you said i prefer graduation

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[Don Ezra]: from full time work but i i retired at a time of my own choosing which many

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[Don Ezra]: people don’t get do and in a way i wanted to do

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[Don Ezra]: and i continued working part time with

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[Don Ezra]: russell and so everything was absolutely perfect and i was absolutely astonished

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[Ramsey Smith]: it’s like everything

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[Don Ezra]: as a result of that to find that i felt completely discombobulated i had no idea

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[Don Ezra]: what had suddenly gone wrong

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[Don Ezra]: but all of a sudden

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[Don Ezra]: things seemed to be falling apart even though i was doing it exactly the way i

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[Don Ezra]: wanted to and and i realized that

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[Don Ezra]: something

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[Paul Tyler]: what

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[Don Ezra]: my friend mayor sta and a professor at santa clara university

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[Don Ezra]: had said was really really really important and i’d never realized he so when

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[Don Ezra]: when

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[Paul Tyler]: what

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[Don Ezra]: when you when you leave work

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[Don Ezra]: you lose part of your identity you lose

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[Don Ezra]: access to your accomplishments you you you lose a community and at russell we

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[Don Ezra]: were not just colleagues we were friends and i lost all of that even though i

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[Don Ezra]: only lost half of it because the rest of the time was all my own

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[Paul Tyler]: the

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[Don Ezra]: but i felt that

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[Paul Tyler]: my

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[Don Ezra]: i i’d been i was a tree that had been uprooted i was

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[Don Ezra]: a very healthy tree it it had grown in soil that nurtured the growth and it was

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[Don Ezra]: thriving and all of a sudden it was uprooted and now i had decisions to me what

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[Don Ezra]: kind of a tree did i want to be where did i want to plant it and wherever i was

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[Don Ezra]: going to plant it the roots would take time to penetrate and grow back again and

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[Don Ezra]: as it happened it took me about three years of thinking about this and

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[Don Ezra]: researching it i mean i

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[Paul Tyler]: oh

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[Don Ezra]: was a consultant what do consultants do other than research

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[Don Ezra]: and benefit from other people’s wisdom which they absorb it took me three years

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[Don Ezra]: before i realized the kinds of things i wanted to do

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[Don Ezra]: and and part of that was actually moving from new york back to toronto which i

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[Don Ezra]: had left twenty five years earlier and it was all that kind of stuff

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[Don Ezra]: that that made me realize that transition i mean we talk about retirement as if

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[Don Ezra]: yesterday you were working today or retired transition is actually

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[Don Ezra]: psychologically a very important stage and in my case it was a three year long

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[Don Ezra]: stage and one of the things that the guys at russell had me do was the first

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[Ramsey Smith]: yeah

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[Don Ezra]: year into that they had me back at the client conference which it had been my job

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[Don Ezra]: to organize in the past and they

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[Paul Tyler]: i think

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[Don Ezra]: had me give a keynote just describing myself s in retirement and it’s the only

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[Don Ezra]: time in my life i ever had a standing ovation and i know what it was i mean we

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[Don Ezra]: were friends with the clients too so they they liked the old guy they were seeing

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[Don Ezra]: in front of them like seam again et cetera

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[Paul Tyler]: what

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[Don Ezra]: etc but i think they realized that this was something they were going to have to

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[Don Ezra]: go through and the honesty of here’s how i feel here’s what i’m doing here’s

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[Don Ezra]: what’s going right here’s what i’m wondering about i think i think that got

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[Don Ezra]: through to them in a very personal way because they knew they were going to have

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[Don Ezra]: to go through that as well

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[Paul Tyler]: then

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[Don Ezra]: and it was as a result of that that i thought ok can i be a consultant again can

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[Don Ezra]: i research this and so i started researching in god bless the internet and and

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[Don Ezra]: that ended up first in a book on happiness because i’d been studying the brain

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[Don Ezra]: for behavioral finance considerations and stuff like that and after that into

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[Don Ezra]: what are the issues that are involved that have caused me to be to be so

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[Don Ezra]: uncomfortable i don’t know if combobulated is a word but after being disco bob i

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[Don Ezra]: finally got cobo bl it again

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[Don Ezra]: and it occurred to me that sort of if you think of this as a journey life this is

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[Don Ezra]: a journey through the second part of your life it’s long enough to be a life so i

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[Don Ezra]: call it life too

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[Don Ezra]: the

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[Paul Tyler]: no

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[Don Ezra]: there are there are some rocks you need to avoid and as i thought about it i mean

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[Don Ezra]: education is the way to do this but what are the subjects it’s not history math

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[Don Ezra]: geography literature and stuff like that the three rocks to avoid there’s there’s

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[Don Ezra]: there’s an identity rock there’s an activity rock and there’s a money rock so

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[Don Ezra]: exactly as she said ramsey there’s there’s much

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[Paul Tyler]: oh

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[Don Ezra]: more to this than just money

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[Don Ezra]: and some people avoid them all some people hit them all but if you’re aware of

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[Don Ezra]: those rocks the identity the activity and the money rocks at least you know what

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[Don Ezra]: you’re looking for and you can get i put together as much wisdom as i could

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[Don Ezra]: assemble from other people’s lives and my own

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[Don Ezra]: and then put them under these headings and say what can you do

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[Don Ezra]: how do you identify the issues and these headings in your own life and then what

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[Don Ezra]: questions can you ask yourself to relate to how you can then start to at least be

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[Don Ezra]: in control it’s it’s like most people have fear and dread when they think about

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[Don Ezra]: retirement they they they don’t want it it’s they don’t say that they say it’s

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[Don Ezra]: too complicated but it’s not actually too complicated for them it’s just they

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[Don Ezra]: don’t want to think about it they’re scared and so that’s that’s where i where i

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[Don Ezra]: tried to help with the book and with my blog posts on my website and stuff like

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[Don Ezra]: that

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[Paul Tyler]: so three rocks i love it uh

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[Paul Tyler]: do you navigate the rocks by yourself or on who helped you navigate your rocks

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[Paul Tyler]: who were the guides along that path

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[Don Ezra]: well

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[Ramsey Smith]: we see that too

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[Don Ezra]: they say there are ten thousand baby boomers a day retiring now

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[Don Ezra]: and they don’t have enough help et cetera baby boomers baby boomers are kids to

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[Don Ezra]: me i’m a world war two baby so i had

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[Ramsey Smith]: hm

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[Don Ezra]: absolutely no help so i had to do this myself i think more and more

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[Paul Tyler]: i

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[Don Ezra]: today there are people who are becoming experts in this area who can help you on

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[Don Ezra]: the money side of course

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[Paul Tyler]: st

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[Don Ezra]: there are there’s expertise all over the place but on the psychological side

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[Don Ezra]: more and more that there are retirement planners who are coming along who who

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[Don Ezra]: retire and coaches is i think they call themselves and they deal with the

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[Don Ezra]: psychological and practical aspects as opposed to the financial aspect so it is

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[Don Ezra]: possible to get help these days

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[Ramsey Smith]: but what is the best way to think about

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[Ramsey Smith]: like let’s start with the identity rock that’s a that’s a really tough one that’s

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[Ramsey Smith]: that in some ways that’s the you know that seems like the the the least solvable

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[Ramsey Smith]: one of the hardest one to solve right because it’s so it’s so

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[Don Ezra]: i i think you spot on yeah

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[Ramsey Smith]: sub subjective yeah so so how do people so jill or john is retiring and they’re

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[Ramsey Smith]: dealing with this i mean you took three years and you know you took you worked on

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[Ramsey Smith]: it very deliberately so

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[Paul Tyler]: oh

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[Paul Tyler]: god

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[Don Ezra]: yeah

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[Ramsey Smith]: what should people expect is the right amount of time for that transition and

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[Ramsey Smith]: what are the most concrete steps they can make to get to get going on it

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[Don Ezra]: i i think i think you probably ought to start maybe at five years before you’re

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[Don Ezra]: planning to graduate

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[Ramsey Smith]: wow okay

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[Don Ezra]: and start thinking about well one of the reasons is that i’ve seen statistics

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[Don Ezra]: that say half of retirees retired before they planned to

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[Paul Tyler]: it is

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[Don Ezra]: i mean it it it it it could be uh your ill health the ill health of someone else

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[Don Ezra]: you have to look after it could be layoffs it could be all kinds of things but

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[Don Ezra]: half of people don’t retire when they’re planning to so give it five years to

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[Don Ezra]: think about it

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[Don Ezra]: and i think some of the things you need to think about as what is important to

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[Don Ezra]: you

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[Don Ezra]: as i quoted mayor staten

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[Don Ezra]: the more successful you’ve been

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[Don Ezra]: the more your identity is tied to your work

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[Don Ezra]: and the more your life sort of surrounds it in fact until covid came along

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[Ramsey Smith]: yes

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[Don Ezra]: most of us the happier we were at work spent far more time at work than we ever

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[Don Ezra]: did at home and in fact having to work from home i understand has driven the

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[Don Ezra]: divorce rate up so it’s it’s yeah it’s not an easy thing to come back so it’s

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[Don Ezra]: partly the activity the combined activity but partly the identity thing too so

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[Don Ezra]: who am i is the big question

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[Don Ezra]: and

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[Don Ezra]: i i found there were a couple of sets of questions to ask yourself

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[Don Ezra]: that tend to help here at at a very very very high level gentleman named george

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[Don Ezra]: kinder i came up with with three life questions and there as follows one is

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[Don Ezra]: you have all the money

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[Don Ezra]: you want how would you live your life okay

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[Don Ezra]: question two

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[Don Ezra]: you’ve just been told you have five to ten years to live

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[Don Ezra]: how would you change your life

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[Don Ezra]: question three you’ve just been told you have twenty four hours to live what are

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[Don Ezra]: your regrets

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[Don Ezra]: and out of that you can start

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[Don Ezra]: i mean these are not questions you answer in sixty seconds these are questions

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[Don Ezra]: you ponder over and take your time over and perhaps every five years you want to

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[Don Ezra]: rethink them

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[Don Ezra]: but these are things that ought to give you some sense of what is the most

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[Don Ezra]: important purpose i have etc etc etc that’s a very high level one at a lower

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[Don Ezra]: level one another one i found very useful is is by a guy named ed jacobson

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[Don Ezra]: who came up with the concept of a life’s abundance portfolio so a portfolio is

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[Don Ezra]: just a collection of things under different headings and this is your life’s

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[Don Ezra]: abundance and he said there were seven different factors

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[Ramsey Smith]: no

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[Don Ezra]: to me there’s seven asset classes in the life’s abundance portfolio and i cannot

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[Don Ezra]: remember

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[Don Ezra]: the names ed gave it but i remember them myself very simply in pairs family

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[Don Ezra]: and friends

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[Don Ezra]: work and play

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[Don Ezra]: mental health which

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[Ramsey Smith]: you

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[Don Ezra]: includes spirituality and

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[Ramsey Smith]: w

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[Don Ezra]: physical health i said there were seven oh yes money

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[Ramsey Smith]: so

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[Don Ezra]: so these are the seven asset classes in your life’s abundance portfolio and on

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[Don Ezra]: each of them give yourself a personal rating where am i on a scale of zero to ten

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[Don Ezra]: where would i wreck myself there are no right answers or wrong answers and only

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[Don Ezra]: your answer is relevant people may say you’re an awful so and so and you should

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[Don Ezra]: rate yourself very lowly on that no no no only your own answer is

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[Ramsey Smith]: what

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[Don Ezra]: relevant so rate yourself there and then look back on your ratings and say are

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[Don Ezra]: there which are the ones i’m comfortable with i mean you could be comfortable

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[Don Ezra]: with a force somewhere and uncomfortable with the seven that’s okay which are the

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[Don Ezra]: ones i’m uncomfortable with and then what is in my power

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[Don Ezra]: to raise my rating in those asset classes in my life’s abundance portfolio and

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[Don Ezra]: that starts to give you some feeling of what are the things you can do that are

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[Don Ezra]: more important to you etc etc etc and one of the other things this starts to

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[Don Ezra]: to get to and it took me far more than my personal three years of transition to

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[Don Ezra]: come to this realization that one of the things that has become important to me

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[Don Ezra]: personally is the legacy i leave not financial legacy the emotional legacy will

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[Don Ezra]: people think of me after i’m gone on this earth that’s as close to immortality

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[Don Ezra]: i’m likely to get and it’s gonna be family and friends and it’ll be for a few

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[Don Ezra]: years that’s it but will they think of me happily

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[Don Ezra]: i

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[Don Ezra]: the way i’ve been behaving they will think of me

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[Don Ezra]: not only with the smile but with a laugh because i’ve they they keep pointing out

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[Don Ezra]: all the stupid things that this very intelligent person does and they say oh do

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[Don Ezra]: you see what don just did oh uncle don did so and so grand et cetera et cetera

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[Don Ezra]: and and

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[Don Ezra]: i i love i love that because intellect is not what this is all about money

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[Don Ezra]: financial legacy is not what this is all about it’s the emotional legacy that at

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[Don Ezra]: this stage of my life has become important to me and i think questions like that

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[Don Ezra]: start to start to change your mindset it may take a

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[Paul Tyler]: i

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[Don Ezra]: long time as i say particularly the more successful we’ve been the longer it

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[Don Ezra]: takes for us to say but that was in the past what about the future

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[Don Ezra]: and and that’s why that’s why i describe myself not just as retired because

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[Don Ezra]: retired is a backward looking word

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[Don Ezra]: but happily retired because i i i feel i’m in the driver’s seat i i still have to

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[Don Ezra]: make decisions on direction on speed

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[Don Ezra]: but in my life’s car at least i’m in the driver’s seat and that’s as as any as

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[Don Ezra]: anyone could have

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[Paul Tyler]: yeah i i’m not sure many people have a true accounting of their assets for

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[Paul Tyler]: happiness right don i think it also adds a whole nother

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[Paul Tyler]: layer to the question of

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[Paul Tyler]: are you leading a rich life

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[Don Ezra]: beautifully put yes exactly exactly

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[Ramsey Smith]: so one of the things that that comes to mind is as i listen to you spell out

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[Ramsey Smith]: these these various priorities these two different sort of paradigms for

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[Ramsey Smith]: priorities is in the in the first or the second one it was interesting that that

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[Ramsey Smith]: money came last and the first one money i don’t believe it was mentioned

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[Ramsey Smith]: mentioned at all

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[Ramsey Smith]: and

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[Don Ezra]: right man

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[Ramsey Smith]: one of the things i think is

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[Don Ezra]: what

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[Ramsey Smith]: often lost on people is that how you prioritize

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[Don Ezra]: right

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[Ramsey Smith]: all those quality of life issues actually can really help

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[Don Ezra]: i

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[Ramsey Smith]: inform the right answer on the money problem right and sometimes

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[Don Ezra]: that

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[Ramsey Smith]: sometimes we’re trying to fix things with money when they’re not really money

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[Ramsey Smith]: problems and that creates stress in and of itself so so

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[Don Ezra]: so so

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[Ramsey Smith]: h how do you

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[Paul Tyler]: and

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[Ramsey Smith]: do you think that

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[Don Ezra]: you

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[Ramsey Smith]: that in in the world of advice if you will do you think this should be a more

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[Ramsey Smith]: important part of

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[Ramsey Smith]: the the advising that is given to retirees potential retirees and maybe is the

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[Ramsey Smith]: case today

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[Don Ezra]: i yes i think so but i think the the client has to be open to it and in fact ed

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[Don Ezra]: jacobson’s life’s abundance portfolio was something i came across at an aicpa

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[Don Ezra]: conference so accountants and ed was speaking we were both speaking there and so

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[Don Ezra]: i done my stuff and and here was a session about having good conversations with

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[Don Ezra]: clients that was what ed

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[Ramsey Smith]: uhhuh

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[Don Ezra]: was talking about and one of the things he mentioned was here are some subjects

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[Don Ezra]: you can talk about and call it the life of life’s abundance portfolio et cetera

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[Don Ezra]: but it’s not always easy to raise the subject one of the things i remember him

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[Don Ezra]: saying was that you want to if you were the one raising the subject

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[Don Ezra]: you want to raise it at a time when things are going well from an investment and

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[Don Ezra]: financial point of view otherwise there might be a suspicion that you’re raising

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[Don Ezra]: it for other reasons so raise it at when other things are going well and

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[Paul Tyler]: i mean

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[Don Ezra]: now you can introduce these new subjects and it’s not always easy to get client’s

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[Don Ezra]: attention because they’ve got to give of themselves much more personally this way

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[Don Ezra]: they have to open up they have to expose themselves and it’s very difficult but

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[Don Ezra]: if you can get a client involved in that way these are things that are that are

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[Don Ezra]: doubly helpful because

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[Don Ezra]: they’re they they’re helpful not only in the

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[Paul Tyler]: i

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[Don Ezra]: conversation and helping the client shape their lives in the future but also

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[Don Ezra]: it allows them to focus on things other than money and

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[Ramsey Smith]: mm hm

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[Don Ezra]: then from your point of view i think it it it helps as well because

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[Don Ezra]: i read i don’t know if this is still true or not because i i don’t have the facts

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[Don Ezra]: but i read that many people have multiple advisors

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[Don Ezra]: and they would like to consolidate under one advisor

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[Don Ezra]: i think the likelihood of being that one advisor is higher if in fact you were

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[Don Ezra]: talking holistically about the whole life’s abundance portfolio then if all

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[Don Ezra]: you’re doing is talking about you know here was your return in the last month the

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[Don Ezra]: last year the last five years et cetera et cetera et cetera because

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[Don Ezra]: that also helps

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[Don Ezra]: for well for

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[Don Ezra]: for example for for people who are not necessarily financially very

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[Don Ezra]: interested literate whatever the word is take my wife she’s a very very very

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[Don Ezra]: intelligent person

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[Don Ezra]: but she does not want to get involved in finance she leaves that to me

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[Don Ezra]: the one thing she understands about our

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[Don Ezra]: arrangements are that we have enough all our needs permanently and as far as our

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[Paul Tyler]: what

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[Don Ezra]: wants are concerned

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[Don Ezra]: that depends on where markets are et cetera et cetera et cetera and we have we

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[Don Ezra]: have set up a our own portfolio this ’cause this was my

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[Don Ezra]: world war two having to do things for myself i learned i learned from my pension

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[Don Ezra]: fund clients to first you survive then you thrive so we’ve got five years of

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[Don Ezra]: cash flow needs okay

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[Don Ezra]: with cash like

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[Don Ezra]: in investments

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[Ramsey Smith]: oh

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[Don Ezra]: and that gives us five years of security should the market fall suddenly if it

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[Don Ezra]: doesn’t fall we will take money out of our market portfolio and spend it if it

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[Don Ezra]: falls we’ve got five years for it to recover and at least historically who knows

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[Don Ezra]: what the future will bring at least historically seventy fifty five percent of

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[Don Ezra]: the time the market has recovered in real terms inflation adjusted terms after

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[Don Ezra]: five years and she gets this that we have five years of virtual safety and then

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[Don Ezra]: the rest is all in a growth

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[Ramsey Smith]: he

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[Don Ezra]: portfolio and what she understands when for example

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[Don Ezra]: two years ago in march when covid started and the market just crashed she said

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[Ramsey Smith]: what

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[Don Ezra]: what what does this do to us

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[Don Ezra]: and the answer was right now nothing we are doing nothing and we will know what

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[Don Ezra]: it does to us five years from now because

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[Ramsey Smith]: oh

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[Don Ezra]: we don’t have to worry and as a matter of fact as the market has gone up so much

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[Don Ezra]: one of the things we’ve done is expanded our safety net from five years to much

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[Don Ezra]: more because

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[Don Ezra]: sorry i’ve i’ve got way off to wear off your question

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[Ramsey Smith]: now keep going

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[Paul Tyler]: no have

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[Ramsey Smith]: this is good

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[Don Ezra]: what one of the things that in our projections is i’m hoping for a real four

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[Don Ezra]: percent return on the equity portfolio on average over the long term if i get if

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[Don Ezra]: i get four percent i’m happy to cash out the next year’s worth etc in addition to

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[Don Ezra]: the five years where we’ve had such high returns that i’ve cashed out an extra

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[Don Ezra]: year for each of the four percents we’ve made and

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[Ramsey Smith]: okay

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[Don Ezra]: so now we have a safety net a safety part that is way longer than five years

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[Don Ezra]: and and so it’s stuff like that that psychologically i think is very important

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[Don Ezra]: and if you can put that psychological fear to rest then you can help with all the

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[Don Ezra]: other things etc and and you get so much more personal in the conversation with

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[Don Ezra]: the clients when you’re talking about family and friends work and play mental and

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[Don Ezra]: physical health etc etc because now now you’re a friend you’re not you’re not

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[Don Ezra]: just an expert you are an expert who’s a friend

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[Paul Tyler]: don the timing of the conversations you mentioned i think is

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[Paul Tyler]: so important

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[Paul Tyler]: want to have my conversation about my wife about the following ramsey there’s

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[Paul Tyler]: certain times that do it at certain

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[Don Ezra]: th

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[Paul Tyler]: times not today this morning was not a couple topics but dodd

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[Don Ezra]: what

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[Paul Tyler]: you might also mention retirement coaches sort of the evolution of retirement

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[Paul Tyler]: coaching coming in here

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[Paul Tyler]: can i i if i if i were a financial advisor and you were advising me on how to

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[Paul Tyler]: reshape shape my practice should i lead with that conversation

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[Paul Tyler]: purpose

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[Paul Tyler]: you know a

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[Paul Tyler]: happiness assets or is this something i earn the right to the conversation i have

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[Paul Tyler]: the e have to earn the right in order to have that with you

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[Don Ezra]: i really don’t know i don’t know what the answer is and i suspect it probably

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[Don Ezra]: varies from client to client and with the personality of the advisor and and what

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[Don Ezra]: kind of relationship

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[Don Ezra]: you have right from the start

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[Paul Tyler]: but

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[Don Ezra]: i really don’t know the answers to

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[Don Ezra]: is there a right way to do it or not

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[Don Ezra]: i think your judgment there would be much better than mine

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[Ramsey Smith]: well listening to your listening to your story it’s

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[Ramsey Smith]: there’s a lot of things going on so there is there is obviously there’s trust

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[Don Ezra]: look in one

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[Ramsey Smith]: you’re in a marriage that’s something that’s you know

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[Ramsey Smith]: extant

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[Don Ezra]: yes

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[Ramsey Smith]: so there’s trust

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[Ramsey Smith]: there’s been this ability to

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[Don Ezra]: ye

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[Ramsey Smith]: narrow sort of a complicated investment strategy

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[Don Ezra]: scrap

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[Ramsey Smith]: into a few key parameters five years of

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[Don Ezra]: but

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[Ramsey Smith]: safety you know if this then that

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[Don Ezra]: if that

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[Ramsey Smith]: else this then that right it’s a very

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[Don Ezra]: right

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[Ramsey Smith]: small subset of pieces of the puzzle

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[Paul Tyler]: that’s

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[Don Ezra]: a

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[Ramsey Smith]: and also a very fundamental element

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[Don Ezra]: one

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[Ramsey Smith]: is

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[Ramsey Smith]: is this notion that if something does happen there’s a willingness to make the

401
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[Ramsey Smith]: necessary adjustments we had bill banging on in the last couple of weeks and this

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[Ramsey Smith]: is one of the things that he talked about a lot is just the the

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[Ramsey Smith]: ultimately like

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[Don Ezra]: oh

405
00:23:26,880 –> 00:23:31,920
[Ramsey Smith]: the killer app using my own words killer app and retirement is is flexibility in

406
00:23:32,000 –> 00:23:33,600
[Ramsey Smith]: your spending like almost more

407
00:23:33,639 –> 00:23:34,639
[Don Ezra]: absolutely

408
00:23:34,000 –> 00:23:35,600
[Ramsey Smith]: almost more than anything else and so

409
00:23:36,640 –> 00:23:38,240
[Ramsey Smith]: a and and to get to that

410
00:23:38,900 –> 00:23:39,900
[Ramsey Smith]: part

411
00:23:39,079 –> 00:23:40,079
[Don Ezra]: yeah

412
00:23:39,600 –> 00:23:43,200
[Ramsey Smith]: of it is figuring out what’s really important everything else you’ve emphasized

413
00:23:43,840 –> 00:23:48,480
[Ramsey Smith]: so it’s just interesting to see how all the other qualitative issues that you

414
00:23:48,620 –> 00:23:49,620
[Ramsey Smith]: brought to the fore here

415
00:23:51,120 –> 00:23:56,480
[Ramsey Smith]: all that ultimately translate into you know greater safety and retirement because

416
00:23:57,120 –> 00:24:01,680
[Ramsey Smith]: you’ve narrowed down parameters and you and you’ve and you’ve imparted a you know

417
00:24:01,760 –> 00:24:03,520
[Ramsey Smith]: a culture a philosophy of

418
00:24:03,466 –> 00:24:04,466
[Paul Tyler]: understood

419
00:24:03,600 –> 00:24:04,640
[Ramsey Smith]: like a flexibility

420
00:24:06,979 –> 00:24:10,259
[Don Ezra]: absolutely absolutely anything bill says is gonna be wise

421
00:24:10,300 –> 00:24:11,300
[Ramsey Smith]: yeah right

422
00:24:10,419 –> 00:24:12,419
[Don Ezra]: anyway we know that because he’s such

423
00:24:12,100 –> 00:24:13,100
[Ramsey Smith]: yeah

424
00:24:12,279 –> 00:24:13,279
[Don Ezra]: a great guy

425
00:24:14,359 –> 00:24:15,359
[Don Ezra]: but

426
00:24:16,839 –> 00:24:17,839
[Don Ezra]: i think

427
00:24:20,019 –> 00:24:24,819
[Don Ezra]: an important thing that i’ve realized as i’ve come across many advisors

428
00:24:25,859 –> 00:24:27,699
[Don Ezra]: is the question of defining risk

429
00:24:29,379 –> 00:24:34,819
[Don Ezra]: and from a professional point of view risk in terms of standard deviation of

430
00:24:35,139 –> 00:24:38,979
[Don Ezra]: investment returns the stuff marco witz came up with seventy years ago when

431
00:24:39,139 –> 00:24:41,299
[Don Ezra]: modern portfolio theory started

432
00:24:42,579 –> 00:24:47,539
[Don Ezra]: i think that that’s a completely foreign concept to most people it it’s it’s only

433
00:24:47,699 –> 00:24:52,419
[Don Ezra]: us geeks who get into that kind of thing risk is actually a psychological

434
00:24:52,100 –> 00:24:53,100
[Ramsey Smith]: yeah

435
00:24:52,579 –> 00:24:58,339
[Don Ezra]: question it’s a lifestyle question it’s what is the risk to my lifestyle what are

436
00:24:57,999 –> 00:24:58,999
[Don Ezra]: the things

437
00:24:58,266 –> 00:24:59,266
[Paul Tyler]: but

438
00:24:58,819 –> 00:25:00,179
[Don Ezra]: i might not be able to do

439
00:25:01,219 –> 00:25:06,499
[Don Ezra]: and you have to understand the client’s lifestyle the clients’ goals and fears

440
00:25:07,699 –> 00:25:13,699
[Don Ezra]: and and in in that area the clients the expert and the financial expert is in

441
00:25:13,699 –> 00:25:18,579
[Don Ezra]: fact the person learning from it whereas most of the time the financial expert is

442
00:25:18,579 –> 00:25:23,139
[Don Ezra]: the expert and the client is trying to learn or relate to it but the idea of

443
00:25:23,219 –> 00:25:27,939
[Don Ezra]: saying the client is the expert on himself or herself and you have to learn about

444
00:25:28,019 –> 00:25:34,499
[Don Ezra]: it is very very important then with your financial expertise you can translate

445
00:25:34,659 –> 00:25:40,179
[Don Ezra]: their psychological lifestyle risk into investment terms and you can do that and

446
00:25:40,259 –> 00:25:44,019
[Don Ezra]: they may not understand that and they may not but but you’ve understood it and

447
00:25:44,099 –> 00:25:48,739
[Don Ezra]: that’s what you’ve done and then when you explain the results or when you explain

448
00:25:48,746 –> 00:25:49,746
[Paul Tyler]: school

449
00:25:49,379 –> 00:25:53,859
[Don Ezra]: the basis on which you have made a proposal or given advice et cetera et cetera

450
00:25:54,339 –> 00:25:55,539
[Don Ezra]: you can then relate it to

451
00:25:56,819 –> 00:26:00,979
[Don Ezra]: these are the goals you have here’s what we’re trying to achieve and these are

452
00:26:01,059 –> 00:26:05,539
[Don Ezra]: the things we’re trying to avoid and nothing is ever given this is an uncertain

453
00:26:05,699 –> 00:26:10,259
[Don Ezra]: world and in the investment world is one of the more uncertain parts even in an

454
00:26:10,419 –> 00:26:14,499
[Don Ezra]: uncertain world but here are the kinds of precautions which you’re trying to take

455
00:26:14,599 –> 00:26:15,599
[Don Ezra]: have i

456
00:26:14,986 –> 00:26:15,986
[Paul Tyler]: okay

457
00:26:15,459 –> 00:26:20,739
[Don Ezra]: have i read you right is this is does this sound right to you this is so much

458
00:26:20,899 –> 00:26:26,979
[Don Ezra]: better than a quarterly return then which quartile are you in et cetera etc and i

459
00:26:26,979 –> 00:26:32,259
[Don Ezra]: think it’s that psychological aspect of risk being able to translate investment

460
00:26:32,419 –> 00:26:33,939
[Don Ezra]: risk into lifestyle

461
00:26:35,239 –> 00:26:36,239
[Don Ezra]: effects

462
00:26:36,020 –> 00:26:37,020
[Ramsey Smith]: but that

463
00:26:36,659 –> 00:26:40,899
[Don Ezra]: that that would then distinguish you from the vast majority

464
00:26:42,099 –> 00:26:45,939
[Don Ezra]: of others who are doing this because they are professionals they are very good

465
00:26:46,019 –> 00:26:50,659
[Don Ezra]: professionals they enjoy being professionals but they are only professionals and

466
00:26:50,739 –> 00:26:54,739
[Don Ezra]: experts and not relating to the client and i think

467
00:26:55,939 –> 00:26:57,379
[Don Ezra]: i i think that would make you stand

468
00:26:57,146 –> 00:26:58,146
[Paul Tyler]: yeah

469
00:26:57,239 –> 00:26:58,239
[Don Ezra]: apart

470
00:26:59,846 –> 00:27:01,126
[Paul Tyler]: i think you’re so right around

471
00:27:02,106 –> 00:27:03,106
[Paul Tyler]: risk equaling

472
00:27:04,086 –> 00:27:09,286
[Paul Tyler]: a psychological state of being for me this comes from my journey is home housing

473
00:27:09,346 –> 00:27:10,346
[Paul Tyler]: that’s kind of what

474
00:27:11,386 –> 00:27:12,386
[Paul Tyler]: my

475
00:27:11,700 –> 00:27:12,700
[Ramsey Smith]: see

476
00:27:13,686 –> 00:27:17,366
[Paul Tyler]: center point is okay do i have a house over my head will i have a house or my

477
00:27:17,366 –> 00:27:21,446
[Paul Tyler]: head don you mentioned time time seem to be important five years why why five

478
00:27:21,526 –> 00:27:23,046
[Paul Tyler]: years went up four one at six

479
00:27:22,399 –> 00:27:23,399
[Don Ezra]: oh i’ve

480
00:27:26,259 –> 00:27:29,459
[Don Ezra]: give a take a few years maybe hay somewhere around five

481
00:27:29,386 –> 00:27:30,386
[Paul Tyler]: yeah his

482
00:27:30,339 –> 00:27:35,459
[Don Ezra]: that’s that’s my approximation i mean i think the actual saving for retirement

483
00:27:35,539 –> 00:27:40,019
[Don Ezra]: you need at least twenty to twenty five years you can get started but twenty to

484
00:27:40,099 –> 00:27:44,099
[Don Ezra]: twenty five years ago you get serious and then you get set and all that kind of

485
00:27:43,719 –> 00:27:44,719
[Don Ezra]: stuff

486
00:27:46,099 –> 00:27:49,779
[Don Ezra]: and compound interest has enough time to work if you give it twenty twenty five

487
00:27:49,939 –> 00:27:51,299
[Don Ezra]: years because the base

488
00:27:50,940 –> 00:27:51,940
[Ramsey Smith]: wow

489
00:27:51,379 –> 00:27:55,859
[Don Ezra]: is relatively low in the early years and these are your best earning years etc so

490
00:27:56,099 –> 00:28:00,579
[Don Ezra]: i think that’s okay but all i’m i think all i’m saying five years was a number

491
00:28:00,739 –> 00:28:04,899
[Don Ezra]: that came into my head all i’m saying is that you ought to start thinking about

492
00:28:04,979 –> 00:28:07,459
[Don Ezra]: the psychological aspects the identity question

493
00:28:08,739 –> 00:28:14,099
[Don Ezra]: before you retire and usually it takes some time because it’s not an adjustment

494
00:28:14,179 –> 00:28:18,659
[Don Ezra]: you make overnight it’s a psychological adjustment it’s an adjustment to your

495
00:28:18,819 –> 00:28:23,779
[Don Ezra]: definition of who you are and that takes time five years i haven’t a clue i have

496
00:28:23,939 –> 00:28:25,619
[Don Ezra]: no clue you’re absolutely right yeah

497
00:28:27,139 –> 00:28:31,379
[Don Ezra]: and i think the other one forgive me the other one we haven’t touched on is the

498
00:28:31,539 –> 00:28:38,179
[Don Ezra]: activity rock which is how do i fill my time when i’m not working full time and

499
00:28:38,259 –> 00:28:42,019
[Don Ezra]: whether it’s volunteering a part time career carrying on et cetera there are a

500
00:28:42,099 –> 00:28:47,299
[Don Ezra]: whole bunch of things but there’s one aspect that my friends and even my kids’

501
00:28:47,119 –> 00:28:48,119
[Don Ezra]: generation

502
00:28:49,219 –> 00:28:51,219
[Don Ezra]: they were very amused by this and remembered it

503
00:28:52,579 –> 00:28:57,139
[Don Ezra]: there’s another aspect that’s very important if you have a life partner and that

504
00:28:57,219 –> 00:28:58,339
[Don Ezra]: is that there are two of you

505
00:28:59,379 –> 00:29:03,779
[Don Ezra]: and you are not just a couple you were also two two separate people and so

506
00:29:04,739 –> 00:29:09,619
[Don Ezra]: actually at my my my son’s my son’s wedding i i i i mentioned this to the gang

507
00:29:09,779 –> 00:29:13,779
[Don Ezra]: assemble there my son said say anything you like whatever you say will embarrass

508
00:29:13,779 –> 00:29:17,779
[Don Ezra]: me so just go ahead sorry i said okay so so here here are two circles

509
00:29:19,059 –> 00:29:23,379
[Don Ezra]: your set of interests and your partner set of interest and they have some overlap

510
00:29:24,339 –> 00:29:28,739
[Don Ezra]: and when you meet you notice the overlap and you get all soppy about it oh we

511
00:29:28,819 –> 00:29:33,139
[Don Ezra]: have so much in carbon et cetera et cetera et cetera and then later on you have

512
00:29:34,739 –> 00:29:38,819
[Don Ezra]: the outside bits sometimes if you have kids they get they get

513
00:29:40,179 –> 00:29:44,739
[Don Ezra]: the kids fill the the middle bit and you lose your chance to do your own outside

514
00:29:45,059 –> 00:29:49,779
[Don Ezra]: bit and then if with any luck the kids leave home one day you may find that the

515
00:29:49,859 –> 00:29:56,259
[Don Ezra]: middle overlapping bit is almost empty and that’s why again divorce goes up at

516
00:29:56,339 –> 00:30:02,019
[Don Ezra]: this kind of stage and so what you need to realize is that as i told them the

517
00:30:02,099 –> 00:30:06,339
[Don Ezra]: most romantic thing you can say to each other every anniversary as you hug each

518
00:30:06,419 –> 00:30:10,499
[Don Ezra]: other in kiss and express your love in whatever way you do if you can say in all

519
00:30:10,659 –> 00:30:15,059
[Don Ezra]: honesty to each other all the parts of our venn diagram are healthy

520
00:30:16,099 –> 00:30:19,699
[Don Ezra]: that is a very very romantic thing to say to each other if you can

521
00:30:19,500 –> 00:30:20,500
[Ramsey Smith]: sorry

522
00:30:20,099 –> 00:30:24,899
[Don Ezra]: and so you know the kids this but the whole idea of the venn diagram and keeping

523
00:30:25,139 –> 00:30:28,979
[Don Ezra]: all the parts of your venn diagram healthy in retirement not

524
00:30:28,740 –> 00:30:29,740
[Ramsey Smith]: just

525
00:30:29,219 –> 00:30:31,859
[Don Ezra]: just doing things together but doing things separately as well

526
00:30:32,899 –> 00:30:37,859
[Don Ezra]: is very very important because as i say until covid we didn’t have to spend our

527
00:30:38,099 –> 00:30:42,739
[Don Ezra]: time that much time together now we will have much more time together and so

528
00:30:42,899 –> 00:30:47,139
[Don Ezra]: getting that middle bit and allowing the fact that there are the two outer edges

529
00:30:46,839 –> 00:30:47,839
[Don Ezra]: as well

530
00:30:48,499 –> 00:30:53,379
[Don Ezra]: it’s perfectly legitimate for each person have their own outer edge and do their

531
00:30:53,459 –> 00:30:56,739
[Don Ezra]: own thing you don’t have to be a couple all the time you’re also two separate

532
00:30:56,819 –> 00:30:58,259
[Don Ezra]: people that’s very important

533
00:30:59,539 –> 00:31:03,699
[Don Ezra]: in planning your activities and that will also give a separate sense of purpose i

534
00:31:03,319 –> 00:31:04,319
[Don Ezra]: think

535
00:31:04,646 –> 00:31:09,126
[Paul Tyler]: and if we were to look at sort of the macro balance sheet for happiness and covid

536
00:31:09,206 –> 00:31:12,486
[Paul Tyler]: you kind of introduced it clearly disrupted a lot of people

537
00:31:13,526 –> 00:31:16,806
[Paul Tyler]: however i’ve seen studies and rams you i think i’m i’m sure if somebody’s

538
00:31:16,886 –> 00:31:18,566
[Paul Tyler]: mentioned this on our show or not where

539
00:31:20,086 –> 00:31:24,566
[Paul Tyler]: don you may know where they’ve done studies of people where they live where they

540
00:31:24,806 –> 00:31:29,046
[Paul Tyler]: work you know where their activities are and their life is the closer that

541
00:31:29,366 –> 00:31:34,806
[Paul Tyler]: cluster is in terms of sheer distance generally the happier are now clear some

542
00:31:34,826 –> 00:31:35,826
[Paul Tyler]: outliers people who

543
00:31:38,300 –> 00:31:39,300
[Ramsey Smith]: i think

544
00:31:38,486 –> 00:31:42,966
[Paul Tyler]: stayed together because they were not together but do you think this has brought

545
00:31:38,486 –> 00:31:42,966
[Paul Tyler]: stayed together because they were not together but do you think this has brought

546
00:31:43,206 –> 00:31:47,526
[Paul Tyler]: you know do you think happiness has gone up collectively as a result of kind of

547
00:31:43,206 –> 00:31:47,526
[Paul Tyler]: you know do you think happiness has gone up collectively as a result of kind of

548
00:31:47,846 –> 00:31:52,166
[Paul Tyler]: slowing down being all sort of parked and home or or you you couldn’t say

549
00:31:47,846 –> 00:31:52,166
[Paul Tyler]: slowing down being all sort of parked and home or or you you couldn’t say

550
00:31:52,259 –> 00:31:57,219
[Don Ezra]: i have absolutely no idea whatsoever this is something i would wait to see the

551
00:31:57,299 –> 00:32:01,779
[Don Ezra]: united nations happiness survey they do a survey every year and i would wait to

552
00:32:01,779 –> 00:32:05,299
[Don Ezra]: see the results and see not only is it gone up or down but are there some

553
00:32:05,379 –> 00:32:08,499
[Don Ezra]: countries where it’s gone up and somewhere it’s gone down etc and then see what

554
00:32:08,579 –> 00:32:10,979
[Don Ezra]: you learn from that i have i have absolutely no idea

555
00:32:12,019 –> 00:32:16,019
[Don Ezra]: but but i think it’s brought the notion that we are

556
00:32:16,100 –> 00:32:17,100
[Ramsey Smith]: i am

557
00:32:17,059 –> 00:32:18,419
[Don Ezra]: two people as well as a couple

558
00:32:19,439 –> 00:32:20,439
[Don Ezra]: um to the four

559
00:32:21,459 –> 00:32:25,699
[Don Ezra]: because we’ve been forced to confront that and for some people this is good and

560
00:32:25,779 –> 00:32:26,979
[Don Ezra]: for some people it’s not good

561
00:32:28,560 –> 00:32:35,600
[Ramsey Smith]: so you’ve now in this in this new chapter you you’re evangelizing this very

562
00:32:35,840 –> 00:32:40,080
[Ramsey Smith]: important these is very important concepts you’ve written written a book well

563
00:32:40,240 –> 00:32:44,880
[Ramsey Smith]: long book and then and a shorter version of it and you’ve got your blog how much

564
00:32:44,960 –> 00:32:50,640
[Ramsey Smith]: is this going to continue to be part of your activity to to spread this to spread

565
00:32:50,720 –> 00:32:53,200
[Ramsey Smith]: this knowledge in this philosophy sort of more broadly

566
00:32:54,259 –> 00:33:00,099
[Don Ezra]: oh i i love it i’m absolutely pathetic at selling always have been which is why i

567
00:33:00,319 –> 00:33:01,319
[Don Ezra]: became a consultant

568
00:33:02,339 –> 00:33:07,779
[Don Ezra]: and so i have no idea how to propagate this so i write for my own benefit

569
00:33:07,900 –> 00:33:08,900
[Ramsey Smith]: i like

570
00:33:08,579 –> 00:33:10,499
[Don Ezra]: i write to explain something to myself

571
00:33:10,340 –> 00:33:11,340
[Ramsey Smith]: i

572
00:33:11,239 –> 00:33:12,239
[Don Ezra]: i find that

573
00:33:11,780 –> 00:33:12,780
[Ramsey Smith]: think about

574
00:33:12,179 –> 00:33:14,419
[Don Ezra]: if you think about something and you think you know it

575
00:33:14,580 –> 00:33:15,580
[Ramsey Smith]: you watch

576
00:33:15,139 –> 00:33:19,459
[Don Ezra]: until you actually write it down you don’t really know it because writing slows

577
00:33:19,539 –> 00:33:25,779
[Don Ezra]: you down and you don’t go from a to d to m to x you go a b c d and suddenly you

578
00:33:25,859 –> 00:33:29,539
[Don Ezra]: find my god i may never get to m it because the logic is taking me somewhere else

579
00:33:29,779 –> 00:33:34,259
[Don Ezra]: so i write for myself so i write in the first person i because i’m doing the

580
00:33:34,499 –> 00:33:39,619
[Don Ezra]: explaining and the person i’m writing to is also myself that’s the i’ve got two

581
00:33:39,619 –> 00:33:43,939
[Don Ezra]: bodies i’m i’m the speaker and the listener and so when i say you that’s also me

582
00:33:43,879 –> 00:33:44,879
[Don Ezra]: and

583
00:33:44,020 –> 00:33:45,020
[Ramsey Smith]: work

584
00:33:44,499 –> 00:33:48,739
[Don Ezra]: then i write that stuff and at the end i see have i understood this or not have i

585
00:33:48,899 –> 00:33:54,099
[Don Ezra]: have i encountered a block or not so i just write for myself and when friends say

586
00:33:54,339 –> 00:33:58,419
[Don Ezra]: this is good stuff that got me started on you know put it together in a book et

587
00:33:58,419 –> 00:34:04,499
[Don Ezra]: cetera et cetera et cetera and so the fulfillment i get from from the website is

588
00:34:04,279 –> 00:34:05,279
[Don Ezra]: that every

589
00:34:04,660 –> 00:34:05,660
[Ramsey Smith]: years

590
00:34:05,139 –> 00:34:07,219
[Don Ezra]: now and again i don’t know every few months

591
00:34:07,180 –> 00:34:08,180
[Ramsey Smith]: so you

592
00:34:07,539 –> 00:34:11,539
[Don Ezra]: someone will write to me and say you know i’m in australia i’m in south africa

593
00:34:11,859 –> 00:34:15,619
[Don Ezra]: i’ve just done this i’ve just done that and you helped me enormously in this and

594
00:34:15,699 –> 00:34:19,299
[Don Ezra]: someone else once told me it was like being hit in the head by a two

595
00:34:18,986 –> 00:34:19,986
[Paul Tyler]: eight

596
00:34:19,459 –> 00:34:24,419
[Don Ezra]: by four i really have to do this and never realize it etc and those those are my

597
00:34:24,239 –> 00:34:25,239
[Don Ezra]: rewards

598
00:34:26,019 –> 00:34:27,539
[Don Ezra]: that that to me is the

599
00:34:27,466 –> 00:34:28,466
[Paul Tyler]: thank

600
00:34:27,619 –> 00:34:33,059
[Don Ezra]: feedback that says oh my god you’ve helped someone somewhere and i don’t know how

601
00:34:33,139 –> 00:34:36,659
[Don Ezra]: many people in my pension consulting career i actually

602
00:34:36,780 –> 00:34:37,780
[Ramsey Smith]: do you

603
00:34:36,979 –> 00:34:43,139
[Don Ezra]: helped i i may have helped institutions i did not help people and my life is now

604
00:34:43,699 –> 00:34:48,019
[Don Ezra]: people oriented as opposed to institution oriented my focus has changed from

605
00:34:48,179 –> 00:34:51,139
[Don Ezra]: institutional investing and finance to individual

606
00:34:51,980 –> 00:34:52,980
[Ramsey Smith]: i don’t know

607
00:34:52,099 –> 00:34:58,339
[Don Ezra]: investing in finance and happiness and that’s that’s in a way my my my purpose

608
00:34:58,380 –> 00:34:59,380
[Ramsey Smith]: oh that

609
00:34:59,619 –> 00:35:00,899
[Don Ezra]: and and that as i say

610
00:35:02,499 –> 00:35:07,219
[Don Ezra]: that will that i hope will create some kind of emotional legacy that goes beyond

611
00:35:07,379 –> 00:35:10,819
[Don Ezra]: family and friends to people who read it and say my god that really helped i

612
00:35:10,979 –> 00:35:16,099
[Don Ezra]: really like that thank you and that’s that’s my reward and i’m i’m absolutely

613
00:35:16,179 –> 00:35:21,779
[Don Ezra]: thrilled with it and if if the book doesn’t sell i really don’t care i mean

614
00:35:21,500 –> 00:35:22,500
[Ramsey Smith]: hm

615
00:35:22,179 –> 00:35:25,939
[Don Ezra]: once as far as i’m concerned i mean i had a best selling book pension fund

616
00:35:26,019 –> 00:35:30,019
[Don Ezra]: excellence that’s sold ten thousand plus copies which is an awful lot in these

617
00:35:30,099 –> 00:35:32,259
[Don Ezra]: terms my my happiness and and

618
00:35:32,180 –> 00:35:33,180
[Ramsey Smith]: smoke

619
00:35:32,499 –> 00:35:37,859
[Don Ezra]: and life two books have each sold a thousand plus copies and if it hits a

620
00:35:37,939 –> 00:35:40,259
[Don Ezra]: thousand i’ve been absolutely thrilled with that

621
00:35:40,666 –> 00:35:41,666
[Paul Tyler]: i

622
00:35:40,819 –> 00:35:45,299
[Don Ezra]: totally thrilled that’s a success to me best seller list hell no not a chance

623
00:35:45,539 –> 00:35:50,019
[Don Ezra]: forget it but that’s not the goal the goal is self satisfaction in learning

624
00:35:51,539 –> 00:35:56,979
[Don Ezra]: in being able to keep learning and to explain and every now and again something

625
00:35:57,299 –> 00:36:00,899
[Don Ezra]: gets through to someone that’s m that’s my that’s my reward

626
00:36:00,806 –> 00:36:05,846
[Paul Tyler]: oh this is great now the book is called life two love the title we will put a

627
00:36:05,926 –> 00:36:10,886
[Paul Tyler]: link in our show notes and we i know don will sell a few more for you so

628
00:36:11,626 –> 00:36:12,626
[Paul Tyler]: love

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00:36:11,959 –> 00:36:12,959
[Don Ezra]: thank you

630
00:36:12,326 –> 00:36:14,166
[Paul Tyler]: to put a zero on that but you know we’ll look

631
00:36:14,239 –> 00:36:15,239
[Don Ezra]: thank you

632
00:36:15,046 –> 00:36:18,726
[Paul Tyler]: think i don’t ramsay any what are your final thoughts or questions for don

633
00:36:19,280 –> 00:36:23,760
[Ramsey Smith]: no i think we i think we i think we covered it i think we covered the the key

634
00:36:23,920 –> 00:36:27,920
[Ramsey Smith]: elements there’s really this existential link between

635
00:36:29,040 –> 00:36:31,760
[Ramsey Smith]: quality of life issues identity activity and

636
00:36:32,800 –> 00:36:37,680
[Ramsey Smith]: money decisions and money happiness and and that’s really where we really really

637
00:36:37,840 –> 00:36:39,920
[Ramsey Smith]: nailed that today so thanks thanks for coming don

638
00:36:39,986 –> 00:36:40,986
[Paul Tyler]: yeah dawn

639
00:36:41,219 –> 00:36:45,059
[Don Ezra]: my pleasure my pleasure you made this very may i say you’ve made this very easy

640
00:36:45,379 –> 00:36:50,739
[Don Ezra]: for me i am a i i do this a lot but i am a very very very nervous performer and

641
00:36:50,819 –> 00:36:53,219
[Don Ezra]: you have made this an absolute joy thank you

642
00:36:52,586 –> 00:36:53,586
[Paul Tyler]: oh no thank

643
00:36:53,740 –> 00:36:54,740
[Ramsey Smith]: our pleasure

644
00:36:53,846 –> 00:36:58,326
[Paul Tyler]: thank you our pleasure and uh all our listeners thanks for listening check out

645
00:36:58,226 –> 00:36:59,226
[Paul Tyler]: the show notes

646
00:37:00,566 –> 00:37:04,326
[Paul Tyler]: buy the book look at the website reach out to don we’ll put some links here and

647
00:37:04,486 –> 00:37:08,086
[Paul Tyler]: join us again next week for another episode of that annuity show

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 147: Preparing for Life 2 With Don Ezra
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Episode 146: Your Marketing Must Go Digital With Greg Dinetz

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Everything in marketing changed with the pandemic. If you don’t have a digital presence, you will not grow in the future. However, the first place to start is usually on improving your core business processes. Greg Dinetz, Co-Founder of Lone Beacon joins us today to talk about how examining your customer experience will uncover the most important digital holes for you to fill first.
Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.
We hope you enjoy the show.
Links mentioned in the show:

Thank you to our show sponsor; The Index Standard!

Fixed Index Annuities and RILAs are getting more complex and technical just when fiduciary rules are getting stricter. How do you choose the right index and allocate to them? The Index Standard is your answer. They are an independent provider ratings and forecasts on all indices and ETFs used in the US insurance space. Their process is systematic and unbiased, identifying robust and well-designed indices. We all know finance is complex and The Index Standard has a clear ratings system and uses approachable language to demystify this complexity. Visit theindexstandard.com for more information.

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Transcript

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 146: Your Marketing Must Go Digital With Greg Dinetz
read more

Episode 145: Diving Deep into the Power of Annuities With Michael Finke

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In this business, we have all heard about the ability of annuities to create a guaranteed income in retirement. Today, Michael Finke, investments/retirement professor and Frank M. Engle Chair of Economic Security Research at The American College joins us  to bring the actual numbers into sharper focus.
Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.
We hope you enjoy the show.
Links mentioned today:

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Transcript

1
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[Paul Tyler]: hi this is paul

3
00:00:02,480 –> 00:00:06,960
[Paul Tyler]: tyler and welcome to another episode of that annuity show ramsey welcome

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[Ramsey Smith]: thank you it’s great to be back live from new york city having a good time

5
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[Paul Tyler]: yeah and yeah it’s good to see you

7
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[Paul Tyler]: so we’ve had kind of an

8
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[Michael Finke]: hundred and

9
00:00:15,520 –> 00:00:20,240
[Paul Tyler]: interesting series of discussions about rules of thumb for a variety of topics

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[Paul Tyler]: including withdrawal and mr bill bengen joined us a week or two ago to talk about

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[Paul Tyler]: the four percent rule

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[Paul Tyler]: and

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[Michael Finke]: sure

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[Paul Tyler]: we’ve got a great discussion teed up with somebody else who’s a very important

15
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[Paul Tyler]: voice in

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[Paul Tyler]: understanding how that may work do you want to introduce our our guest ramsey

17
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[Ramsey Smith]: sure absolutely so delighted to be joined today by michael finke he is he is

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[Ramsey Smith]: one of you know number of sort of very important voices of what i like to call the

19
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[Ramsey Smith]: academic and sort of pragmatic cabal in

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[Ramsey Smith]: retirement uh in retirement research

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[Michael Finke]: hm

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[Ramsey Smith]: and we’re just delighted to have him he’s the professor of wealth management at

23
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[Ramsey Smith]: the american college of financial services and he is the frank m

24

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[Ramsey Smith]: angle chair of economic security

26
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[Ramsey Smith]: so

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[Michael Finke]: yeah

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[Ramsey Smith]: michael

29
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[Ramsey Smith]: it’s been we should have done this six months ago a year ago delighted to have you

30
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[Ramsey Smith]: on

31
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[Ramsey Smith]: so many things to talk about

32
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[Ramsey Smith]: let’s get right into it i would like to first of all find out

33
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[Ramsey Smith]: what you’ve been focusing on you know most recently in your you know in your

34
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[Ramsey Smith]: travels and your practice

35

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[Michael Finke]: well i topic

37
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[Michael Finke]: a couple of topics ramsey so first of all great to be here

38
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[Michael Finke]: just as a way of background this is one of

39
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[Michael Finke]: i

40
00:01:40,217 –> 00:01:45,577
[Michael Finke]: those topics that i’ve been working on now for over a decade it’s been i think now

41
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[Michael Finke]: ten years

42
00:01:45,860 –> 00:01:46,860
[Paul Tyler]: yeah

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[Michael Finke]: since wade vow and david blanchett and i wrote the original article criticizing

44
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[Michael Finke]: the

45
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[Michael Finke]: four percent rule in a low interest rate environment

46
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[Ramsey Smith]: yeah

47
00:01:56,317 –> 00:01:57,317
[Michael Finke]: and since then

48
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[Michael Finke]: like that

49
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[Michael Finke]: i’ve done a lot of different studies on

50
00:02:01,257 –> 00:02:07,097
[Michael Finke]: understanding what risk means in retirement helping clarify the idea of

51
00:02:08,117 –> 00:02:09,117
[Michael Finke]: taking risk

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[Michael Finke]: oh yeah

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[Michael Finke]: by investing in stocks and bonds and

54
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[Michael Finke]: bed

55
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[Michael Finke]: understanding what happens when things go well and when things don’t t go not so

56
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[Michael Finke]: well

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[Michael Finke]: uh what if they

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[Michael Finke]: and one

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[Ramsey Smith]: i think

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[Michael Finke]: of the things that i’ve been thinking a lot about over the last year or two is

61
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[Michael Finke]: this idea of a fixed withdrawal rate and a certain amount

62
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[Michael Finke]: you know

63
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[Michael Finke]: of safety so the whole

64
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[Michael Finke]: like

65
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[Michael Finke]: idea of a monte carlo analysis so if you run one of these monte carlo analyses

66
00:02:34,057 –> 00:02:39,257
[Michael Finke]: which by the way it is just a randomizer it has a distribution of returns that you

67
00:02:39,337 –> 00:02:42,697
[Michael Finke]: can get on an investment portfolio you have to plug in your expected returns your

68
00:02:42,857 –> 00:02:47,257
[Michael Finke]: expected standard deviation it’ll spit out an asset return the first year’ll

69
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[Michael Finke]: simulate

70
00:02:47,563 –> 00:02:48,563
[Michael Finke]: about

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[Michael Finke]: thousands of retirements you know sometimes people get lucky sometimes people get

72
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[Michael Finke]: unlucky

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[Michael Finke]: but i didn’t

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[Michael Finke]: but i think when you run a money carlo just and you just do it at one point in

75
00:02:56,857 –> 00:03:01,497
[Michael Finke]: time it gives you this idea that you’re ninety five percentage safe or ninety

76
00:03:01,577 –> 00:03:05,257
[Michael Finke]: ninety percent safe what does that safety mean it means that you can withdraw a

77
00:03:05,337 –> 00:03:09,657
[Michael Finke]: certain amount of money every year from a retirement portfolio and this is

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[Michael Finke]: really

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00:03:09,737 –> 00:03:11,657
[Michael Finke]: really the idea behind bill

80
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[Michael Finke]: bacon

81
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[Michael Finke]: begin’s work is let’s look at historical time periods and let’s see how much you

82
00:03:17,017 –> 00:03:21,257
[Michael Finke]: could have withdrawn from an investment portfolio of stocks and bonds safely

83
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[Michael Finke]: historically

84
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[Michael Finke]: and one of the points

85
00:03:24,343 –> 00:03:26,023
[Michael Finke]: the white on

86
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[Michael Finke]: that i think is not covered enough

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[Michael Finke]: he he want a money car

88
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[Michael Finke]: is that when you run a money carlo and you’re doing a simulation and you’re

89
00:03:31,943 –> 00:03:33,143
[Michael Finke]: i remember that

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00:03:32,057 –> 00:03:35,177
[Michael Finke]: trying to capture what asset returns are probably going to look like in the future

91
00:03:35,417 –> 00:03:39,417
[Michael Finke]: because again we’re in a low interest rate environment we have very high prices on

92
00:03:39,657 –> 00:03:44,857
[Michael Finke]: risky assets like stocks that’s going to adjust our expectations of returns

93
00:03:44,937 –> 00:03:49,737
[Michael Finke]: downward what sort of a risk does that involve does that change the mechanics of

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00:03:49,817 –> 00:03:50,857
[Michael Finke]: the four percent rule

95
00:03:51,003 –> 00:03:52,003
[Michael Finke]: but also

96
00:03:51,497 –> 00:03:56,457
[Michael Finke]: but also what happens when you get unlucky and to me that is the one area of

97
00:03:56,537 –> 00:04:02,377
[Michael Finke]: retirement income planning that is not discussed enough so if you get unlucky the

98
00:04:02,457 –> 00:04:06,937
[Michael Finke]: first year of retirement so for example you experience something like investors

99
00:04:07,097 –> 00:04:08,377
[Michael Finke]: experienced in two thousand

100
00:04:08,283 –> 00:04:09,283
[Michael Finke]: you

101
00:04:08,697 –> 00:04:14,617
[Michael Finke]: eight how much does that affect the safe withdrawal rate now we

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[Michael Finke]: no

103
00:04:14,777 –> 00:04:18,777
[Michael Finke]: know that you may have had a ninety percent chance of success the first year of

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[Michael Finke]: retirement but

105
00:04:19,483 –> 00:04:20,483
[Michael Finke]: back in the

106
00:04:19,737 –> 00:04:23,657
[Michael Finke]: that can go down to a sixty percentage chance of success that you’re going to be

107
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[Michael Finke]: able to maintain the same lifestyle if you have a two thousand eight occur and

108
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[Michael Finke]: that might

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[Michael Finke]: that gets into this idea of the

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[Michael Finke]: we

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[Michael Finke]: requirement of spending

112
00:04:32,283 –> 00:04:33,283
[Michael Finke]: like

113
00:04:32,697 –> 00:04:40,137
[Michael Finke]: flexibility if you have no safety net you have to be able to adjust your spending

114
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[Michael Finke]: downward if you want to maintain the same probability of success

115
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[Michael Finke]: and

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[Michael Finke]: you

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[Michael Finke]: there’s no getting around that you know people they just cling to

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[Michael Finke]: like

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[Michael Finke]: this idea that

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[Michael Finke]: he couldn’t

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[Michael Finke]: because you had a ninety percentage chance of success the first year of retirement

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[Michael Finke]: you always have a ninety percentage chance of success

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00:04:57,723 –> 00:04:58,723
[Michael Finke]: the

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[Michael Finke]: but that changes every

125
00:04:59,500 –> 00:05:00,500
[Ramsey Smith]: it’s still nice

126
00:04:59,657 –> 00:05:06,057
[Michael Finke]: day every day you’re a chance of being able to maintain a given income changes and

127
00:05:06,123 –> 00:05:07,123
[Michael Finke]: whatever

128
00:05:06,537 –> 00:05:09,817
[Michael Finke]: whatever asset prices were the first day of retirement which are very high

129
00:05:09,483 –> 00:05:10,483
[Michael Finke]: right

130
00:05:09,977 –> 00:05:13,657
[Michael Finke]: right now that’s irrelevant a year from now if you would have just waited a year

131
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[Michael Finke]: of retirement to retire and you went from a million dollars down to seven hundred

132
00:05:17,917 –> 00:05:18,917
[Michael Finke]: fifty thousand dollars

133
00:05:18,683 –> 00:05:19,683
[Michael Finke]: that

134
00:05:19,097 –> 00:05:23,497
[Michael Finke]: all of a sudden your four percent rule would be thirty thousand dollars instead of

135
00:05:23,437 –> 00:05:24,437
[Michael Finke]: forty thousand dollars

136
00:05:24,903 –> 00:05:27,463
[Michael Finke]: yeah i been thinking bi that

137
00:05:24,937 –> 00:05:29,417
[Michael Finke]: and i think it’s one of these ideas that people don’t give enough thought to that

138
00:05:29,497 –> 00:05:31,657
[Michael Finke]: if you want to maintain the same probability of success

139
00:05:32,697 –> 00:05:34,937
[Michael Finke]: your spending path has to be

140
00:05:34,763 –> 00:05:35,763
[Michael Finke]: why

141
00:05:35,257 –> 00:05:39,737
[Michael Finke]: widely variable that was a very long answer to what are you working on right now

142
00:05:40,437 –> 00:05:41,437
[Michael Finke]: but it’s one

143
00:05:40,923 –> 00:05:41,923
[Michael Finke]: what

144
00:05:41,417 –> 00:05:44,937
[Michael Finke]: of these things that i feel very passionate about that’s not discussed enough is

145
00:05:45,177 –> 00:05:50,857
[Michael Finke]: the requirement of spending variability if you have no safety net because you have

146
00:05:50,937 –> 00:05:53,737
[Michael Finke]: to avoid that worst possible outcome

147
00:05:55,920 –> 00:05:59,360
[Paul Tyler]: so i it’s interesting you mentioned control and expenses

148
00:05:55,943 –> 00:05:59,383
[Michael Finke]: so it’s interesting you mentioned control and expenses

149
00:06:01,760 –> 00:06:06,080
[Paul Tyler]: i listened to you know susie armon the other day on one of her our shows interest

150
00:06:01,783 –> 00:06:06,103
[Michael Finke]: i listened to you know susie arman the other day in one of her hour shows interest

151
00:06:06,480 –> 00:06:09,360
[Paul Tyler]: interesting i just really wanted to sort of catch up and hear what she’s doing and

152
00:06:06,503 –> 00:06:09,463
[Michael Finke]: interesting i just really wanted to sort of catch up and hear what she’s doing and

153
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[Paul Tyler]: michael her her advice always also seems to come back to yeah but

154
00:06:10,023 –> 00:06:13,543
[Michael Finke]: michael her her advice always seems to come back to yeah but

155
00:06:14,880 –> 00:06:19,200
[Paul Tyler]: you know lower your cost of lower expenses that is one thing i have in my own

156
00:06:14,903 –> 00:06:19,303
[Michael Finke]: you know lower your cost of lower expenses that is one thing i have in my own

157
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[Paul Tyler]: control

158
00:06:19,243 –> 00:06:20,243
[Michael Finke]: control

159
00:06:20,800 –> 00:06:22,400
[Paul Tyler]: is managing expenses down

160
00:06:20,823 –> 00:06:22,503
[Michael Finke]: is managing expenses down

161
00:06:23,440 –> 00:06:28,080
[Paul Tyler]: as you go into retirement a hard thing to do or is it easier is it natural do you

162
00:06:23,463 –> 00:06:28,183
[Michael Finke]: as you go into retirement a hard thing to do or is it easier is it natural do you

163
00:06:28,160 –> 00:06:31,920
[Paul Tyler]: have any sense of what that pattern looks like for a typical senior

164
00:06:28,183 –> 00:06:31,943
[Michael Finke]: have any sense of what that pattern looks like for a typical senior

165
00:06:33,337 –> 00:06:34,457
[Michael Finke]: well this is a great

166
00:06:34,363 –> 00:06:35,363
[Michael Finke]: but

167
00:06:34,777 –> 00:06:39,097
[Michael Finke]: question so i think at the beginning of retirement the first step needs to be to

168
00:06:39,177 –> 00:06:44,697
[Michael Finke]: look at your expenses and to identify which of those expenses is flexible and

169
00:06:44,857 –> 00:06:50,057
[Michael Finke]: which of those expenses is not flexible your property tax is clearly inflexible

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[Michael Finke]: your health care is inflexible paying for insurance on your car is inflexible all

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[Michael Finke]: of these expenses represent about

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[Michael Finke]: but

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[Michael Finke]: seventy percent of a retirees’ budget

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[Michael Finke]: and it does not make sense to fund those expenses using risky assets because you

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[Michael Finke]: cannot withstand a drop in value

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[Michael Finke]: but you can fund those expenses with safe assets so things like social security or

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[Michael Finke]: a pension or an annuity or maybe a bond ladder and here’s where it gets

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[Michael Finke]: interesting because if you fund it with a bond ladder versus an annuity we know

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[Michael Finke]: that you spend less each year or it requires more money up front you have to

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[Michael Finke]: allocate more money up front to fund those basic expenses now the second part of

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[Michael Finke]: the equation is the flexible expenses of those flexible expenses

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[Paul Tyler]: yeah

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[Michael Finke]: how willing are you to cut back

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[Michael Finke]: okay

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[Michael Finke]: if markets don’t perform well

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[Michael Finke]: how about

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[Michael Finke]: and a lot of people they look at their gym membership and they say that well

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[Michael Finke]: that’s

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[Michael Finke]: what

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[Michael Finke]: not that flexible of an expense my vacations are not that flexible of inexpensive

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[Michael Finke]: my going out to dinner with friends is not that flexible of an expense therefore i

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[Michael Finke]: am not willing to adjust my spending significantly if markets don’t perform well

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[Michael Finke]: remember the whole point of taking investment risk is that you’re hoping to

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[Michael Finke]: get

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[Michael Finke]: good

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[Paul Tyler]: thank you

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[Michael Finke]: a higher return

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[Michael Finke]: but you have to accept risk in retirement what risk means is the possibility of

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[Michael Finke]: spending less so the question you have to ask yourself is are you willing to

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[Michael Finke]: accept the possibility of spending less on going out to dinner with friends in

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[Michael Finke]: order to

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[Michael Finke]: about

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[Michael Finke]: have on average more money to go out to dinner with

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[Paul Tyler]: yeah

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[Michael Finke]: friends in the future that’s the trade off all retirees need to accept and anybody

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[Michael Finke]: who tries to say that you don’t have to make that trade off does not understand

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[Michael Finke]: the basic economic concept of risk risk is real if it wasn’t real we wouldn’t get

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[Michael Finke]: rewarded for taking it but it does mean that we have to be thinking about our

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[Michael Finke]: spending first when we’re developing a retirement income investment plan

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[Ramsey Smith]: so that’s a

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[Ramsey Smith]: it’s it’s a concept that’s that’s very compelling and

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[Ramsey Smith]: there’s some interesting sort of second sort of in my mind two ways to look at it

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[Ramsey Smith]: obviously there’ the expenses that are clearly inflexible right so that the true

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[Ramsey Smith]: fixed costs and then there are others that that aren’t flexible um but for

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[Ramsey Smith]: personal utility reasons people want to treat them as as as is inflexible and why

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[Ramsey Smith]: i find that interesting is that that potentially opens up the use case for

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[Ramsey Smith]: annuities to a broader socioeconomic audience so maybe there are wealthier people

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[Ramsey Smith]: that that ultimately are determined that there is a lifestyle that they want to

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[Ramsey Smith]: lead

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[Ramsey Smith]: that again

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[Ramsey Smith]: there may be activities that aren’t absolutely necessary but they’ve decided for

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[Ramsey Smith]: sure they want to pursue them

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[Michael Finke]: well

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[Ramsey Smith]: and the question is should those sort of voluntary inflect i’ll call them

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[Michael Finke]: oh

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[Ramsey Smith]: voluntary and flexible expenses is there a use case for greater use of annuities

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[Ramsey Smith]: is for coverage of that part

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[Ramsey Smith]: of their income needs as well

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[Ramsey Smith]: i’m not sure if that’s part of the conversation but i’ve always thought that that

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[Ramsey Smith]: was another sort of additional use case

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[Michael Finke]: what is the weather i

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[Michael Finke]: when i interview retirees sometimes what i hear is

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[Michael Finke]: yeah

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[Michael Finke]: they’re

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[Michael Finke]: very crowd

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[Michael Finke]: very proud of the fact that they’re not spending that much in retirement

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[Michael Finke]: yes

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[Michael Finke]: and

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[Michael Finke]: i

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[Michael Finke]: like

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[Michael Finke]: say great you know it’s great that you’re using coupons or going out to the two

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[Michael Finke]: for one dinner early you’re not taking too many vacations you’re not spending too

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[Michael Finke]: much money you must really want to give more money to your kids

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[Michael Finke]: and then what i very often hear is

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[Ramsey Smith]: hey

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[Michael Finke]: no well you know they have plenty of money i i help them pay for their education

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[Michael Finke]: they make more money than i ever did and then there is this silence this sort of

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[Michael Finke]: see

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[Michael Finke]: realization that there’s only two places your money can go in retirement you can

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[Michael Finke]: either give it to other people

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[Michael Finke]: or you can spend it to live better now spending it to live better could mean

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[Michael Finke]: spending it on fun stuff it can it can mean giving money to a grandkid to help

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[Michael Finke]: them with something that they want to be able to do

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[Michael Finke]: like

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[Michael Finke]: but it’s still spending and you know it’s it’s the the the objective no matter how

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[Michael Finke]: much money you have is what plan can i use that will allow me for the portion of

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[Michael Finke]: my wealth that i want to devote to my lifestyle how much what

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[Michael Finke]: what

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[Michael Finke]: what what

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[Michael Finke]: strategy can i use that’s going to allow me to spend the most money every year and

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[Paul Tyler]: or something

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[Michael Finke]: the big

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[Michael Finke]: big mar

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[Michael Finke]: barrier is that you don’t know how long you’re going to live and you don’t know

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[Michael Finke]: the returns you’re going to receive on your investments therefore

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[Michael Finke]: optimally you’ll cut back you won’t spend as much because you want to avoid the

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[Michael Finke]: risk of potentially

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[Michael Finke]: yeah

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[Michael Finke]: running out it’s like if you’re in a circus and they take away the safety net

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[Michael Finke]: you’re not going to take as many risks because the downside is far worse but if

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[Michael Finke]: you can somehow take away the risk of that potential downside from living too long

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[Michael Finke]: or getting bad investment returns that frees you up to spend more money especially

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[Michael Finke]: when the money can do the most good in terms of your lifestyle in your sixty

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[Michael Finke]: seconds and seventy seconds when your physical and cognitive abilities are

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[Michael Finke]: sharpest as opposed to you know in your ninety seconds when you know so how many

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[Michael Finke]: people do you see that end up in their nineties with more money than they can ever

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[Michael Finke]: spend and in essence what they’ve done is they’ve been overly cautious especially

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[Michael Finke]: if they don’t have a strong motive to give the money to someone else you know they

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[Michael Finke]: at the last minute that they could have lived better but they didn’t because of

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[Michael Finke]: that potential fear and you know

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[Michael Finke]: annuitity the whole point of it is let’s take away that source of risk to free you

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[Michael Finke]: think

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[Michael Finke]: up to be able to spend more especially when you can enjoy the money the most

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[Paul Tyler]: so how many retirement plans michael do you think a retiree actually needs i mean

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[Michael Finke]: so how many retirement plans michael do you think a retiree actually

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[Michael Finke]: mm hm

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[Michael Finke]: needs i mean again back to sort of rules of thumb well meet with ramsay your

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[Paul Tyler]: again back to sort of rules of thumb well meet with ramsey your advisor once a

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[Michael Finke]: advisor once a year once a quarter review how your portfolio is going

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[Paul Tyler]: year once a quarter review how your portfolio is going

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[Michael Finke]: oh

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[Paul Tyler]: sounds to me like there may be three major you maybe you’re redoing your plan in a

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[Michael Finke]: sounds to me like there may be three major you may maybe you’re you’re redoing

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[Michael Finke]: your plan in a significant

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[Michael Finke]: oh

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[Paul Tyler]: significant way what three times four times in the course of retirement do you

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[Michael Finke]: way what three times four times in the course of retirement do you have any sense

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[Paul Tyler]: have any sense at how

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[Michael Finke]: at how many how this actually works in practice with retirees who say you yeah

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[Paul Tyler]: how this actually works in practice with retirees who say you yeah i

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[Paul Tyler]: i i will end up with too much money and my kids don’t need it so why am i why am i

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[Michael Finke]: i i end up with too much money and my kids don’t need it so why am i pinching

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[Paul Tyler]: pinching pennies here i want i wanna go on the vacation

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[Michael Finke]: pennies here i want i wanna go on the vacation

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[Michael Finke]: well you know ideally

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[Michael Finke]: it

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[Michael Finke]: if technology advances enough

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[Michael Finke]: yes

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[Michael Finke]: and you know this may

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[Michael Finke]: he

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[Michael Finke]: not be something that requires constant meetings because you’re going to be given

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[Michael Finke]: the information you need to guide you towards making the right decisions your

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[Michael Finke]: portfolio is going to be automatically rebalanced you are going to have that

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[Michael Finke]: protection you’re going to have an idea a guideline about how much you can safely

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[Michael Finke]: spend

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[Michael Finke]: then you know part of the value of going to advisor obviously is well beyond the

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[Michael Finke]: retirement income plan it is

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[Michael Finke]: first of all

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[Michael Finke]: i

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[Michael Finke]: deciding how much you want to pass on to others what is the most efficient way to

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[Michael Finke]: do that how much you want to spend what is the most efficient way to do that

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[Michael Finke]: adjusting along the way

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[Paul Tyler]: eight

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[Michael Finke]: having a voice of comfort so that you don’t freak out when markets fall these are

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[Michael Finke]: all the things that advisors provide tax efficiency understanding rds all the rest

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[Michael Finke]: of it now there’s a huge amount of value that an advisor provides but when it

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[Michael Finke]: comes to the retirement income aspect ideally you put it on autopilot and i think

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[Michael Finke]: one of the reasons why you want to put it on

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[Paul Tyler]: that’s true

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[Michael Finke]: autopilot is that especially as you get to your eighty seconds and ninety seconds

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[Michael Finke]: your you ability to manage an investment portfolio

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[Michael Finke]: is not the same as it was in your sixty second and seventies and decide how much

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[Michael Finke]: you can safely withdraw from that investment portfolio

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[Michael Finke]: it’s good to have professional help to do that not everybody has access to that

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[Michael Finke]: kind of professional help

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[Michael Finke]: for them what i’m hoping is that we eventually get to a point where people first

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[Michael Finke]: of all don’t have to worry about running out of money and second of all have a

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[Michael Finke]: clearer idea of how much they can

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[Paul Tyler]: what

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[Michael Finke]: spend every year

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[Ramsey Smith]: fascinating

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[Ramsey Smith]: so

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[Ramsey Smith]: one of the um one of the other things that uh that you’ve been talking about

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[Ramsey Smith]: recently uh is a social security claiming and you’ve also been talking about

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[Ramsey Smith]: contingent deferred annuities why we start with social security claiming what it

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[Ramsey Smith]: it’s a a it’s a topic that is as often as it’s discussed it is not a it’s not

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[Ramsey Smith]: knowledge that is widely as dispersed among consumers as one would hope or imagine

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[Ramsey Smith]: so tell us a little bit about how you approach that discussion and how you help

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[Ramsey Smith]: educate consumers and frankly advisors on the importance of this

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[Michael Finke]: first of all social security is an annuity you know

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[Michael Finke]: it fun

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[Michael Finke]: for anybody who says they hate annuities well then you must really hate social

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[Michael Finke]: security

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[Michael Finke]: but as it turns out a lot of people like their social security so the idea of

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[Michael Finke]: getting an income

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[Michael Finke]: every month for life

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[Paul Tyler]: yeah

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[Michael Finke]: yeah

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[Michael Finke]: is actually not such a bad thing to have in retirement essentially that is what an

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[Michael Finke]: annuity is and when you think about it as an annuity by delaying claiming for a

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[Michael Finke]: year what you’re doing is you’re giving up the amount of money that you could have

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[Michael Finke]: gotten between say sixty two and sixty three and you’re getting a higher income

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[Michael Finke]: every year in retirement

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[Paul Tyler]: i think

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[Michael Finke]: that begins at age sixty three and then last as long as you’re alive and the way

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[Michael Finke]: that we calculate the value of that income stream is we estimate what it would

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[Michael Finke]: cost to buy that income stream in the future in a low interest rate environment

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[Michael Finke]: that costs a lot and then we look at the likelihood that you’re going to be alive

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[Michael Finke]: at a given age and we’re especially focused on the kind of people that would

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[Michael Finke]: listen to this show who actually have made the biggest gains in longevity over the

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[Michael Finke]: last twenty or thirty years so

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[Michael Finke]: men in the top tenth percentile of income have gained six years of longevity over

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[Michael Finke]: the last twenty five years or so that’s one of the most interesting phenomenon

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[Michael Finke]: that’s happened in the united states is that

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[Michael Finke]: especially higher income men and women but higher income men especially because

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[Michael Finke]: they’re not doing stupid things that they used to do and in the

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[Michael Finke]: sixties and seventies they’re not smoking they’re not you know they’re taking

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[Paul Tyler]: they get it

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[Michael Finke]: better care of themselves they’re eating better they’re exercising for whatever

380
00:17:41,097 –> 00:17:46,697
[Michael Finke]: reason they’re living longer uh women as well so women who earn more money live

381
00:17:46,937 –> 00:17:51,017
[Michael Finke]: longer on average they’ve gained about three years and so when we’re estimating

382
00:17:51,097 –> 00:17:56,457
[Michael Finke]: the value of delayed claiming we now use these updated mortality tables and

383
00:17:56,617 –> 00:18:02,457
[Michael Finke]: remember the formula that you use to estimate the benefit from delayed claiming

384
00:18:02,537 –> 00:18:04,537
[Michael Finke]: was actually created in the one thousand nine hundred eighty seconds when people

385
00:18:04,617 –> 00:18:08,617
[Michael Finke]: were not living as long and when real interests rates were higher than they are

386
00:18:08,697 –> 00:18:11,257
[Michael Finke]: today so those delayed claiming rules are wrong

387
00:18:13,177 –> 00:18:18,777
[Michael Finke]: it means that the actuarial value from delayed claiming is significant and a lot

388
00:18:18,363 –> 00:18:19,363
[Michael Finke]: man

389
00:18:18,777 –> 00:18:21,977
[Michael Finke]: of people think they’re sticking it to the government by claiming it sixty two

390
00:18:22,457 –> 00:18:26,057
[Michael Finke]: well in fact it’s the exact opposite the government is sticking it to you if you

391
00:18:26,217 –> 00:18:27,577
[Michael Finke]: claim at age sixty two

392
00:18:28,157 –> 00:18:29,157
[Michael Finke]: the

393
00:18:28,283 –> 00:18:29,283
[Michael Finke]: yeah

394
00:18:28,697 –> 00:18:33,817
[Michael Finke]: other thing that we’ve noticed is that the delayed claiming rules are tiered in

395
00:18:33,897 –> 00:18:38,457
[Michael Finke]: other words the percentage increase in income that you get from delaying between

396
00:18:38,697 –> 00:18:43,897
[Michael Finke]: sixty two and sixty three is five percent but between sixty four sixty three and

397
00:18:43,977 –> 00:18:47,977
[Michael Finke]: sixty four it’s six and two thirds percent per year and then between sixty six and

398
00:18:48,057 –> 00:18:52,457
[Michael Finke]: sixty seven it goes up to eight percent per year and when you actually back out

399
00:18:53,017 –> 00:18:55,737
[Michael Finke]: the benefit the present value benefit that you get

400
00:18:56,857 –> 00:19:01,577
[Michael Finke]: the biggest benefit you get is from waiting between sixty seven and sixty eight

401
00:19:02,617 –> 00:19:07,897
[Michael Finke]: why because that’s the first year of the eight percent bump in income and that

402
00:19:07,977 –> 00:19:12,217
[Michael Finke]: means that you know by just waiting between sixty seven and sixty eight you have

403
00:19:12,297 –> 00:19:16,377
[Michael Finke]: almost the same expected longevity but your income is so much higher that the

404
00:19:16,537 –> 00:19:21,097
[Michael Finke]: present value of that bump is you know as high as twenty thousand dollars for a

405
00:19:21,257 –> 00:19:27,017
[Michael Finke]: healthy woman and it’s significant for a healthy man as well and if you’re healthy

406
00:19:27,177 –> 00:19:32,057
[Michael Finke]: every year you delay claiming has a positive net present value is it if you’re

407
00:19:32,217 –> 00:19:38,617
[Michael Finke]: buying an annuity that is priced below market it is pretty much the best deal that

408
00:19:38,697 –> 00:19:43,417
[Michael Finke]: you can get from buying annuitity is from delayed claiming of social security so

409
00:19:43,577 –> 00:19:48,457
[Michael Finke]: we recommend to everybody who is healthy that they delay claiming again because

410
00:19:48,537 –> 00:19:52,217
[Michael Finke]: the rules are meant to be actly fair but in fact they’re not

411
00:19:53,197 –> 00:19:54,197
[Michael Finke]: because they’re old

412
00:19:54,700 –> 00:19:55,700
[Paul Tyler]: snacks

413
00:19:54,857 –> 00:19:58,457
[Michael Finke]: they’re stale they’re probably going to get changed at some point but if you can

414
00:19:59,017 –> 00:20:03,577
[Michael Finke]: delay claiming now it’s definitely in your best interest now annuities are priced

415
00:20:03,577 –> 00:20:07,817
[Michael Finke]: the exact same way or at least the simple fixed annuity products are priced the

416
00:20:07,817 –> 00:20:11,417
[Michael Finke]: same way it’s simply a matter of multiplying the probability that you’re going to

417
00:20:11,417 –> 00:20:15,977
[Michael Finke]: be alive at a given age by the present value of buying that income in the future

418
00:20:16,297 –> 00:20:22,617
[Michael Finke]: and that’s one of the reasons why especially late life annuitity is so cheap so

419
00:20:22,777 –> 00:20:29,097
[Michael Finke]: buying an income late in life is so cheap because when you multiply the present

420
00:20:29,497 –> 00:20:35,017
[Michael Finke]: value of the cost of an insurance company guaranteeing an income starting say at

421
00:20:35,097 –> 00:20:39,737
[Michael Finke]: the age of eighty five well there’s you know a relatively and certainly not one

422
00:20:39,817 –> 00:20:42,697
[Michael Finke]: hundred percent chance that you’re going to be alive at the age of eighty five and

423
00:20:42,777 –> 00:20:47,497
[Michael Finke]: the probability of being alive goes down every year after that so you can buy a

424
00:20:47,577 –> 00:20:53,337
[Michael Finke]: pretty significant income for a relatively modest amount of your savings through

425
00:20:53,897 –> 00:20:57,257
[Michael Finke]: some kind of a deferred income annuity and of course i’m a huge fan of the

426
00:20:57,337 –> 00:21:01,977
[Michael Finke]: qualified longevity annuity contracts the q lax because they take away a lot of

427
00:21:01,977 –> 00:21:06,377
[Michael Finke]: that longevity risk for a relatively modest price and that’s what’s known as

428
00:21:06,377 –> 00:21:10,537
[Michael Finke]: mortality credits if you try to do it without an annuity then you would have to

429
00:21:10,537 –> 00:21:14,697
[Michael Finke]: set aside so much money today let’s say you wanted to make sure that your money

430
00:21:14,777 –> 00:21:18,377
[Michael Finke]: lasted to the age of one hundred which is realistic if you were a healthy woman

431
00:21:18,457 –> 00:21:21,497
[Michael Finke]: you still have a nine percent chance that you’re going to live beyond the age of

432
00:21:21,577 –> 00:21:25,977
[Michael Finke]: one hundred so let’s say you only want a ten percent chance of failure you have to

433
00:21:26,057 –> 00:21:28,137
[Michael Finke]: build the bond ladder up to the age of one hundred

434
00:21:29,337 –> 00:21:34,137
[Michael Finke]: it may be three or four times as expensive to do that as opposed to buying a late

435
00:21:34,217 –> 00:21:38,697
[Michael Finke]: life annuity in which case you can way that risk at a relatively low price you

436
00:21:38,777 –> 00:21:42,617
[Michael Finke]: have more money available to spend early on in retirement you can live better you

437
00:21:42,697 –> 00:21:46,537
[Michael Finke]: can spend more with less risk and that’s one of the advantages of annuities it

438
00:21:46,617 –> 00:21:50,297
[Michael Finke]: sounds like you’re a salesperson it’s like you get something for nothing but in

439
00:21:50,377 –> 00:21:54,697
[Michael Finke]: fact you do get something for nothing you can spend more and you’re at less risk

440
00:21:54,857 –> 00:21:56,217
[Michael Finke]: of potentially running out

441
00:21:57,337 –> 00:22:01,177
[Michael Finke]: when you pool some of your retirement savings with other retirees and have it

442
00:22:01,257 –> 00:22:04,697
[Michael Finke]: managed by an insurance company or the federal government in the case of social

443
00:22:04,477 –> 00:22:05,477
[Michael Finke]: security

444
00:22:05,600 –> 00:22:08,320
[Paul Tyler]: okay i’m about to throw a curve ball here which is

445
00:22:05,623 –> 00:22:08,343
[Michael Finke]: okay i’m about to throw a curve ball here which is

446
00:22:10,000 –> 00:22:15,680
[Paul Tyler]: how much does the math and the risk calculus change based on events over the last

447
00:22:10,103 –> 00:22:12,263
[Michael Finke]: how much does the math and

448
00:22:11,837 –> 00:22:12,837
[Michael Finke]: co

449
00:22:12,343 –> 00:22:17,143
[Michael Finke]: the risk calculus change based on events over the last couple of years and i’ll

450
00:22:15,840 –> 00:22:19,920
[Paul Tyler]: couple of years and i’ll throw some provocative statements at one is yeah delay

451
00:22:17,223 –> 00:22:21,063
[Michael Finke]: throw some provocative statements at one is yeah delay social security because

452
00:22:20,080 –> 00:22:22,720
[Paul Tyler]: social security because everybody’s living longer well actually

453
00:22:21,143 –> 00:22:22,823
[Michael Finke]: everybody’s living longer well actually

454
00:22:24,160 –> 00:22:29,280
[Paul Tyler]: mortality tables reversed last year with covid and you know your statement you

455
00:22:24,183 –> 00:22:29,303
[Michael Finke]: mortality tables reversed last year with covid and you know your statement you

456
00:22:29,280 –> 00:22:33,200
[Paul Tyler]: know michael if you’re healthy well a lot of people who are sick looks or had

457
00:22:29,303 –> 00:22:33,223
[Michael Finke]: know michael if you’re healthy well a lot of people who are sick it looks or had

458
00:22:33,360 –> 00:22:38,320
[Paul Tyler]: covid looks like they’re experiencing some longer term health problem so hm that’s

459
00:22:33,383 –> 00:22:38,423
[Michael Finke]: covid looks like they’re experiencing some longer term health problems so that’s

460
00:22:38,480 –> 00:22:39,920
[Paul Tyler]: one another one is well let’s

461
00:22:38,503 –> 00:22:39,943
[Michael Finke]: one another one is well let’s

462
00:22:40,763 –> 00:22:41,763
[Michael Finke]: you know not not

463
00:22:41,600 –> 00:22:42,720
[Paul Tyler]: not necessarily yours but

464
00:22:41,643 –> 00:22:42,643
[Michael Finke]: not necessarily yours

465
00:22:42,157 –> 00:22:43,157
[Michael Finke]: four

466
00:22:42,743 –> 00:22:44,023
[Michael Finke]: but you know

467
00:22:44,400 –> 00:22:48,400
[Paul Tyler]: take money out of the equity market put into bonds some other people in the market

468
00:22:44,423 –> 00:22:48,023
[Michael Finke]: take money out of the equity market put into bonds some other you know people in

469
00:22:48,023 –> 00:22:52,663
[Michael Finke]: the in the market are saying that well look at the credit risk you know ramsey

470
00:22:48,720 –> 00:22:52,720
[Paul Tyler]: are saying that well look at the credit risk you know ramsey from

471
00:22:52,283 –> 00:22:53,283
[Michael Finke]: from

472
00:22:53,920 –> 00:22:57,520
[Paul Tyler]: you know half the world defaulting effectively right on

473
00:22:54,023 –> 00:22:57,543
[Michael Finke]: you know half the world defaulting effectively right on

474
00:22:58,720 –> 00:23:02,240
[Paul Tyler]: you know on some of their bonds what does that do michael to some of these

475
00:22:59,383 –> 00:23:02,823
[Michael Finke]: on some of their bonds what does that do michael to some of these with their all

476
00:23:02,320 –> 00:23:03,760
[Paul Tyler]: withdrawal right assumptions

477
00:23:02,883 –> 00:23:03,883
[Michael Finke]: right assumptions

478
00:23:04,880 –> 00:23:10,160
[Paul Tyler]: diversify your portfolio let’s you know yes you put money in the u s but spread it

479
00:23:04,983 –> 00:23:10,823
[Michael Finke]: diversify your portfolio’s yes you put money in the u s but spread internationally

480
00:23:10,240 –> 00:23:14,240
[Paul Tyler]: internationally we’re starting to see almost a bifurcation of economies you know

481
00:23:11,143 –> 00:23:15,143
[Michael Finke]: you know we’re starting to see almost a bifurcation of economies you know given

482
00:23:14,480 –> 00:23:17,680
[Paul Tyler]: if given what’s sort of where we’re seeing the world

483
00:23:14,957 –> 00:23:15,957
[Michael Finke]: oh

484
00:23:15,283 –> 00:23:16,283
[Michael Finke]: what’s sort of

485
00:23:15,780 –> 00:23:16,780
[Ramsey Smith]: oh

486
00:23:16,743 –> 00:23:17,783
[Michael Finke]: where we’re seeing the world

487
00:23:18,880 –> 00:23:22,640
[Paul Tyler]: get pushed with this war and oh yeah the really ugly one that everybody’s looking

488
00:23:18,903 –> 00:23:22,583
[Michael Finke]: get pushed with this war and then oh yeah the really ugly one that everybody’s

489
00:23:22,663 –> 00:23:25,943
[Michael Finke]: looking as inflation so michael is this just

490
00:23:22,880 –> 00:23:24,880
[Paul Tyler]: as inflation so michael

491
00:23:24,797 –> 00:23:25,797
[Michael Finke]: like

492
00:23:25,260 –> 00:23:26,260
[Paul Tyler]: is this just uh

493
00:23:25,997 –> 00:23:26,997
[Michael Finke]: just

494
00:23:26,880 –> 00:23:30,960
[Paul Tyler]: is this the one of those bumps you just described you know i’m in retirement i see

495
00:23:26,880 –> 00:23:30,960
[Paul Tyler]: is this the one of those bumps you just described you know i’m in retirement i see

496
00:23:26,983 –> 00:23:30,983
[Michael Finke]: is this the one of those bumps you just described you know i’m in retirement i see

497
00:23:31,040 –> 00:23:36,320
[Paul Tyler]: a bump and you know guess what you survive it manage the expenses you can survive

498
00:23:31,040 –> 00:23:36,320
[Paul Tyler]: a bump and you know guess what you survive it manage the expenses you can survive

499
00:23:31,063 –> 00:23:33,143
[Michael Finke]: a bump and guess what you survive it

500
00:23:33,680 –> 00:23:34,800
[Ramsey Smith]: movies pretty

501
00:23:33,703 –> 00:23:36,743
[Michael Finke]: manage the expenses you can survive it or

502
00:23:36,397 –> 00:23:37,397
[Michael Finke]: like

503
00:23:36,400 –> 00:23:40,800
[Paul Tyler]: it or do you see a fundamental shift in how you start to approach long term

504
00:23:36,400 –> 00:23:40,800
[Paul Tyler]: it or do you see a fundamental shift in how you start to approach long term

505
00:23:36,903 –> 00:23:41,623
[Michael Finke]: do you see a fundamental shift in how you start to approach long term planning for

506
00:23:41,120 –> 00:23:42,800
[Paul Tyler]: planning for the next ten fifteen years

507
00:23:41,120 –> 00:23:42,800
[Paul Tyler]: planning for the next ten fifteen years

508
00:23:41,703 –> 00:23:42,823
[Michael Finke]: the next ten fifteen years

509
00:23:43,897 –> 00:23:49,337
[Michael Finke]: you know it’s it’s a great point like we retirees did not realize that they were

510
00:23:49,497 –> 00:23:53,337
[Michael Finke]: exposed to this risk of a pandemic a lot of scientists understood that that risk

511
00:23:53,477 –> 00:23:54,477
[Michael Finke]: was a possibility

512
00:23:56,057 –> 00:24:00,057
[Michael Finke]: they face that in retirement now if they’ve gotten through it and assuming that

513
00:24:01,177 –> 00:24:02,297
[Michael Finke]: the pandemic is

514
00:24:01,940 –> 00:24:02,940
[Paul Tyler]: that’s

515
00:24:02,457 –> 00:24:07,817
[Michael Finke]: on its way out everybody else now is facing the same expected longevity that they

516
00:24:07,897 –> 00:24:11,657
[Michael Finke]: had before covid so for them it didn’t really make that much of a difference

517
00:24:12,137 –> 00:24:18,617
[Michael Finke]: obviously it has a effect on on overall longevity unfortunately you know some

518
00:24:18,697 –> 00:24:20,697
[Michael Finke]: people who had expected to live longer did not

519
00:24:21,737 –> 00:24:24,857
[Michael Finke]: but you’re still exposed to that same longevity risk

520
00:24:26,057 –> 00:24:31,817
[Michael Finke]: you know and your job when you’re planning for retirement is to address the risks

521
00:24:32,057 –> 00:24:37,017
[Michael Finke]: that you’re aware of and do it in in an efficient fashion but there is always

522
00:24:37,177 –> 00:24:40,217
[Michael Finke]: going to risks that you’re not aware of i mean that’s just part of

523
00:24:42,137 –> 00:24:46,217
[Michael Finke]: the game that you play in financial markets and just being a human being we all

524
00:24:46,377 –> 00:24:49,897
[Michael Finke]: face a certain amount of risks that we cannot anticipate and so maybe

525
00:24:49,700 –> 00:24:50,700
[Paul Tyler]: yeah

526
00:24:50,137 –> 00:24:55,337
[Michael Finke]: part of that risk is the possibility that bond markets crash maybe part of that

527
00:24:55,497 –> 00:24:59,897
[Michael Finke]: risk is the possibility that equity markets also fall or that the dollar loses

528
00:24:59,977 –> 00:25:05,257
[Michael Finke]: value or that inflation goes up those are all things that we have to face we are

529
00:25:05,337 –> 00:25:07,097
[Michael Finke]: aware of those risks we try

530
00:25:06,843 –> 00:25:07,843
[Michael Finke]: what do you

531
00:25:07,177 –> 00:25:12,857
[Michael Finke]: to address them as best we can but the only way to respond to risks that we’re not

532
00:25:12,917 –> 00:25:13,917
[Michael Finke]: aware of is to

533
00:25:13,977 –> 00:25:18,217
[Michael Finke]: recognize that we can be overconfident about the lifestyle that we expect to lead

534
00:25:14,043 –> 00:25:15,043
[Michael Finke]: i have

535
00:25:18,357 –> 00:25:19,357
[Michael Finke]: and to

536
00:25:18,603 –> 00:25:19,603
[Michael Finke]: better

537
00:25:19,097 –> 00:25:22,377
[Michael Finke]: build a certain amount of slack into that lifestyle to account

538
00:25:22,043 –> 00:25:23,043
[Michael Finke]: yeah

539
00:25:22,537 –> 00:25:25,497
[Michael Finke]: for the possibility that there may be risks that we don’t anticipate

540
00:25:26,697 –> 00:25:31,897
[Michael Finke]: one of those risks that i think david blanchett and wade fou and i have been

541
00:25:31,977 –> 00:25:37,017
[Michael Finke]: thinking about for a long time is the risk of united states equities and

542
00:25:37,837 –> 00:25:38,837
[Michael Finke]: a lot of people

543
00:25:39,897 –> 00:25:44,297
[Michael Finke]: almost have a religious belief that united states equities are going to continue

544
00:25:44,777 –> 00:25:49,737
[Michael Finke]: to provide ten to twelve percent return indefinitely in retirement and if you can

545
00:25:49,897 –> 00:25:54,297
[Michael Finke]: just wait it out if equities go down in value then everything’s going to be okay

546
00:25:54,357 –> 00:25:55,357
[Michael Finke]: in the long run

547
00:25:56,457 –> 00:26:01,257
[Michael Finke]: this fervent belief that we are all entitled to what’s known as an equity risk

548
00:26:01,497 –> 00:26:05,977
[Michael Finke]: premium in other words a higher return from stos for than from bonds can get

549
00:26:06,137 –> 00:26:10,857
[Michael Finke]: people in trouble as well because there is no guarantee and especially as

550
00:26:10,937 –> 00:26:14,297
[Michael Finke]: expensive as stock prices have been in recent years

551
00:26:15,897 –> 00:26:19,497
[Michael Finke]: historically when stocks are this expensive they simply don’t perform that well

552
00:26:20,937 –> 00:26:26,217
[Michael Finke]: over a long term time horizon that’s a risk we’re aware of and if you’re not

553
00:26:26,297 –> 00:26:30,297
[Michael Finke]: building that risk into your retirement income plan the possibility that equities

554
00:26:30,377 –> 00:26:34,857
[Michael Finke]: are not going to bail you out then you may end up in trouble and let me just give

555
00:26:34,637 –> 00:26:35,637
[Michael Finke]: you as an example

556
00:26:36,537 –> 00:26:41,337
[Michael Finke]: if you look at remember the four percent rule concept is based on this idea that

557
00:26:41,417 –> 00:26:46,137
[Michael Finke]: your spending goes up every year in order to match inflation of course inflation

558
00:26:46,217 –> 00:26:48,297
[Michael Finke]: is its own video syncretic risk

559
00:26:49,437 –> 00:26:50,437
[Michael Finke]: so

560
00:26:52,457 –> 00:26:55,017
[Michael Finke]: you can buy what’s known as a treasury inflation

561
00:26:55,083 –> 00:26:56,083
[Michael Finke]: man

562
00:26:55,177 –> 00:27:00,377
[Michael Finke]: protected security as a way of getting rid of that inflation risk but if you do

563
00:27:00,457 –> 00:27:04,537
[Michael Finke]: that and you follow the four for percent rule then at today’s low treasury

564
00:27:04,697 –> 00:27:06,937
[Michael Finke]: inflation protected security rates you’re going

565
00:27:06,603 –> 00:27:07,603
[Michael Finke]: that was

566
00:27:06,937 –> 00:27:12,057
[Michael Finke]: to run out of money at about age eighty seven so you’re relying on the stock

567
00:27:12,377 –> 00:27:13,897
[Michael Finke]: portion of your portfolio

568
00:27:15,017 –> 00:27:20,297
[Michael Finke]: drag your investment portfolio beyond the age of eighty seven so that you can

569
00:27:20,457 –> 00:27:25,497
[Michael Finke]: continue to spend four percent after inflation every year but there’s no guarantee

570
00:27:25,497 –> 00:27:28,857
[Michael Finke]: that it is going to do that and it could do that on average but if you get unlucky

571
00:27:28,937 –> 00:27:32,937
[Michael Finke]: the first ten years of retirement you may not have much of an equity portfolio

572
00:27:33,097 –> 00:27:39,497
[Michael Finke]: left so you’re putting a lot of weight on that equity risk premium to provide

573
00:27:39,977 –> 00:27:45,017
[Michael Finke]: safety that it simply cannot by definition provide because risk is real it would

574
00:27:45,177 –> 00:27:47,737
[Michael Finke]: not be compensated again if it weren’t real

575
00:27:50,683 –> 00:27:51,683
[Michael Finke]: you have

576
00:27:53,360 –> 00:27:56,720
[Ramsey Smith]: so uh first of all super commentary

577
00:27:57,760 –> 00:28:02,400
[Ramsey Smith]: i have to say we’ve had i’m just gonna go back quickly to to your comments on

578
00:28:02,480 –> 00:28:05,680
[Ramsey Smith]: social security we’ve talked about it a lot on this show but you’re the first

579
00:28:05,580 –> 00:28:06,580
[Ramsey Smith]: person to

580
00:28:06,523 –> 00:28:07,523
[Michael Finke]: yeah

581
00:28:07,680 –> 00:28:10,560
[Ramsey Smith]: break down the pv benefit sort of

582
00:28:10,580 –> 00:28:11,580
[Paul Tyler]: man

583
00:28:10,683 –> 00:28:11,683
[Michael Finke]: man

584
00:28:11,600 –> 00:28:13,440
[Ramsey Smith]: in those specific tiers that is

585
00:28:14,720 –> 00:28:17,600
[Ramsey Smith]: that is actually very helpful very helpful perspective there

586
00:28:19,920 –> 00:28:24,080
[Ramsey Smith]: so one other one other area that you’ve been focusing on

587
00:28:25,360 –> 00:28:27,680
[Ramsey Smith]: is contingent deferred annuities

588
00:28:28,260 –> 00:28:29,260
[Paul Tyler]: yeah

589
00:28:28,640 –> 00:28:31,840
[Ramsey Smith]: want to hear what your thoughts are on those do you think that that’s something

590
00:28:32,000 –> 00:28:33,040
[Ramsey Smith]: that that should be

591
00:28:34,320 –> 00:28:38,080
[Ramsey Smith]: uh more un offered do you think people are ready for them do you think you think

592
00:28:38,160 –> 00:28:40,640
[Ramsey Smith]: that advisors and consumers will understand them

593
00:28:42,617 –> 00:28:47,577
[Michael Finke]: well let’s say that you have a client and you’re you know you were a strong

594
00:28:47,817 –> 00:28:53,977
[Michael Finke]: adherent in the four percentage rule and the client comes to you and you tell them

595
00:28:54,137 –> 00:28:58,217
[Michael Finke]: that you can withdraw four percent after inflation every year from your investment

596
00:28:58,377 –> 00:29:01,417
[Michael Finke]: portfolio and you’re probably going to be okay and then you say well what does

597
00:29:01,497 –> 00:29:04,937
[Michael Finke]: probably mean well you’ve got a ninety percentage chance of success according to a

598
00:29:04,937 –> 00:29:09,657
[Michael Finke]: monte carlo model that uses historical returns and you say well what if returns

599
00:29:09,737 –> 00:29:10,777
[Michael Finke]: aren’t what they have been

600
00:29:10,763 –> 00:29:11,763
[Michael Finke]: yeah

601
00:29:11,017 –> 00:29:13,897
[Michael Finke]: historically what if we get unlucky what if we end up like japan

602
00:29:15,317 –> 00:29:16,317
[Michael Finke]: will you

603
00:29:17,417 –> 00:29:22,217
[Michael Finke]: provide a backstop will you continue to pay my income if i do what you tell me to

604
00:29:22,297 –> 00:29:25,417
[Michael Finke]: do if i follow the four percent rule and i live to age

605
00:29:25,140 –> 00:29:26,140
[Paul Tyler]: my

606
00:29:25,657 –> 00:29:28,697
[Michael Finke]: ninety and all of a sudden i don’t have any money left

607
00:29:28,980 –> 00:29:29,980
[Paul Tyler]: red

608
00:29:29,083 –> 00:29:30,083
[Michael Finke]: yeah

609
00:29:29,277 –> 00:29:30,277
[Michael Finke]: then

610
00:29:30,857 –> 00:29:36,617
[Michael Finke]: will you continue to send me a check and the advisor will say no i’m not gonna

611
00:29:36,857 –> 00:29:38,297
[Michael Finke]: take that liability and i’m

612
00:29:37,860 –> 00:29:38,860
[Paul Tyler]: i

613
00:29:38,237 –> 00:29:39,237
[Michael Finke]: not going to take that risk

614
00:29:40,617 –> 00:29:45,577
[Michael Finke]: and then the client says well why not you just told me that there was no risk to

615
00:29:45,737 –> 00:29:49,737
[Michael Finke]: following the for four percent rule why are you not willing to follow that up with

616
00:29:50,137 –> 00:29:54,617
[Michael Finke]: some sort of insurance to protect me so that i can feel comfortable spending my

617
00:29:54,697 –> 00:29:58,857
[Michael Finke]: money every year in retirement without the possibility without thinking in the

618
00:29:58,937 –> 00:30:03,497
[Michael Finke]: back of my mind that if i spend too much i could potentially run out of money

619
00:30:03,163 –> 00:30:04,163
[Michael Finke]: she

620
00:30:04,617 –> 00:30:11,177
[Michael Finke]: well that’s what a contingent deferred annuity is it is portfolio income insurance

621
00:30:12,057 –> 00:30:14,937
[Michael Finke]: is the backstop and of course it’s going to cost money

622
00:30:14,523 –> 00:30:15,523
[Michael Finke]: what

623
00:30:15,177 –> 00:30:17,337
[Michael Finke]: because your advisor is not going to give it to you for free

624
00:30:16,900 –> 00:30:17,900
[Paul Tyler]: know

625
00:30:17,517 –> 00:30:18,517
[Michael Finke]: he’s he’s

626
00:30:17,963 –> 00:30:18,963
[Michael Finke]: i

627
00:30:18,377 –> 00:30:23,337
[Michael Finke]: not gonna say he or she is not going to say i will write a check out of my own

628
00:30:23,497 –> 00:30:29,977
[Michael Finke]: account if you run out of money and i will continue to provide that income for you

629
00:30:30,377 –> 00:30:37,897
[Michael Finke]: in retirement now sometimes i hear advisors or advising companies say that the

630
00:30:38,137 –> 00:30:43,017
[Michael Finke]: insurance expense that people pay to provide that backstop is a fee

631
00:30:44,057 –> 00:30:45,977
[Michael Finke]: well it’s not a fee it’s

632
00:30:45,780 –> 00:30:46,780
[Paul Tyler]: what

633
00:30:46,217 –> 00:30:53,577
[Michael Finke]: insurance so you you’re paying for an insurance premium whether it be for a uh for

634
00:30:53,657 –> 00:30:58,777
[Michael Finke]: the cost of receiving a guaranteed minimum withdrawal benefit from your investment

635
00:30:58,937 –> 00:31:03,177
[Michael Finke]: portfolio or this new thing which is a contingent deferred annuity which is

636
00:31:03,337 –> 00:31:06,777
[Michael Finke]: entirely separate from your investment portfolio so you’re managing your

637
00:31:06,937 –> 00:31:10,217
[Michael Finke]: investments but then you have this insurance product that’s tacked onto it that

638
00:31:10,217 –> 00:31:12,377
[Michael Finke]: you’re gonna have to pay a fee for but

639
00:31:12,343 –> 00:31:13,463
[Michael Finke]: what okay

640
00:31:13,497 –> 00:31:19,097
[Michael Finke]: that fee allows you to spend money from your investment portfolio free from the

641
00:31:19,257 –> 00:31:24,697
[Michael Finke]: worry that if markets tank and you live too long you are not going to be able to

642
00:31:24,777 –> 00:31:26,377
[Michael Finke]: maintain your lifestyle

643
00:31:26,603 –> 00:31:27,603
[Michael Finke]: but that

644
00:31:26,937 –> 00:31:30,137
[Michael Finke]: now that’s something that i think as you know someone who comes from the

645
00:31:29,883 –> 00:31:30,883
[Michael Finke]: right

646
00:31:30,077 –> 00:31:31,077
[Michael Finke]: ria community

647
00:31:32,217 –> 00:31:33,577
[Michael Finke]: i didn’t give enough thought to

648
00:31:34,423 –> 00:31:35,863
[Michael Finke]: but you don’t have any

649
00:31:34,457 –> 00:31:38,697
[Michael Finke]: but if you don’t have an answer to that question if you’re not willing to provide

650
00:31:38,777 –> 00:31:43,737
[Michael Finke]: the backstop and if your client wants the backstop then you have to consider

651
00:31:45,017 –> 00:31:50,777
[Michael Finke]: buying portfolio income insurance now it’s not cheap but’s not expensive either

652
00:31:51,817 –> 00:31:56,617
[Michael Finke]: so in the sense that it may not be much more than what you’re charging for asset

653
00:31:56,777 –> 00:32:00,217
[Michael Finke]: center management fees the insurance company is willing to take on that risk what

654
00:32:00,297 –> 00:32:02,617
[Michael Finke]: does the insurance company do will they put the money into

655
00:32:03,817 –> 00:32:08,297
[Michael Finke]: a general account portfolio and safe investments they might buy hedging

656
00:32:09,177 –> 00:32:10,377
[Michael Finke]: instruments they might buy

657
00:32:10,443 –> 00:32:11,443
[Michael Finke]: area

658
00:32:10,777 –> 00:32:14,857
[Michael Finke]: instruments that hedge against equity risk or interest rate swaps but

659
00:32:14,580 –> 00:32:15,580
[Paul Tyler]: yeah

660
00:32:15,417 –> 00:32:20,537
[Michael Finke]: that costs money and it’s going to result in a lower expected wealth over time

661
00:32:20,597 –> 00:32:21,597
[Michael Finke]: just like any

662
00:32:21,220 –> 00:32:22,220
[Paul Tyler]: thank you

663
00:32:21,817 –> 00:32:26,217
[Michael Finke]: insurance product that you buy if you buy homeowners insurance you will have less

664
00:32:26,457 –> 00:32:33,337
[Michael Finke]: wealth over time because you are paying for that pooling risk so that if if your

665
00:32:33,417 –> 00:32:37,497
[Michael Finke]: house burns down then you’re going to get a new home in the same way you’re

666
00:32:37,577 –> 00:32:41,737
[Michael Finke]: pooling risk it results in less wealth over time but you’re getting rid of the

667
00:32:41,737 –> 00:32:46,377
[Michael Finke]: risk of potentially running out and the advantage of that is that even with a

668
00:32:46,537 –> 00:32:51,897
[Michael Finke]: portfolio that includes risky assets that could allow you to spend more so this is

669
00:32:51,977 –> 00:32:58,697
[Michael Finke]: a solution i think for the flexible part of your budget is that yes i’m willing to

670
00:32:58,777 –> 00:33:03,417
[Michael Finke]: take a certain amount of risk but with my flexible expenses i am also not willing

671
00:33:03,497 –> 00:33:04,617
[Michael Finke]: to cut back so much

672
00:33:06,137 –> 00:33:11,977
[Michael Finke]: that i’m not able to enjoy my retirement so that insurance product then provides

673
00:33:12,037 –> 00:33:13,037
[Michael Finke]: that backstop

674
00:33:12,500 –> 00:33:13,500
[Paul Tyler]: the

675
00:33:13,577 –> 00:33:18,377
[Michael Finke]: portfolio income protection now from the perspective of an insurance company this

676
00:33:18,077 –> 00:33:19,077
[Michael Finke]: is actually

677
00:33:19,977 –> 00:33:26,217
[Michael Finke]: not an incredibly onerous insurance product to provide why because it only kicks

678
00:33:26,297 –> 00:33:31,897
[Michael Finke]: in if the person lives too long and markets don’t cooperate and if you’ve hedged

679
00:33:31,977 –> 00:33:35,897
[Michael Finke]: this appropriate appropriately if markets have done really badly then your

680
00:33:36,217 –> 00:33:41,257
[Michael Finke]: portfolio that you’re using to fund this guarantee is actually doing pretty well

681
00:33:41,977 –> 00:33:47,657
[Michael Finke]: so that that’s why you can buy it for a relatively modest cost but the benefit in

682
00:33:47,737 –> 00:33:50,297
[Michael Finke]: terms of lifestyle is enormous

683
00:33:50,363 –> 00:33:51,363
[Michael Finke]: white

684
00:33:50,857 –> 00:33:54,937
[Michael Finke]: i can spend money even if the markets tank i can go out to dinner i can continue

685
00:33:55,177 –> 00:34:00,697
[Michael Finke]: to go on vacations because i know that that backstop protection exists and from

686
00:34:01,097 –> 00:34:05,097
[Michael Finke]: most of us who are in the ra world are trained to believe that this is just sort

687
00:34:05,097 –> 00:34:11,657
[Michael Finke]: of a scam but if it is a scam then are you willing to provide that yourself to a

688
00:34:11,737 –> 00:34:16,297
[Michael Finke]: client are you willing to provide the backstop if they run out of money if not

689
00:34:17,097 –> 00:34:21,817
[Michael Finke]: then you have to consider incorporating this kind of portfolio insurance into your

690
00:34:21,897 –> 00:34:23,177
[Michael Finke]: retirement income plans

691
00:34:24,400 –> 00:34:26,720
[Ramsey Smith]: yeah i look i think that’s a very strong point and

692
00:34:28,240 –> 00:34:34,480
[Ramsey Smith]: i i my view is that financial advisors provide an extraordinarily important

693
00:34:34,800 –> 00:34:36,480
[Ramsey Smith]: service along so many

694
00:34:38,000 –> 00:34:42,880
[Ramsey Smith]: parameters but they don’t necessarily have like that that skin in the game and

695
00:34:42,960 –> 00:34:44,080
[Ramsey Smith]: this is the discussion that

696
00:34:44,860 –> 00:34:45,860
[Ramsey Smith]: that sort of

697
00:34:46,100 –> 00:34:47,100
[Paul Tyler]: me

698
00:34:46,123 –> 00:34:47,123
[Michael Finke]: me

699
00:34:46,560 –> 00:34:49,680
[Ramsey Smith]: puts that puts that at the forefront i mean i imagine it’s

700
00:34:49,803 –> 00:34:50,803
[Michael Finke]: yeah

701
00:34:50,000 –> 00:34:54,000
[Ramsey Smith]: imagine it can be an uncomfortable discussion but i i think it

702
00:34:53,780 –> 00:34:54,780
[Paul Tyler]: that

703
00:34:54,160 –> 00:34:55,440
[Ramsey Smith]: you know over time you know

704
00:34:54,160 –> 00:34:55,440
[Ramsey Smith]: you know over time you know

705
00:34:56,220 –> 00:34:57,220
[Ramsey Smith]: there’s the potential

706
00:34:56,843 –> 00:34:57,843
[Michael Finke]: yeah

707
00:34:57,280 –> 00:35:01,680
[Ramsey Smith]: for it to lead to better write better and more complete solutions for for

708
00:35:01,580 –> 00:35:02,580
[Ramsey Smith]: consumers

709
00:35:04,403 –> 00:35:05,403
[Michael Finke]: yeah i

710
00:35:04,720 –> 00:35:10,560
[Paul Tyler]: yeah i i i i’d actually be interested to know like in my you’ve probably done this

711
00:35:04,720 –> 00:35:10,560
[Paul Tyler]: yeah i i i i’d actually be interested to know like in my you’ve probably done this

712
00:35:06,583 –> 00:35:10,823
[Michael Finke]: i’d actually be interested to know like and my per you’ve probably done this i

713
00:35:10,300 –> 00:35:11,300
[Paul Tyler]: i mean

714
00:35:10,300 –> 00:35:11,300
[Paul Tyler]: i mean

715
00:35:10,443 –> 00:35:11,443
[Michael Finke]: mean

716
00:35:12,720 –> 00:35:18,720
[Paul Tyler]: that product versus an fi a when i’m taking income out you know fifteen twenty

717
00:35:12,743 –> 00:35:16,423
[Michael Finke]: that product versus an fia when i’m taking

718
00:35:16,237 –> 00:35:17,237
[Michael Finke]: cool

719
00:35:16,663 –> 00:35:20,903
[Michael Finke]: income out you know fifteen twenty years from now i mean how does how does it how

720
00:35:18,960 –> 00:35:21,600
[Paul Tyler]: years from now i mean how does it how does it compare

721
00:35:20,803 –> 00:35:21,803
[Michael Finke]: does it compare

722
00:35:23,040 –> 00:35:25,360
[Paul Tyler]: in terms of the income you’d be able to show a client

723
00:35:23,143 –> 00:35:25,383
[Michael Finke]: in terms of the income you’d be able to show a client

724
00:35:26,077 –> 00:35:27,077
[Michael Finke]: so

725
00:35:26,300 –> 00:35:27,300
[Paul Tyler]: i yeah

726
00:35:26,323 –> 00:35:27,323
[Michael Finke]: i yeah

727
00:35:26,323 –> 00:35:27,323
[Michael Finke]: i yeah

728
00:35:27,897 –> 00:35:32,857
[Michael Finke]: yeah um you know one of the benefits of this type of a product is that you get to

729
00:35:33,657 –> 00:35:36,777
[Michael Finke]: capture more of the equity risk premium if

730
00:35:36,340 –> 00:35:37,340
[Paul Tyler]: right

731
00:35:36,363 –> 00:35:37,363
[Michael Finke]: right

732
00:35:36,857 –> 00:35:41,977
[Michael Finke]: you get it that’s why you invest in risky assets is so that if stocks do well then

733
00:35:42,137 –> 00:35:47,337
[Michael Finke]: your portfolio value is going to rise and then your income your guaranteed income

734
00:35:47,417 –> 00:35:50,297
[Michael Finke]: amount can also ratchet up that allows you to spend more and that’s why you take

735
00:35:50,297 –> 00:35:51,497
[Michael Finke]: risk in the first place so that

736
00:35:51,083 –> 00:35:52,083
[Michael Finke]: yes

737
00:35:51,497 –> 00:35:54,217
[Michael Finke]: you could potentially with your flexible expenses you could potentially live

738
00:35:54,217 –> 00:35:58,617
[Michael Finke]: better if stocks do well with a fixed index annuity especially at today’s low

739
00:35:58,777 –> 00:36:03,577
[Michael Finke]: interest rates the budget for your upside is really not that great so it’s really

740
00:36:03,577 –> 00:36:07,657
[Michael Finke]: more of a fixed income like potential for growth whereas this gives you more

741
00:36:07,557 –> 00:36:08,557
[Michael Finke]: upside potential

742
00:36:10,297 –> 00:36:13,337
[Michael Finke]: whereas the downside actually might be a little bit lower than it would be for a

743
00:36:13,237 –> 00:36:14,237
[Michael Finke]: fixed and extra noy

744
00:36:15,580 –> 00:36:16,580
[Paul Tyler]: yeah well

745
00:36:15,683 –> 00:36:16,683
[Michael Finke]: yeah well

746
00:36:17,920 –> 00:36:22,320
[Paul Tyler]: we’re close to the end i just got to have to have to ask you this question you

747
00:36:17,920 –> 00:36:22,320
[Paul Tyler]: we’re close to the end i just got to have to have to ask you this question you

748
00:36:18,023 –> 00:36:19,783
[Michael Finke]: we’re close to the end i i just got

749
00:36:20,763 –> 00:36:21,763
[Michael Finke]: have to ask you

750
00:36:21,277 –> 00:36:22,277
[Michael Finke]: any

751
00:36:21,703 –> 00:36:24,183
[Michael Finke]: this question you know you’ve mentioned a number of your

752
00:36:22,320 –> 00:36:26,240
[Paul Tyler]: know you’ve mentioned a number of your colleagues you’re working with wade we’ve

753
00:36:22,320 –> 00:36:26,240
[Paul Tyler]: know you’ve mentioned a number of your colleagues you’re working with wade we’ve

754
00:36:24,397 –> 00:36:25,397
[Michael Finke]: oh

755
00:36:24,743 –> 00:36:26,903
[Michael Finke]: colleagues you’re working with wade we’ve had on

756
00:36:25,980 –> 00:36:26,980
[Paul Tyler]: had on

757
00:36:25,980 –> 00:36:26,980
[Paul Tyler]: had on

758
00:36:27,840 –> 00:36:33,360
[Paul Tyler]: dave we talked to press and cherry back i guess have been like i don’t know four

759
00:36:27,943 –> 00:36:33,223
[Michael Finke]: dave we talked to press and cherry i guess it must have been like i don’t know

760
00:36:33,303 –> 00:36:38,583
[Michael Finke]: four or five months agogo we discovered texas tech was like somehow a nexus of

761
00:36:33,360 –> 00:36:38,800
[Paul Tyler]: or five months ago we discovered texas tech was like somehow a nexus of people

762
00:36:38,743 –> 00:36:42,423
[Michael Finke]: people doing really interesting work in this space tell us more i mean is there

763
00:36:39,120 –> 00:36:42,560
[Paul Tyler]: doing really interesting work in the space tell us more i mean is there something

764
00:36:42,503 –> 00:36:45,383
[Michael Finke]: something in the water in texas tech michael that just

765
00:36:42,720 –> 00:36:44,720
[Paul Tyler]: in the water in texas tech michael that just

766
00:36:46,380 –> 00:36:47,380
[Paul Tyler]: makes you want

767
00:36:46,443 –> 00:36:47,443
[Michael Finke]: makes you want

768
00:36:46,843 –> 00:36:47,843
[Michael Finke]: to

769
00:36:46,877 –> 00:36:47,877
[Michael Finke]: thank you

770
00:36:48,160 –> 00:36:51,200
[Paul Tyler]: really make a difference in this planning market

771
00:36:48,263 –> 00:36:51,223
[Michael Finke]: really make a difference in this planning market

772
00:36:51,977 –> 00:36:57,497
[Michael Finke]: you know the the credit for texas tech goes back to a guy named bill gustafson and

773
00:36:57,657 –> 00:37:02,537
[Michael Finke]: vicky hampton if you’ve ever heard those names so those two recognized the

774
00:37:03,897 –> 00:37:08,617
[Michael Finke]: importance of the financial planning profession and providing an education to

775
00:37:08,937 –> 00:37:13,817
[Michael Finke]: financial advisors that was high quality and so back in the one thousand nine

776
00:37:13,897 –> 00:37:18,857
[Michael Finke]: hundred ninety seconds they put together this team of experts and they became the

777
00:37:19,097 –> 00:37:23,417
[Michael Finke]: place to go if you wanted a high quality financial planning education and then in

778
00:37:23,577 –> 00:37:28,697
[Michael Finke]: two thousand six i came to texas tech and my job was to lead the phd

779
00:37:28,500 –> 00:37:29,500
[Paul Tyler]: that

780
00:37:28,777 –> 00:37:32,537
[Michael Finke]: program in financial planning and a lot of the people who graduated from that

781
00:37:32,617 –> 00:37:36,377
[Michael Finke]: program are now heads of financial planning programs across the united states

782
00:37:35,963 –> 00:37:36,963
[Michael Finke]: yeah

783
00:37:36,457 –> 00:37:39,657
[Michael Finke]: so the chair of the program at georgia is from texas

784
00:37:40,043 –> 00:37:41,043
[Michael Finke]: yeah

785
00:37:40,217 –> 00:37:42,057
[Michael Finke]: tch kansas state

786
00:37:42,683 –> 00:37:43,683
[Michael Finke]: five

787
00:37:44,057 –> 00:37:47,337
[Michael Finke]: you know utah valley a lot of these smaller programs that really focus on

788
00:37:47,497 –> 00:37:52,537
[Michael Finke]: financial planning they’re texas tech graduates and when it comes to annuitity

789
00:37:53,977 –> 00:38:01,017
[Michael Finke]: this i think receptivity to annuitity came from this idea that you know we’re

790
00:38:01,017 –> 00:38:06,217
[Michael Finke]: economists we read the economic research and for a long time it kind of economists

791
00:38:06,217 –> 00:38:10,217
[Michael Finke]: have been talking about this annuity puzzle this idea that people are not

792
00:38:10,297 –> 00:38:14,777
[Michael Finke]: annuitity izing as much as they should and in financial planning practice you know

793
00:38:14,857 –> 00:38:19,657
[Michael Finke]: there’s this historical split betweens and investments and there’s not a whole lot

794
00:38:19,597 –> 00:38:20,597
[Michael Finke]: of cross pollination

795
00:38:21,897 –> 00:38:26,617
[Michael Finke]: but as economist our job is to try to tell investment advisors how they can

796
00:38:26,777 –> 00:38:32,137
[Michael Finke]: actually be fiduciary and exposing your client to an idiosyncratic risk like the

797
00:38:32,217 –> 00:38:37,177
[Michael Finke]: risk of unknown longevity is not something a fiduciary should do it’s not in the

798
00:38:37,177 –> 00:38:41,737
[Michael Finke]: best interest of a client so we have to then teach them how to do it appropriately

799
00:38:41,737 –> 00:38:45,737
[Michael Finke]: and that’s part of what motivated us to think about what are some of the tradeoffs

800
00:38:45,817 –> 00:38:50,057
[Michael Finke]: between using for example the four percent rule which exposes the client to that

801
00:38:50,137 –> 00:38:54,377
[Michael Finke]: idiosyncratic risk of not knowing how long they’re going to live as opposed to

802
00:38:54,777 –> 00:38:59,337
[Michael Finke]: another strategy that incorporates some combination of annuitity that allows

803
00:38:59,417 –> 00:39:04,377
[Michael Finke]: people to live better in retirement and so that’s really the genesis of a lot of

804
00:39:04,377 –> 00:39:08,537
[Michael Finke]: the research on david blanch had also got his phd at texas tech but he was doing

805
00:39:08,777 –> 00:39:13,977
[Michael Finke]: research on retirement income planning before he came to texas tech waited foul

806
00:39:14,057 –> 00:39:19,257
[Michael Finke]: and i and david have done a lot of research together and really our main purpose

807
00:39:19,277 –> 00:39:20,277
[Michael Finke]: is to

808
00:39:21,337 –> 00:39:22,937
[Michael Finke]: get advisors to understand

809
00:39:23,977 –> 00:39:26,697
[Michael Finke]: when annuities provide value and why they

810
00:39:26,580 –> 00:39:27,580
[Paul Tyler]: that’s true

811
00:39:26,857 –> 00:39:31,417
[Michael Finke]: provide value really how to put together a retirement income plan that does the

812
00:39:31,577 –> 00:39:37,497
[Michael Finke]: best job for your client and then we have obviously faced a lot of opposition

813
00:39:37,737 –> 00:39:40,617
[Michael Finke]: along the way from people who like to believe that

814
00:39:40,603 –> 00:39:41,603
[Michael Finke]: yeah

815
00:39:40,857 –> 00:39:45,817
[Michael Finke]: annu doesn’t actually provide value but the reality is that every economist who

816
00:39:45,897 –> 00:39:47,657
[Michael Finke]: studies retirement income planning has been

817
00:39:47,323 –> 00:39:48,323
[Michael Finke]: yeah

818
00:39:47,817 –> 00:39:51,257
[Michael Finke]: saying for a long time that people are simply don’t anu as much and they could

819
00:39:52,297 –> 00:39:55,897
[Michael Finke]: have be happier in retirement they could spend more they could have more welfare

820
00:39:56,057 –> 00:40:01,097
[Michael Finke]: if they actually annu more of their savings and we just sort of adopted that as

821
00:40:01,177 –> 00:40:02,297
[Michael Finke]: the financial planning researchers

822
00:40:05,680 –> 00:40:10,080
[Ramsey Smith]: fantastic so i think we’re i think we’re at the the top of the hour here it’s been

823
00:40:10,240 –> 00:40:16,800
[Ramsey Smith]: uh been fantastic to have you on michael and uh we would love to have you back on

824
00:40:17,120 –> 00:40:19,360
[Ramsey Smith]: or make you a regular frankly in the

825
00:40:19,140 –> 00:40:20,140
[Ramsey Smith]: coming

826
00:40:19,380 –> 00:40:20,380
[Paul Tyler]: uh hu

827
00:40:19,563 –> 00:40:20,563
[Michael Finke]: hu

828
00:40:19,620 –> 00:40:20,620
[Ramsey Smith]: months and years

829
00:40:21,557 –> 00:40:22,557
[Michael Finke]: well i’d love that

830
00:40:21,763 –> 00:40:22,763
[Michael Finke]: no yeah

831
00:40:21,840 –> 00:40:26,160
[Paul Tyler]: no yeah ab absolutely michael so for listeners out there who want to learn more

832
00:40:22,420 –> 00:40:23,420
[Ramsey Smith]: yeah

833
00:40:22,743 –> 00:40:26,743
[Michael Finke]: ab absolutely michael so for listeners out there want to learn more all your

834
00:40:26,320 –> 00:40:28,480
[Paul Tyler]: follow your research where’s the best place to go

835
00:40:26,823 –> 00:40:28,583
[Michael Finke]: research where’s the best place to go

836
00:40:29,497 –> 00:40:33,737
[Michael Finke]: well i’m a contributing editor forth advisor magazine so once or twice a month

837
00:40:33,897 –> 00:40:37,497
[Michael Finke]: i’ll be writing articles for think advisor you can always follow my research on

838
00:40:37,737 –> 00:40:43,417
[Michael Finke]: social science research network to search ss rn and my name and you’ll find the

839
00:40:43,497 –> 00:40:47,817
[Michael Finke]: articles that i’ve done recently and all the articles that i’ve done in the past

840
00:40:48,560 –> 00:40:52,560
[Paul Tyler]: excellent all right wilson thanks so much for time michael ramsey great to see you

841
00:40:48,663 –> 00:40:52,583
[Michael Finke]: excellent alright wilson thanks so much for time michael ramsay great to see you

842
00:40:52,720 –> 00:40:59,120
[Paul Tyler]: in thai and for those of our listeners join us again next week for another episode

843
00:40:52,743 –> 00:40:58,343
[Michael Finke]: in thai and uh for those of our listeners join us again next week for another

844
00:40:58,663 –> 00:41:00,583
[Michael Finke]: episode of that annuity show

845
00:40:59,280 –> 00:41:00,480
[Paul Tyler]: of that annuity show

846
00:41:04,560 –> 00:41:07,360
[Paul Tyler]: hey thanks that was great michael can you leave your um

847
00:41:08,400 –> 00:41:13,520
[Paul Tyler]: your browser open you’re about halfway uploaded so we’ll end up dropping off but

848
00:41:13,600 –> 00:41:17,920
[Paul Tyler]: just if you just let it let it run that would be great hey ramsay thank that we

849
00:41:18,000 –> 00:41:19,760
[Paul Tyler]: appreciate it this is great to get you on here

850
00:41:22,660 –> 00:41:23,660
[Paul Tyler]: yeah

851
00:41:24,980 –> 00:41:25,980
[Paul Tyler]: well

852
00:41:28,160 –> 00:41:29,200
[Paul Tyler]: for getting you on

853
00:41:34,340 –> 00:41:35,340
[Paul Tyler]: yeah

854
00:41:36,960 –> 00:41:40,640
[Paul Tyler]: yeah and michael just on your last name is it finke if fink

855
00:41:41,760 –> 00:41:47,440
[Paul Tyler]: fina okay german excellent all right hey listen no this is great well i’ll put

856
00:41:47,520 –> 00:41:50,800
[Paul Tyler]: those links in the show outs and anything else you’d think you’d want us to link

857
00:41:50,420 –> 00:41:51,420
[Paul Tyler]: to

858
00:41:52,000 –> 00:41:56,640
[Paul Tyler]: shoot me out and we’ll get it up in the next i think to look out how many weeks

859
00:41:56,640 –> 00:42:00,880
[Paul Tyler]: we’re out it what we’re one or two weeks out right now uh with show but uh good

860
00:42:01,340 –> 00:42:02,340
[Paul Tyler]: alright

861
00:42:03,440 –> 00:42:05,440
[Paul Tyler]: thank you thanks bye

862
00:42:09,520 –> 00:42:11,680
[Paul Tyler]: we call okay great thanks

863
00:42:14,640 –> 00:42:16,720
[Paul Tyler]: we leave it up ts yeah thank you

864
00:42:18,480 –> 00:42:21,520
[Paul Tyler]: uh okay so next is what

865
00:42:25,920 –> 00:42:27,440
[Paul Tyler]: ashley yeah this is really good here

866
00:42:29,220 –> 00:42:30,220
[Paul Tyler]: ha

867
00:42:30,500 –> 00:42:31,500
[Paul Tyler]: lake

868
00:42:39,660 –> 00:42:40,660
[Paul Tyler]: yeah stream key

869
00:42:50,060 –> 00:42:51,060
[Paul Tyler]: right okay

870
00:43:20,960 –> 00:43:22,000
[Paul Tyler]: here are the times

871
00:43:25,280 –> 00:43:26,320
[Paul Tyler]: okay ashley

872
00:43:30,240 –> 00:43:31,280
[Paul Tyler]: hm okay

873
00:43:36,620 –> 00:43:37,620
[Paul Tyler]: hm

874
00:43:41,840 –> 00:43:47,760
[Paul Tyler]: hey ashley oh how you doing you don’t feel it feels like two weeks i’m telling you

875
00:43:48,000 –> 00:43:50,480
[Paul Tyler]: and what we part two

876
00:43:51,060 –> 00:43:52,060
[Paul Tyler]: yeah

877
00:43:53,760 –> 00:43:57,760
[Paul Tyler]: no good good interview with michael finke finke fink

878
00:43:59,040 –> 00:44:03,680
[Paul Tyler]: who who’s a professor at the american college some he you know he’s somebody he

879
00:44:03,760 –> 00:44:09,280
[Paul Tyler]: gets written up all all over he’s a vocal but i don’t know a little stuffy guy i

880
00:44:09,280 –> 00:44:13,120
[Paul Tyler]: don’t know it it was good it was good he’ll be a good name to get on there but

881
00:44:13,680 –> 00:44:17,760
[Paul Tyler]: this guy net you can tell he never deals with clients and he’s been you can tell

882
00:44:17,840 –> 00:44:20,320
[Paul Tyler]: he’s saying the same thing over and over and over and over again

883
00:44:21,920 –> 00:44:25,760
[Paul Tyler]: he’s a te he’s a teacher exactly a teacher

884
00:44:27,600 –> 00:44:34,800
[Paul Tyler]: yeah yeah so fs out yeah and shagging on social media at least oh yeah totally

885
00:44:35,200 –> 00:44:39,040
[Paul Tyler]: okay so hey listen you’re you’re working a lot here let me let me go through my

886
00:44:39,120 –> 00:44:41,360
[Paul Tyler]: list and kind of you tell me what i what i’m missing here

887
00:44:42,260 –> 00:44:43,260
[Paul Tyler]: so

888
00:44:45,580 –> 00:44:46,580
[Paul Tyler]: pull us up

889
00:44:50,580 –> 00:44:51,580
[Paul Tyler]: let’s see

890
00:44:52,980 –> 00:44:53,980
[Paul Tyler]: okay uh

891
00:44:56,000 –> 00:44:57,520
[Paul Tyler]: all right so if i were looking

892
00:44:58,960 –> 00:45:00,720
[Paul Tyler]: backwards and i know i’m missing stuff

893
00:45:05,460 –> 00:45:06,460
[Paul Tyler]: oh yeah let’s see

894
00:45:13,440 –> 00:45:15,360
[Paul Tyler]: make sure i’m like not missing it here

895
00:45:19,600 –> 00:45:23,760
[Paul Tyler]: okay big stuff if i look at and tell me what i’m missing if i if i kind of grouped

896
00:45:23,840 –> 00:45:26,080
[Paul Tyler]: it by like okay fi work

897
00:45:28,320 –> 00:45:29,520
[Paul Tyler]: well writer courses

898
00:45:30,900 –> 00:45:31,900
[Paul Tyler]: writer pages

899
00:45:33,040 –> 00:45:34,720
[Paul Tyler]: the index videos right

900
00:45:35,780 –> 00:45:36,780
[Paul Tyler]: um

901
00:45:37,360 –> 00:45:41,280
[Paul Tyler]: th th were those kind of the big ones i think like if you look back last quarter

902
00:45:42,140 –> 00:45:43,140
[Paul Tyler]: right for

903
00:45:44,480 –> 00:45:48,240
[Paul Tyler]: i would say so i think most of the the time and organization went into those

904
00:45:51,520 –> 00:45:57,120
[Paul Tyler]: y yeah question i’m not sure i have to go back and look the rest of the stuff i

905
00:45:57,200 –> 00:46:00,000
[Paul Tyler]: know there’s a lot of stuff but i’m trying yeah if i’m going to try back and say

906
00:46:00,080 –> 00:46:04,560
[Paul Tyler]: well what did she do well you know listen ashley was played a big role in getting

907
00:46:05,280 –> 00:46:10,800
[Paul Tyler]: all those new products launched and out the door for the fs now i think on med sup

908
00:46:11,200 –> 00:46:16,160
[Paul Tyler]: you’ve been doing a ton there now the ones that kind of leaps out is all the work

909
00:46:16,400 –> 00:46:21,680
[Paul Tyler]: to get all the ads running on meds yeah that was for or for last quarter

910
00:46:22,000 –> 00:46:25,600
[Paul Tyler]: definitely for this past quarter for sure yeah obviously we

911
00:46:27,200 –> 00:46:32,080
[Paul Tyler]: yeah millions right i mean it’s it’s a it’s a it’s a lot of stuff going on but and

912
00:46:32,080 –> 00:46:35,360
[Paul Tyler]: then going back and actually looking through those pages after we got them

913
00:46:35,440 –> 00:46:41,120
[Paul Tyler]: launched now you’ve also done you did a lot for for the content for the app right

914
00:46:41,520 –> 00:46:44,080
[Paul Tyler]: a lot of the content development work for our

915
00:46:45,680 –> 00:46:49,520
[Paul Tyler]: and development part management and the app kind of going back and forth between

916
00:46:49,760 –> 00:46:53,360
[Paul Tyler]: systems and loading everything and organizing with nick how to update the website

917
00:46:53,420 –> 00:46:54,420
[Paul Tyler]: right to reflect

918
00:46:55,760 –> 00:47:00,640
[Paul Tyler]: yeah yeah that was that was big um and the other one was i think which is a good

919
00:47:00,800 –> 00:47:04,080
[Paul Tyler]: one and probably it probably didn’t take you that much time but it was i think

920
00:47:04,080 –> 00:47:08,160
[Paul Tyler]: it’s good for time just to see doing that stuff is you know pulling those pages

921
00:47:08,240 –> 00:47:09,360
[Paul Tyler]: apart and

922
00:47:10,720 –> 00:47:14,400
[Paul Tyler]: on sales net it seemed like okay how do you tell a story about going from here to

923
00:47:14,560 –> 00:47:19,120
[Paul Tyler]: here to there so i think that’s the bit you like right are we missing anything now

924
00:47:19,680 –> 00:47:23,920
[Paul Tyler]: you did a lot with salesforce but there’s still kind of stuff in flight there um

925
00:47:25,600 –> 00:47:29,440
[Paul Tyler]: yeah a lot of building of reports and organizing things tesa and i are going to

926
00:47:29,520 –> 00:47:34,000
[Paul Tyler]: have a call with them this week to renew our package for next year and ask a

927
00:47:33,820 –> 00:47:34,820
[Paul Tyler]: couple of questions

928
00:47:35,760 –> 00:47:40,240
[Paul Tyler]: yeah right i mean you got all the reimagined contacts in there right that was a

929
00:47:40,320 –> 00:47:44,880
[Paul Tyler]: big deal we had all the um update elite stuff in we had all the reimagined

930
00:47:44,880 –> 00:47:49,520
[Paul Tyler]: contacts too we added all the simple annuity and red agent information that we

931
00:47:49,680 –> 00:47:56,160
[Paul Tyler]: have and organize that um i think those are the good paths they list close yeah

932
00:48:05,680 –> 00:48:10,960
[Paul Tyler]: and the f stuff kind of being part of that oh yeah yeah yeah let me not it is a

933
00:48:11,040 –> 00:48:14,480
[Paul Tyler]: problem it’s like this action i mean this year i’m swear i’m keeping these lists

934
00:48:14,540 –> 00:48:15,540
[Paul Tyler]: so that it’s

935
00:48:16,880 –> 00:48:18,480
[Paul Tyler]: easy through the course of the year here

936
00:48:20,960 –> 00:48:24,800
[Paul Tyler]: it is as we talk about it more stuff is popping up in my mind so i’m like yeah i

937
00:48:24,800 –> 00:48:28,000
[Paul Tyler]: guess yeah it just not like you’re you know it’s not like the score points however

938
00:48:28,160 –> 00:48:29,920
[Paul Tyler]: it’s great to be able to look back and say

939
00:48:30,500 –> 00:48:31,500
[Paul Tyler]: okay

940
00:48:32,720 –> 00:48:37,760
[Paul Tyler]: w you know we just sit on our butts for accomplishments to yeah

941
00:48:40,640 –> 00:48:43,280
[Paul Tyler]: yeah five nine implementation and that was

942
00:48:47,680 –> 00:48:51,920
[Paul Tyler]: that was mary mary was mary was really involved in that one too right as what’s

943
00:48:52,000 –> 00:48:56,720
[Paul Tyler]: tea she really drove it and then he’s a kind of like handled it from the back end

944
00:48:57,840 –> 00:49:03,040
[Paul Tyler]: yeah all the calls but mary i think was kind of put together yeah okay so that’s

945
00:49:02,860 –> 00:49:03,860
[Paul Tyler]: good so that

946
00:49:04,720 –> 00:49:08,320
[Paul Tyler]: if you think either stuff tell me because i think it’s great to kind of what you

947
00:49:08,400 –> 00:49:10,080
[Paul Tyler]: know what i do right was big

948
00:49:12,480 –> 00:49:17,280
[Paul Tyler]: i think um now in progress oh my gosh okay let’s let’s kind of go through this so

949
00:49:18,180 –> 00:49:19,180
[Paul Tyler]: um

950
00:49:20,160 –> 00:49:22,320
[Paul Tyler]: this is not an order this is just how it’s sorted

951
00:49:23,680 –> 00:49:27,120
[Paul Tyler]: okay triathlon that thing’s kind of going when i’m moving along right with

952
00:49:28,720 –> 00:49:35,360
[Paul Tyler]: you and jessica yeah for that for our ordering a braided items and or where it’s

953
00:49:35,440 –> 00:49:36,800
[Paul Tyler]: coming from reasonable

954
00:49:38,320 –> 00:49:41,600
[Paul Tyler]: okay i’m getting pricing on snow fencing and other manners of

955
00:49:43,280 –> 00:49:45,600
[Paul Tyler]: yeah you know what i would do is see if you could

956
00:49:47,840 –> 00:49:52,320
[Paul Tyler]: see if neal could be there for photos why are you why do you why don’t you book

957
00:49:52,140 –> 00:49:53,140
[Paul Tyler]: him now

958
00:49:54,860 –> 00:49:55,860
[Paul Tyler]: let’s do that

959
00:50:00,180 –> 00:50:01,180
[Paul Tyler]: i think

960
00:50:02,320 –> 00:50:07,520
[Paul Tyler]: can you put something together for mark i think there’s the triathlon uh i think

961
00:50:07,300 –> 00:50:08,300
[Paul Tyler]: there’s a

962
00:50:08,820 –> 00:50:09,820
[Paul Tyler]: yeah i

963
00:50:10,480 –> 00:50:12,640
[Paul Tyler]: for sale for sales people yeah i think um

964
00:50:13,540 –> 00:50:14,540
[Paul Tyler]: day

965
00:50:16,480 –> 00:50:19,440
[Paul Tyler]: yeah it just something that he could kind of

966
00:50:20,480 –> 00:50:25,280
[Paul Tyler]: send to people to say what what the heck is this i’ve got a starter page for you

967
00:50:25,520 –> 00:50:29,360
[Paul Tyler]: feel free to start from scratch right that was one that just kind of put out there

968
00:50:32,880 –> 00:50:36,800
[Paul Tyler]: okay grow together deck we gotta wait for tom mark was actually asking for us

969
00:50:37,600 –> 00:50:40,320
[Paul Tyler]: that’s kind of out there annuity genius

970
00:50:40,900 –> 00:50:41,900
[Paul Tyler]: piece

971
00:50:43,280 –> 00:50:47,200
[Paul Tyler]: you just need to know like when can we cancel are we hooked into this thing

972
00:50:47,060 –> 00:50:48,060
[Paul Tyler]: forever

973
00:50:48,800 –> 00:50:52,080
[Paul Tyler]: i asked her in the mail yesterday and i said we’d like to consider a three month

974
00:50:52,140 –> 00:50:53,140
[Paul Tyler]: contract i want to

975
00:50:53,940 –> 00:50:54,940
[Paul Tyler]: okay

976
00:50:58,560 –> 00:51:04,480
[Paul Tyler]: so you know suffer for snub on your end is personalized agendas and then has colin

977
00:51:04,560 –> 00:51:08,720
[Paul Tyler]: given you any sort of run a show yet to figure out like what are you doing when no

978
00:51:08,960 –> 00:51:13,520
[Paul Tyler]: so she said that mary’s creating it the contractor is gonna create it and send it

979
00:51:13,600 –> 00:51:15,360
[Paul Tyler]: to us but i haven’t seen anything so i

980
00:51:16,560 –> 00:51:19,600
[Paul Tyler]: yeah just to ask her because i i don’t want you to go down there and feel like

981
00:51:19,600 –> 00:51:25,040
[Paul Tyler]: you’re sitting on your hands or worse you you’ve you kind of jumping around at

982
00:51:25,120 –> 00:51:30,080
[Paul Tyler]: last second to do stuff right enough either way is fine i mean i i don’t think’ll

983
00:51:30,080 –> 00:51:33,520
[Paul Tyler]: be sitting around cause there’s less staff now this time around than there wasn’t

984
00:51:33,680 –> 00:51:37,040
[Paul Tyler]: noa and yeah i think she wants us to drive people around

985
00:51:38,320 –> 00:51:41,040
[Paul Tyler]: i think that’s going to be part of like a big part of what we’re doing is like

986
00:51:41,120 –> 00:51:44,160
[Paul Tyler]: golf caring people okay so stay

987
00:51:45,200 –> 00:51:46,480
[Paul Tyler]: do we have insurance for that

988
00:51:48,140 –> 00:51:49,140
[Paul Tyler]: it’s a good question

989
00:51:50,240 –> 00:51:51,440
[Paul Tyler]: yeah seriously right

990
00:51:52,640 –> 00:51:55,760
[Paul Tyler]: so i think you ask because if we start to shuttle people around

991
00:51:57,600 –> 00:52:01,040
[Paul Tyler]: okay somebody falls off a golf cart somebody gets hit by a golf cart

992
00:52:02,720 –> 00:52:08,320
[Paul Tyler]: the resort yeah i don’t want to see you personally right right wrong

993
00:52:09,360 –> 00:52:12,880
[Paul Tyler]: i mean i probably it prob it would probably fall on her scope right

994
00:52:14,320 –> 00:52:19,600
[Paul Tyler]: it probably is in shared with the event um but i don’t know yeah because there’s a

995
00:52:19,680 –> 00:52:22,160
[Paul Tyler]: reason why people at companies aren’t driving people around

996
00:52:23,920 –> 00:52:25,360
[Paul Tyler]: okay we be hire companies

997
00:52:26,640 –> 00:52:27,840
[Paul Tyler]: yeah yeah okay

998
00:52:29,700 –> 00:52:30,700
[Paul Tyler]: so okay

999
00:52:31,420 –> 00:52:32,420
[Paul Tyler]: personalized stuff

1000
00:52:33,840 –> 00:52:37,600
[Paul Tyler]: now i think the ones where i think you know the big impact okay

1001
00:52:38,640 –> 00:52:43,360
[Paul Tyler]: chat usage by elites this is going to be good i think the bigger salesforce stuff

1002
00:52:43,760 –> 00:52:48,320
[Paul Tyler]: is a big deal like i think that elite scoreboard i i’m calling it elite score

1003
00:52:48,400 –> 00:52:49,600
[Paul Tyler]: board in salesforce

1004
00:52:50,260 –> 00:52:51,260
[Paul Tyler]: um

1005
00:52:52,640 –> 00:52:56,560
[Paul Tyler]: uh when do you think you’re i’m sorry i keep asking so is it ended this week

1006
00:52:56,720 –> 00:53:01,680
[Paul Tyler]: they’re giving you data um ask for it by monday so we could do the first up monday

1007
00:53:01,680 –> 00:53:04,080
[Paul Tyler]: scott’s right back he’s at the office oh good

1008
00:53:04,740 –> 00:53:05,740
[Paul Tyler]: okay

1009
00:53:07,340 –> 00:53:08,340
[Paul Tyler]: that’s right

1010
00:53:09,200 –> 00:53:10,960
[Paul Tyler]: so yeah don’t worry

1011
00:53:11,620 –> 00:53:12,620
[Paul Tyler]: i think

1012
00:53:15,140 –> 00:53:16,140
[Paul Tyler]: let’s see

1013
00:53:17,600 –> 00:53:20,560
[Paul Tyler]: i think we’re in a good place though with the fields and i think he can do it all

1014
00:53:20,720 –> 00:53:24,960
[Paul Tyler]: it’s not i don’t think there’s is any issue in him mapping those skills okay all

1015
00:53:24,580 –> 00:53:25,580
[Paul Tyler]: right

1016
00:53:25,780 –> 00:53:26,780
[Paul Tyler]: um

1017
00:53:27,680 –> 00:53:32,720
[Paul Tyler]: did you see sorry back to the live chat thing you see the facebook messenger yeah

1018
00:53:32,880 –> 00:53:36,720
[Paul Tyler]: that it was great because i actually it started pop up and i think i think it gave

1019
00:53:36,720 –> 00:53:42,240
[Paul Tyler]: me a a two like a like some initial chat thing coming through there but it was

1020
00:53:42,400 –> 00:53:45,520
[Paul Tyler]: great i responded she went back through facebook

1021
00:53:47,220 –> 00:53:48,220
[Paul Tyler]: no

1022
00:53:49,600 –> 00:53:50,640
[Paul Tyler]: yeah no i yeah

1023
00:53:52,320 –> 00:53:53,680
[Paul Tyler]: yeah i think this was really good

1024
00:53:56,080 –> 00:54:00,960
[Paul Tyler]: again chat the reason i’m kind of walking through this elite and chat is going to

1025
00:54:00,960 –> 00:54:04,800
[Paul Tyler]: be really important for how do we engage these people in sort of an automated

1026
00:54:04,960 –> 00:54:08,880
[Paul Tyler]: fashion and that this will link the phone calls to the notes to the whatever so we

1027
00:54:09,120 –> 00:54:12,160
[Paul Tyler]: really you know get to know these people and

1028
00:54:16,080 –> 00:54:19,920
[Paul Tyler]: you know how do you turn into advisor for these elites right thats you know hey

1029
00:54:20,000 –> 00:54:23,840
[Paul Tyler]: i’m calling up ashley because she needs help with this stuff like i i’ll go back

1030
00:54:24,080 –> 00:54:27,120
[Paul Tyler]: to chris and give him a call and say he how’s everything going i’ll probably call

1031
00:54:27,200 –> 00:54:32,320
[Paul Tyler]: him the next next four or five days oh ashley’s great she does this she knows my

1032
00:54:32,020 –> 00:54:33,020
[Paul Tyler]: stuff

1033
00:54:36,880 –> 00:54:41,440
[Paul Tyler]: that will be i think that this will be a really good experience for you right if

1034
00:54:41,520 –> 00:54:44,960
[Paul Tyler]: you can sort of become the consult not the person’s doing it but the consult

1035
00:54:46,000 –> 00:54:50,400
[Paul Tyler]: but you know it’s a fine line between here’s the destruction manual versus i’m

1036
00:54:50,480 –> 00:54:53,360
[Paul Tyler]: actually going in and doing your phot post w where’s that

1037
00:54:54,400 –> 00:54:57,520
[Paul Tyler]: yeah there’s always a little bit of a healthy hand or at least willingness right

1038
00:54:57,260 –> 00:54:58,260
[Paul Tyler]: like you

1039
00:55:00,880 –> 00:55:03,120
[Paul Tyler]: yeah yeah so that’s that’s really good

1040
00:55:04,480 –> 00:55:08,480
[Paul Tyler]: now in terms of i don’t have the stuff on here it feels like you’re really

1041
00:55:08,640 –> 00:55:13,600
[Paul Tyler]: enjoying these podcast promotional stuff right went into riverside last night i

1042
00:55:13,760 –> 00:55:16,480
[Paul Tyler]: played around a little bit with the clips and i like redid the layouts and stuff

1043
00:55:16,800 –> 00:55:19,920
[Paul Tyler]: myself so i that was fun okay good good i’m

1044
00:55:20,900 –> 00:55:21,900
[Paul Tyler]: okay good

1045
00:55:22,880 –> 00:55:26,640
[Paul Tyler]: now i’m kind of excited about i think this will be good too for you to launch this

1046
00:55:26,720 –> 00:55:31,280
[Paul Tyler]: med sup piece frank’s going to come up here i want to work i want to work a little

1047
00:55:31,360 –> 00:55:35,920
[Paul Tyler]: more on that logo i kind of look at it it just feels a little too drab

1048
00:55:37,040 –> 00:55:39,280
[Paul Tyler]: yeah what does it feel like old

1049
00:55:40,140 –> 00:55:41,140
[Paul Tyler]: yes it does

1050
00:55:42,100 –> 00:55:43,100
[Paul Tyler]: i’m

1051
00:55:44,240 –> 00:55:47,760
[Paul Tyler]: some of the stuff that i heard in that social media examiner podcast was like the

1052
00:55:47,840 –> 00:55:52,720
[Paul Tyler]: trends and the upcoming trends are we use neons but brighter colors and things

1053
00:55:53,680 –> 00:55:57,280
[Paul Tyler]: well yeah and i’m gonna have freak like i looked at those color palettes and

1054
00:55:59,040 –> 00:56:02,720
[Paul Tyler]: you know i’ve been watching all these drug commercials like o tesla i can almost

1055
00:56:02,800 –> 00:56:08,240
[Paul Tyler]: say sing the o tesla commercial now hot you know ro zamak

1056
00:56:09,920 –> 00:56:14,560
[Paul Tyler]: but you know they’re all like real neon purple green blue and i think if frank

1057
00:56:14,640 –> 00:56:17,680
[Paul Tyler]: just tuned those colors up i think what i’m gonna do is have him i’m gonna have

1058
00:56:17,680 –> 00:56:22,000
[Paul Tyler]: him up here work through what the how to make sure the graphics are all kind of

1059
00:56:22,080 –> 00:56:25,760
[Paul Tyler]: set up but i think i’m going to have him tune those colors up a little more take

1060
00:56:25,840 –> 00:56:30,160
[Paul Tyler]: the hues up so we have a gray one but let’s take it up i agree with you we need

1061
00:56:29,940 –> 00:56:30,940
[Paul Tyler]: more of a

1062
00:56:31,660 –> 00:56:32,660
[Paul Tyler]: it seems like a very

1063
00:56:34,080 –> 00:56:38,880
[Paul Tyler]: yeah it’s too i don’t know it’s different it’ll definitely look different than

1064
00:56:39,040 –> 00:56:43,520
[Paul Tyler]: anything else that’s on the yeah yeah and it’s legible and i think it’ll appeal to

1065
00:56:43,600 –> 00:56:45,840
[Paul Tyler]: end and i think we can animate some of those characters

1066
00:56:46,420 –> 00:56:47,420
[Paul Tyler]: so

1067
00:56:48,400 –> 00:56:53,280
[Paul Tyler]: how what’s her name jessica ho her down i haven’t seen any emails come back let’s

1068
00:56:53,280 –> 00:56:58,240
[Paul Tyler]: see an emailer today to reach out towar and see kind of touch base introduce

1069
00:56:58,320 –> 00:57:01,920
[Paul Tyler]: yourself find out about the speakers yeah find find out where we are

1070
00:57:02,980 –> 00:57:03,980
[Paul Tyler]: now

1071
00:57:05,280 –> 00:57:06,640
[Paul Tyler]: we line them up i think

1072
00:57:07,620 –> 00:57:08,620
[Paul Tyler]: um

1073
00:57:09,840 –> 00:57:13,840
[Paul Tyler]: you know if we could telling actually if we could lock them all up in a week we

1074
00:57:13,920 –> 00:57:18,800
[Paul Tyler]: could bundle them up say ten of them and that could be our initial launch you know

1075
00:57:19,120 –> 00:57:25,200
[Paul Tyler]: for you know we load three or four and then push out a couple others later i don’t

1076
00:57:25,200 –> 00:57:29,440
[Paul Tyler]: know think about what that launch may be because we could do this all probably in

1077
00:57:29,520 –> 00:57:34,000
[Paul Tyler]: one set and push it up there you want to do the podcast release weekly or you do

1078
00:57:34,080 –> 00:57:38,480
[Paul Tyler]: it by week i don’t know i would think so sometimes when they i i think you talked

1079
00:57:38,480 –> 00:57:41,040
[Paul Tyler]: to jessica about how they will push and promote it

1080
00:57:42,880 –> 00:57:47,040
[Paul Tyler]: but when we apply for you know apple and stuff to get in there there’s a process

1081
00:57:47,360 –> 00:57:50,400
[Paul Tyler]: it’s super easy and lets them to sort of set up a new podcast

1082
00:57:51,680 –> 00:57:56,320
[Paul Tyler]: however i didn’t actually do the approval process for apple so it’s kind of like

1083
00:57:56,400 –> 00:58:00,960
[Paul Tyler]: you have to put it all together and then apply to apple to be listed and i have

1084
00:58:01,040 –> 00:58:04,400
[Paul Tyler]: not if you could kind of investigate that that is what we paid this other firm to

1085
00:58:04,480 –> 00:58:07,760
[Paul Tyler]: do for us you know and we used them once yeah

1086
00:58:08,800 –> 00:58:11,360
[Paul Tyler]: yeah that different versus

1087
00:58:13,600 –> 00:58:17,120
[Paul Tyler]: yeah yeah yeah it’s it’s different but it’s similar because you have to get listed

1088
00:58:17,280 –> 00:58:20,800
[Paul Tyler]: i’m not sure if they need five episodes or six episodes they just kind of want i

1089
00:58:21,040 –> 00:58:23,120
[Paul Tyler]: think they listen or screen through and say are you

1090
00:58:24,720 –> 00:58:27,280
[Paul Tyler]: doing anything offensive for something

1091
00:58:30,320 –> 00:58:35,520
[Paul Tyler]: yeah yeah so and then let’s figure out like is this a one time thing or you know

1092
00:58:35,680 –> 00:58:38,800
[Paul Tyler]: does it keep going oh guess what speak of the devil j

1093
00:58:39,920 –> 00:58:42,640
[Paul Tyler]: jw trub just sent an email through it jay says

1094
00:58:44,820 –> 00:58:45,820
[Paul Tyler]: hey

1095
00:58:46,640 –> 00:58:48,080
[Paul Tyler]: inclusive of age tech

1096
00:58:51,200 –> 00:58:53,120
[Paul Tyler]: wanna see if we align this with the event

1097
00:58:59,900 –> 00:59:00,900
[Paul Tyler]: like innovation st

1098
00:59:02,160 –> 00:59:04,720
[Paul Tyler]: yeah a little broader and then like line it up there

1099
00:59:06,000 –> 00:59:07,520
[Paul Tyler]: yeah do you want let’s see

1100
00:59:09,360 –> 00:59:11,440
[Paul Tyler]: sure like like i think the answer is

1101
00:59:13,280 –> 00:59:17,120
[Paul Tyler]: meds up if we get line with this event you don’t have to by any account

1102
00:59:19,680 –> 00:59:20,880
[Paul Tyler]: yeah absolutely

1103
00:59:22,400 –> 00:59:24,960
[Paul Tyler]: absolutely um absolutely how closely

1104
00:59:26,420 –> 00:59:27,420
[Paul Tyler]: absolutely

1105
00:59:30,080 –> 00:59:32,000
[Paul Tyler]: how closely would you want want it

1106
00:59:34,880 –> 00:59:37,360
[Paul Tyler]: how closely would you want this

1107
00:59:39,360 –> 00:59:42,000
[Paul Tyler]: to a lot to align with your event you know

1108
00:59:44,320 –> 00:59:45,440
[Paul Tyler]: you know i eat you know

1109
00:59:47,460 –> 00:59:48,460
[Paul Tyler]: levels

1110
00:59:49,980 –> 00:59:50,980
[Paul Tyler]: could be

1111
00:59:51,900 –> 00:59:52,900
[Paul Tyler]: you know

1112
00:59:53,580 –> 00:59:54,580
[Paul Tyler]: colors

1113
00:59:55,680 –> 01:00:00,800
[Paul Tyler]: um is us a really nice yeah inclusion you know you know i’d say cut your e you

1114
01:00:00,340 –> 01:00:01,340
[Paul Tyler]: know

1115
01:00:02,560 –> 01:00:04,960
[Paul Tyler]: your color palate around that n

1116
01:00:06,960 –> 01:00:08,880
[Paul Tyler]: you know include you know your you know

1117
01:00:09,620 –> 01:00:10,620
[Paul Tyler]: and

1118
01:00:15,380 –> 01:00:16,380
[Paul Tyler]: mediterranean name

1119
01:00:17,860 –> 01:00:18,860
[Paul Tyler]: mediterranean

1120
01:00:21,620 –> 01:00:22,620
[Paul Tyler]: name

1121
01:00:23,600 –> 01:00:24,880
[Paul Tyler]: include your medicare name

1122
01:00:27,140 –> 01:00:28,140
[Paul Tyler]: in the show

1123
01:00:34,080 –> 01:00:35,920
[Paul Tyler]: like it in the right end or in the reader

1124
01:00:37,580 –> 01:00:38,580
[Paul Tyler]: yeah um

1125
01:00:39,820 –> 01:00:40,820
[Paul Tyler]: you know partnership

1126
01:00:45,060 –> 01:00:46,060
[Paul Tyler]: eight

1127
01:00:52,720 –> 01:00:57,280
[Paul Tyler]: i checked him out on linkedin that looks like he’s like the entrepreneur oh he is

1128
01:00:59,420 –> 01:01:00,420
[Paul Tyler]: happy to

1129
01:01:01,440 –> 01:01:04,400
[Paul Tyler]: email s name too quick zoom

1130
01:01:08,560 –> 01:01:11,760
[Paul Tyler]: yeah so when you can you cook start looking at page check

1131
01:01:13,060 –> 01:01:14,060
[Paul Tyler]: a check

1132
01:01:14,880 –> 01:01:18,800
[Paul Tyler]: might be a nice tian you to re imagine it could be it it really could it really

1133
01:01:18,960 –> 01:01:20,400
[Paul Tyler]: could here so um

1134
01:01:22,080 –> 01:01:24,800
[Paul Tyler]: so so we have to think like let’s see what the answer is but there’s like is the

1135
01:01:24,880 –> 01:01:27,040
[Paul Tyler]: age tech or is it you know

1136
01:01:31,020 –> 01:01:32,020
[Paul Tyler]: health and

1137
01:01:33,780 –> 01:01:34,780
[Paul Tyler]: senior health

1138
01:01:36,300 –> 01:01:37,300
[Paul Tyler]: yeah yeah

1139
01:01:38,400 –> 01:01:43,200
[Paul Tyler]: to see home age tax sounds better i’d rather oh i do a senior health care podcast

1140
01:01:46,800 –> 01:01:49,040
[Paul Tyler]: right yeah no i agree yeah

1141
01:01:50,320 –> 01:01:53,200
[Paul Tyler]: um okay i’ll do some research around that yeah

1142
01:01:56,720 –> 01:01:59,840
[Paul Tyler]: because it could be just a limited thing man we’re just doing it this i’m looking

1143
01:02:00,000 –> 01:02:02,080
[Paul Tyler]: at this is like get us in the door with these people

1144
01:02:03,100 –> 01:02:04,100
[Paul Tyler]: absolutely

1145
01:02:05,260 –> 01:02:06,260
[Paul Tyler]: alright

1146
01:02:08,320 –> 01:02:13,360
[Paul Tyler]: let’s see oh for he kudos to you for taking these courses ashley i wish everybody

1147
01:02:13,680 –> 01:02:15,120
[Paul Tyler]: were doing what you’re doing okay

1148
01:02:16,400 –> 01:02:20,640
[Paul Tyler]: um i i would like you to take people through that write up that you did on the um

1149
01:02:20,800 –> 01:02:24,480
[Paul Tyler]: social media examiner thing what was your like what were the big like you know the

1150
01:02:24,560 –> 01:02:28,640
[Paul Tyler]: things you say i’m like we should be doing you know x y and z like what’s the

1151
01:02:28,960 –> 01:02:32,720
[Paul Tyler]: what’s the we’re doing the lot of it i think’s room for enhancement in a lot of

1152
01:02:32,800 –> 01:02:35,600
[Paul Tyler]: what we’re doing so like the things that really stuck out to me obviously videos

1153
01:02:36,000 –> 01:02:41,920
[Paul Tyler]: came so yeah look for the short short form video is a big deal clearly through tip

1154
01:02:42,080 –> 01:02:46,080
[Paul Tyler]: top and instagram because that’s the way like the whole world is working so they

1155
01:02:46,320 –> 01:02:48,160
[Paul Tyler]: talked about trends that they’re seeing in

1156
01:02:49,360 –> 01:02:53,600
[Paul Tyler]: like when instagram releases things or facebook meta releases things

1157
01:02:54,800 –> 01:02:59,280
[Paul Tyler]: be clues about what they’re looking for right um video is a huge one so they’re

1158
01:02:59,280 –> 01:03:03,680
[Paul Tyler]: moving away from picture towards video the other thing i thought was interesting

1159
01:03:03,920 –> 01:03:05,600
[Paul Tyler]: was they didn’t mention twitter at all

1160
01:03:06,640 –> 01:03:10,800
[Paul Tyler]: yeah there was one word about not one session about twitter

1161
01:03:12,240 –> 01:03:15,440
[Paul Tyler]: that was super interesting they did talk about long form video coming back on

1162
01:03:15,520 –> 01:03:18,800
[Paul Tyler]: youtube and how to kind of work around that and what to do there

1163
01:03:19,700 –> 01:03:20,700
[Paul Tyler]: um

1164
01:03:22,800 –> 01:03:25,200
[Paul Tyler]: you know it was huge that was like the big big takeaway

1165
01:03:27,600 –> 01:03:29,840
[Paul Tyler]: current parent making yourself trustworthy right

1166
01:03:30,880 –> 01:03:34,160
[Paul Tyler]: things that we don’t understand just made very clear

1167
01:03:35,920 –> 01:03:40,720
[Paul Tyler]: right so i i i guess the qu you know the question i was struggle with is okay how

1168
01:03:40,800 –> 01:03:43,920
[Paul Tyler]: much of this is you know do we do this for the consumer

1169
01:03:45,280 –> 01:03:50,720
[Paul Tyler]: versus how much it is for the agent and we you know for the community we tie into

1170
01:03:51,520 –> 01:03:55,040
[Paul Tyler]: right absolutely go for an instagram we need an instagram account for our company

1171
01:03:57,120 –> 01:04:01,360
[Paul Tyler]: to you so i started setting it up this morning do you wanna go with a user name

1172
01:04:01,680 –> 01:04:05,040
[Paul Tyler]: nasa financial group or would you like to go if user named nasa careers

1173
01:04:07,120 –> 01:04:10,400
[Paul Tyler]: i thought that an group is what we use on everything else even though we’re not

1174
01:04:10,540 –> 01:04:11,540
[Paul Tyler]: like we go

1175
01:04:12,720 –> 01:04:16,960
[Paul Tyler]: oh i know and then and then fi and phil wants somehow has got this nasa annuities

1176
01:04:17,100 –> 01:04:18,100
[Paul Tyler]: in his head right

1177
01:04:20,000 –> 01:04:21,840
[Paul Tyler]: which is terrifying to me but that’s okay

1178
01:04:26,140 –> 01:04:27,140
[Paul Tyler]: yeah um

1179
01:04:28,720 –> 01:04:31,280
[Paul Tyler]: the only worry i have about care is is

1180
01:04:32,480 –> 01:04:36,880
[Paul Tyler]: it feels like i you know i i don’t want to get us in the hook of its you know

1181
01:04:40,480 –> 01:04:43,760
[Paul Tyler]: because i remember when this popped up i think it’s popped up right around the the

1182
01:04:43,840 –> 01:04:49,120
[Paul Tyler]: pandemic a little bit before when everybody’s using a hashtag travelers cares

1183
01:04:51,200 –> 01:04:54,000
[Paul Tyler]: i didn’t know about that yeah yeah like i think

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 145: Diving Deep into the Power of Annuities With Michael Finke
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Episode 144: Charting a New Course for the Industry with Dave Levenson

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What role should an industry association play to support the growth of the life insurance and annuity business? This week’s guest, David Levenson has invested a lot of time of energy answering this question. As President and CEO of LIMRA, LOMA & LLGlobal, Dave has redefined the mission, structure, and operations of our major industry association during a period of crisis and rapid change. Today, he gives us an update on the group’s future direction and his perspective on major industry trends.
Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.
We hope you enjoy the show!
Links mentioned in the show:

Thank you to our show sponsor; The Index Standard!

Fixed Index Annuities and RILAs are getting more complex and technical just when fiduciary rules are getting stricter. How do you choose the right index and allocate to them? The Index Standard is your answer. They are an independent provider ratings and forecasts on all indices and ETFs used in the US insurance space. Their process is systematic and unbiased, identifying robust and well-designed indices. We all know finance is complex and The Index Standard has a clear ratings system and uses approachable language to demystify this complexity. Visit theindexstandard.com for more information.

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Transcript

1
00:00:00,905 –> 00:00:06,745
[Paul Tyler]: hi this is paul tyler and welcome to another episode of that annuity show ramsey

2
00:00:01,995 –> 00:02:00,315

3
00:00:06,825 –> 00:00:08,585
[Paul Tyler]: there’s no tie you lost your tie

4
00:00:09,120 –> 00:00:12,480
[Ramsey Smith]: yeah i came back from new york so i don’t i don’t need the uniform anymore

5
00:00:13,945 –> 00:00:19,945
[Paul Tyler]: all right so we’re back to sort of normal attire got a great guest once again okay

6
00:00:21,145 –> 00:00:27,385
[Paul Tyler]: you know i’m ramsey you you you got a very good person on to talk about where the

7
00:00:27,465 –> 00:00:30,345
[Paul Tyler]: industry is headed do you want to introduce him

8
00:00:30,960 –> 00:00:36,080
[Ramsey Smith]: yeah so we’re joined today by dave levinson who’s president and ceo of limber loma

9
00:00:36,160 –> 00:00:38,000
[Ramsey Smith]: and he’s an old friend of yours too paul so

10
00:00:38,045 –> 00:00:39,045
[Paul Tyler]: yes

11
00:00:38,400 –> 00:00:39,920
[Ramsey Smith]: i’m happy to share credit

12
00:00:41,120 –> 00:00:42,240
[Ramsey Smith]: for bringing him on the show

13
00:00:43,840 –> 00:00:49,440
[Ramsey Smith]: dave dave is a is a unique individual in a lot of ways he was at hartford for many

14
00:00:49,600 –> 00:00:53,360
[Ramsey Smith]: years at edward jones and now running limma so

15
00:00:55,200 –> 00:01:00,160
[Ramsey Smith]: the different elements of the industry that he has covered is broad and unique and

16
00:01:00,240 –> 00:01:03,920
[Ramsey Smith]: we’re really delighted to have him join us today so dave welcome

17
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[Ramsey Smith]: let’s get started but would definitely like to hear more about your journey you’ve

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[Ramsey Smith]: you’ve covered so many different areas and then now you’re back in at hartford

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[Ramsey Smith]: focusing on limma tell us about tell us about that trip

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[Dave Levenson]: yeah would would love to first you know ramsey paul thanks for having me and

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[Dave Levenson]: it is great spending some time with you guys again it’s spent a little bit little

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[Dave Levenson]: bit of time but it is good seeing you in a a casual a more casual environment so

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[Dave Levenson]: again thanks for the opportunity to to be with you today

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[Ramsey Smith]: so

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[Dave Levenson]: so look you know it’s been a fun journey

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[Ramsey Smith]: so

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[Dave Levenson]: so i was with hartford for seventeen years

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[Dave Levenson]: and did a lot of fun and interesting things

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[Dave Levenson]: it is the annuity show so i was i was managing the domestic u s business in

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[Dave Levenson]: addition to some other responsibilities

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[Dave Levenson]: and then you know i had the opportunity to go out to japan which you know was a

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[Dave Levenson]: tremendous

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[Dave Levenson]: a tremendous amount of fun for me

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[kate_theroux]: Ssssssssssssss,

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[Dave Levenson]: and just incredibly interesting so you know hartford entered and i’m going to

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[Paul Tyler]: yeah

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[Dave Levenson]: diverge a little bit but just to give you know listeners a background but you know

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[Dave Levenson]: hartford entered the

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[Dave Levenson]: the japanese

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[Ramsey Smith]: yeah

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[Dave Levenson]: insurance business there was really an

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[Dave Levenson]: annuity business

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[Ramsey Smith]: so

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[Dave Levenson]: in nineteen ninety nine two thousand

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[Dave Levenson]: and shot up like a rocket

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[Dave Levenson]: and you know within five years

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[Dave Levenson]: the company was doing more business in japan than it was in the u s and in the u s

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[Dave Levenson]: it was number one in market share so just pretty incredible

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[Ramsey Smith]: well

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[Dave Levenson]: but then it kind of went down as fast as it went up

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[Dave Levenson]: and you know i was sent out there to um try to stabilize things for a little bit

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[Dave Levenson]: so i went out spent three years there uh and just it was just

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[Dave Levenson]: a tremendous learning experience we did a lot of great things

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[Dave Levenson]: but you know ultimately came back after three years and uh you know harford went

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[Dave Levenson]: through a lot during the two thousand eight two thousand nine crisis

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[Dave Levenson]: and then you know i got to run the life company so life annuities

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[Dave Levenson]: retirement plans

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[Dave Levenson]: um

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[Dave Levenson]: you know that that was a lot of fun for me as well in twenty twelve hartford

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[Dave Levenson]: decided to get out of the life business and really focus on pnc

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[Dave Levenson]: and at that point ramsay i needed another job

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[Dave Levenson]: so you know most of my time was focused on our employees land

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[Dave Levenson]: but a fortuitous meeting with edward jones led to my next adventure and i spent

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[Dave Levenson]: six years in st louis ultimately leading their product suite in north america for

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[Dave Levenson]: everything that they did so advisory platforms mutual funds insurance annuities et

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[Dave Levenson]: cetera and that was great and then this opportunity came along around three years

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[Dave Levenson]: ago and

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[Dave Levenson]: you know at this point in my career the ability to give back to the industry was

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[Dave Levenson]: just compelling the ability to get back to the east coast

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[kate_theroux]: Ssssssssssssss

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[Dave Levenson]: uh to family was compelling and then here we are

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[Paul Tyler]: well e look this fascinating journey and i think it it feels long time ago but not

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[Paul Tyler]: that far along when yeah we were having a dinner in downtown hartford and you were

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[Paul Tyler]: talking to me about i think at that point dave you maybe it had been on the job

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[Paul Tyler]: maybe you know i don’t maybe six months and i

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[Dave Levenson]: yeah

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[Paul Tyler]: know you were doing a huge you know review to say okay

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[Paul Tyler]: hey listen lammers come a long ways you know world’s changing you know how do you

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[Paul Tyler]: keep an industry association relevant and you’d really taken a undertaken a bold

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[Paul Tyler]: strategy to reposition the organization now this was pre covid

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[Dave Levenson]: yeah exactly

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[Paul Tyler]: so tell us you know what happened covid hit um what had

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[Ramsey Smith]: what is that

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[Paul Tyler]: happened w you know how did the strategy prove out

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[Ramsey Smith]: no

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[Paul Tyler]: how did you have to change

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[Paul Tyler]: talk to us about the whole covid experience here

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[Dave Levenson]: yeah again another uh incredible adventure paul so and you’ve got a good memory so

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[Dave Levenson]: you know i joined the association in twenty nineteen

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[Dave Levenson]: january twenty nineteen i took over as ceo

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[Dave Levenson]: and you know we laid out what we call our compass twenty twenty five so you know

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[Dave Levenson]: where were we going over the next five or six years and you know what did do we

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[Dave Levenson]: really want to do with the association how could we benefit members all the stuff

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[Dave Levenson]: you would end up doing in a strategic plan

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[Dave Levenson]: and you know that’s still our north star

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[Dave Levenson]: and in some ways in many ways the pandemic which hit just you know fifteen months

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[Dave Levenson]: later

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[Dave Levenson]: accelerated a lot of things i mean some things we had to slow down on but some

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[Dave Levenson]: things we truly accelerated on i’ll give you an example

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[Dave Levenson]: one of the things that we said in our plan is we’ve got to do a better job

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[Dave Levenson]: connecting with c suite executives

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[Dave Levenson]: so a lot of the c suite

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[Dave Levenson]: has known us but not everyone in the c suite knew us well and yet we have a lot of

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[kate_theroux]: Ssssssssssssss,

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[Dave Levenson]: wonderful research that you know most people in the c suite should be looking at

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[Dave Levenson]: um fairly often

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[Dave Levenson]: so what we did early in the pandemic is we created i mean we have about one

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[Dave Levenson]: hundred twenty committee study groups that type of stuff but we didn’t have a lot

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[Dave Levenson]: for the c suite so we created what we called our cxo committees so we brought

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[Dave Levenson]: together cfos and chief investment officers and chief human resource officers and

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[Paul Tyler]: maybe

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[Dave Levenson]: chief underwriters and chief actuaries

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[Dave Levenson]: and the demand for

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[Dave Levenson]: executives to talk to one another

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[Dave Levenson]: nobody’s been through this pandemic right to talk to one another and say what are

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[Dave Levenson]: you experiencing and you know what are best practices and how are you getting

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[Dave Levenson]: through this and how are you getting through that it was really a unique time and

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[Dave Levenson]: it enabled us as an industry trade to really host some wonderful meetings that

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[Dave Levenson]: helped our member companies

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[Paul Tyler]: maybe

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[Dave Levenson]: kind of get through a pretty tough time

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[Dave Levenson]: there were other things that we were able to do that i thought were

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[Paul Tyler]: see

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[Dave Levenson]: incredibly valuable so go back to twenty twenty

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[Dave Levenson]: the markets were pretty crazy right for the first couple of months

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[Dave Levenson]: but you remember how low interest rates were

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[Ramsey Smith]: yeah

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[Dave Levenson]: right and we had just taken on a project at the request of some of our board

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[Dave Levenson]: members to

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[Paul Tyler]: i

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[Dave Levenson]: really study low interest rates and the long term impact on the industry

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[Dave Levenson]: so we brought together oliver ween and the acl and the three organizations worked

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[Dave Levenson]: with over one hundred executives to put out a lot of great insights and research

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[Dave Levenson]: about how to get through this low interest rate environment so again in many ways

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[Dave Levenson]: the pandemic has helped us um but you know let’s be let’s be honest i mean just

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[Dave Levenson]: being working remotely and going through a lot of change has also been a little

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[Dave Levenson]: difficult

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[Ramsey Smith]: are there any are there any key takeaways

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[Paul Tyler]: what

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[Ramsey Smith]: sort of big picture takeaways

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[Ramsey Smith]: from that study i mean that’s clearly right it’s an industry that lives and

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[kate_theroux]: Ssssssssssssss,

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[Ramsey Smith]: breathes on yield

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[Ramsey Smith]: so i’m curious what some of the there were what were some of the key conclusions

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[Ramsey Smith]: there

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[Dave Levenson]: well you know from uh you know i appreciate that question ramsey from a regulatory

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[Dave Levenson]: perspective i would say

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[Dave Levenson]: you know the regulators weren’t really um

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[Dave Levenson]: ready for this right you know what happens if interest rates go negative and you

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[Dave Levenson]: know when rates are when the ten years at one hundred seven

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[Dave Levenson]: nobody really thinks about that maybe they do more so than when they were at three

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[Dave Levenson]: or

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[Ramsey Smith]: yeah

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[Dave Levenson]: four when they’re at forty or fifty basis points it becomes a little bit of a

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[Dave Levenson]: different a different focal point for the industry

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[Dave Levenson]: so

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[Dave Levenson]: you know i think we

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[Dave Levenson]: we got our members to really think about negative rates and the impact of negative

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[Dave Levenson]: rates and we got our members to really think through

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[Dave Levenson]: what happens if this doesn’t turn quickly

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[Dave Levenson]: from a capital management perspective from a sales perspective from a product

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[Dave Levenson]: value perspective there’s so many different perspectives

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[Dave Levenson]: so i think ultimately ramsay there are a lot of really interesting takeaways i

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[Dave Levenson]: know i remember having six subgroups and each subgroup focusing on a different

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[Dave Levenson]: dimension and then we had a wrap up presentation at the end of twenty twenty

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[Dave Levenson]: but you know here we are what just just a couple years later and now we’re worried

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[Dave Levenson]: about you know wage inflation and inflation in general and you know will interest

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[Dave Levenson]: rates pop too quickly as opposed to we in a forty basis fifty basis point scenario

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[Dave Levenson]: again so it’s interesting how quickly the world changes

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[Ramsey Smith]: so you know just just just following up a little bit on that and you talked about

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[Ramsey Smith]: your experiences in japan and so things like negative interest rates are something

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[Ramsey Smith]: that

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[Ramsey Smith]: you probably saw at least on the horizon in

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[Dave Levenson]: yeah

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[Ramsey Smith]: japan not just not just low and negative but but over a long period of time

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[Ramsey Smith]: just very

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[Paul Tyler]: great

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[Ramsey Smith]: curious about how your experience outside the u s in the insurance industry which

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[kate_theroux]: Ssssssssssssss

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[Ramsey Smith]: is unusual we can be a very domestic industry if you think about it like you know

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[Ramsey Smith]: how that is how that is informed you know your thoughts on the industry and

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[Ramsey Smith]: frankly

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[Ramsey Smith]: your broader goals for limma

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[Dave Levenson]: yeah look it you know the world’s a big world

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[Dave Levenson]: and you know i think one of the key lessons for me going through the pandemic was

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[Dave Levenson]: you know one of the groups that i mentioned there were six groups looking at these

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[Dave Levenson]: slow interest rate what one of the groups looked at just what was going on in

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[Dave Levenson]: different parts of the world so what happened in japan what happened in

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[Dave Levenson]: switzerland because some of those countries you know we’re in a negative rate

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[Dave Levenson]: environment

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[Dave Levenson]: and of course in japan they’ve been in a low interest rate environment for an

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[Dave Levenson]: awfully long time

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[Dave Levenson]: so the ability to kind of look into you know how are those industries working

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[Dave Levenson]: what are their concerns challenges

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[Dave Levenson]: i think those were some pictures that we were able to really

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[Paul Tyler]: oh

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[Dave Levenson]: help members with

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[Dave Levenson]: but look there’s a lot of different factors at play so i’ll give you i’ll give you

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[Dave Levenson]: an example

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[Dave Levenson]: of the product that launched hartford in japan and really got us to this amazing

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[Dave Levenson]: position

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[Dave Levenson]: so it was

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[Dave Levenson]: a one year

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[Dave Levenson]: annuity

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[Dave Levenson]: uh with a payout over fifteen years

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[Dave Levenson]: right if

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[Dave Levenson]: if you if you’re you had below your prin if the account value were below principle

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[Dave Levenson]: so think about it as a gm b

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[Dave Levenson]: a twenty five year product

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[Dave Levenson]: and all we did was guarantee you’d get your money back over that two five year

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[Dave Levenson]: period right and this is this is about low interest

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[Ramsey Smith]: yeah

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[Dave Levenson]: rates so that doesn’t sound like much of a guarantee right

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[Ramsey Smith]: yeah

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[Dave Levenson]: but it enabled hartford to go from nowhere to to more sales than it what it was

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[kate_theroux]: Ssssssssssssss

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[Ramsey Smith]: yeah

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[Dave Levenson]: doing in the united states which is pretty incredible

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[Ramsey Smith]: sure

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[Dave Levenson]: but you know just to finish that story in japan what happened is

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[Dave Levenson]: a lot of the domestic players were watching this saying oh my god you know here’s

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[Dave Levenson]: this this u company coming in to to japan and you know taking this massive market

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[Dave Levenson]: share and you know we can do better than that right so it became like an arms race

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[Ramsey Smith]: yeah

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[Dave Levenson]: and pretty soon people were doing ten year g mab s in a low interest rate

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[Dave Levenson]: environment

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[Dave Levenson]: and we were looking at it saying you know we went to your former company and said

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[Dave Levenson]: how much would it cost to hedge this and the hedge was fifty percent more than the

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[Dave Levenson]: price of the product right

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[Ramsey Smith]: yeah

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[Dave Levenson]: so it just became a really crazy environment and just shows you how much

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[Dave Levenson]: you really need to understand it’s not just about the sales as you know

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[Dave Levenson]: this is a big risk management play

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[Dave Levenson]: but putting those pieces together

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[Dave Levenson]: was so fascinating again to watch our rise than to watch how the whole industry

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[Dave Levenson]: adjusted

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[Paul Tyler]: yeah we’ve had a couple of companies on ramsey over the last six months focused on

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[Paul Tyler]: flat out optimizing interest rates safe interest rates

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[Ramsey Smith]: yeah

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[Paul Tyler]: it’s interesting dave some have had both of them have had very little to do with

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[Paul Tyler]: insurance and annuities but i think they will end up leveraging annuities at some

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[Paul Tyler]: point

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[Dave Levenson]: yeah

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[Paul Tyler]: now with inflation rates again whole new whole new ball game

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[Paul Tyler]: maybe talk to us about maybe we could shift to one other sort of sort of big under

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[Paul Tyler]: underlying theme pre pandemic during pandemic post and

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[Paul Tyler]: post pandemic is going digital right you

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[Dave Levenson]: yeah

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[Paul Tyler]: know i think before the pandemic

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[Paul Tyler]: it was kind of innovation

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[Paul Tyler]: thinking about the future felt like the middle of the pandemic was we we just have

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[kate_theroux]: Ssssssssssssss

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[Paul Tyler]: to do it in order to even do business

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[Paul Tyler]: you know where’s the puck headed on on digitization of insurance carriers

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[Dave Levenson]: yeah look i think the industry made a lot of progress in the last couple of years

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[Dave Levenson]: because it had to right

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[Dave Levenson]: so you know on the life side we saw just a big jump in things like accelerated

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[Dave Levenson]: underwriting

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[Dave Levenson]: we saw a big jump in terms of

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[Dave Levenson]: the digitalization tools and the digital tools that advisors need to interface

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[Dave Levenson]: with clients

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[Ramsey Smith]: i’m so

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[Dave Levenson]: and we saw tremendous productivity gains right so all of that i think was very

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[Dave Levenson]: positive

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[Dave Levenson]: we saw changes in uh

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[Dave Levenson]: you know things like e signatures and just again those are all positive things for

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[Dave Levenson]: our industry so it is going to continue

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[Dave Levenson]: um

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[Dave Levenson]: and

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[Paul Tyler]: yeah

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[Dave Levenson]: you know i’m bullish that some of the changes that i think were long overdue

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[Dave Levenson]: have made but there’s still a ways to go for sure

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[Dave Levenson]: um you know one of the things that uh

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[Dave Levenson]: i think was really good for our industry is uh with life insurance we

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[Ramsey Smith]: uh

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[Dave Levenson]: saw

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[Dave Levenson]: just tremendous demand right and that’s not a surprise in the middle of a pandemic

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[Dave Levenson]: so we saw sales at levels that we hadn’t seen since nineteen eighty three

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[Dave Levenson]: and even the annuity business which

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[Dave Levenson]: really surprising to me has been flat like if you take the pandemic years out it

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[Dave Levenson]: it’s been flat for the last decade

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[Dave Levenson]: but we saw that that business jumped sixteen percent in aggregate if you just look

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[Dave Levenson]: at twenty one versus twenty and twenty was up versus nineteen toward the end of

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[Dave Levenson]: the year from a runway perspective so

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[Dave Levenson]: so i do think the pandemic’s been good to the industry when it could have been

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[Dave Levenson]: really bad

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[Dave Levenson]: but to your point about digital there are some things that we did that are great

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[kate_theroux]: Ssssssssssssss

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[Dave Levenson]: and there’s a lot that we have to still do

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[Paul Tyler]: now that’s interesting you mentioned life insurance sales and i’ve heard that i

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[Paul Tyler]: mean if the companies i saw dave who had

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[Paul Tyler]: you know on they were they had a use signature they had e app they could take

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[Paul Tyler]: do direct sales to consumers they can do rapid underwriting they had banner years

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[Paul Tyler]: you know i’ve talked to some of my

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[Dave Levenson]: yeah

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[Paul Tyler]: my peers around the market

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[Paul Tyler]: do you think the spike was effectively an acceleration of purchases of insurance

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[Paul Tyler]: or do you think it its somehow sort of changed the demand going forward and just

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[Paul Tyler]: in the life insurance sector

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[Dave Levenson]: yeah so that’s that’s the that’s the sixty four thousand dollar question i’ll say

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[Dave Levenson]: that we know that the demand increased so

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[Dave Levenson]: we did a study in the fall of two thousand and we know that

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[Dave Levenson]: because of the pandemic demand for life insurance increased about thirty one

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[Dave Levenson]: percent

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[Dave Levenson]: so similar to the study that we did on low interest rates with oliver weyman and

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[Dave Levenson]: ac what we did when we saw that pall because we want to be much more action

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[Dave Levenson]: oriented

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[Dave Levenson]: is we brought all of the life trade associations together so back to a cli finsec

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[Dave Levenson]: nab mafa mrt lid which is a the trade association for direct writers life happens

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[Dave Levenson]: all of us got together and said this is the time to unify and we came together and

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[Dave Levenson]: we we worked with seventy six

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[Dave Levenson]: of our member companies

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[Dave Levenson]: manufacturers and distributors

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[Dave Levenson]: and

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[Dave Levenson]: kate thau

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[Dave Levenson]: on our pr side every week sent out a kit um to all of these companies about what

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[Dave Levenson]: you need to know and it they were fact sheets it was social media

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[kate_theroux]: Ssssssssssssss,

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[Dave Levenson]: it went out to the distribution

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[Dave Levenson]: organizations and you know it was our feeling that

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[Ramsey Smith]: aw

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[Dave Levenson]: everybody became much more aware of their mortality right in the midst of the

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[Dave Levenson]: pandemic

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[Dave Levenson]: and

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[Dave Levenson]: not only was it important for our industry to support customers but we also felt

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[Dave Levenson]: like it was our responsibility

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[Dave Levenson]: as we heard all of these you know horrific stories so you i really

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[Ramsey Smith]: scary

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[Dave Levenson]: think this was a good time for our industry to step up and it was just i’m so

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[Dave Levenson]: proud of how how the insurance industry did step up

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[Ramsey Smith]: so in terms of your vision for for limma i remember we were speaking i think a few

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[Ramsey Smith]: weeks ago

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[Ramsey Smith]: and you’ve got grand plans

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[Ramsey Smith]: so so so so share some of those with us i mean you were you’re obviously doing a

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[Ramsey Smith]: lot of things here in the u s it’s interesting because

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[Ramsey Smith]: there’s existing organizations that are already trade organizations but you’re

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[Ramsey Smith]: playing a unifying role even among the organizations here in the u s and

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[Paul Tyler]: it’s

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[Ramsey Smith]: you’re taking steps to expand outside the u s tell us tell us about what your

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[Ramsey Smith]: vision is there

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[Dave Levenson]: yeah ramsay i appreciate the question so

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[Dave Levenson]: you know look you know when i came in

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[Dave Levenson]: you know limmer hass been around for you know one hundred six years it’s it’s it’s

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[Dave Levenson]: um it’s such a wonderful organization

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[Dave Levenson]: and so it’s got rich pedigree and

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[Dave Levenson]: strong reach in size right it’s the largest

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[Dave Levenson]: association in the world

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[Paul Tyler]: oh

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[Dave Levenson]: supporting life annuity and workplace benefits so there was a lot of great things

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[Dave Levenson]: that had been done historically with the association

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[Dave Levenson]: but let’s face it our industry was changing and has been changing very very

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[Dave Levenson]: quickly

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[Dave Levenson]: so

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[Dave Levenson]: i think it’s our responsibility to get ahead of it and help guide our member

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[kate_theroux]: Ssssssssssssss

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[Dave Levenson]: companies through a lot of this type of stuff

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[Dave Levenson]: so one of the first things that we did as part of our strategic review as we kind

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[Dave Levenson]: of stepped back and said look why do we exist why are we here and what would

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[Dave Levenson]: happen if we weren’t here so that enabled us to step back and you know something

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[Dave Levenson]: as basic as developing a purpose statement right and we developed a purpose

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[Dave Levenson]: statement that said what you know why we here

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[Dave Levenson]: and we’re

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[Ramsey Smith]: your

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[Dave Levenson]: here to advance the financial services industry by empowering our members with

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[Dave Levenson]: knowledge insights connections and solutions

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[Dave Levenson]: so that purpose statement

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[Dave Levenson]: allowed us to be very very focused on the things that we should do and the things

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[Dave Levenson]: that we shouldn’t do

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[Dave Levenson]: so when i think about things like knowledge i think about professional development

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[Dave Levenson]: and we have a designation program fm which is one of the largest in the world

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[Dave Levenson]: and over a hundred thousand people

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[Paul Tyler]: yeah

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[Dave Levenson]: have

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[Ramsey Smith]: cheese

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[Dave Levenson]: taken the fli designation

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[Dave Levenson]: but our designation i mean this is this is probably one hundred fifty hours to get

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[Dave Levenson]: your full designation is that where the world is going or do people want more

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[Dave Levenson]: quick hits

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[Dave Levenson]: so we’re shifting a little bit more toward foundational education

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[Dave Levenson]: was shifting to

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[Ramsey Smith]: just

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[Dave Levenson]: executive development work but that’s not something that we should do it’s

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[Dave Levenson]: something that we can partner with a wharton to do and in fact

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[Dave Levenson]: in the summer uh it’s gonna be our first

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[Dave Levenson]: program for wh executive education with lira

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[Dave Levenson]: and we only had a hundred

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[Ramsey Smith]: i guess

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[Dave Levenson]: seats because that’s all wharton would give us and here we are in march and we’re

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[Dave Levenson]: sold out right we’ve got fifty four companies

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[Paul Tyler]: hm

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[Dave Levenson]: that have signed up

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[Ramsey Smith]: wow

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[Dave Levenson]: for this and you go to wharton you

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[Paul Tyler]: yes

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[Dave Levenson]: go to the wharton school one week a year for three years and you know

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[Paul Tyler]: that

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[Dave Levenson]: you’re taught about you’re taught by some of the best professors in the world

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[Dave Levenson]: about how to work through this change and navigate this change and you know the

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[kate_theroux]: Ssssssssssssss,

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[Dave Levenson]: peer group you meet et cetera et cetera so you know i’m going down a little bit of

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[Dave Levenson]: a rabbit hole but what i’m trying to do is give you a sense that we’re looking at

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[Dave Levenson]: our knowledge bucket we’re looking at our insights bucket we’re looking at our

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[Dave Levenson]: solutions bucket we’re looking at our connections bucket and we’re saying what

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[Dave Levenson]: does that need to look like

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[Dave Levenson]: in three years

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[Dave Levenson]: for us to be truly indispensable to our members and we have a full

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[Ramsey Smith]: what else

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00:22:28,575 –> 00:22:32,255
[Dave Levenson]: fledged plan as far as what we’re going to do this year next year the year after

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[Dave Levenson]: to enable us to get to that point of indispensable with the vast majority of our

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[Dave Levenson]: members so again i could go on and on about different examples of different things

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[Ramsey Smith]: well so i’ve got two questions first one was so after three

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[Dave Levenson]: we’ve done but yeah

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[Paul Tyler]: we

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[Ramsey Smith]: years one one week a month you said like do you come out with an mba or what is

415
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[Ramsey Smith]: what is

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[Paul Tyler]: yeah

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[Ramsey Smith]: are you

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[Dave Levenson]: well that’d be a three week nba right um no you come out with a certificate and

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[Dave Levenson]: you know candidly we modeled this after a program that already existed

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[Ramsey Smith]: got it okay

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[Dave Levenson]: it’s called si

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[Ramsey Smith]: uhhuh

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[Dave Levenson]: and it’s between sif ma the securities industry and wharton

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[Ramsey Smith]: got it

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[Dave Levenson]: and whenever i went out and i talked to our member companies

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[Paul Tyler]: yeah

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[Dave Levenson]: they had no idea what i was talking about when i brought up that program and i

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[Dave Levenson]: said you know i went through it when i was with edward jones it was a phenomenal

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[Dave Levenson]: program

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[Ramsey Smith]: yeah

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[Dave Levenson]: why shouldn’t our industry have the same thing so that’s essentially what we did

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[Dave Levenson]: and the people on our team that put this together just doing an exceptional job

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[Dave Levenson]: and i’m super excited about what it’s going to look like in july

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[Ramsey Smith]: and the second thing was you said you were talking about things you should do and

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[Ramsey Smith]: shouldn’t do so i

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[Dave Levenson]: right

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[Ramsey Smith]: can’t resist

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[Dave Levenson]: right right

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[Ramsey Smith]: what would what were the things you get what were the things you you thought that

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[Ramsey Smith]: maybe you could deemphasize if if it’s not controversial

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[Dave Levenson]: yeah you know i’m not sure i want to go into a ton of detail

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[Ramsey Smith]: okay

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[Dave Levenson]: about that type of stuff but what i’ll share with you is

444
00:23:55,695 –> 00:24:02,095
[Dave Levenson]: you know we are an industry association which means if we’re not going deep with

445
00:24:01,995 –> 00:26:00,315
[kate_theroux]: Ssssssssssssss,

446
00:24:02,175 –> 00:24:04,975
[Dave Levenson]: our solutions with fifteen twenty fifty companies

447
00:24:06,175 –> 00:24:09,375
[Dave Levenson]: there’s probably limited value uh in what we do

448
00:24:09,140 –> 00:24:10,140
[Ramsey Smith]: uhuh

449
00:24:10,315 –> 00:24:11,315
[Dave Levenson]: so we had

450
00:24:10,605 –> 00:24:11,605
[Paul Tyler]: yeah

451
00:24:11,375 –> 00:24:12,815
[Dave Levenson]: a lot of solutions that

452
00:24:14,495 –> 00:24:16,975
[Dave Levenson]: three companies picked up or two companies picked up

453
00:24:18,015 –> 00:24:21,215
[Dave Levenson]: and candidly we’ve done away with several of those

454
00:24:21,980 –> 00:24:22,980
[Ramsey Smith]: got it all

455
00:24:22,365 –> 00:24:23,365
[Paul Tyler]: yeah

456
00:24:22,420 –> 00:24:23,420
[Ramsey Smith]: right

457
00:24:23,645 –> 00:24:24,645
[Paul Tyler]: yeah

458
00:24:24,180 –> 00:24:25,180
[Ramsey Smith]: very helpful

459
00:24:25,945 –> 00:24:31,305
[Paul Tyler]: yeah absolutely uh now we also do have a lot of agents who are listening

460
00:24:31,355 –> 00:24:32,355
[Dave Levenson]: yeah yeah

461
00:24:31,465 –> 00:24:32,665
[Paul Tyler]: and i know agents

462
00:24:34,425 –> 00:24:37,145
[Paul Tyler]: i’m trying to think if i’m an agent i know lira from

463
00:24:38,005 –> 00:24:39,005
[Paul Tyler]: you know

464
00:24:38,180 –> 00:24:39,180
[Ramsey Smith]: am

465
00:24:38,825 –> 00:24:40,585
[Paul Tyler]: taking my sorry am

466
00:24:40,365 –> 00:24:41,365
[Paul Tyler]: l

467
00:24:40,420 –> 00:24:41,420
[Ramsey Smith]: am ml

468
00:24:40,995 –> 00:24:41,995
[Dave Levenson]: am

469
00:24:41,485 –> 00:24:42,485
[Paul Tyler]: t taking my

470
00:24:42,475 –> 00:24:43,475
[Dave Levenson]: absolutely

471
00:24:42,665 –> 00:24:48,105
[Paul Tyler]: licensing you know uh or take my mandatory training there’s a lot of stuff i

472
00:24:48,265 –> 00:24:49,865
[Paul Tyler]: probably don’t know um

473
00:24:51,385 –> 00:24:54,825
[Paul Tyler]: how does how does your industry touch me as an agent

474
00:24:58,315 –> 00:24:59,315
[Dave Levenson]: yeah so

475
00:25:00,075 –> 00:25:01,075
[Dave Levenson]: when i think about

476
00:25:02,015 –> 00:25:06,255
[Dave Levenson]: and i’ll give you i’ll go a little deeper now so i gave you a little bit of a

477
00:25:06,655 –> 00:25:10,815
[Dave Levenson]: vision for knowledge i’ll give you a little bit of a vision for insights all right

478
00:25:10,895 –> 00:25:13,775
[Dave Levenson]: so when you think about insights think about our

479
00:25:13,660 –> 00:25:14,660
[Ramsey Smith]: thank you

480
00:25:13,935 –> 00:25:17,535
[Dave Levenson]: research organization which is the heart of who we are and who we’ve been

481
00:25:18,655 –> 00:25:19,775
[Dave Levenson]: um we’ve got about

482
00:25:21,055 –> 00:25:25,535
[Dave Levenson]: thirty percent of our organization that’s focused on the research function thirty

483
00:25:25,775 –> 00:25:27,375
[Dave Levenson]: percent of our three hundred twenty people

484
00:25:28,755 –> 00:25:29,755
[Dave Levenson]: so

485
00:25:30,495 –> 00:25:32,095
[Dave Levenson]: when i think about uh

486
00:25:33,135 –> 00:25:37,775
[Dave Levenson]: where we are very focused again we used to do a lot of stuff we just the

487
00:25:37,380 –> 00:25:38,380
[Ramsey Smith]: but

488
00:25:37,855 –> 00:25:41,215
[Dave Levenson]: breadth of what we did was incredible and this might get back into what did we

489
00:25:41,375 –> 00:25:46,575
[Dave Levenson]: stop doing and now what we’re saying is we are very focused on three verticals

490
00:25:47,375 –> 00:25:51,055
[Dave Levenson]: life insurance annuities and workplace benefits

491
00:25:52,095 –> 00:25:53,615
[Dave Levenson]: and there are three functions

492
00:25:54,895 –> 00:25:59,295
[Dave Levenson]: that we are very focused on because we could we could go all over the place with

493
00:25:59,455 –> 00:26:04,175
[Dave Levenson]: life annuity and workplace benefits but from a research perspective we are focused

494
00:26:01,995 –> 00:28:00,315
[kate_theroux]: Ssssssssssssss,

495
00:26:04,195 –> 00:26:05,195
[Dave Levenson]: on distribution

496
00:26:06,415 –> 00:26:11,535
[Dave Levenson]: and we are focused on the customer and customer insights and we are focused on

497
00:26:11,775 –> 00:26:16,095
[Dave Levenson]: product those are the three so when you think about you know paul your question

498
00:26:16,075 –> 00:26:17,075
[Dave Levenson]: you know

499
00:26:17,935 –> 00:26:22,815
[Dave Levenson]: we are going to be doing a lot of research in that we call it our three by three

500
00:26:23,775 –> 00:26:26,895
[Dave Levenson]: so annuity distribution is one of those boxes

501
00:26:28,015 –> 00:26:33,695
[Dave Levenson]: and you know we will be able to provide a lot of research to

502
00:26:35,295 –> 00:26:39,695
[Dave Levenson]: our members that manufacture products and our members that distribute products

503
00:26:40,735 –> 00:26:48,015
[Dave Levenson]: about annuity distribution so what do advisors want and what do customers want and

504
00:26:48,095 –> 00:26:53,455
[Dave Levenson]: how do advisors meet those needs and we’ve got a ton of research already that

505
00:26:53,535 –> 00:26:56,975
[Dave Levenson]: we’ve done around these things but we’re going to get even more focused around it

506
00:26:59,165 –> 00:27:00,165
[Paul Tyler]: got it

507
00:27:01,545 –> 00:27:05,225
[Paul Tyler]: again from the agent perspective i’ll stick to our area

508
00:27:05,395 –> 00:27:06,395
[Dave Levenson]: yeah

509
00:27:05,465 –> 00:27:09,545
[Paul Tyler]: annuities we talked about life insurance lots of change you know i think

510
00:27:09,460 –> 00:27:10,460
[Ramsey Smith]: i think i like

511
00:27:09,625 –> 00:27:13,145
[Paul Tyler]: about my career dev it work i started with a mutual it turned into a public

512
00:27:12,925 –> 00:27:13,925
[Paul Tyler]: company

513
00:27:14,075 –> 00:27:15,075
[Dave Levenson]: hello

514
00:27:14,985 –> 00:27:18,425
[Paul Tyler]: worked for a private equity owned insurance company when i think it was you know

515
00:27:18,425 –> 00:27:22,505
[Paul Tyler]: we were one of the first few now it seems to be you know private equity ownership

516
00:27:22,585 –> 00:27:23,625
[Paul Tyler]: is almost the the

517
00:27:24,180 –> 00:27:25,180
[Ramsey Smith]: becoming the norm

518
00:27:24,965 –> 00:27:25,965
[Paul Tyler]: it is the norm

519
00:27:26,275 –> 00:27:27,275
[Dave Levenson]: yeah

520
00:27:27,145 –> 00:27:30,745
[Paul Tyler]: but lots of change you know you got pe firms coming in but

521
00:27:30,355 –> 00:27:31,355
[Dave Levenson]: yeah

522
00:27:30,825 –> 00:27:31,865
[Paul Tyler]: then you see a lot of companies

523
00:27:32,985 –> 00:27:37,305
[Paul Tyler]: boxing up their annuity business and giving it to people to run as closed blocks

524
00:27:37,085 –> 00:27:38,085
[Paul Tyler]: how do i

525
00:27:37,475 –> 00:27:38,475
[Dave Levenson]: yeah

526
00:27:37,865 –> 00:27:41,785
[Paul Tyler]: make sense of this as an agent you know do i need to worry about it is this just

527
00:27:41,865 –> 00:27:47,065
[Paul Tyler]: sort of a normal changing of the guard in an industry and whose bank account is is

528
00:27:47,225 –> 00:27:48,425
[Paul Tyler]: backing the products

529
00:27:49,295 –> 00:27:53,535
[Dave Levenson]: he again you you’re asking all the right questions and i wish i had a crystal ball

530
00:27:53,615 –> 00:27:58,575
[Dave Levenson]: to tell you kind of what it all means but what it does mean is that again there’s

531
00:27:58,435 –> 00:27:59,435
[Dave Levenson]: a lot of change

532
00:28:00,335 –> 00:28:04,735
[Dave Levenson]: so the industry just in the last twenty four months has changed tremendously

533
00:28:01,995 –> 00:30:00,315
[kate_theroux]: Ssssssssssssss

534
00:28:05,855 –> 00:28:07,935
[Dave Levenson]: with the amount of private equity firms that

535
00:28:08,675 –> 00:28:09,675
[Dave Levenson]: are

536
00:28:10,815 –> 00:28:15,135
[Dave Levenson]: in place and you know people always say you know dave is that good or is it bad

537
00:28:15,215 –> 00:28:18,815
[Dave Levenson]: and i say look i don’t know if it is good or i don’t know if it is bad it just is

538
00:28:19,535 –> 00:28:21,695
[Dave Levenson]: right and that’s our reality so

539
00:28:22,735 –> 00:28:27,055
[Dave Levenson]: you know when i think about and again you know edward jones had eighteen thousand

540
00:28:27,375 –> 00:28:31,055
[Dave Levenson]: financial advisors when i think about the role of the financial advisor

541
00:28:32,335 –> 00:28:36,335
[Dave Levenson]: they’ve got to make sure that the products and solutions that they bring to

542
00:28:36,195 –> 00:28:37,195
[Dave Levenson]: customers

543
00:28:38,115 –> 00:28:39,115
[Dave Levenson]: meet their needs

544
00:28:40,575 –> 00:28:41,855
[Dave Levenson]: and are good for

545
00:28:42,975 –> 00:28:47,215
[Dave Levenson]: the time period that the customer wants them to be good for right so if i’m fifty

546
00:28:47,455 –> 00:28:51,535
[Dave Levenson]: five and i want to turn income on at sixty five i need a product that’s going to

547
00:28:51,615 –> 00:28:53,215
[Dave Levenson]: be around for twenty thirty forty years

548
00:28:55,075 –> 00:28:56,075
[Dave Levenson]: so

549
00:28:56,735 –> 00:29:02,175
[Dave Levenson]: i think with the help of insurance regulators there’s a lot of products that are

550
00:29:02,495 –> 00:29:05,935
[Dave Levenson]: in force that are still good products and whether they’re owned by

551
00:29:06,875 –> 00:29:07,875
[Dave Levenson]: you know

552
00:29:08,495 –> 00:29:12,255
[Dave Levenson]: you know blackstone or whether they’re owned by a traditional mutual company i’m

553
00:29:12,335 –> 00:29:13,695
[Dave Levenson]: not sure it matters that much

554
00:29:14,735 –> 00:29:15,935
[Dave Levenson]: um you know i think

555
00:29:17,135 –> 00:29:21,055
[Dave Levenson]: there’s a lot of solvency for the companies that are backing those products

556
00:29:22,175 –> 00:29:29,295
[Dave Levenson]: as it go as it has implications to new products right and what advisors or agents

557
00:29:29,235 –> 00:29:30,235
[Dave Levenson]: could get excited about

558
00:29:31,215 –> 00:29:32,575
[Dave Levenson]: i think it’s going to open up

559
00:29:34,015 –> 00:29:36,735
[Dave Levenson]: more creativity and innovation in

560
00:29:36,420 –> 00:29:37,420
[Ramsey Smith]: so

561
00:29:36,475 –> 00:29:37,475
[Dave Levenson]: our space

562
00:29:38,415 –> 00:29:41,695
[Dave Levenson]: anytime you have new entrants that’s what they do right to disrupt i’ve got to

563
00:29:41,775 –> 00:29:45,535
[Dave Levenson]: come up with different solutions different ways of doing business i’m a big

564
00:29:45,695 –> 00:29:47,775
[Dave Levenson]: believer that that is never a bad thing

565
00:29:49,135 –> 00:29:52,975
[Dave Levenson]: so it’s good good for customers and ultimately i think it’s good for our industry

566
00:29:52,995 –> 00:29:53,995
[Dave Levenson]: so

567
00:29:55,215 –> 00:29:59,455
[Dave Levenson]: those that get in front of the change and those that can leverage the change

568
00:29:59,775 –> 00:30:02,815
[Dave Levenson]: effectively you’re going to win i think over the next several years

569
00:30:01,995 –> 00:32:00,315
[kate_theroux]: Ssssssssssssss,

570
00:30:03,600 –> 00:30:07,680
[Ramsey Smith]: so now you brought up pardon me you brought up as one of your three key areas

571
00:30:08,720 –> 00:30:10,480
[Ramsey Smith]: workplace benefits and

572
00:30:10,115 –> 00:30:11,115
[Dave Levenson]: yeah

573
00:30:11,440 –> 00:30:15,120
[Ramsey Smith]: secure act is something we’ve talked about on this show a lot and something

574
00:30:14,675 –> 00:30:15,675
[Dave Levenson]: yes

575
00:30:15,360 –> 00:30:17,920
[Ramsey Smith]: i spend a lot of time thinking about in terms of my own

576
00:30:18,940 –> 00:30:19,940
[Ramsey Smith]: business objectives

577
00:30:19,405 –> 00:30:20,405
[Paul Tyler]: well

578
00:30:20,900 –> 00:30:21,900
[Ramsey Smith]: very interested to hear

579
00:30:24,000 –> 00:30:29,440
[Ramsey Smith]: what sort of thoughts have been developed within limma vc v vc v

580
00:30:30,800 –> 00:30:35,840
[Ramsey Smith]: implant annuities and other other initiatives that are essentially born of the

581
00:30:35,660 –> 00:30:36,660
[Ramsey Smith]: secure act

582
00:30:36,445 –> 00:30:37,445
[Paul Tyler]: yeah

583
00:30:37,120 –> 00:30:41,120
[Ramsey Smith]: would love to get your perspective is somebody one who sort of in the middle of

584
00:30:41,200 –> 00:30:44,720
[Ramsey Smith]: the in the middle of the industry united nations if you will

585
00:30:46,560 –> 00:30:49,040
[Ramsey Smith]: and how many years do you think it’s going to take before it really

586
00:30:50,080 –> 00:30:51,200
[Ramsey Smith]: finds its momentum

587
00:30:52,895 –> 00:30:56,415
[Dave Levenson]: yeah uh so ramsay you probably know more about this than i do

588
00:30:57,615 –> 00:31:03,455
[Dave Levenson]: but you know what i’d share with you is you know the secure act good thing right a

589
00:31:03,535 –> 00:31:05,615
[Dave Levenson]: good thing that it requires an annuity solution

590
00:31:07,215 –> 00:31:08,415
[Dave Levenson]: on a lot of these plans

591
00:31:09,775 –> 00:31:11,055
[Dave Levenson]: but you know early on again

592
00:31:12,175 –> 00:31:15,775
[Dave Levenson]: if i’m a provider of the industry if i’m a four hundred one thousand provider i

593
00:31:15,935 –> 00:31:19,695
[Dave Levenson]: kind of look at this and say you know meps peps good bad

594
00:31:19,460 –> 00:31:20,460
[Ramsey Smith]: yeah

595
00:31:20,175 –> 00:31:23,935
[Dave Levenson]: growing fast i mean so the fact that we can get in front of this

596
00:31:25,135 –> 00:31:29,215
[Dave Levenson]: because we’re so good with benchmarking i mean it’s kind of when i talk about

597
00:31:29,375 –> 00:31:33,855
[Dave Levenson]: research the heart of our research is our benchmarking so people will look to us

598
00:31:33,675 –> 00:31:34,675
[Dave Levenson]: and say

599
00:31:35,935 –> 00:31:40,815
[Dave Levenson]: alright i’ve been watching but like is this happening like what’s happened the

600
00:31:40,815 –> 00:31:45,375
[Dave Levenson]: first couple of months and we provide those insights to our members which is super

601
00:31:45,195 –> 00:31:46,195
[Dave Levenson]: helpful

602
00:31:46,895 –> 00:31:52,975
[Dave Levenson]: similar for implant annuities and you know you know as well as i do that the take

603
00:31:53,155 –> 00:31:54,155
[Dave Levenson]: on that has been slow

604
00:31:54,980 –> 00:31:55,980
[Ramsey Smith]: yeah

605
00:31:55,315 –> 00:31:56,315
[Dave Levenson]: so

606
00:31:57,455 –> 00:32:01,615
[Dave Levenson]: there are a number of plans that are offering these solutions

607
00:32:01,995 –> 00:34:00,315
[kate_theroux]: Ssssssssssssss,

608
00:32:03,055 –> 00:32:06,495
[Dave Levenson]: but at the participant level it’s still fairly complicated

609
00:32:08,335 –> 00:32:11,535
[Dave Levenson]: but i’m so when you ask the question how long will it take

610
00:32:13,695 –> 00:32:18,655
[Dave Levenson]: i think about this and i say are implant annuities the right thing or the wrong

611
00:32:18,975 –> 00:32:20,015
[Dave Levenson]: thing right

612
00:32:21,215 –> 00:32:24,095
[Dave Levenson]: and i say for a retirement plan

613
00:32:25,375 –> 00:32:26,895
[Dave Levenson]: they’re absolutely the right thing

614
00:32:27,795 –> 00:32:28,795
[Dave Levenson]: because

615
00:32:30,015 –> 00:32:35,375
[Dave Levenson]: we are getting tax preferred treatment on retirement plans because the government

616
00:32:35,775 –> 00:32:38,415
[Dave Levenson]: wants us to help people in retirement right

617
00:32:38,260 –> 00:32:39,260
[Ramsey Smith]: yep

618
00:32:39,295 –> 00:32:44,015
[Dave Levenson]: and the best way to help people in retirement is to ensure that people have income

619
00:32:44,815 –> 00:32:47,775
[Dave Levenson]: while they’re in retirement at the end of the day that’s what that’s what you know

620
00:32:48,015 –> 00:32:52,575
[Dave Levenson]: the government is is supporting us to do thats what we should do so i’m a big

621
00:32:52,655 –> 00:32:57,215
[Dave Levenson]: believer in implant annuities it’s just it’s a very sophisticated solution

622
00:32:57,935 –> 00:33:02,815
[Dave Levenson]: relative to what people are used to it may maybe it’s not super sophisticate it’s

623
00:33:02,815 –> 00:33:06,815
[Dave Levenson]: just different right but when i think about back to your question paul about

624
00:33:06,975 –> 00:33:13,215
[Dave Levenson]: digital and the role of i think that’s all gonna come together nicely and i do i

625
00:33:13,295 –> 00:33:17,295
[Dave Levenson]: am bullish that we’re going to see growth in that space but i don’t think it’s

626
00:33:17,375 –> 00:33:23,295
[Dave Levenson]: going to be at you know a speed at a level of speed that you know over the next

627
00:33:22,980 –> 00:33:23,980
[Ramsey Smith]: true

628
00:33:23,455 –> 00:33:26,255
[Dave Levenson]: two or three years is gonna you know break any speed records

629
00:33:26,800 –> 00:33:28,080
[Ramsey Smith]: got it so i have

630
00:33:28,155 –> 00:33:29,155
[Dave Levenson]: but it’s coming

631
00:33:28,240 –> 00:33:33,360
[Ramsey Smith]: i have one more one more question uh that really sort of harks back to your time

632
00:33:33,520 –> 00:33:35,600
[Ramsey Smith]: at edward jones so you were

633
00:33:35,395 –> 00:33:36,395
[Dave Levenson]: do

634
00:33:36,080 –> 00:33:40,560
[Ramsey Smith]: you were working for you know one of the premier sort of financial advisory firms

635
00:33:40,720 –> 00:33:45,120
[Ramsey Smith]: in the united states and you know you were you you’re coming in there as an

636
00:33:45,280 –> 00:33:51,040
[Ramsey Smith]: insurance expert one of the tensions in the industry is how we engage with

637
00:33:51,840 –> 00:33:54,880
[Ramsey Smith]: financial advisors effectively so

638
00:33:54,435 –> 00:33:55,435
[Dave Levenson]: yeah

639
00:33:55,840 –> 00:33:59,440
[Ramsey Smith]: meeting them where they are in terms of the kind of products they’ll like they

640
00:33:59,600 –> 00:34:02,080
[Ramsey Smith]: like compensation structure et cetera

641
00:34:01,995 –> 00:36:00,315
[kate_theroux]: Ssssssssssssss,

642
00:34:03,520 –> 00:34:08,000
[Ramsey Smith]: any insights it means that you can share from that experience would be would be

643
00:34:05,085 –> 00:34:06,085
[Paul Tyler]: sure

644
00:34:08,100 –> 00:34:09,100
[Ramsey Smith]: would be fascinating

645
00:34:10,655 –> 00:34:15,055
[Dave Levenson]: yeah look edward jones is an exceptional firm as are a lot of the other

646
00:34:16,335 –> 00:34:19,775
[Dave Levenson]: firms out there that a lot of the you know your listeners work for

647
00:34:21,375 –> 00:34:25,615
[Dave Levenson]: but you know one of the things that i respected greatly about the organization is

648
00:34:25,695 –> 00:34:27,775
[Dave Levenson]: that its focus on the consumer

649
00:34:29,695 –> 00:34:35,375
[Dave Levenson]: and ensuring that whatever we did was right by the customer and we had checks and

650
00:34:35,455 –> 00:34:40,335
[Dave Levenson]: balances all all through the organization to ensure that that was always true

651
00:34:41,875 –> 00:34:42,875
[Dave Levenson]: so

652
00:34:43,595 –> 00:34:44,595
[Dave Levenson]: vmc what

653
00:34:44,125 –> 00:34:45,125
[Paul Tyler]: yeah

654
00:34:44,575 –> 00:34:50,095
[Dave Levenson]: i’ll do is i’ll draw i’ll draw a little analogy here right because this is the way

655
00:34:50,255 –> 00:34:53,935
[Dave Levenson]: i always used to think about things so think about how much time and effort

656
00:34:55,935 –> 00:34:59,935
[Dave Levenson]: the industry is spending on fiduciary and

657
00:35:00,975 –> 00:35:06,415
[Dave Levenson]: the dol rule and the sec rule and the syncing up of the rules and where’s it going

658
00:35:06,895 –> 00:35:08,735
[Dave Levenson]: and you know and then think

659
00:35:08,445 –> 00:35:09,445
[Paul Tyler]: yeah

660
00:35:08,895 –> 00:35:13,855
[Dave Levenson]: about the core of what it’s designed to do right at the end of the day it’s really

661
00:35:14,175 –> 00:35:18,655
[Dave Levenson]: designed to protect consumers right to ensure

662
00:35:20,015 –> 00:35:25,215
[Dave Levenson]: that whatever somebody sells them is right for them right

663
00:35:26,575 –> 00:35:30,575
[Dave Levenson]: and then think about um if you step back and think about

664
00:35:31,315 –> 00:35:32,315
[Dave Levenson]: how many

665
00:35:32,915 –> 00:35:33,915
[Dave Levenson]: um

666
00:35:34,575 –> 00:35:36,655
[Dave Levenson]: consumers sit down with an advisor

667
00:35:37,695 –> 00:35:42,175
[Dave Levenson]: and truly get a broad based plan that addresses all of their needs

668
00:35:42,915 –> 00:35:43,915
[Dave Levenson]: right

669
00:35:44,435 –> 00:35:45,435
[Dave Levenson]: and insurance

670
00:35:47,275 –> 00:35:48,275
[Dave Levenson]: retirement income

671
00:35:49,635 –> 00:35:50,635
[Dave Levenson]: investments

672
00:35:51,615 –> 00:35:55,615
[Dave Levenson]: uh college planning that all has to factor in together

673
00:35:57,455 –> 00:36:03,935
[Dave Levenson]: so the way i looked at it is that is the gold standard that’s what every advisor

674
00:36:01,995 –> 00:38:00,315
[kate_theroux]: Ssssssssssssss

675
00:36:04,095 –> 00:36:08,255
[Dave Levenson]: should be doing and look i know life insurance can be very clunky right sometimes

676
00:36:08,495 –> 00:36:12,415
[Dave Levenson]: you have to fill out an application and maybe it’s more paper intensive than it

677
00:36:12,155 –> 00:36:13,155
[Dave Levenson]: should be

678
00:36:13,855 –> 00:36:19,055
[Dave Levenson]: but is it necessary for a forty year old with a young family to have life

679
00:36:18,835 –> 00:36:19,835
[Dave Levenson]: insurance

680
00:36:20,655 –> 00:36:25,375
[Dave Levenson]: and if i’m an advisor is that my responsibility right back to again

681
00:36:26,895 –> 00:36:29,375
[Dave Levenson]: the uh the concept of fiduciary

682
00:36:30,575 –> 00:36:35,455
[Dave Levenson]: so in my heart right and i think in your hearts and i think in most advisors

683
00:36:35,615 –> 00:36:40,095
[Dave Levenson]: hearts that is absolutely what they should be doing and they can point to

684
00:36:40,255 –> 00:36:43,375
[Dave Levenson]: insurance and say it’s clunky or they can point to annuities and say the

685
00:36:43,615 –> 00:36:47,295
[Dave Levenson]: technology is not where it needs to be and things aren’t integrated but

686
00:36:48,655 –> 00:36:52,575
[Dave Levenson]: we as financial professionals need to go that extra mile

687
00:36:53,695 –> 00:36:57,855
[Dave Levenson]: and ensure that it’s all coming together the right way even if it’s extra work

688
00:36:58,895 –> 00:37:03,535
[Dave Levenson]: because our responsibility is to make sure that consumers are invested and have

689
00:37:03,755 –> 00:37:04,755
[Dave Levenson]: protection where they should

690
00:37:06,425 –> 00:37:08,105
[Paul Tyler]: wow that that that’s great

691
00:37:08,540 –> 00:37:09,540
[Ramsey Smith]: absolutely

692
00:37:09,705 –> 00:37:15,225
[Paul Tyler]: it is now we’re almost at the top top of our time so dave i i’ve got the big y

693
00:37:15,545 –> 00:37:18,665
[Paul Tyler]: question so you’ve got a huge board

694
00:37:20,025 –> 00:37:25,545
[Paul Tyler]: of i’m sure probably if you have twenty members on your board i you got two strong

695
00:37:25,855 –> 00:37:28,255
[Dave Levenson]: twenty five yeah yeah yeah

696
00:37:26,105 –> 00:37:27,225
[Paul Tyler]: strong opinion right

697
00:37:30,165 –> 00:37:31,165
[Paul Tyler]: you know you’ve

698
00:37:33,385 –> 00:37:38,745
[Paul Tyler]: you’ve got a very complicated organization a lot of different set of very

699
00:37:38,985 –> 00:37:42,585
[Paul Tyler]: important services that you deliver to the industry why do you do this

700
00:37:43,165 –> 00:37:44,165
[Paul Tyler]: why

701
00:37:43,835 –> 00:37:44,835
[Dave Levenson]: why do i do it

702
00:37:44,365 –> 00:37:45,365
[Paul Tyler]: yeah why do you

703
00:37:48,580 –> 00:37:49,580
[Ramsey Smith]: so

704
00:37:49,295 –> 00:37:55,455
[Dave Levenson]: so paul i i think i think that this is a little bit of a higher calling for me

705
00:37:55,155 –> 00:37:56,155
[Dave Levenson]: right

706
00:37:56,735 –> 00:38:02,175
[Dave Levenson]: i i love what our industry does i think it serves an incredible purpose so whether

707
00:38:01,995 –> 00:40:00,315
[kate_theroux]: Ssssssssssssss,

708
00:38:02,335 –> 00:38:06,895
[Dave Levenson]: it’s life insurance or annuities or even you know investments long term care

709
00:38:07,935 –> 00:38:14,655
[Dave Levenson]: you know you know group life group disability they are wonderful solutions for so

710
00:38:14,815 –> 00:38:16,975
[Dave Levenson]: many people in our country and so many people in the world

711
00:38:18,495 –> 00:38:22,335
[Dave Levenson]: and if i can just take this last leg of my career

712
00:38:23,315 –> 00:38:24,315
[Dave Levenson]: and help

713
00:38:26,495 –> 00:38:30,895
[Dave Levenson]: more companies deliver those solutions effectively to consumers

714
00:38:32,015 –> 00:38:33,535
[Dave Levenson]: then i think there’s more value

715
00:38:35,135 –> 00:38:37,775
[Dave Levenson]: i do in this role than working

716
00:38:37,565 –> 00:38:38,565
[Paul Tyler]: sure

717
00:38:38,335 –> 00:38:43,615
[Dave Levenson]: any one company trying to influence what that one company does so you know it’s a

718
00:38:43,695 –> 00:38:48,575
[Dave Levenson]: privilege to work with a trade association much more so than i could ever have

719
00:38:48,735 –> 00:38:54,095
[Dave Levenson]: imagined and you know yeah i’ve got a large board but it’s not a corporate board

720
00:38:54,175 –> 00:38:58,895
[Dave Levenson]: right a corporate board with twenty five people would be a circus i’ve got a i’ve

721
00:38:58,895 –> 00:39:04,575
[Dave Levenson]: got a member board of twenty five people and you know they provide me guidance and

722
00:39:04,735 –> 00:39:06,255
[Dave Levenson]: advice and stewardship

723
00:39:07,615 –> 00:39:09,775
[Dave Levenson]: but they’re also the consumers of what we do

724
00:39:11,135 –> 00:39:15,215
[Dave Levenson]: and that’s one of the key reasons that we have twenty five people but i’ve got to

725
00:39:15,295 –> 00:39:17,135
[Dave Levenson]: tell you i work with some of the best people

726
00:39:18,575 –> 00:39:22,495
[Dave Levenson]: every day whether it’s these leaders of uh of our member companies

727
00:39:23,615 –> 00:39:26,895
[Dave Levenson]: or whether it’s the employees that i’m privileged to lead every day and

728
00:39:27,935 –> 00:39:30,095
[Dave Levenson]: it’s been a thrill that that’ why i do it paul

729
00:39:30,985 –> 00:39:35,465
[Paul Tyler]: thank you yeah and and thank you dave i think what you’re doing is is tremendous i

730
00:39:35,465 –> 00:39:40,345
[Paul Tyler]: mean limmer really has had a huge impact in the past i think what you’re where

731
00:39:40,425 –> 00:39:44,745
[Paul Tyler]: you’re headed what you’ve done over the last couple of years has been phenomenal

732
00:39:45,465 –> 00:39:49,705
[Paul Tyler]: and you know i can’t wait to see uh what the next chapter is so

733
00:39:49,935 –> 00:39:55,375
[Dave Levenson]: yeah it’ll it’ll be fun you know before you guys cut me off i do want to promised

734
00:39:55,375 –> 00:39:59,535
[Dave Levenson]: ramsey this just gives you a sense for some of our annuity research because

735
00:39:59,695 –> 00:40:04,335
[Dave Levenson]: there’s some fun stuff coming so annuity income by race and ethnicity this report

736
00:40:01,995 –> 00:42:00,315
[kate_theroux]: Ssssssssssssss,

737
00:40:04,575 –> 00:40:06,095
[Dave Levenson]: is coming out real soon from us

738
00:40:07,215 –> 00:40:10,735
[Dave Levenson]: the upside and the downside of annuity product selection

739
00:40:07,280 –> 00:40:08,480
[Ramsey Smith]: i’m so now but

740
00:40:11,060 –> 00:40:12,060
[Ramsey Smith]: yes

741
00:40:11,715 –> 00:40:12,715
[Dave Levenson]: that is already out

742
00:40:13,775 –> 00:40:15,935
[Dave Levenson]: annuities what do advisors think

743
00:40:17,135 –> 00:40:18,495
[Dave Levenson]: that research is already out

744
00:40:19,695 –> 00:40:22,255
[Dave Levenson]: a reference guide which is like a two hundred page

745
00:40:23,775 –> 00:40:27,855
[Dave Levenson]: book about the retail retirement reference guide the fifth edition

746
00:40:28,435 –> 00:40:29,435
[Dave Levenson]: um

747
00:40:30,095 –> 00:40:34,975
[Dave Levenson]: uh we’ve got uh a forecast a future view of annuity sales we didn’t even talk

748
00:40:35,055 –> 00:40:40,575
[Dave Levenson]: about riles and fis and so people should certainly tune in for that and gosh we’ve

749
00:40:40,575 –> 00:40:44,015
[Dave Levenson]: got a lot of convening opportunities with our conferences and our committees and

750
00:40:44,335 –> 00:40:47,455
[Dave Levenson]: if any of the listeners would like to have more information about this just

751
00:40:47,935 –> 00:40:49,775
[Dave Levenson]: contact me or anybody at limma

752
00:40:50,205 –> 00:40:51,205
[Paul Tyler]: that’s great right

753
00:40:50,560 –> 00:40:53,920
[Ramsey Smith]: so yes how do people get that debt obviously members get that data

754
00:40:54,960 –> 00:40:58,240
[Ramsey Smith]: if you’re an agent or an agency do you subscribe

755
00:40:59,440 –> 00:41:01,680
[Ramsey Smith]: how do they get exposure to all that great information

756
00:41:02,575 –> 00:41:06,175
[Dave Levenson]: yeah you know again we’re a member based organization so most of the stuff we do

757
00:41:06,075 –> 00:41:07,075
[Dave Levenson]: is for our

758
00:41:06,740 –> 00:41:07,740
[Ramsey Smith]: yeah

759
00:41:06,975 –> 00:41:09,695
[Dave Levenson]: membership but our membership is not

760
00:41:11,295 –> 00:41:16,175
[Dave Levenson]: unique to the carriers anymore so distribution firms almost all of the large

761
00:41:16,335 –> 00:41:22,735
[Dave Levenson]: broker dealers our members a lot of the large insurance bg’s our members we’re

762
00:41:22,815 –> 00:41:25,855
[Dave Levenson]: always looking for more members and then you know we

763
00:41:25,460 –> 00:41:26,460
[Ramsey Smith]: sure

764
00:41:26,015 –> 00:41:30,335
[Dave Levenson]: share some of these things obviously with other trade associations whether you

765
00:41:30,335 –> 00:41:33,135
[Dave Levenson]: know it’s finsec as an example on the

766
00:41:34,575 –> 00:41:40,015
[Dave Levenson]: on the life insurance side or riri as an example on the annuity side so we’re all

767
00:41:40,095 –> 00:41:44,175
[Dave Levenson]: big on sharing if it helps make the industry a lot stronger

768
00:41:43,940 –> 00:41:44,940
[Ramsey Smith]: fantastic

769
00:41:45,065 –> 00:41:50,825
[Paul Tyler]: excellent hey dave thanks so much for spending some time with us and ramsey any

770
00:41:51,065 –> 00:41:52,665
[Paul Tyler]: anything else on your end

771
00:41:53,280 –> 00:41:55,280
[Ramsey Smith]: i’m excited to see what the preacher holds

772
00:41:56,320 –> 00:42:02,480
[Ramsey Smith]: i’m really excited to see what what dave has in mind to g lim lomas influence

773
00:42:01,675 –> 00:42:31,995
[kate_theroux]: Iss.

774
00:42:03,040 –> 00:42:06,480
[Ramsey Smith]: outside the u s internationally so i’m watching with great interest

775
00:42:07,085 –> 00:42:08,085
[Paul Tyler]: excellent

776
00:42:07,295 –> 00:42:10,815
[Dave Levenson]: i’d love to come back and tell you about our international plans it’s it’s pretty

777
00:42:10,635 –> 00:42:11,635
[Dave Levenson]: exciting

778
00:42:11,145 –> 00:42:12,505
[Paul Tyler]: oh great okay you’re on

779
00:42:12,400 –> 00:42:13,600
[Ramsey Smith]: be careful what you wish for

780
00:42:14,265 –> 00:42:15,785
[Paul Tyler]: we’ll we’ll write this down and

781
00:42:17,465 –> 00:42:21,305
[Paul Tyler]: look yeah dave all right listen thanks so much and hey thanks all to all our

782
00:42:21,465 –> 00:42:27,385
[Paul Tyler]: listeners join us again next week for another episode of that annuity show thanks

783
00:42:27,020 –> 00:42:28,020
[Ramsey Smith]: thank you

784
00:42:27,295 –> 00:42:29,455
[Dave Levenson]: great seeing you guys and thanks for doing this

785
00:42:27,295 –> 00:42:29,455
[Dave Levenson]: great seeing you guys and thanks for doing this

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 144: Charting a New Course for the Industry with Dave Levenson
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Episode 143: When Should Your Client Pay Off The Mortgage With Jason Fichtner

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Should your client pay off their mortgage as they head into retirement?  Today, Jason Fichtner joins us again to talk about the risks inherent in answering this question with confidence. Jason is Vice President and Chief Economist at the Bipartisan Policy Center and Senior Fellow for the Alliance for Lifetime Income.
Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.
We hope you enjoy the show.
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Tanscript

1
00:00:05,819 –> 00:00:10,699
[Paul Tyler]: hi this is paul tyler and welcome to another episode of that annuity show and

2
00:00:12,059 –> 00:00:14,539
[Paul Tyler]: this is a special one but sometimes you know we have

3
00:00:15,899 –> 00:00:21,499
[Paul Tyler]: interviews with guest ramsey that beg for a part two and this certainly was the

4
00:00:21,499 –> 00:00:26,779
[Paul Tyler]: case for an interview we did about a month and a half ago do you wanna set it up

5
00:00:27,437 –> 00:00:34,237
[Ramsey Smith]: sure so we had jason fitch on about a month and a half ago and we talked about a

6
00:00:34,317 –> 00:00:38,877
[Ramsey Smith]: number of amazing subjects including social security and we just got

7
00:00:38,939 –> 00:00:40,059
[Paul Tyler]: let talking about

8
00:00:39,037 –> 00:00:44,157
[Ramsey Smith]: started talking about mortgages and decisions sets around mortgages

9
00:00:45,197 –> 00:00:48,317
[Ramsey Smith]: and today we’re going to continue that conversation when we left off so just to

10
00:00:48,317 –> 00:00:50,717
[Ramsey Smith]: reintroduce jason he is the

11
00:00:50,559 –> 00:00:51,559
[Paul Tyler]: like

12
00:00:50,797 –> 00:00:55,917
[Ramsey Smith]: vice president chief economist at the bipartisan policy center and he’s a senior

13
00:00:55,997 –> 00:00:58,957
[Ramsey Smith]: fellow for the alliance for lifetime income so he and the

14
00:00:58,559 –> 00:00:59,559
[Paul Tyler]: yeah

15
00:00:59,037 –> 00:01:03,357
[Ramsey Smith]: alliance have been great friends of great friends of the show and we’re just happy

16
00:01:03,597 –> 00:01:05,437
[Ramsey Smith]: to have them back so jason welcome back

17
00:01:05,359 –> 00:01:06,359
[Paul Tyler]: back and

18
00:01:05,917 –> 00:01:09,917
[Ramsey Smith]: and like just first of all like for for people that are new in the

19
00:01:09,719 –> 00:01:10,719
[Paul Tyler]: the audience

20
00:01:09,997 –> 00:01:15,117
[Ramsey Smith]: audience or for people that are that are coming back just remind us again that you

21
00:01:15,197 –> 00:01:17,997
[Ramsey Smith]: know the things that the work that you’re doing for

22
00:01:19,037 –> 00:01:23,197
[Ramsey Smith]: for the alliance and for the bipartisan policy center and let’s get right into it

23
00:01:23,137 –> 00:01:24,137
[Ramsey Smith]: on mortgages

24
00:01:24,160 –> 00:01:27,120
[Jason Fitcher]: awesome well thank you both for having me back it’s good great to see you and

25
00:01:27,360 –> 00:01:29,280
[Jason Fitcher]: again and looking forward to the conversation

26
00:01:30,560 –> 00:01:33,280
[Jason Fitcher]: my responsibilities and roles you know my fun

27
00:01:32,959 –> 00:01:33,959
[Paul Tyler]: what

28
00:01:33,520 –> 00:01:37,520
[Jason Fitcher]: job if you will is to help people have a financially secure retirement that’s

29
00:01:37,119 –> 00:01:38,119
[Paul Tyler]: oh

30
00:01:37,600 –> 00:01:41,280
[Jason Fitcher]: kind of my mission in life and i get to do that both the bipartisan policy center

31
00:01:41,600 –> 00:01:46,560
[Jason Fitcher]: and at the alliance for lifetime income and it’s talking about protected income

32
00:01:46,960 –> 00:01:51,520
[Jason Fitcher]: it’s an understanding of how to help people be more secure in retirement when

33
00:01:51,680 –> 00:01:54,960
[Jason Fitcher]: thinking about protected income and that just does not just mean annuities which

34
00:01:55,040 –> 00:01:57,920
[Jason Fitcher]: you talked about last time it’s also social security which is a form protected

35
00:01:58,000 –> 00:02:01,920
[Jason Fitcher]: income and it’s helping people understand what the role of social security and

36
00:02:02,000 –> 00:02:07,280
[Jason Fitcher]: other protected income means for having a financially secure retirement one in

37
00:02:07,360 –> 00:02:08,880
[Jason Fitcher]: which they can spend and

38
00:02:08,737 –> 00:02:09,737
[Ramsey Smith]: yes

39
00:02:09,120 –> 00:02:13,920
[Jason Fitcher]: enjoy retirement and one in which they can mitigate risks and too often we’ve been

40
00:02:14,080 –> 00:02:18,880
[Jason Fitcher]: brought up on this culture of you need to save save sake which i’m very in favor

41
00:02:18,960 –> 00:02:22,480
[Jason Fitcher]: of you need to maximize your return which i’m also in favor of but we don’t often

42
00:02:22,560 –> 00:02:26,880
[Jason Fitcher]: talk about what the risks are and we help people save for retirement through our

43
00:02:26,880 –> 00:02:29,680
[Jason Fitcher]: four hundred one thousand plans our four hundred three bs and iras we have

44
00:02:29,760 –> 00:02:33,600
[Jason Fitcher]: employer sponsored plans we have a lot of tax advantages people get to retirement

45
00:02:33,680 –> 00:02:37,920
[Jason Fitcher]: we say have a nice day and they’re looking around for help and what do they do now

46
00:02:38,080 –> 00:02:41,920
[Jason Fitcher]: with these defined contribution assets they built up they were afraid of spending

47
00:02:42,000 –> 00:02:44,640
[Jason Fitcher]: them down and running out of money retirement how do we

48
00:02:44,257 –> 00:02:45,257
[Ramsey Smith]: so

49
00:02:44,720 –> 00:02:50,000
[Jason Fitcher]: help them psychologically and financially make sure they can draw down that income

50
00:02:50,080 –> 00:02:52,800
[Jason Fitcher]: appropriately whether it’s through protected income strategies like annuities

51
00:02:52,880 –> 00:02:56,720
[Jason Fitcher]: whether it’s drawdown strategies whether it’s thinking about debt and what does it

52
00:02:56,720 –> 00:02:59,840
[Jason Fitcher]: do with debt levels because that’s very important both from a financial standpoint

53
00:03:00,160 –> 00:03:04,240
[Jason Fitcher]: and a psychological level how do we help them have the best retirement and we can

54
00:03:04,240 –> 00:03:07,680
[Jason Fitcher]: do that with the funding our future campaign we have the bipartisan policy center

55
00:03:07,920 –> 00:03:10,480
[Jason Fitcher]: and the alliance to lifetime income and the research were doing at the retirement

56
00:03:10,480 –> 00:03:14,480
[Jason Fitcher]: income institute and we had a great discussion last time so for the new audience

57
00:03:14,560 –> 00:03:18,240
[Jason Fitcher]: members who didn’t listen please pull up the last episode about a month and a half

58
00:03:18,240 –> 00:03:21,760
[Jason Fitcher]: ago and we left it off we ran out of time but we were talking about whether or not

59
00:03:21,840 –> 00:03:24,560
[Jason Fitcher]: people should pay off their mortgage and retirement and i had mentioned some

60
00:03:24,640 –> 00:03:28,720
[Jason Fitcher]: previous research i had done that showed that with each successive generation less

61
00:03:29,360 –> 00:03:32,640
[Jason Fitcher]: people are paying off their mortgage before they enter retirement and what does

62
00:03:32,720 –> 00:03:35,760
[Jason Fitcher]: that mean do you have some financial professionals telling you of course interest

63
00:03:35,820 –> 00:03:36,820
[Jason Fitcher]: rates are low you

64
00:03:36,497 –> 00:03:37,497
[Ramsey Smith]: yep

65
00:03:36,880 –> 00:03:40,480
[Jason Fitcher]: shouldn’t pay it off invest that money someplace else others are saying you want

66
00:03:40,640 –> 00:03:44,560
[Jason Fitcher]: to risk a less risky retirement pay off your house and use that investment in that

67
00:03:44,640 –> 00:03:48,640
[Jason Fitcher]: cash or something else what do you do and that’s where we left and we’re hoping to

68
00:03:48,720 –> 00:03:49,760
[Jason Fitcher]: tee it off again today

69
00:03:51,339 –> 00:03:56,059
[Paul Tyler]: yeah well and i guess for most people right if you said what are the biggest

70
00:03:56,139 –> 00:03:59,339
[Paul Tyler]: assets in retirement it would be number one probably social security

71
00:04:01,179 –> 00:04:05,179
[Paul Tyler]: probably number two would be any equity you have in your house and maybe you know

72
00:04:05,179 –> 00:04:08,059
[Paul Tyler]: if you’re lucky you’ve got a four hundred one thousand jason is that is that kind

73
00:04:08,059 –> 00:04:09,499
[Paul Tyler]: of the right way to think about it

74
00:04:09,060 –> 00:04:10,060
[Jason Fitcher]: yeah

75
00:04:09,777 –> 00:04:10,777
[Ramsey Smith]: yeah think about

76
00:04:09,920 –> 00:04:13,760
[Jason Fitcher]: to think about when you think about an asset and retirement so the the beauty of

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[Jason Fitcher]: social security is it pays your scheme of income but it’s not giving you a lump su

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[Jason Fitcher]: so you can’t go to social security right now and say hello i’m sixty seven i would

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[Jason Fitcher]: like my lifetime have income as a lu sum and then you think of an asset you think

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[Jason Fitcher]: of it as an income stream but you are right to talk about it as an asset the

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[Paul Tyler]: no

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[Jason Fitcher]: house and your four one k you see as a lump sum but you can convert that into an

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[Jason Fitcher]: income stream and that’s where you we start thinking about how do we use this kind

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[Jason Fitcher]: of assets to create protected income or income streams that would help people have

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[Jason Fitcher]: their most financially secure retirement but those are the three biggest and

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[Jason Fitcher]: actually for most people when you think about the lump sum amount like what you

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[Jason Fitcher]: actually

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[Paul Tyler]: yeah

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[Jason Fitcher]: can convert to cash today it usually is the house that’s bigger than the four one

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[Jason Fitcher]: k plan for most people that is their primary asset going into retirement so how

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[Jason Fitcher]: they utilize that asset when they do with that is very very important for

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[Jason Fitcher]: financial security and retirement

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[Paul Tyler]: yeah now i f i probably fall on the extreme when it comes to homes and it’s

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[Paul Tyler]: interesting what shapes your perspective of ris jason your smack on i i don’t

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[Paul Tyler]: think we talked about this like my mother’s a small business person and i would

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[Paul Tyler]: say she never should have been

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[Paul Tyler]: it was

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[Paul Tyler]: and we we frankly grown up had it was it was rough you know we had a couple times

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[Paul Tyler]: when our house was close to being repossessed because she got too far over skis

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[Paul Tyler]: with work

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[Paul Tyler]: and mortgages so there’s nothing coming home to see like auction notices on your

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[Paul Tyler]: door to say okay this will never happen and so you know i i i’m somebody who opted

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[Paul Tyler]: for the smaller house was paid off

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[Ramsey Smith]: no

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[Paul Tyler]: i’ve always adjacent had friends and rams you’re probably in the other you know

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[Paul Tyler]: probably from more from a a more risk uh have a better view of the risk but jason

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[Paul Tyler]: i had friends saying you’ve got to be kidding me you know in the real estate

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[Paul Tyler]: market unlv property is an asset that’s just going to waste

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[Paul Tyler]: how do you how do you think about risk

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[Paul Tyler]: like especially you’re they’re in going getting closer retirement

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[Jason Fitcher]: so this is i always found the buying a house the process so much backwards than

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[Jason Fitcher]: say buying a car so if if you were to go buy a car and if buying a car today’s

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[Jason Fitcher]: environment is a lot harder because of supply chain issues so the prices are

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[Jason Fitcher]: higher but usually you went to buy a car the salesman ask you paul ramsey how much

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[Jason Fitcher]: do you want to pay a month for your car what would the best answer be

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[Ramsey Smith]: i don’t know six hundred dollars a month

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[Jason Fitcher]: well i’d like to say zero right i’d like to

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[Jason Fitcher]: pay zero but that’s not the option

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[Ramsey Smith]: okay well

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[Ramsey Smith]: okay

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[Jason Fitcher]: right so you say zero but then you know but some people say well i pay four

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[Jason Fitcher]: hundred dollars so the dealer finds a way to fit you into the most expensive car

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[Jason Fitcher]: for four hundred dollars by doing what when they could extend the terms of a loan

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[Ramsey Smith]: sure

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[Jason Fitcher]: so one of

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[Paul Tyler]: what

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[Jason Fitcher]: the even though we’re talking about housing debt think about card debt so my

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[Jason Fitcher]: grandparents always paid cash for their car then you started getting loans out so

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[Jason Fitcher]: the average term for a loan used to be three years then four then five now it’s

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[Jason Fitcher]: seven years

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[Paul Tyler]: seven

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[Jason Fitcher]: so people

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[Ramsey Smith]: for a car really

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[Jason Fitcher]: are taking out for a car so now

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[Ramsey Smith]: wow

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[Jason Fitcher]: people are taking our seven year mortgages for a car and some people don’t own the

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[Jason Fitcher]: car longs when they go to get a new car they’re actually under water they owe more

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[Jason Fitcher]: than the resale residual value of the car is and the deal’s like don’t worry you

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[Jason Fitcher]: want to pay five hundred dollars a month we’ll just roll that balance into the

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[Jason Fitcher]: next slow so they keep getting further and further under water with debt by

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[Jason Fitcher]: getting new cars so the house sort of works

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[Ramsey Smith]: yeah

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[Jason Fitcher]: in the same way but backwards we go in and people say look mortgage rates are

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[Jason Fitcher]: lower because the rates are lower now you can afford to buy more house so let’s

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[Jason Fitcher]: get a more expensive house a bigger house because the rates are down we can keep

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[Jason Fitcher]: your

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[Ramsey Smith]: aw

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[Jason Fitcher]: mortgage payment slower you’re like this is a fantastic deal or out doo it so now

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[Jason Fitcher]: people have been buying bigger houses more expensive houses with lower rates as

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[Jason Fitcher]: rates go up better of course changes housing becomes more expensive than might the

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[Jason Fitcher]: downsize but we’ve created a generation

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[Ramsey Smith]: generation

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[Jason Fitcher]: of people who are used through lower interest rates and buying bigger houses are

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[Jason Fitcher]: they gonna be under water are they gonna pay them

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[Ramsey Smith]: harder

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[Jason Fitcher]: off they gonna keep using revolving credit

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[Jason Fitcher]: this is the problem with risk and again we might be more comfortable with debt now

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[Jason Fitcher]: we we take out debt for a lot of things and i now see online when i go

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[Ramsey Smith]: so that

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[Jason Fitcher]: to amazon it says do you want to pay this in four quarterly installments and i’m

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[Jason Fitcher]: like no i don’ i i but i still put it on a credit card and it’s it’s a much

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[Jason Fitcher]: different psychological thing if you have to go and pay cash out of your wallet

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[Jason Fitcher]: with everything you buy than just putting it on plastic or clicking your apple

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[Jason Fitcher]: watch or using an auto paes through a credit

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[Ramsey Smith]: it’s right

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[Jason Fitcher]: card where then you get a month they’re like wait how much should i spend how did

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[Jason Fitcher]: i do this so this is where we’ve gotten used to credit we’ve gotten used to

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[Jason Fitcher]: spending we’ve gotten used to low interest rates and we’ve carried that retirement

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[Jason Fitcher]: so when i did some research looking at what was called the health retirement

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[Jason Fitcher]: survey health return study through the university of michigan they look at those

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[Jason Fitcher]: who are fifty and older with each successive generations they track people so we

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[Jason Fitcher]: can look at the you know the world war ii generation we can go up to the baby

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[Jason Fitcher]: boomers with each generation they’re taking a higher level of debt into retirement

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[Jason Fitcher]: and less of them are paying off their houses going into retirement it used to be

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[Jason Fitcher]: you were told you know you when you basically retire pay off your house because

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[Jason Fitcher]: one as you said paul that’s sort of your biggest if not the biggest asset

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[Jason Fitcher]: retirement but two think about your current budget constraints so everyone who is

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[Jason Fitcher]: listening on this call right now think about your expenses what are you paying out

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[Jason Fitcher]: a month for food

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[Paul Tyler]: let’s see

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[Jason Fitcher]: for utilities for your cell phone for your cable my guess

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[Paul Tyler]: yeah

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[Jason Fitcher]: is that the largest expense people have or at least most people is mortgage or

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[Jason Fitcher]: their rent housing is the biggest expense what if that expense was gone in

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[Jason Fitcher]: retirement that frees up a lot of extra income source income whether it’s coming

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[Jason Fitcher]: from social security or from annuity or from your investments to use someplace

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[Jason Fitcher]: else you minimize risk if you carry

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[Ramsey Smith]: hear

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[Jason Fitcher]: that mortgage with you into retirement you’ve got to pay it and if you get

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[Ramsey Smith]: get down the

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[Jason Fitcher]: a downturn in the market or there is a hell shock or you get a shock in your

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[Ramsey Smith]: years ago

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[Jason Fitcher]: income do you want to get kicked out of your house we’re seeing more bankruptcies

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[Jason Fitcher]: in retirement because of housing than we have previously this is where we need to

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[Jason Fitcher]: start thinking about reframing our discussion

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[Paul Tyler]: excuse me

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[Jason Fitcher]: around risk mitigation retirement and not necessarily trying to have the biggest

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[Jason Fitcher]: and greatest yield you can get off your assets

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[Ramsey Smith]: yeah that makes a lot of sense i mean it it is it is it’s remarkable and

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[Paul Tyler]: yeah that makes a lot of stuff

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[Paul Tyler]: father had

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[Ramsey Smith]: problematic that decisions are made based on

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[Paul Tyler]: how about you

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[Ramsey Smith]: how much i can fund how much the how much the bank at any given point in time will

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[Ramsey Smith]: let you fund as opposed to what your utility is now if your

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[Paul Tyler]: no

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[Ramsey Smith]: utility happens to be you know in the same place and then

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[Paul Tyler]: maybe

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[Ramsey Smith]: maybe maybe there’s some other sort of reward for for buying the bigger house but

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[Ramsey Smith]: maybe maybe there’s some other sort of reward for for buying the bigger house but

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[Ramsey Smith]: you know

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[Ramsey Smith]: you know

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[Ramsey Smith]: in my mind right you’re taking on a lot

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[Paul Tyler]: that

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[Ramsey Smith]: of ex for risk without any true incremental utility

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[Ramsey Smith]: and i think that people could put themselves could avoid

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[Paul Tyler]: a lot

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[Ramsey Smith]: a lot of issues if if they if they thought about it they thought about it that way

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[Ramsey Smith]: because then they’re forced to downsize later and it might not be in a good market

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[Ramsey Smith]: so

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[Paul Tyler]: well i

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[Ramsey Smith]: i think this is a very good discussion for for precisely those reasons

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[Paul Tyler]: yeah no jason the calculation

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[Jason Fitcher]: yeah

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[Paul Tyler]: has shifted three if

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[Ramsey Smith]: um i studies at is rural

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[Paul Tyler]: let me put the step back if i were you know sixty six

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[Paul Tyler]: sixty seven owned a house with a mortgage

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[Ramsey Smith]: what is

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[Paul Tyler]: the calculus has changed so so dramatically over the last two years pre pandemic

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[Paul Tyler]: you know a lot of suburbs real estate market was down you probably had lost equity

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[Paul Tyler]: in your house

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[Ramsey Smith]: it’s w

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[Paul Tyler]: okay but the rates were low so you could afford to sit there and pandemic hits a

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[Paul Tyler]: lot of

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[Jason Fitcher]: what’s that

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[Paul Tyler]: suburban areas real estate goes way up okay it also means your equity is higher

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[Paul Tyler]: suburban areas real estate goes way up okay it also means your equity is higher

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[Paul Tyler]: maybe you can sell your house where you go

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[Paul Tyler]: now i don’t know like we just we we were talking before the show this last month

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[Paul Tyler]: wow interest

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[Ramsey Smith]: why

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[Paul Tyler]: rates are starting to spike again stock market

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[Ramsey Smith]: yeah that’s

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[Paul Tyler]: i don’t i wouldn’t want wanna to have sold my house and but i put it in the market

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[Paul Tyler]: last month not good how do you

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[Ramsey Smith]: yeah the last um r is

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[Paul Tyler]: how do you dynamically approach something like this

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[Ramsey Smith]: per person what

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[Jason Fitcher]: i well you you’ve bought out some great points paul and i think maybe the word

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[Jason Fitcher]: dynamic is something to focus on any dynamic and risk or two words we need to have

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[Jason Fitcher]: as our framing here because there are many people who again go into retirement

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[Jason Fitcher]: without paying off their house and think i’ve got income coming in from a variety

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[Jason Fitcher]: of sources including the market if the market

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[Paul Tyler]: what

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[Jason Fitcher]: this is where i think we talked about this last time too whether you should have

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[Jason Fitcher]: the three percentage rule the four percent drawdown rule that

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[Ramsey Smith]: that work

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[Jason Fitcher]: rule can work if you have an ever increasing market right the market keeps going

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[Jason Fitcher]: up ten percent a year and you’re taking out three or four it probably works for

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[Jason Fitcher]: you that only works if you don’t have a recession in the first two or three or

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[Jason Fitcher]: five years’ retirement and you don’t have it till the end it’s the sequence of

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[Jason Fitcher]: return risk we’re talking about the same goes for housing if people haven’t paid

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[Jason Fitcher]: off their housing or they’ve done something even worse like you know you’ve heard

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[Jason Fitcher]: the old jo of people taking out a whole meck line of credit when they retired to

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[Jason Fitcher]: buy a boat so

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[Ramsey Smith]: oh

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[Jason Fitcher]: now they

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[Paul Tyler]: i did

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[Jason Fitcher]: not pit off their boat they’re pay off their house

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[Paul Tyler]: i

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[Jason Fitcher]: they have a boat they’ve got to pay for and and the old joke is you know how do

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[Jason Fitcher]: you become a millionaire first you get a billion dollars and you buy a boat and

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[Jason Fitcher]: thats how

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[Ramsey Smith]: right

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[Jason Fitcher]: you become a millionaire

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[Jason Fitcher]: people take on this extra level of debt and debt i think we should really call

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[Jason Fitcher]: debt risk right and it really is risk can you are you at risk of not being paid

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[Jason Fitcher]: have an asset collected a secure asset someone can come after maybe you’re okay

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[Jason Fitcher]: with someone possessing your car your boat but your house

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[Jason Fitcher]: you live in it you need housing and in retirement

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[Ramsey Smith]: yes

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[Jason Fitcher]: and i think the dynamic nature is what i would like for us to start having is

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[Jason Fitcher]: these kitchen table conversations you never know she made the right decision until

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[Jason Fitcher]: that decision has passed have hindsight right hindsight is twenty twenty is the

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[Jason Fitcher]: market going to go up is the market going to go down boy i

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[Paul Tyler]: what

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[Jason Fitcher]: wish i would have done this you know if i had tried bought apple stock when it was

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[Jason Fitcher]: going to eight dollars back when i you know twenty thirty years ago i’d be a

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[Jason Fitcher]: millionaire a billionaire but you know i didn’t so i missed out

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[Jason Fitcher]: what do we do when it comes to these discussions about dynamic nature of housing

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[Jason Fitcher]: and risk and i think what i think people should think about is the house is an

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[Jason Fitcher]: asset if it’s paid off and you go into retirement you have minimized risk and you

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[Jason Fitcher]: have expanded your flexibility so for many people

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[Jason Fitcher]: if

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[Ramsey Smith]: yeah

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[Jason Fitcher]: your house is paid off you could use that home equity

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[Jason Fitcher]: down the road for long term care long term care insurance if you can find it now

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[Ramsey Smith]: we just don’t need that we here

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[Jason Fitcher]: it’s really really expensive

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[Jason Fitcher]: think about long term care as your housing in your really really senior years if

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[Jason Fitcher]: your house is paid off and you have to go into long term care you could sell your

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[Jason Fitcher]: house or you saw home equity or reverse mortgage to pay your long term care and

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[Jason Fitcher]: not leave that bill on your on your kids or your grandkids or you know hopefully

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[Jason Fitcher]: you’re not going to go on medicaid if you’re indigent to go into long term care

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[Jason Fitcher]: thinking about planning for this and the dynamic nature of what retirement means

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[Jason Fitcher]: and what the markets can do helps people think about how do you better use their

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[Jason Fitcher]: assets and i mean my fear is too often we’ve trained people to think about acid

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[Jason Fitcher]: accumulation in their years of working we haven’t talked about the either

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[Jason Fitcher]: distribution or accumulation phase and retirement and what that means for risk

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[Jason Fitcher]: mitigation and how to make sure people don’t outlive their savings they’re not

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[Jason Fitcher]: afraid to spend what they have and can actually have a financially comfortable

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[Jason Fitcher]: secure retirement that they’re enjoying that they enjoy their golden years you

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[Jason Fitcher]: know you want to be as worry free as possible if you’ve got that mortgage sitting

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[Jason Fitcher]: of your head you know in turbulent times like right now you know with how long

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[Jason Fitcher]: does this russian ukraine g were going to last is it gonna end tomorrow is it

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[Jason Fitcher]: going to end in three years whatever end what does that mean for oil prices that

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[Jason Fitcher]: go to one hundred thirty dollars a barrel one day and then down to below one

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[Jason Fitcher]: hundred the next mortgage

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[Paul Tyler]: just

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[Jason Fitcher]: rates again they’re now creeping upwards above four and five percent going towards

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[Jason Fitcher]: five the federal reserve is going to start raising interest rates to start trying

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[Jason Fitcher]: to tamper down on inflation if you need to sell your house and you haven’t put off

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[Jason Fitcher]: your mortgage are you going to be under water did you take out a home lot of

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[Jason Fitcher]: credit so you are under water now these are all really important factors to

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[Jason Fitcher]: consider when talking about the dynamic na paul but i think you’re right we need

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[Jason Fitcher]: to start talking about what this means for risk and when people say oh don’t

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[Ramsey Smith]: don’t

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[Jason Fitcher]: pay off your house because you can use that money to go to the market

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[Jason Fitcher]: well you can lose money in the market you really don’t wanna lose your home

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[Ramsey Smith]: so

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[Paul Tyler]: i she got couple

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[Ramsey Smith]: let me ask you this so there’s this is a this is a decision that’s that’s

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[Paul Tyler]: i

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[Ramsey Smith]: obviously very difficult

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[Paul Tyler]: christmas

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[Ramsey Smith]: for for consumers to make often they are going to financial advisors is your

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[Paul Tyler]: that’s pretty good

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[Ramsey Smith]: experience that the financial advisors or the financial advice community

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[Ramsey Smith]: is is is answering this question the way you think they ought to

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[Jason Fitcher]: i

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[Jason Fitcher]: would put it differently it’s not

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[Paul Tyler]: i would

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[Jason Fitcher]: whether they’re

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[Jason Fitcher]: answering it properly it’s

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[Ramsey Smith]: ja mm

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[Paul Tyler]: school

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[Jason Fitcher]: whether they’re having the right discussion and i think

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[Ramsey Smith]: okay

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[Jason Fitcher]: that’s what’s missing right so the answer shouldn’t be yes you should sell no you

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[Jason Fitcher]: shouldn’t sell you should you know pay off your mortgage no you shouldn’t it

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[Jason Fitcher]: really should be a discussion with the individuals about what are their risks what

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[Jason Fitcher]: other income do they have what other assets do they have what are their goals do

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[Jason Fitcher]: they have

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[Ramsey Smith]: they have

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[Jason Fitcher]: a spouse are they sick right there’s

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[Paul Tyler]: water

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[Jason Fitcher]: a lot of things that go into this conversation it’s the same sort of factors we

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[Jason Fitcher]: talked about when it was thinking about when do you claim social security

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[Jason Fitcher]: retirement benefits it’s a personal decision one science is not fit all the fear i

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[Jason Fitcher]: have is that somebody goes into financial professional and says what do i do and

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[Jason Fitcher]: they just give a quick answer without having the

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[Jason Fitcher]: discussion about what their needs are what their risks are and how they can

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[Ramsey Smith]: i would say a kid

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[Jason Fitcher]: minimize risk and there’s a difference between saying selling

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[Ramsey Smith]: what

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[Jason Fitcher]: an asset like selling a stock asset to pay off a house versus taking out a reverse

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[Jason Fitcher]: mortgage or another

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[Jason Fitcher]: mortgage i mean the number of people i’ve seen who in the research get into their

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[Ramsey Smith]: have the testimony i’m going

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[Jason Fitcher]: late fifty seconds and then refinance for another thirty year mortgage is really

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[Jason Fitcher]: surprising to me the idea that you could be paying off a mortgage until your

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[Jason Fitcher]: seventies or eighties it is just surprise not how i grew up that’s not how that

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[Jason Fitcher]: framing i was brought up with and some people like maybe we’re comfortable just

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[Jason Fitcher]: live in the

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[Ramsey Smith]: i

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[Jason Fitcher]: house if we died then someone comes and takes the houses where dead who cares

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[Paul Tyler]: yeah

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00:17:44,320 –> 00:17:47,760
[Jason Fitcher]: that may be a smart decision for somebody who understands that and has other

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[Jason Fitcher]: assets and make sure that they have income coming in so there’s a market

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[Paul Tyler]: s

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[Ramsey Smith]: what

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[Jason Fitcher]: downturn they’re protecting they’re always paying their mortgage for somebody else

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[Jason Fitcher]: it might not be the right decision

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[Paul Tyler]: hm

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[Jason Fitcher]: and they might talk about how they can use their financial assets besides the

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[Jason Fitcher]: house to have a protective stream of income that also then pays off the house so

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[Jason Fitcher]: that’s off their balance sheet in retirement and becomes a pure asset that they

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[Jason Fitcher]: have flexibility with so it’s a discussion that i want to encourage not

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[Jason Fitcher]: necessarily focusing on what is the right or wrong answer because that really does

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[Jason Fitcher]: depend on the individual circumstances

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[Ramsey Smith]: so

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[Paul Tyler]: you been

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[Ramsey Smith]: you’ve mentioned reverse mortgages a few times and we don’t necessarily have a dog

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[Ramsey Smith]: in that fight on the show but it’s

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[Ramsey Smith]: it’s come up we’ve had um we’ve had don graves on here recently and we’ve had

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[Ramsey Smith]: we’ve had way at wed fowl also on a couple of times and both of them speak a lot

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[Ramsey Smith]: about the rule of reverse mortgages

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[Ramsey Smith]: you how do you feel about them there’s there’s two

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00:18:37,359 –> 00:18:38,359
[Paul Tyler]: what

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00:18:37,757 –> 00:18:42,397
[Ramsey Smith]: questions one is the function of them and the other is how they’re priced so i

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00:18:42,477 –> 00:18:43,517
[Ramsey Smith]: will you know i guess

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00:18:43,757 –> 00:18:46,397
[Ramsey Smith]: let’s focus on the function first and then we can

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00:18:43,979 –> 00:18:45,179
[Paul Tyler]: spoke function first

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00:18:46,180 –> 00:18:47,180
[Jason Fitcher]: okay

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00:18:46,717 –> 00:18:49,677
[Ramsey Smith]: if you have an opinion on how their price we can talk about that too but as a

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00:18:49,297 –> 00:18:50,297
[Ramsey Smith]: function

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00:18:50,877 –> 00:18:52,957
[Ramsey Smith]: as you know for their utility what are your thoughts

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00:18:53,200 –> 00:18:54,240
[Jason Fitcher]: so i again

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00:18:54,079 –> 00:18:55,079
[Paul Tyler]: been white

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[Jason Fitcher]: my my hope in this discussion is we can talk about how the house can be used as a

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[Jason Fitcher]: financial asset and retirement to mitigate risk

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[Jason Fitcher]: and then one of i know wait fo talks about the idea of you know the risks you have

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00:19:05,840 –> 00:19:09,840
[Jason Fitcher]: of sequencing of market timing and how you could use reverse mortgage to basically

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00:19:10,000 –> 00:19:13,200
[Jason Fitcher]: get some more income later on your retirement years i think that’s an important

416
00:19:13,280 –> 00:19:14,720
[Jason Fitcher]: tool to talk about is the basket

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00:19:14,657 –> 00:19:15,657
[Ramsey Smith]: yeah

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00:19:14,800 –> 00:19:18,000
[Jason Fitcher]: of options one may have and again this goes back to my earlier thing early

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00:19:18,240 –> 00:19:19,680
[Jason Fitcher]: discussion i want financial

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00:19:19,439 –> 00:19:20,439
[Paul Tyler]: what

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00:19:19,537 –> 00:19:20,537
[Ramsey Smith]: what

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00:19:19,920 –> 00:19:23,440
[Jason Fitcher]: professionals to be able to talk to their clients about the options

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00:19:23,177 –> 00:19:24,177
[Ramsey Smith]: oh yeah

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00:19:23,520 –> 00:19:27,760
[Jason Fitcher]: that are available what the risks and rewards are the pros and cons and give them

425
00:19:23,520 –> 00:19:27,760
[Jason Fitcher]: that are available what the risks and rewards are the pros and cons and give them

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00:19:27,840 –> 00:19:31,280
[Jason Fitcher]: a menu and walk them through it right no pressure just talk about your options

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00:19:27,840 –> 00:19:31,280
[Jason Fitcher]: a menu and walk them through it right no pressure just talk about your options

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00:19:31,360 –> 00:19:32,640
[Jason Fitcher]: here’s what they are

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00:19:31,360 –> 00:19:32,640
[Jason Fitcher]: here’s what they are

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00:19:33,579 –> 00:19:34,619
[Paul Tyler]: oh i think

431
00:19:33,700 –> 00:19:34,700
[Jason Fitcher]: i think

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00:19:34,137 –> 00:19:35,137
[Ramsey Smith]: i think

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00:19:34,400 –> 00:19:37,440
[Jason Fitcher]: a reverse mortgage would be part of that discussion but so could a home equity

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[Jason Fitcher]: line of credit right you could do a whole amount of credit as well if you wanted

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00:19:40,400 –> 00:19:44,080
[Jason Fitcher]: to there are a lot of structures you can do and think about how to tap into the

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00:19:44,080 –> 00:19:46,480
[Jason Fitcher]: assets of your home equity to help in retirement

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00:19:46,399 –> 00:19:47,399
[Paul Tyler]: it

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00:19:46,880 –> 00:19:48,000
[Jason Fitcher]: but it’s new at its conversation

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00:19:48,699 –> 00:19:53,179
[Paul Tyler]: well is it wrong of me to think of taking a reverse mortgage effectively is doing

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00:19:53,259 –> 00:19:56,379
[Paul Tyler]: what you’re saying i’m paying off your mortgage right because i think tell me if

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[Paul Tyler]: i’m wrong if i do a reverse mortgage and i’ve got a mortgage say hundred thousand

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00:20:02,059 –> 00:20:06,619
[Paul Tyler]: dollars in the house i think that you got to wrap the whole thing up and get rid

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[Paul Tyler]: of the mortgage right is that yeah

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[Jason Fitcher]: yeah yeah so and this is again how do you use your house retirement the

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[Paul Tyler]: yeah yeah

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[Jason Fitcher]: asset and again as you said po it’s for most people it is their largest asset in

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[Jason Fitcher]: retirement and you know and if someone it again depends

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00:20:19,617 –> 00:20:20,617
[Ramsey Smith]: definitely

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00:20:19,920 –> 00:20:23,120
[Jason Fitcher]: on are youre to leave a request you do you have a spouse what’s the role you know

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00:20:23,440 –> 00:20:27,120
[Jason Fitcher]: if you are a single let’s say you’re a single person you have no kids you have no

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00:20:27,200 –> 00:20:31,200
[Jason Fitcher]: grandkids you’re not trying to leave a request to somebody why do you want to die

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[Jason Fitcher]: and leave thistles att

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[Jason Fitcher]: if you got a spouse to worry about if you’re worried about want to leave money to

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[Paul Tyler]: yeah

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00:20:39,280 –> 00:20:42,960
[Jason Fitcher]: your kids or your family it’s a different conversation so again it’s it’s it

456
00:20:43,200 –> 00:20:44,320
[Jason Fitcher]: really is amazing how

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00:20:46,320 –> 00:20:51,200
[Jason Fitcher]: times one of the reasons i love this show is we can talk about money yeah and but

458
00:20:51,440 –> 00:20:54,960
[Jason Fitcher]: but i mean that sincerely do you know how uncomfortable is talking money with

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00:20:54,860 –> 00:20:55,860
[Jason Fitcher]: people like

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[Paul Tyler]: right

461
00:20:55,500 –> 00:20:56,500
[Jason Fitcher]: real people

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00:20:56,337 –> 00:20:57,337
[Ramsey Smith]: sure

463
00:20:56,640 –> 00:20:59,840
[Jason Fitcher]: they’re they’re they just yeah you know this they get they they get nervous

464
00:21:00,580 –> 00:21:01,580
[Jason Fitcher]: going

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00:21:00,977 –> 00:21:01,977
[Ramsey Smith]: what

466
00:21:01,360 –> 00:21:05,360
[Jason Fitcher]: back to this idea we can have kitchen table conversations with your family members

467
00:21:05,760 –> 00:21:08,720
[Jason Fitcher]: and this is what becomes important even for like people who aren’t retiring yet

468
00:21:08,720 –> 00:21:11,920
[Jason Fitcher]: but whose parents might be retiring you just sit down with that of discussion

469
00:21:12,160 –> 00:21:16,480
[Jason Fitcher]: about what are their finances what are their worries do they actually no one likes

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00:21:16,560 –> 00:21:19,840
[Jason Fitcher]: to talk about death but do you have a will do you have you know do you have a

471
00:21:19,920 –> 00:21:23,920
[Jason Fitcher]: power of attorney have you structured all this i’m starting to have friends whose

472
00:21:24,000 –> 00:21:25,840
[Jason Fitcher]: parents are passing away and they’re finding

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00:21:25,697 –> 00:21:26,697
[Ramsey Smith]: yeah

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00:21:25,920 –> 00:21:30,560
[Jason Fitcher]: that their parents didn’t have the proper legal documents in order to help

475
00:21:30,880 –> 00:21:33,840
[Jason Fitcher]: straighten out their affairs because they were nervous about talking about it or

476
00:21:33,840 –> 00:21:36,560
[Jason Fitcher]: their kids now find out that they didn’t have much money as they thought and

477
00:21:36,640 –> 00:21:39,920
[Jason Fitcher]: there’s debt they’ve got to figure out how to pay off we need to go back to being

478
00:21:40,000 –> 00:21:41,840
[Jason Fitcher]: able to have these kitchen table financial conversations

479
00:21:43,920 –> 00:21:48,160
[Jason Fitcher]: in a responsible way without feeling guilty about it or nervous so we can talk

480
00:21:48,320 –> 00:21:51,760
[Jason Fitcher]: about what actually are our risks our trade offs the pros and cons of various

481
00:21:52,000 –> 00:21:54,640
[Jason Fitcher]: things and that’s where a financial planner comes in that’s where family and

482
00:21:54,720 –> 00:21:58,880
[Jason Fitcher]: friends can come in and we can have this again discussion of risk and how to

483
00:21:58,960 –> 00:22:01,120
[Jason Fitcher]: minimize risk especially in retirement

484
00:22:02,059 –> 00:22:06,379
[Paul Tyler]: so so if i think about the problem we’re really trying to help solve right you can

485
00:22:06,539 –> 00:22:11,259
[Paul Tyler]: step back a couple layers and say well it’s really how do you reduce your housing

486
00:22:11,339 –> 00:22:17,179
[Paul Tyler]: expenses in retirement right so big component obviously in a debt’s a hugely

487
00:22:17,339 –> 00:22:20,219
[Paul Tyler]: expensive proposition right there are other expenses

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00:22:25,899 –> 00:22:27,499
[Paul Tyler]: okay i agree i

489
00:22:27,057 –> 00:22:28,057
[Ramsey Smith]: agree

490
00:22:27,579 –> 00:22:29,099
[Paul Tyler]: ha i wanna get my

491
00:22:30,379 –> 00:22:35,339
[Paul Tyler]: get rid of my mortgage it feels like a kind of high a rare solution where somebody

492
00:22:35,579 –> 00:22:38,539
[Paul Tyler]: could just go in and say hey you know rams i’m going to pull money out of my money

493
00:22:38,699 –> 00:22:42,939
[Paul Tyler]: market and pay off my mortgage right that feels like jason what are the most

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00:22:42,660 –> 00:22:43,660
[Jason Fitcher]: yeah

495
00:22:43,099 –> 00:22:44,619
[Paul Tyler]: likely scenarios here where

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00:22:45,420 –> 00:22:46,420
[Jason Fitcher]: so he here’s

497
00:22:45,659 –> 00:22:48,219
[Paul Tyler]: i actually do get rid of my eliminate my mortgage

498
00:22:48,480 –> 00:22:51,840
[Jason Fitcher]: here’s how the people should think about one is there’s when you pay off your

499
00:22:51,920 –> 00:22:54,880
[Jason Fitcher]: mortgage there’s a couple ways to do it right you just brought the idea of

500
00:22:55,040 –> 00:22:58,080
[Jason Fitcher]: basically taking money from another pot i have a you know buy a

501
00:22:57,839 –> 00:22:58,839
[Paul Tyler]: yeah

502
00:22:58,160 –> 00:23:02,720
[Jason Fitcher]: cash i have a money market i have stocks i have bonds i have a four one can retire

503
00:23:02,720 –> 00:23:07,120
[Jason Fitcher]: and going to sell x to pay off the mortgage y that’s one way and that becomes a

504
00:23:07,200 –> 00:23:10,400
[Jason Fitcher]: decision on one risk management it also becomes in how do you want to allocate

505
00:23:10,480 –> 00:23:15,200
[Jason Fitcher]: your assets think about your house it’s a portfolio right the first rule portfolio

506
00:23:15,280 –> 00:23:17,360
[Jason Fitcher]: diversification is it has to be diversified

507
00:23:18,640 –> 00:23:22,160
[Jason Fitcher]: a house is part of your diversified portfolio so you don’t want to sell all of

508
00:23:22,160 –> 00:23:25,760
[Jason Fitcher]: your stock assets to pay off a house but how do you balance it my

509
00:23:25,439 –> 00:23:26,439
[Paul Tyler]: what

510
00:23:25,920 –> 00:23:28,960
[Jason Fitcher]: thing has always been i’ve always been concerned that people take out these home

511
00:23:29,200 –> 00:23:34,080
[Jason Fitcher]: economic credits or keep refinancing to do cash refinancing to buy something else

512
00:23:34,640 –> 00:23:39,360
[Jason Fitcher]: so they start looking at their houses an atm and a cash machine as opposed to

513
00:23:39,840 –> 00:23:45,360
[Jason Fitcher]: retirement asset housing consumption et cetera so my first advice for people when

514
00:23:45,440 –> 00:23:48,240
[Jason Fitcher]: they get a mortgage is just unless rates drop

515
00:23:47,839 –> 00:23:48,839
[Paul Tyler]: water

516
00:23:48,640 –> 00:23:52,240
[Jason Fitcher]: stick with it and if race dropped you when to refinance don’t keep refinancing the

517
00:23:52,320 –> 00:23:55,680
[Jason Fitcher]: thirty years and pushing it out if you had a thirty year can you get a twenty year

518
00:23:55,760 –> 00:23:59,600
[Jason Fitcher]: next time perhaps a fifteen maybe you can do a ten year i

519
00:23:59,279 –> 00:24:00,279
[Paul Tyler]: i

520
00:23:59,680 –> 00:24:04,400
[Jason Fitcher]: ref you know my first house i couldn’t afford to pay cash for my first house i got

521
00:24:04,480 –> 00:24:06,320
[Jason Fitcher]: a thirty year mortgage rates started

522
00:24:05,919 –> 00:24:06,919
[Paul Tyler]: you

523
00:24:06,400 –> 00:24:10,000
[Jason Fitcher]: dropping i refinanced and at some point i was able to refinance to a fifteen year

524
00:24:10,160 –> 00:24:13,440
[Jason Fitcher]: mortgage and we were talking before the show and i’m happy to put it on in public

525
00:24:13,600 –> 00:24:17,680
[Jason Fitcher]: i am fifty years old and i’m two years away from paying off my house because i’ve

526
00:24:17,680 –> 00:24:21,520
[Jason Fitcher]: been paying it monthly and got a fifteen year mortgage i am going pay off my house

527
00:24:21,760 –> 00:24:24,640
[Jason Fitcher]: i am not i mean i get letters from you know banks

528
00:24:24,457 –> 00:24:25,457
[Ramsey Smith]: i think

529
00:24:24,720 –> 00:24:28,080
[Jason Fitcher]: saying hey you could be finance the equity you have in your house like yes that is

530
00:24:28,080 –> 00:24:31,120
[Jason Fitcher]: going to be my long term care insurance that is to me what my wife is gonna have

531
00:24:31,120 –> 00:24:35,600
[Jason Fitcher]: when i pass away that is going to be a worry free asset yeah i’ve gotta pay taxes

532
00:24:35,680 –> 00:24:39,440
[Jason Fitcher]: on it yes i’ll have to have maintenance i don’t have to pay rent i have to pay a

533
00:24:39,440 –> 00:24:44,160
[Jason Fitcher]: mortgage and that money that was allocated for housing can now go into other

534
00:24:44,320 –> 00:24:47,920
[Jason Fitcher]: things whether that’s vacation travel whether i want to put that back in the

535
00:24:47,920 –> 00:24:50,640
[Jason Fitcher]: market and reallocate money that what is going to housing and i’ll put

536
00:24:50,319 –> 00:24:51,319
[Paul Tyler]: see

537
00:24:50,720 –> 00:24:55,520
[Jason Fitcher]: it in investments i now have that flexibility but having the house paid off means

538
00:24:55,520 –> 00:25:00,000
[Jason Fitcher]: i can start going into retirement not worrying about housing which again for most

539
00:25:00,080 –> 00:25:03,920
[Jason Fitcher]: people it’s the biggest expense so that’s when we start thinking about housing you

540
00:25:03,920 –> 00:25:08,080
[Jason Fitcher]: know paul it’s not do i sell off all my assets to pay down the house when i retire

541
00:25:07,860 –> 00:25:08,860
[Jason Fitcher]: it’s what

542
00:25:08,239 –> 00:25:09,239
[Paul Tyler]: what

543
00:25:08,640 –> 00:25:13,280
[Jason Fitcher]: have i got is my portfolio and am i overleveraged in one versus the other and

544
00:25:13,440 –> 00:25:17,200
[Jason Fitcher]: don’t look at your house as a cash machine in the sense of using it to buy a boat

545
00:25:17,600 –> 00:25:21,360
[Jason Fitcher]: think about it as how you would take that house to mitigate risk and retirement

546
00:25:21,360 –> 00:25:24,720
[Jason Fitcher]: and presumably down the road maybe turn into a stream of income which could be

547
00:25:24,720 –> 00:25:27,760
[Jason Fitcher]: either again i’m not saying i’m buying into reverse mortgages because there’s a

548
00:25:27,760 –> 00:25:31,120
[Jason Fitcher]: lot of ways you could do home equity there’s a lot of things you can do but that

549
00:25:31,200 –> 00:25:34,640
[Jason Fitcher]: house you might decide to sell it maybe you get to the point where the house is

550
00:25:34,720 –> 00:25:39,280
[Jason Fitcher]: too big you bought this big house and the kids are gone the dogs are gone it’s

551
00:25:39,280 –> 00:25:42,400
[Jason Fitcher]: just you or maybe you’re in a spouse in this big house and you want to downsize

552
00:25:43,600 –> 00:25:46,560
[Jason Fitcher]: what do you sell how do you downsize what do you use the additional proceeds for

553
00:25:46,560 –> 00:25:48,960
[Jason Fitcher]: how do you use that to do you buy more protected income

554
00:25:48,737 –> 00:25:49,737
[Ramsey Smith]: she

555
00:25:49,040 –> 00:25:50,560
[Jason Fitcher]: do you reallocate it into the market

556
00:25:51,680 –> 00:25:54,720
[Jason Fitcher]: there’s a lot of things you can do and you have a lot more flexibility if the

557
00:25:54,720 –> 00:25:56,320
[Jason Fitcher]: house is paid off or close to it

558
00:25:56,857 –> 00:25:57,857
[Ramsey Smith]: i think

559
00:25:56,919 –> 00:25:57,919
[Paul Tyler]: i think

560
00:25:58,557 –> 00:25:59,677
[Ramsey Smith]: part of the issue here is

561
00:26:00,797 –> 00:26:05,437
[Ramsey Smith]: is is when financial advisor or somebody else is having a conversation

562
00:26:06,557 –> 00:26:08,957
[Ramsey Smith]: with a consumer that’s kind of in that right in

563
00:26:08,500 –> 00:26:09,500
[Jason Fitcher]: i

564
00:26:09,037 –> 00:26:13,037
[Ramsey Smith]: this age range we’re talking about is to sort of express upfront that

565
00:26:14,157 –> 00:26:16,397
[Ramsey Smith]: it is a it is a normal goal

566
00:26:16,500 –> 00:26:17,500
[Jason Fitcher]: yeah

567
00:26:17,197 –> 00:26:21,517
[Ramsey Smith]: to go under retirement with a debt free with debt free housing right like that

568
00:26:21,757 –> 00:26:26,557
[Ramsey Smith]: like that is a that is an aspirational first set it up as an aspirational goal so

569
00:26:26,717 –> 00:26:28,317
[Ramsey Smith]: people people see it as a

570
00:26:29,577 –> 00:26:30,577
[Ramsey Smith]: as a target

571
00:26:31,757 –> 00:26:33,117
[Ramsey Smith]: the second part of that i think

572
00:26:33,117 –> 00:26:35,357
[Ramsey Smith]: that that you said that’s very important

573
00:26:33,120 –> 00:26:35,120
[Jason Fitcher]: right um what

574
00:26:36,657 –> 00:26:37,657
[Ramsey Smith]: is

575
00:26:37,200 –> 00:26:39,040
[Jason Fitcher]: it down and the one is

576
00:26:37,277 –> 00:26:41,677
[Ramsey Smith]: ultimately highlighting that it’s an asset and then there are things that you can

577
00:26:41,677 –> 00:26:45,357
[Ramsey Smith]: do to create some liquidity around that asset so it’s the line of credit or the

578
00:26:45,357 –> 00:26:46,637
[Ramsey Smith]: verse mortgage driver you

579
00:26:46,340 –> 00:26:47,340
[Jason Fitcher]: uhuh

580
00:26:46,717 –> 00:26:49,117
[Ramsey Smith]: happen to do it but the key thing is that

581
00:26:50,397 –> 00:26:54,077
[Ramsey Smith]: that the liquidity and resources that you draw from your house

582
00:26:55,137 –> 00:26:56,137
[Ramsey Smith]: should be spent

583
00:26:55,700 –> 00:26:56,700
[Jason Fitcher]: watch

584
00:26:56,537 –> 00:26:57,537
[Ramsey Smith]: on things

585
00:26:57,180 –> 00:26:58,180
[Jason Fitcher]: know i said i

586
00:26:57,517 –> 00:27:00,077
[Ramsey Smith]: that are essential as opposed to things that are non essential

587
00:26:59,839 –> 00:27:00,839
[Paul Tyler]: what

588
00:27:00,157 –> 00:27:04,717
[Ramsey Smith]: i’m trying to i’m trying to take everything you said and sort of try to find a way

589
00:27:04,417 –> 00:27:05,417
[Ramsey Smith]: to sort

590
00:27:05,040 –> 00:27:06,640
[Jason Fitcher]: condense it yeah i think that’s great

591
00:27:05,117 –> 00:27:09,517
[Ramsey Smith]: of frame it for people that like you know that you really that that it’s okay to

592
00:27:09,199 –> 00:27:10,199
[Paul Tyler]: ban

593
00:27:09,257 –> 00:27:10,257
[Ramsey Smith]: finance

594
00:27:09,460 –> 00:27:10,460
[Jason Fitcher]: that

595
00:27:10,317 –> 00:27:11,597
[Ramsey Smith]: things but if you’re financing things

596
00:27:11,140 –> 00:27:12,140
[Jason Fitcher]: i

597
00:27:11,597 –> 00:27:15,437
[Ramsey Smith]: that are non essential you’re imparting more risk if you’re financing things that

598
00:27:15,377 –> 00:27:16,377
[Ramsey Smith]: are essential or

599
00:27:16,159 –> 00:27:17,159
[Paul Tyler]: that’s

600
00:27:16,477 –> 00:27:21,357
[Ramsey Smith]: potentially essential then you’re actually reducing risk so you know anyway i’m

601
00:27:21,337 –> 00:27:22,337
[Ramsey Smith]: this has been this

602
00:27:21,700 –> 00:27:22,700
[Jason Fitcher]: yeah

603
00:27:22,157 –> 00:27:24,237
[Ramsey Smith]: has been very helpful i’m trying to put a

604
00:27:23,600 –> 00:27:25,280
[Jason Fitcher]: well this is this is also where i

605
00:27:24,977 –> 00:27:25,977
[Ramsey Smith]: yeah

606
00:27:25,360 –> 00:27:28,800
[Jason Fitcher]: think for financial professionals to start talking to people about the role of

607
00:27:28,960 –> 00:27:32,240
[Jason Fitcher]: income and retirement what does it mean right to basically take the wealth you

608
00:27:32,320 –> 00:27:36,000
[Jason Fitcher]: have and make into a stream of income whether it’s a drawdown strategy or annuity

609
00:27:36,080 –> 00:27:40,880
[Jason Fitcher]: but it’s the role of income and we do find with research and also our anecdotal

610
00:27:40,960 –> 00:27:45,360
[Jason Fitcher]: experience talking to again real people is that they fear running out of money and

611
00:27:45,440 –> 00:27:48,320
[Jason Fitcher]: outliving their money so they fear they’re going to be living off cat food they’re

612
00:27:48,320 –> 00:27:51,840
[Jason Fitcher]: gonna spend down their money they don’t spend enough and for some people they

613
00:27:52,000 –> 00:27:55,440
[Jason Fitcher]: actually die with a significant amount of assets that they could have spent but

614
00:27:55,520 –> 00:27:59,120
[Jason Fitcher]: they were just afraid to do so and what we see this is research that david

615
00:27:59,120 –> 00:28:02,800
[Jason Fitcher]: blanchet michael have done and we’ve got some work at the alliance that this call

616
00:28:02,960 –> 00:28:06,560
[Jason Fitcher]: this license to spend right if you have enough income coming in that’s protected

617
00:28:06,640 –> 00:28:11,600
[Jason Fitcher]: it’s like your budget constraints if youer the number is that you know you’re

618
00:28:11,600 –> 00:28:16,560
[Jason Fitcher]: getting monthly it’s guaranteed it’s so security plus maybe annuity maybe it’s a

619
00:28:16,620 –> 00:28:17,620
[Jason Fitcher]: pension but you know you’ve

620
00:28:17,217 –> 00:28:18,217
[Ramsey Smith]: you

621
00:28:17,680 –> 00:28:22,480
[Jason Fitcher]: got it you spend up that and you allow other money then you can invest it you can

622
00:28:22,560 –> 00:28:26,000
[Jason Fitcher]: take it say i can go and be more risky in assets now because i know i’ve got this

623
00:28:26,080 –> 00:28:28,000
[Jason Fitcher]: printed income that pays for my essentials

624
00:28:30,000 –> 00:28:34,400
[Jason Fitcher]: if that essential includes housing whether it’s rent or mortgage that takes up a

625
00:28:34,480 –> 00:28:38,240
[Jason Fitcher]: significant dollar amount of your flexibility to do other things mitigate risks

626
00:28:38,240 –> 00:28:39,280
[Jason Fitcher]: that maybe your car

627
00:28:39,440 –> 00:28:42,720
[Jason Fitcher]: breaks down maybe you need to buy a new car during covid which is very expensive

628
00:28:39,517 –> 00:28:40,877
[Ramsey Smith]: hardly so s

629
00:28:42,960 –> 00:28:46,800
[Jason Fitcher]: if you have a housing repair get health shock all these things come into play so

630
00:28:46,880 –> 00:28:50,320
[Jason Fitcher]: you really need to think about what that means and then try to mitigate risk and

631
00:28:50,400 –> 00:28:53,200
[Jason Fitcher]: people don’t realize that a lot of these things start happening when you retire

632
00:28:53,440 –> 00:28:57,280
[Jason Fitcher]: again we get older things start breaking down not just you know our bodies start

633
00:28:57,440 –> 00:29:00,480
[Jason Fitcher]: going but we’re not as young as we used to be and who

634
00:29:00,097 –> 00:29:01,097
[Ramsey Smith]: good

635
00:29:00,640 –> 00:29:03,520
[Jason Fitcher]: knows it’s going to happen with inflation right you know is inflation going to

636
00:29:03,520 –> 00:29:06,320
[Jason Fitcher]: turn around also and go lower again is it going to continue to go up is it

637
00:29:06,400 –> 00:29:10,320
[Jason Fitcher]: transitory is it permanent how do we mitigate the risk and try to protect

638
00:29:10,640 –> 00:29:14,320
[Jason Fitcher]: ourselves and this is where it comes into big thinking more dynamically and the

639
00:29:14,480 –> 00:29:18,480
[Jason Fitcher]: more you can reduce debt to retirement the better off you’re gonna be

640
00:29:18,619 –> 00:29:24,859
[Paul Tyler]: yeah i i totally agree you got to have somebody you who’s knowledgeable helping

641
00:29:24,939 –> 00:29:30,219
[Paul Tyler]: you through this and and and i’ll just had this great chat we i i kind of read you

642
00:29:30,299 –> 00:29:33,419
[Paul Tyler]: a little bit of this just before the show but had an agent coming on an online

643
00:29:33,519 –> 00:29:34,519
[Paul Tyler]: chat and i

644
00:29:34,140 –> 00:29:35,140
[Jason Fitcher]: mm

645
00:29:34,539 –> 00:29:36,939
[Paul Tyler]: think of the risks okay the planning that’s

646
00:29:36,820 –> 00:29:37,820
[Jason Fitcher]: like

647
00:29:37,019 –> 00:29:40,859
[Paul Tyler]: involved in doing something like this and the amount of risk you’ve got to sort of

648
00:29:42,059 –> 00:29:45,499
[Paul Tyler]: dynamically work through can all you know kind of buil

649
00:29:45,260 –> 00:29:46,260
[Jason Fitcher]: but i

650
00:29:45,579 –> 00:29:51,019
[Paul Tyler]: your head so says and i’ll sanitize this a little bit so we’re not promoting

651
00:29:51,179 –> 00:29:55,419
[Paul Tyler]: products here but i have in laws that just sold their home and considering putting

652
00:29:55,499 –> 00:29:57,499
[Paul Tyler]: their profits into either one of your two

653
00:29:57,659 –> 00:30:03,259
[Paul Tyler]: annuities okay all right so they had this house they clearly sold it and they had

654
00:29:57,940 –> 00:29:58,940
[Jason Fitcher]: how you

655
00:30:03,339 –> 00:30:06,539
[Paul Tyler]: to make a bet on g do i keep this thing and

656
00:30:06,260 –> 00:30:07,260
[Jason Fitcher]: yeah

657
00:30:06,699 –> 00:30:09,819
[Paul Tyler]: get the appreciation keep you know is the market going to still going up so they

658
00:30:09,979 –> 00:30:14,059
[Paul Tyler]: bet that the probably the market’s up as high as it’s going go or they don’t need

659
00:30:14,119 –> 00:30:15,119
[Paul Tyler]: you know it’s something they

660
00:30:14,580 –> 00:30:15,580
[Jason Fitcher]: he

661
00:30:14,719 –> 00:30:15,719
[Paul Tyler]: don’t need

662
00:30:16,619 –> 00:30:19,659
[Paul Tyler]: so they’re gonna take their profits so they’re clearly using the principle and

663
00:30:19,659 –> 00:30:23,659
[Paul Tyler]: doing something else with whatever their or whatever their basis was in one of

664
00:30:23,659 –> 00:30:27,899
[Paul Tyler]: these news so they’re diversifying their risk right so they’re keeping some who

665
00:30:27,979 –> 00:30:30,619
[Paul Tyler]: knows what they’re doing the the capital gains the

666
00:30:30,340 –> 00:30:31,340
[Jason Fitcher]: and

667
00:30:30,779 –> 00:30:35,499
[Paul Tyler]: thinking of putting in annuities now here’s what it’s it’s more complicated i had

668
00:30:35,659 –> 00:30:41,259
[Paul Tyler]: to go dig deep on this one ramsey you love this if they submit jointly will a

669
00:30:41,060 –> 00:30:42,060
[Jason Fitcher]: what i

670
00:30:41,339 –> 00:30:42,859
[Paul Tyler]: policy continue as normal should

671
00:30:42,820 –> 00:30:43,820
[Jason Fitcher]: the new york

672
00:30:43,019 –> 00:30:47,419
[Paul Tyler]: one pass or is it better for just one to submit okay so he’s also managing

673
00:30:47,439 –> 00:30:48,439
[Paul Tyler]: longevity risk

674
00:30:48,160 –> 00:30:50,320
[Jason Fitcher]: but if and spouse

675
00:30:50,439 –> 00:30:51,439
[Paul Tyler]: the spouse

676
00:30:50,860 –> 00:30:51,860
[Jason Fitcher]: possible benefit

677
00:30:51,737 –> 00:30:52,737
[Ramsey Smith]: yep

678
00:30:52,619 –> 00:30:55,659
[Paul Tyler]: right how long are they are they going to go and you know the answer is

679
00:30:55,739 –> 00:31:00,139
[Paul Tyler]: complicated because you know if if one’s an owner as it turns out ramsay don’t

680
00:30:59,919 –> 00:31:00,919
[Paul Tyler]: know this before

681
00:31:00,880 –> 00:31:02,560
[Jason Fitcher]: why you go over that i

682
00:31:01,659 –> 00:31:07,259
[Paul Tyler]: you know certain of these features are disappear if the spouse is a is just listed

683
00:31:07,339 –> 00:31:11,979
[Paul Tyler]: as a beneficiary so you got to think through what the contract is who you put on

684
00:31:11,599 –> 00:31:12,599
[Paul Tyler]: as

685
00:31:12,100 –> 00:31:13,100
[Jason Fitcher]: i did like

686
00:31:12,219 –> 00:31:13,819
[Paul Tyler]: the owner and then

687
00:31:14,139 –> 00:31:18,139
[Paul Tyler]: jason the next questions we sort of dig down is like when the money is

688
00:31:14,400 –> 00:31:15,600
[Jason Fitcher]: she would be man

689
00:31:17,820 –> 00:31:18,820
[Jason Fitcher]: like you

690
00:31:18,219 –> 00:31:21,979
[Paul Tyler]: withdrawn on a monthly basis how’s it taxed oh

691
00:31:23,020 –> 00:31:24,020
[Jason Fitcher]: i think i

692
00:31:23,659 –> 00:31:27,499
[Paul Tyler]: you know here’s it okay well is it a free withdrawal versus income versus

693
00:31:28,939 –> 00:31:32,859
[Paul Tyler]: what does the tax rate look like five six ten years from now

694
00:31:32,640 –> 00:31:36,800
[Jason Fitcher]: ten year again your point life is complicated these are complicated decisions

695
00:31:36,859 –> 00:31:37,979
[Paul Tyler]: yeah so yeah

696
00:31:37,120 –> 00:31:40,640
[Jason Fitcher]: and i think well this is you know again there’s a lot of things we don’t know

697
00:31:40,720 –> 00:31:43,520
[Jason Fitcher]: about their their circumstances right do they have other assets besides the house

698
00:31:43,680 –> 00:31:47,680
[Jason Fitcher]: they just sold how much of the assets do they have are they getting any other

699
00:31:47,840 –> 00:31:52,720
[Jason Fitcher]: income from dividends are they do they have an ira they taking r m ds i

700
00:31:52,720 –> 00:31:56,880
[Jason Fitcher]: don’t know so there there’s is a lot that goes into this but what i started seeing

701
00:31:52,937 –> 00:31:53,937
[Ramsey Smith]: i don’t there’s

702
00:31:57,200 –> 00:32:00,480
[Jason Fitcher]: you know again and partis and the research you seeing the data and then two is the

703
00:32:00,560 –> 00:32:03,520
[Jason Fitcher]: anecdote when we talk to real people and you start to merge the two together to

704
00:32:03,600 –> 00:32:08,240
[Jason Fitcher]: get a picture of what’s going on in retirement is that more people are entering

705
00:32:08,320 –> 00:32:12,000
[Jason Fitcher]: retirement with housing debt so they haven’t paid off their mortgage and they’ve

706
00:32:12,000 –> 00:32:17,280
[Jason Fitcher]: been so useless framing of well i can borrow for cheap it’s almost co the phrase i

707
00:32:17,280 –> 00:32:19,120
[Jason Fitcher]: always hate is it’s almost free money

708
00:32:20,240 –> 00:32:21,840
[Jason Fitcher]: there’s no such thing as free i

709
00:32:21,920 –> 00:32:25,680
[Jason Fitcher]: mean there’s just there’s this and that and i don’t mean that you know the people

710
00:32:21,997 –> 00:32:23,117
[Ramsey Smith]: that’s the truth yeah

711
00:32:25,840 –> 00:32:28,880
[Jason Fitcher]: say free money because the cost is low but it’s the opportunity cost of that money

712
00:32:29,280 –> 00:32:32,240
[Jason Fitcher]: what you could do with it and you have some people saying well take the money out

713
00:32:32,240 –> 00:32:35,520
[Jason Fitcher]: of your house in which you’re paying even if you’re paying now say you’re paying

714
00:32:35,600 –> 00:32:38,560
[Jason Fitcher]: four percent if you’re paying four percent you can put up the market making ten

715
00:32:38,640 –> 00:32:41,440
[Jason Fitcher]: percent a year and your arbitrage the taxes you’re coming out of head you’re not

716
00:32:41,440 –> 00:32:45,280
[Jason Fitcher]: financially smart where the market goes down right so you lose twenty percentage

717
00:32:45,520 –> 00:32:49,440
[Jason Fitcher]: one year in a market you’ve now got this huge debt on your house

718
00:32:49,039 –> 00:32:50,039
[Paul Tyler]: yeah

719
00:32:49,520 –> 00:32:52,160
[Jason Fitcher]: that you got to pay for you might not be able to afford it where it happened to

720
00:32:52,240 –> 00:32:55,200
[Jason Fitcher]: your income stream now you’re out of a house what do you do you gonna go live with

721
00:32:55,100 –> 00:32:56,100
[Jason Fitcher]: your kids you’re gonna

722
00:32:55,657 –> 00:32:56,657
[Ramsey Smith]: it’s

723
00:32:55,900 –> 00:32:56,900
[Jason Fitcher]: you know

724
00:32:57,840 –> 00:33:01,280
[Jason Fitcher]: this is the risk that we’re not talking about it’s too focused on

725
00:33:02,320 –> 00:33:06,240
[Jason Fitcher]: trying to get maximum yield after the point of time when you should be thinking

726
00:33:06,240 –> 00:33:09,200
[Jason Fitcher]: about yield i’m not saying you don’t think of growth mats i think about inflation

727
00:33:09,280 –> 00:33:13,600
[Jason Fitcher]: but that goes back to a diversified portfolio and the house should be part of a

728
00:33:13,680 –> 00:33:15,600
[Jason Fitcher]: diversified portfolio and also

729
00:33:15,457 –> 00:33:16,457
[Ramsey Smith]: yeah

730
00:33:15,840 –> 00:33:20,560
[Jason Fitcher]: but it’s this is where think people get confused they they see like a stock and a

731
00:33:20,560 –> 00:33:24,320
[Jason Fitcher]: bond and they think that’s an asset so in their head it’s an asset they look at

732
00:33:24,400 –> 00:33:28,000
[Jason Fitcher]: the house and for a lot of fines professionals they talk about it as an asset but

733
00:33:28,080 –> 00:33:30,240
[Jason Fitcher]: it takes two functions one is the asset

734
00:33:29,999 –> 00:33:30,999
[Paul Tyler]: yeah

735
00:33:30,320 –> 00:33:32,240
[Jason Fitcher]: so diversify your portfolio but

736
00:33:32,559 –> 00:33:33,559
[Paul Tyler]: yes

737
00:33:32,960 –> 00:33:38,000
[Jason Fitcher]: you consume housing you’re living in it so to an economist i’m looking at this

738
00:33:38,000 –> 00:33:39,040
[Jason Fitcher]: house that i sit in and

739
00:33:38,897 –> 00:33:39,897
[Ramsey Smith]: did i

740
00:33:39,120 –> 00:33:43,280
[Jason Fitcher]: i’m talking to you guys on i’m consuming living here so it’s part investment part

741
00:33:43,360 –> 00:33:47,360
[Jason Fitcher]: consumption and it’s that consumption that we talk about with our monthly expenses

742
00:33:47,440 –> 00:33:51,040
[Jason Fitcher]: we have in retirement i have to consume utilities i have to consume housing i have

743
00:33:51,200 –> 00:33:54,720
[Jason Fitcher]: to consume carss that to consume travel to consume health care if all of a sudden

744
00:33:54,720 –> 00:33:56,960
[Jason Fitcher]: my housing consumption costs are low

745
00:33:58,000 –> 00:34:02,560
[Jason Fitcher]: i have a lot more flexibility to do and afford the other things including shocks

746
00:34:03,837 –> 00:34:05,997
[Ramsey Smith]: one of which is inflation right

747
00:34:05,860 –> 00:34:06,860
[Jason Fitcher]: is it yes

748
00:34:06,057 –> 00:34:07,057
[Ramsey Smith]: so like if you

749
00:34:06,719 –> 00:34:07,719
[Paul Tyler]: yes

750
00:34:07,197 –> 00:34:08,637
[Ramsey Smith]: because if you rent if you rent

751
00:34:08,260 –> 00:34:09,260
[Jason Fitcher]: good point

752
00:34:08,717 –> 00:34:11,277
[Ramsey Smith]: housing inflation’ is going to hit you more directly than if you

753
00:34:11,119 –> 00:34:12,119
[Paul Tyler]: yeah

754
00:34:11,677 –> 00:34:14,637
[Ramsey Smith]: and if you own your home so you’re indexed no

755
00:34:12,880 –> 00:34:17,120
[Jason Fitcher]: yep that that’s yep you’re exactly right and this is also i mean pill asked what

756
00:34:17,200 –> 00:34:19,280
[Jason Fitcher]: should i rent in retirement but yeah the best answer

757
00:34:18,959 –> 00:34:19,959
[Paul Tyler]: yeah

758
00:34:19,680 –> 00:34:24,320
[Jason Fitcher]: we always talked about for any economic question is it depends right so you go

759
00:34:24,400 –> 00:34:27,840
[Jason Fitcher]: back to that couple you were talking about the advisor who emailed you paul what

760
00:34:27,540 –> 00:34:28,540
[Jason Fitcher]: if that

761
00:34:27,777 –> 00:34:28,777
[Ramsey Smith]: like

762
00:34:27,780 –> 00:34:28,780
[Jason Fitcher]: couple

763
00:34:28,159 –> 00:34:29,159
[Paul Tyler]: that

764
00:34:28,640 –> 00:34:30,080
[Jason Fitcher]: said we’re you know we decide

765
00:34:29,879 –> 00:34:30,879
[Paul Tyler]: i want

766
00:34:30,240 –> 00:34:32,720
[Jason Fitcher]: we wanna take the next eighteen months in travel

767
00:34:33,760 –> 00:34:37,600
[Jason Fitcher]: you could use in some way some proceeds have a small base sign of twelve or

768
00:34:37,600 –> 00:34:41,280
[Jason Fitcher]: eighteen month lease right lock in payments have a have a home base use those

769
00:34:41,520 –> 00:34:42,640
[Jason Fitcher]: proceeds to pay for rent

770
00:34:42,417 –> 00:34:43,417
[Ramsey Smith]: by

771
00:34:42,800 –> 00:34:46,160
[Jason Fitcher]: go travel and then figure out when you come back whether or not you need to have a

772
00:34:46,160 –> 00:34:50,080
[Jason Fitcher]: small condo or a small house or what you want to do renting is not always bad but

773
00:34:50,240 –> 00:34:54,240
[Jason Fitcher]: again you have to understand that there’s consumption and that’s part of your

774
00:34:54,240 –> 00:34:57,760
[Jason Fitcher]: budget fine but you’re now exposing yourself to rental increases and everything

775
00:34:57,540 –> 00:34:58,540
[Jason Fitcher]: else so

776
00:34:59,440 –> 00:35:02,640
[Jason Fitcher]: got i want people to have these conversations because it’s the conversations that

777
00:35:02,720 –> 00:35:06,160
[Jason Fitcher]: allow the individual to say hey i also have this issue i didn’t tell you about

778
00:35:06,240 –> 00:35:09,440
[Jason Fitcher]: maybe add that into the conversation and see what that means for my my risk

779
00:35:09,179 –> 00:35:13,579
[Paul Tyler]: you visited oh yeah well in ramsey you gotta laugh so you know where my head

780
00:35:13,659 –> 00:35:17,419
[Paul Tyler]: goes there is gee if you’re going to travel and you’re senior do you have met sup

781
00:35:13,760 –> 00:35:14,880
[Jason Fitcher]: i don’t know yeah

782
00:35:17,579 –> 00:35:22,539
[Paul Tyler]: you have that advantage and are you going to be a networker out jason it’s just

783
00:35:22,539 –> 00:35:26,699
[Paul Tyler]: it’s like you pull a thread and it’s just it just will not stop coming

784
00:35:30,480 –> 00:35:34,400
[Jason Fitcher]: these are again they’re complicated issues i i don’t want to solve them with a

785
00:35:34,480 –> 00:35:38,800
[Jason Fitcher]: bumper sticker you know rules of thumbs you know are general rules that don’t

786
00:35:38,800 –> 00:35:43,840
[Jason Fitcher]: always apply to everybody but it it is important to have these conversations and i

787
00:35:43,840 –> 00:35:46,800
[Jason Fitcher]: think that’s one of the things that is improving we are seeing it improve

788
00:35:48,800 –> 00:35:53,520
[Jason Fitcher]: but too often i and i love that in fact we have access to credit believe it access

789
00:35:53,760 –> 00:35:58,000
[Jason Fitcher]: to credit makes things work i mean this is just i’m all in favor of access to

790
00:35:58,080 –> 00:36:01,600
[Jason Fitcher]: credit i want to be more nuanced i can have a better discussion of what it means

791
00:36:02,080 –> 00:36:05,840
[Jason Fitcher]: because it becomes too easy that people don’t really understand the long term

792
00:36:06,800 –> 00:36:11,520
[Jason Fitcher]: implications of that debt that’s whether credit card debt car debt housing debt

793
00:36:11,600 –> 00:36:15,200
[Jason Fitcher]: you name it um but it’s part of that conversation you have to have before you go

794
00:36:15,360 –> 00:36:17,840
[Jason Fitcher]: into well before you go into retirement to be honest

795
00:36:18,459 –> 00:36:23,659
[Paul Tyler]: so ramsey i don’t know you maybe you you your takeaways did we make this simpler

796
00:36:23,739 –> 00:36:24,779
[Paul Tyler]: or more complicated

797
00:36:26,637 –> 00:36:30,877
[Ramsey Smith]: for me that the the the biggest thing i would hope that everybody takes away from

798
00:36:31,037 –> 00:36:33,277
[Ramsey Smith]: this is one this

799
00:36:32,879 –> 00:36:33,879
[Paul Tyler]: like

800
00:36:32,980 –> 00:36:33,980
[Jason Fitcher]: well

801
00:36:33,177 –> 00:36:34,177
[Ramsey Smith]: idea that

802
00:36:33,177 –> 00:36:34,177
[Ramsey Smith]: idea that

803
00:36:35,137 –> 00:36:36,137
[Ramsey Smith]: that

804
00:36:35,759 –> 00:36:36,759
[Paul Tyler]: you

805
00:36:35,837 –> 00:36:39,517
[Ramsey Smith]: reducing risk and retirement is critical cause you’ve got fewer options

806
00:36:39,679 –> 00:36:40,679
[Paul Tyler]: that

807
00:36:40,397 –> 00:36:41,837
[Ramsey Smith]: to an important component of that

808
00:36:40,400 –> 00:36:42,080
[Jason Fitcher]: you’re like oh oh

809
00:36:43,057 –> 00:36:44,057
[Ramsey Smith]: is

810
00:36:43,500 –> 00:36:44,500
[Jason Fitcher]: that not

811
00:36:44,237 –> 00:36:47,837
[Ramsey Smith]: reducing or eliminating the debt that you have associated with

812
00:36:47,599 –> 00:36:48,599
[Paul Tyler]: my

813
00:36:47,997 –> 00:36:51,037
[Ramsey Smith]: your your housing because it imparts more risk three

814
00:36:50,719 –> 00:36:51,719
[Paul Tyler]: we

815
00:36:51,277 –> 00:36:54,077
[Ramsey Smith]: to the extent that you have a house that is an asset

816
00:36:54,239 –> 00:36:55,239
[Paul Tyler]: yeah

817
00:36:54,817 –> 00:36:55,817
[Ramsey Smith]: and you can

818
00:36:55,780 –> 00:36:56,780
[Jason Fitcher]: what type what

819
00:36:55,917 –> 00:37:00,637
[Ramsey Smith]: use it to create sources of liquidity those are sources of liquidity that should

820
00:37:00,717 –> 00:37:03,677
[Ramsey Smith]: be used one in the case of emergencies and two in the case

821
00:37:04,717 –> 00:37:08,237
[Ramsey Smith]: of financing your sort of essential consumption in retirement

822
00:37:08,940 –> 00:37:09,940
[Jason Fitcher]: alright

823
00:37:09,677 –> 00:37:14,237
[Ramsey Smith]: and only frankly as a last resort for non essentials so

824
00:37:12,400 –> 00:37:14,400
[Jason Fitcher]: okay i know about play s

825
00:37:15,279 –> 00:37:16,279
[Paul Tyler]: that’s

826
00:37:15,517 –> 00:37:19,917
[Ramsey Smith]: that’s sort of the framework that sort of i put together as we were as we were

827
00:37:15,517 –> 00:37:19,917
[Ramsey Smith]: that’s sort of the framework that sort of i put together as we were as we were

828
00:37:20,057 –> 00:37:21,057
[Ramsey Smith]: walking through this

829
00:37:20,057 –> 00:37:21,057
[Ramsey Smith]: walking through this

830
00:37:21,120 –> 00:37:24,960
[Jason Fitcher]: that’s a fantastic for eric ramsay and now we know why you get paid the big bucks

831
00:37:25,040 –> 00:37:27,360
[Jason Fitcher]: cause you hit it right on the not right in the nose

832
00:37:28,539 –> 00:37:33,499
[Paul Tyler]: yeah well jason this was this was great um i guess you you’ve done some really

833
00:37:33,279 –> 00:37:34,279
[Paul Tyler]: good research

834
00:37:35,179 –> 00:37:36,459
[Paul Tyler]: we have a lot of advisors

835
00:37:37,499 –> 00:37:41,179
[Paul Tyler]: what would you suggest first of all where can they find more of what you’re doing

836
00:37:41,579 –> 00:37:45,099
[Paul Tyler]: and is there any place you’d say advisors should look to as they’re

837
00:37:45,057 –> 00:37:46,057
[Ramsey Smith]: uh

838
00:37:45,259 –> 00:37:49,259
[Paul Tyler]: helping their clients think through what they do with their mortgage

839
00:37:50,320 –> 00:37:53,520
[Jason Fitcher]: so my research you can you can google my name and i think you guys post links

840
00:37:53,380 –> 00:37:54,380
[Jason Fitcher]: sometimes to the research

841
00:37:53,919 –> 00:37:54,919
[Paul Tyler]: yes

842
00:37:54,480 –> 00:37:57,600
[Jason Fitcher]: so i i have two papers that were financed by the social security administration

843
00:37:57,600 –> 00:38:01,920
[Jason Fitcher]: that were done through the university of wisconsin on on debt and retirement and

844
00:38:01,920 –> 00:38:05,120
[Jason Fitcher]: that includes not just housing debt which is the largest debt but even credit card

845
00:38:05,200 –> 00:38:09,360
[Jason Fitcher]: debt which shows that debt levels are rising and and if someone is going to email

846
00:38:09,440 –> 00:38:10,720
[Jason Fitcher]: you we should say that it’s also

847
00:38:11,137 –> 00:38:12,137
[Ramsey Smith]: yes

848
00:38:11,200 –> 00:38:16,240
[Jason Fitcher]: assets arising but the debt to asset ratio is also rising so as people get more

849
00:38:16,320 –> 00:38:19,360
[Jason Fitcher]: assets they feel like they were more comfortable taking on more debt and we see

850
00:38:19,440 –> 00:38:22,480
[Jason Fitcher]: that like for ten percent of the population heading into retirement at some point

851
00:38:22,380 –> 00:38:23,380
[Jason Fitcher]: they have

852
00:38:23,097 –> 00:38:24,097
[Ramsey Smith]: yeah yeah

853
00:38:23,200 –> 00:38:27,200
[Jason Fitcher]: more debt liabilities and assets to cover them so that’s also important so

854
00:38:27,039 –> 00:38:28,039
[Paul Tyler]: that

855
00:38:27,360 –> 00:38:31,200
[Jason Fitcher]: that’s online again you can just google my name and like ho home mortgage those

856
00:38:31,360 –> 00:38:33,280
[Jason Fitcher]: two papers should come up i would

857
00:38:32,977 –> 00:38:33,977
[Ramsey Smith]: maybe

858
00:38:33,440 –> 00:38:36,240
[Jason Fitcher]: encourage people to pull up a two to pager that the social

859
00:38:36,560 –> 00:38:40,800
[Jason Fitcher]: administration does when to start receiving retirement benefits it sort of walks

860
00:38:36,577 –> 00:38:37,577
[Ramsey Smith]: see

861
00:38:40,880 –> 00:38:43,840
[Jason Fitcher]: through this kitchen table conversation about thinking about your spouse other

862
00:38:43,920 –> 00:38:47,520
[Jason Fitcher]: assets that’s even a good framework to have on thinking about what it means to pay

863
00:38:47,600 –> 00:38:50,480
[Jason Fitcher]: off your house like what other assets do you have what other sources of income do

864
00:38:50,560 –> 00:38:52,000
[Jason Fitcher]: you have what do you want to do how’s your health

865
00:38:51,799 –> 00:38:52,799
[Paul Tyler]: let’s see

866
00:38:52,080 –> 00:38:54,640
[Jason Fitcher]: those are important things to have a conversation with people

867
00:38:54,319 –> 00:38:55,319
[Paul Tyler]: what

868
00:38:54,800 –> 00:38:58,240
[Jason Fitcher]: on and then obviously the alliance for lifetime income which is that protective

869
00:38:58,320 –> 00:39:00,160
[Jason Fitcher]: income that or we have a lot of uh

870
00:39:01,040 –> 00:39:03,680
[Jason Fitcher]: materials for financial professionals they can use

871
00:39:01,057 –> 00:39:02,057
[Ramsey Smith]: hear

872
00:39:04,720 –> 00:39:09,760
[Jason Fitcher]: and also for consumers there’s a dictionary there’s glass of terms there’s things

873
00:39:09,840 –> 00:39:12,880
[Jason Fitcher]: you should ask your financial professionals so we have terms online as well and

874
00:39:12,960 –> 00:39:16,960
[Jason Fitcher]: the bipartisan pa center were doing lots of research on retirement security google

875
00:39:17,040 –> 00:39:21,200
[Jason Fitcher]: funding our future and it’ll pop up to the b b pc page you can see all the work

876
00:39:21,360 –> 00:39:24,720
[Jason Fitcher]: we’re doing there to help people have a financially secure retirement but also a

877
00:39:24,880 –> 00:39:28,800
[Jason Fitcher]: financially secure working years we’re trying to also encourage like secure act

878
00:39:28,960 –> 00:39:32,560
[Jason Fitcher]: two point zero and more employers to have financial wellness programs and to

879
00:39:32,640 –> 00:39:35,360
[Jason Fitcher]: encourage people to have access to and save for retirement as well

880
00:39:35,739 –> 00:39:39,579
[Paul Tyler]: oh that’s great listen we’ll put all those links in the show notes and jason

881
00:39:39,659 –> 00:39:42,379
[Paul Tyler]: thanks thanks for having me on here again this is great yeah

882
00:39:41,357 –> 00:39:43,277
[Ramsey Smith]: thanks a lot thanks for coming back

883
00:39:42,480 –> 00:39:45,280
[Jason Fitcher]: always a pleasure gentlemen good to see you both and have this discussion

884
00:39:43,739 –> 00:39:48,459
[Paul Tyler]: yeah hey ramsey thanks and uh thanks to all our listeners and be sure to tune

885
00:39:48,619 –> 00:39:52,299
[Paul Tyler]: again next week for another episode of that annuity show thanks

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 143: When Should Your Client Pay Off The Mortgage With Jason Fichtner
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SPECIAL EPISODE – David Czerniecki Discusses Inflation Trends

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Inflation is the topic of the day. How high will it go? How long will it last? In a special episode, David Czerniecki, Chief Investment Officer for Nassau Financial Group shares his perspective on inflation and the global economy.

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The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersSPECIAL EPISODE – David Czerniecki Discusses Inflation Trends
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Episode 142: Everything You Wanted to Know About the Nasdaq-100 With Efram Slen and Mark Marex

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Indices continue to proliferate inside fixed indexed annuities. Some of them stand by brand name and reputation alone. The Nasdaq-100 falls squarely into that category. Today we have two representatives from Nasdaq on to talk about their index. You may be surprised about what you learn. We welcome Efram Slen, Head of Index Research and Mark Marex, Head of Index Research & Product Development for Nasdaq.
Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.
We hope you enjoy the show.
Links mentioned in the show:

Thank you to our show sponsor; The Index Standard!

Fixed Index Annuities and RILAs are getting more complex and technical just when fiduciary rules are getting stricter. How do you choose the right index and allocate to them? The Index Standard is your answer. They are an independent provider ratings and forecasts on all indices and ETFs used in the US insurance space. Their process is systematic and unbiased, identifying robust and well-designed indices. We all know finance is complex and The Index Standard has a clear ratings system and uses approachable language to demystify this complexity. Visit theindexstandard.com for more information.

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Transcript

1
00:00:01,280 –> 00:00:06,640
[Paul Tyler]: hi this is paul tyler and welcome to another episode of that annuity show ramsey

2
00:00:06,540 –> 00:00:07,540
[Paul Tyler]: welcome again

3
00:00:08,133 –> 00:00:09,133
[Ramsey Smith]: always great to be here

4
00:00:09,680 –> 00:00:14,080
[Paul Tyler]: all right we’ve moved to sweaters i i didn’t bring mine today with ties to shirts

5
00:00:14,160 –> 00:00:16,000
[Paul Tyler]: i know it’s what’s

6
00:00:15,273 –> 00:00:19,193
[Ramsey Smith]: i needed to mix it up like it was nothing but sort of a typical brooks brother’s

7
00:00:19,193 –> 00:00:23,273
[Ramsey Smith]: blue shirt for the first like a hundred and forty two episodes so i’ve mixed it

8
00:00:22,933 –> 00:00:23,933
[Ramsey Smith]: up now

9
00:00:24,160 –> 00:00:27,680
[Paul Tyler]: that’s that’s great hey we have a really interesting show today

10
00:00:28,960 –> 00:00:32,960
[Paul Tyler]: and it’s it’s going to be out of in indices we’ve had a lot of conversations with

11
00:00:33,040 –> 00:00:38,320
[Paul Tyler]: people about indices where they fit in the products and we thought hey listen why

12
00:00:38,320 –> 00:00:43,840
[Paul Tyler]: don’t we actually bring some actual experts on who run one and today we have

13
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[Paul Tyler]: representatives from the nasdaq one hundred index

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[Paul Tyler]: and i am going to say full disclosure

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[Paul Tyler]: my company by day we are proud partners with nasdaq one hundred we just

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[Paul Tyler]: actually added the nasdaq one hundred to a number of our flagship fi products but

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[Paul Tyler]: we just want to go deeper and understand what it is and i’d like to welcome two

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[Paul Tyler]: individuals Efram Slen who is the head of index research and Mark Marex who

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[Paul Tyler]: is the senior specialist nasdaq excuse me senior specialist of the nasdaq indexed

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[Paul Tyler]: research function mark that i think i clobbered your your title

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[Mark Marex]: you were totally fine thanks paul

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[Paul Tyler]: totally fine alright hey after mark welcome

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[Efram Slen]: glad to be here thanks for having us

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[Paul Tyler]: hey thanks

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[Ramsey Smith]: like

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[Paul Tyler]: hey listen first question is

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[Paul Tyler]: nasdaq nasdaq indices nasdaq index

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[Paul Tyler]: you kind of say nasdaq and somebody says oh yeah the nasdaq index but i know the

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[Paul Tyler]: world’s a lot more complicated than that can you just kind of lay out maybe after

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[Paul Tyler]: from like

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[Paul Tyler]: what in when we say index what index are we talking about how many indices could

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[Paul Tyler]: we be talking about that the nasdaq is responsible for creates

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[Efram Slen]: think thanks ball it there are actually over forty five thousand indexes that

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[Efram Slen]: nasdaq calculates right just like some of the other big big index players out

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[Efram Slen]: there there are actually hundreds of the thousands of indexes that are calculated

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[Efram Slen]: there are only a handful that people really know globally so when you think of

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[Efram Slen]: nasa i can hear every single day people say the nasdaq went up the nasdaq went

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[Efram Slen]: down that’s actually the nasdaq composite that’s usually being referenced that’s

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[Efram Slen]: the index comprised of all securities listed on the nasdaq stock exchange so

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[Efram Slen]: that’s over a couple thousand names as opposed to the nasdaq one hundred which

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[Efram Slen]: folks still know it’s very very prominent it’s the one that’s actually the

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[Efram Slen]: barometer for the invesco qq et f and the products that you were talking about

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[Efram Slen]: right it’s an index comprised of the one hundred largest nonfinancial companies

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[Efram Slen]: from the nasdaq composite so when people tend to say the nasdaq went up and na as

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[Efram Slen]: they went down they’re actually usually referencing the composite but a lot of

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[Efram Slen]: times it gets interspersed and confused with the nasa one hundred which is where

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[Efram Slen]: all the products really

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[Paul Tyler]: how many

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[Efram Slen]: are tracking

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[Paul Tyler]: yeah and

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[Paul Tyler]: maybe just explain the mechanics so companies in the nasdaq one hundred it’s out

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[Paul Tyler]: of the one hundred

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[Paul Tyler]: how does that actually happen like is this monthly weekly

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[Paul Tyler]: what’s the process do you how do you actually manage something like this

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[Efram Slen]: so so back in nineteen seventy one maybe even give this this kind of breakdown so

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[Efram Slen]: back in nineteen seventy one when nasdaq the exchange launched that’s when the

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[Efram Slen]: composite was created fifteen years later we launched the nasdaq one hundred as

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[Efram Slen]: the tradable version right so once a

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[Ramsey Smith]: what

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[Efram Slen]: year since nineteen eighty five we have an annual reconstitution it’s a rules

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[Efram Slen]: based transfer process where the one hundred largest nonfinancial companies are

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[Efram Slen]: selected that happens every december and it’s called the quad witch day of the

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[Efram Slen]: third friday of december the other three quarters just a rebalancing that occurs

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[Efram Slen]: right so weights are reviewed and ensured that they are meeting all the

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[Efram Slen]: regulatory elements there so where necessary capping might might be applied

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[Efram Slen]: yeah so that’s it again in a nutshell the the nasdaq one hundred

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[Efram Slen]: again once a year that’s when names are are added again they need to be non

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[Efram Slen]: financial and they meet a variety of other criteria but the most important being

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[Efram Slen]: that they’re listed on the nasdaq exchange

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[Ramsey Smith]: are there who who actually makes the decision so if you look at the index indices

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[Ramsey Smith]: that are out there you’ve got s p indices which are actually in some sense

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[Ramsey Smith]: actively managed and then you have

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[Ramsey Smith]: indices which are truly rule based where do you stand in terms you know what

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[Ramsey Smith]: determines what is added orle is it does somebody make a decision is there a

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[Ramsey Smith]: committee how is that managed

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[Efram Slen]: i’m glad you asked that ramsay so we are entirely rules based it’s something that

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[Efram Slen]: we really pride ourselves on and interesting and so if you look back at the

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[Efram Slen]: nasdaq one hundred one of the things that made us unique compared to the sn p

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[Efram Slen]: five hundred in particular is that tesla right made

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[Paul Tyler]: sure

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[Efram Slen]: it into the nasdaq one hundred in july twenty thirteen when it was first eligible

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[Efram Slen]: at a market cap of around fifteen billion dollars

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[Efram Slen]: fast forward seven and seven and a half years later when the s p committee said

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[Efram Slen]: yeah it’s eligible for the s p five hundred now it was at a market cap of six

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[Efram Slen]: hundred sixty billion dollars right so yeah we’re rules based transparent we’re

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[Efram Slen]: really proud of that

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[Paul Tyler]: and it interesting so you brought up tesla when i i think of nasdaq i think okay

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[Ramsey Smith]: your

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[Paul Tyler]: tech you know tech tech tech

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[Paul Tyler]: i guess

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[Paul Tyler]: what type of misconceptions

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[Paul Tyler]: do people make when they think of nasdaq and put technology and tesla in the same

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[Paul Tyler]: same bucket

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[Efram Slen]: so we actually think of teslas yeah it can be a tech company for sure it’s also

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[Efram Slen]: an auto company right there’s a lot of great things that they’re doing look i

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[Efram Slen]: said this to it to a colleague and some friends the other day a neighbor mine

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[Efram Slen]: just put solar panels on their roof made by tesla one of the coolest things i

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[Efram Slen]: think it’s the nicest roof in the block they do a lot more than just create some

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[Efram Slen]: of the nicest looking cars on the road but yeah it depends how you want to look

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[Efram Slen]: at it right they’re an innovative organization that’s actually the core that word

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[Efram Slen]: innovation

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[Ramsey Smith]: so

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[Efram Slen]: that’s what we think of when we think of the nasdaq one hundred or even the

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[Efram Slen]: nasdaq list listing venue in general in our company that’s again it’s a very very

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[Efram Slen]: often used word but the reason why we tend to think of it it’s just not not just

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[Efram Slen]: technology and of itself so if you look and you break down companies within

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[Efram Slen]: nasdaq one hundred some of the biggest names right that come up that you could

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[Efram Slen]: probably think from you you have alphabet you have you have amazon microsoft

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[Efram Slen]: apple meta platforms and so forth right so some of the biggest names out there

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[Efram Slen]: but not all of them are actually classified as technology by your general

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[Efram Slen]: classification standards actually only a handful only about half of those were

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[Efram Slen]: some of them are consumer discretionary right where is amazon actually fit like

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[Efram Slen]: they’re the biggest cloud provider in the world but where do they fit they’re

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[Paul Tyler]: or the grocery store i don’t know right

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[Efram Slen]: actually consumer

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[Efram Slen]: they grocery store that’s right so they’re actually classified as consumer

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[Efram Slen]: discretionary so again that’s a fun thing when it comes to classifications a lot

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[Efram Slen]: of it’s just perception and a lot of it just comes down to how the rules from

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[Efram Slen]: classification systems are actually putting companies into pockets

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[Ramsey Smith]: so you mentioned that uh that the companies have to be non financial so i thought

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[Ramsey Smith]: that was i actually was not aware of that and so i i’m curious you know in a

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[Ramsey Smith]: world where financial used to be something very clear before it was sort of

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[Ramsey Smith]: balance sheet intensive banks insurance companies et cetera but now we live in a

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[Ramsey Smith]: world of fintech where

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[Ramsey Smith]: the

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[Ramsey Smith]: there may be a balance sheet it’s balance sheet light and the technology is sort

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[Ramsey Smith]: of more sort of important part

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[Ramsey Smith]: of the description of the company where does fintech sit for you from your

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[Ramsey Smith]: perspective

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[Efram Slen]: so

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[Efram Slen]: we have to utilize again this goes back to the rules based transparent we

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[Efram Slen]: actually outsource the classification we don’t utilize we don’t make those

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[Efram Slen]: decisions ourselves we utilize

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[Ramsey Smith]: got it

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[Efram Slen]: the industry classification benchmark system to determine again are they

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[Efram Slen]: financials are they not where do they fit within the rankings so we don’t include

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[Efram Slen]: any companies that are classified as financials according to that bench

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[Efram Slen]: classification system called ic

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[Ramsey Smith]: understood

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[Efram Slen]: is the benchmark so companies like nasdaq ourselves we are excluded like t ro

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[Efram Slen]: price like cme group that are listed here in nasdaq who proudly have them this

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[Efram Slen]: year they’re excluded as a result of that classification

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[Paul Tyler]: yeah interesting so if if i were you know

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[Paul Tyler]: independent financial adviser presenting nasdaq one hundred to clients what would

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[Paul Tyler]: the composition look like you know ten years ago versus today i mean clearly some

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[Paul Tyler]: of those names are still there you mentioned tesla was in there i’m sure i bet

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[Paul Tyler]: amazon i bet google was but

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[Paul Tyler]: what what have been the major major shifts like from there then to now

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[Efram Slen]: so definitely in some that we’ve seen even more over the last couple of years

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[Efram Slen]: right companies like like zoom rising to prominence right with the work from home

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[Efram Slen]: trade that was seen over the last couple of years but to be perfectly frank the

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[Efram Slen]: story just continued to evolve

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[Efram Slen]: and the important dynamic here is that we try and make sure folks understand is

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[Efram Slen]: that the nasdaq one hundred itself post ah the tech bubble and burst it’s a far

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[Efram Slen]: different story so even ten years ago the story is actually pretty aren’t similar

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[Efram Slen]: today as it was ten years ago it’s the prior ten years that we’re trying to

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[Efram Slen]: ensure that people don’t have in the back of their minds

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[Ramsey Smith]: so one of the things that we chatted about you know ahead of the show is sort of

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[Ramsey Smith]: the profile of the nasdaq and the nasdaq one hundred in the market so we’re in a

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[Ramsey Smith]: place where over i call it the last really is ten years since the first custom

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[Ramsey Smith]: index came out but probably six or seven before they started coming out like in

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[Ramsey Smith]: in real numbers there’s been explosion of customized indices

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[Ramsey Smith]: in in the fia space and tell us a little bit about you know about i don’t know

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[Ramsey Smith]: how how you feel about competing in that market and why you think why you think

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[Ramsey Smith]: your index is something that’s a familiar one

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[Ramsey Smith]: you know is for many people maybe a better way to go

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[Efram Slen]: nasdaq one hundred the way we think about very many different there are many

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[Efram Slen]: different spots that it can fit into a portfolio but it is from an index

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[Efram Slen]: perspective right

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[Efram Slen]: it can be a large capital play it can be a large growth play it can be a thematic

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[Efram Slen]: play there are many different ways or even a technology play there are many

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[Efram Slen]: different ways that that this index can fit and it’s really up to frankly how

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[Efram Slen]: folks view that type of basket in their portfolio so a big part of what we tend

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[Efram Slen]: to do in our research is compare the nasdaq one hundred to the s and p five

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[Efram Slen]: hundred because we want to make sure again like i said before the call that

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[Efram Slen]: where the nasdaq was in in the early two thousand seconds to then twenty ten to

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[Efram Slen]: the twenty tens to today just such a different story we’ve seen such a big

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[Efram Slen]: maturation of companies balance sheets completely changing and flipping on their

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[Efram Slen]: heads right where today

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[Efram Slen]: when you think of the nasdaq one hundred maybe we don’t even think that we pay

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[Efram Slen]: dividends we do i mean it’s not a massive dividend paying um in index benchmark

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[Efram Slen]: but it’s actually half of what the s and p five hundred is as at the end of

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[Efram Slen]: february at around seventy basis points but we are fully fully fledged an index

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[Efram Slen]: that index dividend that is dividend payers and so forth so again it’s a pr

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[Efram Slen]: pretty pretty great uh story depending on how you’re looking to have it fit into

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[Efram Slen]: your portfolio

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[Paul Tyler]: yeah i guess how has the risk profile changed do you think of the companies over

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[Paul Tyler]: the last ten years in the nasdaq one hundred i mean i would think that if you

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[Paul Tyler]: shifted from maybe more tact to as you’re describing more mature companies with

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[Paul Tyler]: dividend pain you’d think the volatility the risk might go out however last

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[Paul Tyler]: couple of years have been crazy in terms of market volatility what’s your

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[Paul Tyler]: perspective on

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[Paul Tyler]: you know how how i would allocate you know clients’ funds to the

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[Paul Tyler]: nasdaq one hundred versus you know funds a you know indices a b or c

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[Efram Slen]: so i actually want to make sure i give mark a chance to jump in on this but one

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[Efram Slen]: thing that i’ll comment even just at before he even gets in the answer is that

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[Efram Slen]: you know we’re an index provider we’re meant to give

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[Ramsey Smith]: yeah

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[Efram Slen]: a spot for folks to understand and track benchmarks we’re not really giving

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[Efram Slen]: investment decisions so i just want to at least caveat

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[Efram Slen]: the answer there but

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[Paul Tyler]: now thank you

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[Efram Slen]: mark i’ll let you jump in thank you

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[Mark Marex]: yeah thanks ama i mean i’ll point out a couple of data

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[Paul Tyler]: i don’t know

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[Mark Marex]: points that we have one of which is a

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[Paul Tyler]: i don’t

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[Mark Marex]: you know very long term kind of graph of you know realized volatility when you

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[Mark Marex]: look at nasdaq one hundred versus something like the s and p five hundred which

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[Mark Marex]: is much broader but plays in that same large cap space right the volatility is

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[Mark Marex]: actually very very close over the last ten to fifteen years it’s maybe a

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[Mark Marex]: difference of two or three percent a year annualized on average

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[Mark Marex]: the really interesting thing though that you know we kind of explored

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[Mark Marex]: last year writing up a white paper about you know what the performance looked

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[Mark Marex]: like during the covid bear market and how that compared to things like two

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[Mark Marex]: thousand eight to things like the tech bubble the nasdaq one hundred actually

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[Mark Marex]: outperformed in terms of not just the drawdown being lower in march of twenty

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[Mark Marex]: twenty than the s and p five hundred but also volatility being lower and i would

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[Mark Marex]: say that speaks more than anything to the difference in the composition versus

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[Mark Marex]: ten or fifteen or even twenty years ago it’s not that the sector exposures are

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[Paul Tyler]: wait minute

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[Mark Marex]: necessarily different tech has continued to be pretty consistent fifty to sixty

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[Mark Marex]: percent of the index you get another twenty to thirty percent of the index coming

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[Mark Marex]: from things like consumer and health care that stays pretty consistent long term

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[Mark Marex]: even though the company underlying will grow larger and grow smaller and go

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[Mark Marex]: private and fall out and whatnot right but in terms of you know the reputation

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[Mark Marex]: that the index has gotten especially from those top five or so names right

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[Mark Marex]: they’re almost like a defensive play nowadays right they they’re extremely

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[Mark Marex]: profitable they’re very very efficient and generating cash and turning over their

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[Mark Marex]: assets they’ve grown their buybacks which kind of

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[Mark Marex]: overshadows the dividend under performance versus something like the s and p five

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[Mark Marex]: hundred they’ve grown their buybacks by literally hundreds of billions of dollars

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[Mark Marex]: over the past couple of years

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[Mark Marex]: and that i think speaks to you know why this index isn’t you know the same as it

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[Mark Marex]: used to be twenty years ago where you had a lot of companies that were still

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[Mark Marex]: early stage still were unprofitable weren’t doing things like dividends and

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[Mark Marex]: buybacks nowadays you have this very very solid fundamental core of the index of

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[Mark Marex]: about fifty percentage of the index is the top seven companies and they are all

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[Mark Marex]: massive fundamentally strong and sound companies that have this

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[Mark Marex]: tail added on top of it of companies that buy enlarge

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[Mark Marex]: disproportionately put innovation at the center of their business models that’s

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[Mark Marex]: what the index is about to me these days more than anything else

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[Ramsey Smith]: so another thing that that sort of was was on my mind as i was thinking about

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[Ramsey Smith]: thinking about your index is just what kind of what kind of assets are ifly under

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[Ramsey Smith]: management or benchmarked to the nasdaq one hundred like can you give some idea

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[Ramsey Smith]: to the audience of the magnitude of of whether it’s an etfs or fis or if it’s in

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[Ramsey Smith]: mutual funds just even ballpark figures like how much how much money looks how

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[Ramsey Smith]: much money is out there that looks to the nasdaq one hundred as its key benchmark

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[Ramsey Smith]: in order just in orders of magnitude

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[Efram Slen]: there are hundreds of billions of dollars that that track the nasdaq one hundred

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[Efram Slen]: across pretty much every single financial product wrap that’s been created right

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[Efram Slen]: from etfs to mutual funds to insurance products utd products futures options you

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[Efram Slen]: think of a product there is an ass at one product tracking it in some capacity

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[Efram Slen]: some possibly even somewhere in the world right so there are efs in well over

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[Efram Slen]: twenty countries in the world alone let alone other product wrappers the eme

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[Efram Slen]: features that track the nad seven hundred have grown

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[Efram Slen]: explosively over the last couple years so and the micro mi launching out of the

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[Paul Tyler]: next

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[Efram Slen]: cme here as well so

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[Paul Tyler]: it’s

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[Efram Slen]: tons of derivative trading going on in very increased capacity the cues hit hit

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[Efram Slen]: over two hundred billion dollars

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[Efram Slen]: recently enough and approaching backup on the nih qs that’s the invest qq et f so

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[Efram Slen]: yeah just hundreds of billions of dollars that’s the short answer there

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[Paul Tyler]: it well go ahead

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[Ramsey Smith]: so i just kind of add quickly to that so the reason i brought that up is that you

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[Ramsey Smith]: know it’s somebody

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[Ramsey Smith]: who was in this space in my prior career like one of the challenges that

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[Ramsey Smith]: one of the tensions was always between alright you come up with something that’s

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[Ramsey Smith]: creative and customized it may work if you look at history but is it tradable on

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[Ramsey Smith]: the other side you’ve got you know you’ve got something like the nasdaq one

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[Ramsey Smith]: hundred and some other indices which are very tradable which ultimately in

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[Ramsey Smith]: addition to being recognizable also brings the ability to hedge efficiently

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[Ramsey Smith]: because behind every one of every transaction every fia purchase there’s a

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[Ramsey Smith]: hedging transaction so that’s something that i think is something that you

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[Ramsey Smith]: there’s not a question here just just a comment but i think

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[Ramsey Smith]: that is an important element

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[Ramsey Smith]: a of using a broad based indic index rather

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[Ramsey Smith]: in this in the fia space

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[Efram Slen]: i’ll even go on top of that and i i appreciate you saying that ramsay it’s great

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[Efram Slen]: this index has no they said launched nineteen eighty five is an over three seven

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[Efram Slen]: year track record right so the products have been around for quite a long time

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[Efram Slen]: like the cues launched in ‘ninety nine right and that’s again one of only saying

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[Efram Slen]: before many different products and product wrappers so yes having that track

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[Efram Slen]: record absolutely stands without question

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[Ramsey Smith]: really

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[Paul Tyler]: now well of course from a macro perspective

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[Paul Tyler]: we just get through covid only to have this awful war breakout

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[Paul Tyler]: in ukraine tell us how has this impacted the nasdaq one hundred

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[Efram Slen]: so it it hasn’t from a an actual inclusion perspective so there were no russian

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[Efram Slen]: equities in the nasdaq

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[Efram Slen]: one hundred but like many index providers out there like and p and m s c i fy

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[Efram Slen]: russell

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[Efram Slen]: all four of us actually put our announcements to remove russian equities from

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[Efram Slen]: from all over index benchmarks

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[Paul Tyler]: interesting so no no change no

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[Paul Tyler]: if i were sitting down with the client

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[Paul Tyler]: no company no russian company was in in nasdaq one one hundred that would have

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[Paul Tyler]: been pulled then

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[Efram Slen]: that’s correct

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[Paul Tyler]: okay interesting

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[Ramsey Smith]: so what are what do you see as sort of the the opportunity set in this space

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[Ramsey Smith]: broadly so just as as we mentioned before

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[Ramsey Smith]: a lot of people are getting get into the index game so you mentioned that there

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[Ramsey Smith]: are forty thousand just just you alone manage forty to forty five thousand in

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[Ramsey Smith]: indices is that right

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[Ramsey Smith]: well

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[Efram Slen]: that’s right that’s right

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[Ramsey Smith]: what what’s interesting to me is that i think they are only the last time i

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[Ramsey Smith]: checked there were like thirty five hundred stocks in the u s and the u s market

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[Ramsey Smith]: the wilshire five thousand doesn’t even cover five thousand stocks anymore back

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[Ramsey Smith]: when i started it had seven thousand in it right now now i think it has a lot

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[Ramsey Smith]: less so yeah i’m curious do you have a sense for what the future is

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[Ramsey Smith]: in indexes whether it’s broad based or more customized indices

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[Ramsey Smith]: it’s it’s been a remarkable proliferation

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[Efram Slen]: there absolutely has been um there are more and more ways to slice and dice

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[Efram Slen]: things than you can imagine so of the forty five thousand plus indexes that we

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[Efram Slen]: offer many of them actually go back to one index it’s is a global equity index

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[Efram Slen]: benchmark of around nine thousand global equities from developed in emerging

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[Efram Slen]: markets

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[Efram Slen]: that cover forty four countries i mentioned the exclusion exclusion of of russia

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[Efram Slen]: as well as a large mid small cap all cap large mid cap different currencies

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[Efram Slen]: different ways to calculate with and without dividends before you know it you’ve

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[Efram Slen]: got again we could do it on a far more the way we did it but the way we have it

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[Efram Slen]: today it’s is over forty around forty thousand or so

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[Paul Tyler]: just

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[Efram Slen]: indexes from one

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[Efram Slen]: basket of nine thousand names now think about that

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[Ramsey Smith]: mo

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[Efram Slen]: from from from how the way things have continued to evolve over the last even

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[Efram Slen]: fifteen years in the index space it started out

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[Efram Slen]: beyond fifteen years as just ways for folks to track the markets right so there

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[Efram Slen]: are only a handful of indexes that people really paid attention to indexes

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[Efram Slen]: continued to come to market just in the benchmark variety that are regular market

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[Efram Slen]: cap literally what is the world valuing these indexes as and then we start to

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[Efram Slen]: have some new indexes come to market right now were equal weighted there were

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[Efram Slen]: fundamentally weighted different ways to

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[Ramsey Smith]: maybe

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[Efram Slen]: track and and select and manage portfolios and then we started saying all right

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[Efram Slen]: well what are the active managers doing how can we try and get exposure in

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[Efram Slen]: returns that are like what active managing that’s when the rise of smart beta

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[Efram Slen]: came around and it was you know where factor indexes came about so folks were

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[Efram Slen]: focusing on far more than just value and growth there’s look at underpinning data

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[Efram Slen]: points from balance sheets and financial statements and saying well i want to

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[Efram Slen]: focus in around this data point so mark brought up before buybacks right we have

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[Efram Slen]: a buyback achiever index here we have many dividend based indexes here we have

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[Efram Slen]: many multi factor indexes that can look at a wide range of data points and then

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[Efram Slen]: over the last several years thematics has been the new rage right that’s where

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[Efram Slen]: folks have been digging into not technology or financials or health care it’s

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[Efram Slen]: fintech right it’s a smaller baske games that are focusing on like we said before

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[Efram Slen]: just just those specific names looking at names that are in cloud computing only

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[Efram Slen]: at cyber security only you’re only going to get thirty fifty maybe seventy names

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[Efram Slen]: at most in some of these thematic baskets if you’re really pushing up to seventy

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[Efram Slen]: sometimes far less

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[Efram Slen]: and again that’s what we’ve seen really things continue to evolve and it’s been

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[Efram Slen]: an awesome thing to be a part of been in nasdaq or

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[Ramsey Smith]: she

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[Efram Slen]: over eleven years it’s been a great ride watching frankly the continued growth

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[Efram Slen]: and maturation of the space

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[Paul Tyler]: interesting well yeah tell us just a little bit about both your background so a

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[Paul Tyler]: you’ve been at nasdaq for eleven years

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[Paul Tyler]: you know tell us what got you nasdaq you know what what keeps you

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[Paul Tyler]: totally engaged as we can tell in this in this space

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[Efram Slen]: i i just love frankly i i love coming to work working with

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[Ramsey Smith]: the

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[Efram Slen]: folks like mark working folks like wealthy who in the space where you have to

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[Efram Slen]: have conversations around around the markets around what we’ve got going on but

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[Efram Slen]: what my job really entails to today i’m responsible for all the research content

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[Efram Slen]: that we put out across our index business

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[Efram Slen]: so when i started here at nasdaq i was a combination of new index development as

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[Efram Slen]: well as putting our content supporting our business but today the roles evolved

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[Efram Slen]: and i’m responsible for to all content support supporting the index space here in

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[Efram Slen]: nasdaq

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[Paul Tyler]: yeah mark mark you your background and

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[Paul Tyler]: what excites you most about

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[Paul Tyler]: this particular space in the in the market

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[Mark Marex]: thanks

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[Ramsey Smith]: yeah

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[Mark Marex]: yeah i mean i’m coming up on three years with nasdaq here and specifically with

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[Mark Marex]: ephram team

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[Ramsey Smith]: but

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[Mark Marex]: took a bit of more of a roundabout path to get here like ramsey i did my stint at

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[Mark Marex]: took a bit of more of a roundabout path to get here like ramsey i did my stint at

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[Mark Marex]: a big new york bank for about eight years in my case city coming out of college

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[Mark Marex]: a big new york bank for about eight years in my case city coming out of college

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[Mark Marex]: and my last role there was in sort of a client strategy and analytics role within

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[Mark Marex]: and my last role there was in sort of a client strategy and analytics role within

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[Mark Marex]: ib d

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[Mark Marex]: ib d

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[Mark Marex]: but really you know for a long part of that time at city my passion was elsewhere

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[Mark Marex]: and more in the realm of asset management

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[Mark Marex]: and specifically systematic strategy

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[Mark Marex]: research

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[Mark Marex]: and creation and execution that led me to launching a startup fund with a close

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[Mark Marex]: colleague of mine to trade u s equities long short on a very systematic basis

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[Mark Marex]: right and you know very risky endeavor didn’t end up working out long term but

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[Mark Marex]: really kind of cemented my desire to stay within that general space of you know

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[Mark Marex]: how do you design launch and then support

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[Ramsey Smith]: so

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[Mark Marex]: systematic strategies

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[Mark Marex]: that are data driven that are you know kind of fully transparent that offers

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[Mark Marex]: something unique

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[Mark Marex]: and i found that nasdaq

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00:25:18,594 –> 00:25:23,554
[Mark Marex]: value proposition was very compelling from the perspective of you know it has

405
00:25:23,714 –> 00:25:29,314
[Mark Marex]: this industry leading index business that is very much underpinned just like s

406
00:25:29,394 –> 00:25:34,194
[Mark Marex]: and p right or m sci underpinned by this flagship product that everybody almost

407
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[Mark Marex]: everybody knows and has such a great

408
00:25:37,874 –> 00:25:41,394
[Mark Marex]: reputation in terms of the nasdaq one hundred but then you have all these other

409
00:25:41,554 –> 00:25:46,434
[Mark Marex]: interesting things going on under the hood that people you know outside of nasdaq

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00:25:46,514 –> 00:25:50,754
[Mark Marex]: will really not have any idea about right things like designing indexes with

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[Mark Marex]: embedded options whether that is using options to juice your yield or to provide

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[Mark Marex]: downside protection or to minimize volatility on something like the nasdaq one

413
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[Mark Marex]: hundred you know we do that

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[Mark Marex]: as era mentioned the thematic space that’s been such a great source of creativity

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[Mark Marex]: and trying to figure out ways of how do you define a new industry that is driven

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[Mark Marex]: by a single technological breakthrough do you go peer play do you go uh sort of

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[Mark Marex]: broad based in coverage with that and working with clients every day to figure

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[Mark Marex]: out how do we design an index from the ground up that is rules based that is

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[Mark Marex]: transparent that is reputable and invest

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[Mark Marex]: it’s a

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[Paul Tyler]: my

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[Mark Marex]: great challenge because there’s no single right answer but i feel like we have

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[Mark Marex]: these guidelines these principles that move us in the direction of

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[Mark Marex]: putting out market leading products whether it’s thematic whether it’s smart beta

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[Mark Marex]: or something else day in and day out and that’s really exciting

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[Paul Tyler]: excellent okay so for ramsay and i have an appointment with a client i guess at

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[Paul Tyler]: two thirty we’ve got two hours to prep for this for ramsey and

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[Paul Tyler]: oh my

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[Ramsey Smith]: oh my go

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[Paul Tyler]: gosh i’ve gotta explain the nasdaq one hundred what what’s the best place to go

431
00:27:05,280 –> 00:27:09,760
[Paul Tyler]: to learn enough that i can actually represent your index and you know the the

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00:27:09,840 –> 00:27:14,960
[Paul Tyler]: mechanics and and what’s you know and and the the stocks inside it so that i can

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[Paul Tyler]: give somebody

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[Paul Tyler]: who’s trusting me a good understanding of where their money is

435
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[Paul Tyler]: what their money is going to earn interest credits against

436
00:27:26,916 –> 00:27:30,916
[Efram Slen]: so there are a few spots where we have kind of content around the nasdaq one one

437
00:27:30,916 –> 00:27:34,996
[Efram Slen]: hundred so i’ll give you kind of both both locations and and landing pages so one

438
00:27:35,156 –> 00:27:41,636
[Efram Slen]: is nasdaq com backlash nasdaq dash one hundred the other one it’s a little bit

439
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[Efram Slen]: harder to find but perfectly perfectly honest but if you go to indexes nasma com

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[Efram Slen]: and you go in the search bar and look for nd x n dx which is the index ticker for

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[Efram Slen]: the nasa of one hundred or just type in nasa gash one hundred you scroll down and

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[Efram Slen]: be able to find get on that page and able to see kind of all the great content

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[Efram Slen]: there that we have around around the index

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[Paul Tyler]: oh that’s great thanks ramsey any final thoughts or questions this is your this

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[Paul Tyler]: is your space

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[Ramsey Smith]: so just just one one quick question so you’ve got forty forty thousand plus

447
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[Ramsey Smith]: indices and it sounds like you you know you interact very proactively with your

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[Ramsey Smith]: your clients you know i’m wondering sort of what are the various ways they it can

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00:28:22,873 –> 00:28:26,793
[Ramsey Smith]: interact with you could a could some entity it could be an insurance company

450
00:28:27,033 –> 00:28:31,513
[Ramsey Smith]: could be a bank it could could be a dis an insurance distributor right can they

451
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[Ramsey Smith]: come to you and and

452
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[Ramsey Smith]: work with you to develop their own custom index that they can launch on their

453
00:28:38,633 –> 00:28:42,953
[Ramsey Smith]: product i guess it’s do you go which way do you go is it inquiry reverse increase

454
00:28:43,193 –> 00:28:47,113
[Ramsey Smith]: can you go both ways i’m just curious how how people can engage with you to

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[Ramsey Smith]: to create unique product

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00:28:50,196 –> 00:28:54,036
[Efram Slen]: it’s absolutely both but our our favorites actually the one that’s in between

457
00:28:54,436 –> 00:28:57,796
[Efram Slen]: where it’s together right where we come together and say we have an idea and they

458
00:28:57,796 –> 00:29:01,556
[Efram Slen]: have an idea we come together we work together create the final solution for me

459
00:29:01,636 –> 00:29:04,676
[Efram Slen]: that’s the most exciting that i’ve been a part of and i know the team kind of

460
00:29:04,676 –> 00:29:08,116
[Efram Slen]: loves here of course it’s great when someone has their own view and we help them

461
00:29:08,276 –> 00:29:11,476
[Efram Slen]: get that out in the market or we have our own view we get that in the market my

462
00:29:11,556 –> 00:29:15,236
[Efram Slen]: favorite though is when everybody comes together and we’re able to create that

463
00:29:15,396 –> 00:29:17,796
[Efram Slen]: bin kind of thought into a final index solution

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[Paul Tyler]: okay well hey well listen uh after mark thanks for your time with the links

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[Paul Tyler]: in the show notes and really appreciate your time maybe we can another time we

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[Paul Tyler]: can actually come down to the the floor when it’s

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[Paul Tyler]: know we get through this whole covid and record a show there love to love to do

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[Paul Tyler]: that in new york sometim

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[Ramsey Smith]: sh

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[Paul Tyler]: so alright

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[Efram Slen]: that’d be awesome we’ll have have to do that

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[Paul Tyler]: listen yeah all right hey thanks so much ramsey thanks and uh joins you next week

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[Ramsey Smith]: i don’t know

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[Paul Tyler]: for another episode of that annuity show

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 142: Everything You Wanted to Know About the Nasdaq-100 With Efram Slen and Mark Marex
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Episode 141: Diving Deeper Into The Qualified Default Investment Alternative Market With Tamiko Toland

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Since the passage of the SECURE Act, we’ve all been talking a lot more about the institutional annuity market. However, Tamiko Toland with CANNEX has been working hard to build this business for a long time. Today we talk with her about the real opportunities and obstacles to bringing guaranteed income to a wider segment of the population.
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Transcript

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[Paul Tyler]: hi this is paul tyler and welcome to another episode of that annuity show and

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[Paul Tyler]: ramsey good to see you

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[Ramsey Smith]: always glad to be here

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[Paul Tyler]: and we have a

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[Paul Tyler]: almost regular guest returning guest do you wanna do you wanna do the intro here

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[Ramsey Smith]: sure so time ago i think this is this is at least your third time here and um you

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[Ramsey Smith]: know we should do something like on saturday night live like when you get on when

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[Ramsey Smith]: you host for five times you get like a jacket or something like that so we’re

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[Ramsey Smith]: so third time i think end counting right

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[Ramsey Smith]: delighted to have you back for those of you who don’t know Tamiko Toland she is the

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[Ramsey Smith]: director of retirement markets at k x k x is a leading provider of data for the

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[Ramsey Smith]: insurance life insurance industry and the annuity industry in particular

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[Ramsey Smith]: and Tamiko’s influence

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[Ramsey Smith]: is really remarkable it spans retail and increasingly institutional and that’s

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[Ramsey Smith]: what we’re going to spend a lot of time talking about

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[Tamiko Toland]: so

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[Ramsey Smith]: today is

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[Ramsey Smith]: a lot a lot of the progress that’s going on in what is probably the biggest

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[Ramsey Smith]: opportunity in the guaranteed income space

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[Tamiko Toland]: space

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[Ramsey Smith]: and

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[Ramsey Smith]: the core work that Tamiko her team and her affiliates to doing to get us

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[Ramsey Smith]: there so with that Tamiko

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[Tamiko Toland]: that’s not something

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[Ramsey Smith]: tell us about some of the things that you’ve been you’ve been up to lately

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[Tamiko Toland]: sure

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[Paul Tyler]: i don’t know you

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[Tamiko Toland]: so before i i dive right into the four one key space i’ll

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[Paul Tyler]: i

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[Tamiko Toland]: mention a couple pieces that came out recently

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[Tamiko Toland]: and one was for investments and wealth monitor and it’s

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[Paul Tyler]: it about nine

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[Tamiko Toland]: really just about the validity of replacing

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[Tamiko Toland]: some or all the fixed income allocation and retirement with a guaranteed income

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[Tamiko Toland]: source and i say it like that because we did the research on based on spa but you

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[Tamiko Toland]: can replace other annuities as well so but still always

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[Paul Tyler]: so

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[Tamiko Toland]: annuities but

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[Paul Tyler]: but

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[Tamiko Toland]: that this actually

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[Paul Tyler]: i

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[Tamiko Toland]: improves outcomes um both in terms of income sustainability and

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[Paul Tyler]: get what

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[Tamiko Toland]: actually legacy which is i th

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[Paul Tyler]: i i feel like that’s

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[Tamiko Toland]: i feel like that’s a sort of the hidden story um

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[Paul Tyler]: else

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[Tamiko Toland]: when it comes to guaranteed income that we act

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[Paul Tyler]: y

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[Tamiko Toland]: like it’s it’ going to make legacy worse but anyway so another

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[Paul Tyler]: another

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[Tamiko Toland]: piece uh that i’ve done recently is uh for the journal of pension benefits and it

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[Tamiko Toland]: is on the topic of four hundred thousand that’s been a huge focus of mine over

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[Tamiko Toland]: the last couple of years and we’re very excited to be involved in the lifetime

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[Tamiko Toland]: income consortium where we’re really going to be focusing on this topic with a

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[Tamiko Toland]: group of member companies

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[Tamiko Toland]: this the administrative home for this is broad ridge fi three hundred sixty

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[Tamiko Toland]: solutions and we’re also working with another

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[Tamiko Toland]: friend of the show michelle rector at fiduciary insurance uh services and so yeah

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[Tamiko Toland]: happy to talk about any and all that

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[Paul Tyler]: excellent

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[Paul Tyler]: four one k has been a really interesting topic over a number of years actually

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[Paul Tyler]: years ramsey remember i think we did a podcast way back when episode number seven

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[Paul Tyler]: if you want to look and i think when the secure act came out

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[Paul Tyler]: and you think okay two years what’s happened

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[Paul Tyler]: a lot of companies have sort of

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[Paul Tyler]: looked at this opportunity

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[Paul Tyler]: we see some entrances i’ll leave you know rams you can sort of talk about the

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[Paul Tyler]: industry

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[Tamiko Toland]: sometimes

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[Paul Tyler]: landscape but just in the last like two days i’ve had some real

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[Tamiko Toland]: so

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[Paul Tyler]: interesting inbounds to i

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[Paul Tyler]: one was uh you know a writer for for forbes chris caruso saying looking for

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[Paul Tyler]: people’s

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[Paul Tyler]: answers to a question of what will really make this sales happen in the k space

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[Paul Tyler]: i’ll talk to some other questions again but let’s just kind of throw that out

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[Paul Tyler]: what will

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[Paul Tyler]: or what won’t make uh annuities and four hundred one ks work i don’t know which

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[Paul Tyler]: way you want to take it ramsay don’t know

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[Ramsey Smith]: well i’m taking notes ’cause as you mentioned this is this is an area of primary

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[Ramsey Smith]: focus for

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[Paul Tyler]: yeah

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[Ramsey Smith]: for me and my in my company and and uh i i have i have some theories

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[Ramsey Smith]: and very interested to hear tom’s input give me some idea about at least what

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[Ramsey Smith]: we’ve tabulated in terms of i’ll call it deals announced

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[Paul Tyler]: what

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[Ramsey Smith]: right and and they’re in various stages of actual execution but we recently added

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[Ramsey Smith]: up all everything we could find in the press and there’s something like sixty

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[Ramsey Smith]: billion dollars worth of announcements

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[Ramsey Smith]: you know that are in in in the space

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[Tamiko Toland]: that was so that’s

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[Ramsey Smith]: so’s not that’s not that’s not huge given the seven trillion opportunity

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[Tamiko Toland]: so

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[Ramsey Smith]: but it’s not insignificant and my guess is it will continue to grow but how we

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[Ramsey Smith]: get there that’s what tomic is going to share with us so so what do you think

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[Paul Tyler]: yes maybe tom yeah start with what won’t try i don’t know

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[Ramsey Smith]: yeah

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[Paul Tyler]: i’m fascinated to get your your impression

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[Tamiko Toland]: well i i’m gonna take a step back about a decade um in two thousand twelve i

101
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[Tamiko Toland]: actually wrote a report on in planned guarantees when i was at strategic insight

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[Tamiko Toland]: because

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[Tamiko Toland]: it was a very hot topic and it was about

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[Paul Tyler]: you think read

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[Paul Tyler]: so

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[Tamiko Toland]: to explode right we all felt like this is necessary it’s beneficial um to

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[Tamiko Toland]: participants right in particular like that’s where a lot of the conversation

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[Tamiko Toland]: focuses

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[Tamiko Toland]: and

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[Paul Tyler]: is

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[Tamiko Toland]: there

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[Paul Tyler]: you were a lot

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[Tamiko Toland]: were a lot of different companies that were coming out

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[Paul Tyler]: no

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[Tamiko Toland]: with initiatives

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[Paul Tyler]: i i have one

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[Tamiko Toland]: that were going to make a big difference and they were really

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[Paul Tyler]: i

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[Tamiko Toland]: designing around the challenges and

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[Paul Tyler]: yeah

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[Tamiko Toland]: you know the the big one at that time

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[Paul Tyler]: big one time

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[Tamiko Toland]: was

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[Paul Tyler]: play

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[Tamiko Toland]: eins bernstein and the lifetime income strategy which they

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[Paul Tyler]: yeah

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[Tamiko Toland]: actually did get placed as a qa and i’ll explain that a that as a qualified

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[Paul Tyler]: place

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[Tamiko Toland]: default’ investment

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[Tamiko Toland]: alternative right and so this is where

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[Paul Tyler]: wow that was great great branding qualified default wow okay sorry

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[Tamiko Toland]: well it is cause it’s a default

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[Paul Tyler]: yes

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[Tamiko Toland]: right and this has everything to do with the

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[Tamiko Toland]: all the money in motion um within four o one k plans i mean the target date fund

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[Tamiko Toland]: has become the mainstay and it is because of their use as a q dia right and all

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[Tamiko Toland]: these things are are completely related but

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[Paul Tyler]: but it might

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[Tamiko Toland]: it’s funny because you know at the time

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[Tamiko Toland]: i did this research it was more

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[Paul Tyler]: walk

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[Tamiko Toland]: qualitative research where i talked to folks who were involved and collected

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[Tamiko Toland]: information about the different solutions that were out there and so forth and i

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[Tamiko Toland]: said okay well you know this is foundational and then we’re gonna be you know

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[Tamiko Toland]: going up from here and then it just seemed to stall out and

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[Paul Tyler]: wa

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[Tamiko Toland]: despite the efforts with lines burning in their success with the uc plan which is

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[Tamiko Toland]: now part of raytheon so people refer to it as raytheon because they did implement

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[Tamiko Toland]: it

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[Paul Tyler]: yeah it

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[Tamiko Toland]: and it’s been very successful as such it’s they’ve continued and and full

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[Tamiko Toland]: disclosure they are a client of ours so

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[Tamiko Toland]: you know so what’s happened in the last decade why hasn’t it taken off and i

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[Tamiko Toland]: think there are probably a thousand different smaller reasons

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[Tamiko Toland]: and

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[Paul Tyler]: that would

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[Tamiko Toland]: that was one of the the um

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[Paul Tyler]: that

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[Tamiko Toland]: facts that led me to believe that the secure act alone wasn’t going to change the

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[Tamiko Toland]: facts that led me to believe that the secure act alone wasn’t going to change the

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[Tamiko Toland]: story

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[Tamiko Toland]: story

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[Paul Tyler]: excuse

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[Tamiko Toland]: and we really pen a lot of the changes on the secure act and i i i do think it’s

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[Tamiko Toland]: helpful and it’s certainly um beneficial

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[Tamiko Toland]: but the reality is that there are a lot of other um

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[Tamiko Toland]: like through

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[Paul Tyler]: like

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[Tamiko Toland]: lines in the industry that are coming together and

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[Paul Tyler]: i

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[Tamiko Toland]: i kind of want to get to

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[Tamiko Toland]: why is it that plan sponsors

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[Paul Tyler]: you really

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[Tamiko Toland]: really need to consider adoption of

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[Paul Tyler]: like

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[Tamiko Toland]: lifetime income it because it the ultimate reason

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[Paul Tyler]: thank you

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[Tamiko Toland]: is not altruistic you know we don’t companies don’t have this paternalistic

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[Tamiko Toland]: attitude in general like we need to take care of people obviously we know the

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[Tamiko Toland]: trend that pensions are dissipating and they’re being

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[Tamiko Toland]: replaced by dc so naturally we need to include some kind of income solution as

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[Paul Tyler]: like like yeah

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[Tamiko Toland]: part of so

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[Paul Tyler]: why not

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[Tamiko Toland]: why hasn’t it happened why

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[Paul Tyler]: he get

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[Tamiko Toland]: is it going to suddenly happen i

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[Tamiko Toland]: mean frankly in terms of the economic environment

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[Paul Tyler]: she frankly

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[Tamiko Toland]: um when people are facing uncertainty and

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[Paul Tyler]: you know

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[Tamiko Toland]: you know i i really do think that low interest rates have influences this not

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[Tamiko Toland]: something we really talk about a lot

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[Tamiko Toland]: but the methods that we use to generate income and retirement regardless of where

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[Tamiko Toland]: you’re sitting have

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[Tamiko Toland]: really deteriorated bond ladders don’t have the power that they used to so now

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[Tamiko Toland]: we’re talking about all this as

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[Tamiko Toland]: um moving

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[Paul Tyler]: i

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[Tamiko Toland]: attitudes in the retail arena well

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[Paul Tyler]: i think

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[Tamiko Toland]: the same really applies it’s the same people right it’s just

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[Paul Tyler]: thank you

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[Tamiko Toland]: regular american workers who are saving

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[Paul Tyler]: is

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[Tamiko Toland]: and when they

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[Tamiko Toland]: approach retirement when they reach retirement age and they do not have the

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[Tamiko Toland]: confidence to retire

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[Tamiko Toland]: and they’re

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[Paul Tyler]: what

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[Tamiko Toland]: much more likely to stay at their companies

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[Tamiko Toland]: and frankly this is a workforce management issue for companies that want to be

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[Tamiko Toland]: able to hire younger workers promote them through you can’t promote people when

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[Tamiko Toland]: there’s folks already sitting in those positions so that company life cycle

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[Tamiko Toland]: really gets stalled when you have people not retiring right and when you you have

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[Tamiko Toland]: folks that are hanging on not because they’re passionate about their work and

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[Tamiko Toland]: want

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[Paul Tyler]: was

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[Tamiko Toland]: to continue working retirement which is a very valid thing that we talk about so

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[Tamiko Toland]: much more now with you know

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[Paul Tyler]: i

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[Tamiko Toland]: a revision of how we view retirement but when that’s not the reason people are

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[Tamiko Toland]: are sticking to their jobs

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[Paul Tyler]: no

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[Tamiko Toland]: you know i think there are a lot

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[Paul Tyler]: about

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[Tamiko Toland]: of additional workforce issues and older workers are more expensive to companies

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[Paul Tyler]: and we don’t want talk and i

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[Tamiko Toland]: and you know we don’t want to talk about this and and i really i don’t want to

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[Tamiko Toland]: make sure that i’m be careful not to speak about this from an age’s perspective

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[Tamiko Toland]: because i you know i’m also like

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[Tamiko Toland]: leaning that direction as we all are time time moves in one direction for all of

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[Tamiko Toland]: us

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[Tamiko Toland]: but you really want people to be able to enjoy the retirements that they’ve been

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[Tamiko Toland]: saving for but when you’re not giving them that confidence and you’re not giving

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[Tamiko Toland]: them lifetime income then that

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[Paul Tyler]: that is

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[Tamiko Toland]: isn’t going to happen i

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[Tamiko Toland]: haven’t answered your question but i i see ramsey taking notes and i have a

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[Paul Tyler]: i have these i pay

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[Tamiko Toland]: feeling there might be some more questions flying my way so we we’ll get there

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[Ramsey Smith]: so yes i i was gonna say that is the that is the politest version of o k boomer

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[Ramsey Smith]: i’ve ever heard

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[Ramsey Smith]: um but it’s but let me let me ask you about this so

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[Paul Tyler]: so

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[Ramsey Smith]: um

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[Paul Tyler]: um

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[Ramsey Smith]: do you do you get the sense that that companies

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[Ramsey Smith]: hr departments

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[Ramsey Smith]: the folks that are sort of actually dealing with this particular problem you you

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[Ramsey Smith]: you’re saying this can potentially address do you think they see that yet right

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[Ramsey Smith]: do are you

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[Tamiko Toland]: yeah

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[Ramsey Smith]: yeah i mean i is that a i i i’m at the end of the day at the end of the day in

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[Ramsey Smith]: order for this to work there have to be pain points right they have to be sort of

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[Ramsey Smith]: pain

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[Tamiko Toland]: that

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[Ramsey Smith]: points that people are

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[Ramsey Smith]: are determined to sort of

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[Tamiko Toland]: just

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[Ramsey Smith]: resolve and so the question is is that a big enough pain point yet you think

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[Tamiko Toland]: i

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[Paul Tyler]: i have that

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[Ramsey Smith]: i i think that that

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[Tamiko Toland]: i think that that it’s a combination of factors and

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[Paul Tyler]: yeah

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[Tamiko Toland]: yes

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[Ramsey Smith]: yeah

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[Tamiko Toland]: i do think that

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[Ramsey Smith]: that

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[Tamiko Toland]: the employers are starting to recognize this issue

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[Tamiko Toland]: the employers are starting to recognize this issue

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[Tamiko Toland]: and i

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[Ramsey Smith]: and i

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[Paul Tyler]: and i think it it just something something like

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[Tamiko Toland]: think and i don’t forget there’s also

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[Ramsey Smith]: like that

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[Tamiko Toland]: like the there’s the

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[Paul Tyler]: parent

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[Tamiko Toland]: carrot not just the stick that

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[Ramsey Smith]: sure

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[Tamiko Toland]: you know of trying to attract you know new employees um but you know a lot of

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[Tamiko Toland]: you know of trying to attract you know new employees um but you know a lot of

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[Tamiko Toland]: times

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[Tamiko Toland]: times

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[Tamiko Toland]: that’s what

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[Ramsey Smith]: would be hard

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[Tamiko Toland]: we talk about right

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[Tamiko Toland]: oh

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[Paul Tyler]: oh

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[Ramsey Smith]: oh

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[Tamiko Toland]: participants really want this but participants

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[Ramsey Smith]: one

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[Tamiko Toland]: wanting it isn’t necessarily enough to get

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[Ramsey Smith]: you know your

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[Tamiko Toland]: over the barrier of oh there’s risk for the sponsor and that has been where

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[Ramsey Smith]: your

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[Tamiko Toland]: a lot of the conversations have really

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[Paul Tyler]: water

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[Tamiko Toland]: revolved around and so it’s it’s some you know like it it’s a set of factors and

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[Tamiko Toland]: and one of them is

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[Paul Tyler]: born

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[Tamiko Toland]: lowering the barrier

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[Tamiko Toland]: from a risk perspective which

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[Tamiko Toland]: secure

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[Paul Tyler]: you

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[Ramsey Smith]: here i actually

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[Tamiko Toland]: act does actually uh remove

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[Tamiko Toland]: that

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[Paul Tyler]: yeah

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[Ramsey Smith]: that of

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[Tamiko Toland]: in terms of including a safe harb for selection of the insurer but there’s still

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[Tamiko Toland]: a big

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[Tamiko Toland]: gap

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[Paul Tyler]: yeah

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[Tamiko Toland]: for implementation

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[Paul Tyler]: and it is

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[Tamiko Toland]: and it is a very significant gap which is

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[Paul Tyler]: how

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[Tamiko Toland]: how do you actually

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[Tamiko Toland]: how do you actually

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[Tamiko Toland]: make the choice

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[Tamiko Toland]: and we

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[Tamiko Toland]: we

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[Ramsey Smith]: you know that there are

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[Paul Tyler]: else there are right

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[Tamiko Toland]: that there are sort of tried and true methods for other other

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[Paul Tyler]: other

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[Ramsey Smith]: other friend

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[Tamiko Toland]: investments target date funds right like yes

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[Ramsey Smith]: yes

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[Tamiko Toland]: we understand

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[Tamiko Toland]: how

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[Ramsey Smith]: i

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[Tamiko Toland]: other investment options um you know make it into a plan

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[Tamiko Toland]: um but we’re talking about something that’s not just another investment

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[Tamiko Toland]: income is a completely different conversation and it works differently it

338
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[Ramsey Smith]: that

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[Tamiko Toland]: affects the

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[Paul Tyler]: scientific

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[Tamiko Toland]: dynamics and you know particularly because you’re talking about post retirement

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[Ramsey Smith]: dynamic

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[Tamiko Toland]: right

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[Ramsey Smith]: like the do we

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[Tamiko Toland]: that that’s really where it kicks in so how

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[Tamiko Toland]: does it behave

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[Ramsey Smith]: so how ca

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[Paul Tyler]: keep water

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[Tamiko Toland]: before retirement do we have the same expectations that we do for other

350
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[Paul Tyler]: that

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[Tamiko Toland]: investments and so it’s a different mindset and so when you ask

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[Paul Tyler]: yes

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[Tamiko Toland]: me like what is the biggest challenge

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[Ramsey Smith]: out

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[Tamiko Toland]: we have been

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[Tamiko Toland]: we have been

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[Tamiko Toland]: working on a lot of the solutions that are necessary for example middleware

358
00:13:20,184 –> 00:13:21,304
[Tamiko Toland]: solutions which are

359
00:13:21,380 –> 00:13:22,380
[Paul Tyler]: really

360
00:13:21,784 –> 00:13:22,984
[Tamiko Toland]: really important for kind

361
00:13:22,620 –> 00:13:23,620
[Paul Tyler]: kind of

362
00:13:23,064 –> 00:13:25,784
[Tamiko Toland]: of like the connective tissue all right

363
00:13:25,540 –> 00:13:26,540
[Paul Tyler]: any

364
00:13:26,024 –> 00:13:30,904
[Tamiko Toland]: for you know getting everybody hooked up to this right and you know

365
00:13:30,580 –> 00:13:31,580
[Paul Tyler]: that

366
00:13:30,878 –> 00:13:31,878
[Ramsey Smith]: does that work

367
00:13:31,064 –> 00:13:35,864
[Tamiko Toland]: that market has matured significantly in the last decade right where pe you know

368
00:13:36,504 –> 00:13:42,264
[Tamiko Toland]: we’re seeing some some very positive change right but the reality is that for the

369
00:13:42,344 –> 00:13:43,544
[Tamiko Toland]: folks who are actually

370
00:13:45,144 –> 00:13:49,944
[Tamiko Toland]: look at considering these solutions income is not their native language

371
00:13:51,244 –> 00:13:52,244
[Tamiko Toland]: and

372
00:13:51,940 –> 00:13:52,940
[Paul Tyler]: i think that

373
00:13:52,184 –> 00:13:54,584
[Tamiko Toland]: i think that that is a huge hurdle

374
00:13:55,884 –> 00:13:56,884
[Tamiko Toland]: in terms of

375
00:13:57,244 –> 00:13:58,244
[Tamiko Toland]: getting

376
00:13:58,824 –> 00:14:05,304
[Tamiko Toland]: the let’s say the consultants retirement plan advisors comfortable with making

377
00:14:05,544 –> 00:14:10,504
[Tamiko Toland]: those recommendations and confident that they are doing that appropriately for

378
00:14:10,664 –> 00:14:12,984
[Tamiko Toland]: the sponsor client right and

379
00:14:12,604 –> 00:14:13,604
[Tamiko Toland]: the

380
00:14:12,918 –> 00:14:13,918
[Ramsey Smith]: it’s a lot

381
00:14:12,980 –> 00:14:13,980
[Paul Tyler]: what

382
00:14:13,304 –> 00:14:14,744
[Tamiko Toland]: sponsors have to feel like

383
00:14:14,818 –> 00:14:17,058
[Ramsey Smith]: like yeah that that makes sense it fun

384
00:14:14,984 –> 00:14:18,024
[Tamiko Toland]: yeah that that makes sense and i don’t think i just stuck

385
00:14:15,040 –> 00:14:16,880
[Paul Tyler]: yeah that’s it i

386
00:14:17,638 –> 00:14:18,638
[Ramsey Smith]: like

387
00:14:18,104 –> 00:14:23,144
[Tamiko Toland]: my neck out in order to do this and it’s not simply a matter of a legislative fix

388
00:14:23,304 –> 00:14:26,024
[Tamiko Toland]: because we like we don’t need another like

389
00:14:26,180 –> 00:14:27,180
[Paul Tyler]: like

390
00:14:26,664 –> 00:14:29,144
[Tamiko Toland]: dick rule about how to do this

391
00:14:26,664 –> 00:14:29,144
[Tamiko Toland]: dick rule about how to do this

392
00:14:30,264 –> 00:14:33,944
[Tamiko Toland]: and frankly the department of labor generally stays away from that like that you

393
00:14:34,024 –> 00:14:37,864
[Tamiko Toland]: know these things kind of evolve and the general guidelines yes but not very

394
00:14:38,184 –> 00:14:44,584
[Tamiko Toland]: specific details and particularly on a really a novel subject matter and a novel

395
00:14:44,984 –> 00:14:49,144
[Tamiko Toland]: product dynamic which is what income represents

396
00:14:49,840 –> 00:14:50,880
[Paul Tyler]: so okay when i

397
00:14:52,000 –> 00:14:57,280
[Paul Tyler]: a two part question when i think toco of the group market i think like you

398
00:14:57,360 –> 00:15:00,960
[Paul Tyler]: mentioned a company with a very you know a very big company right

399
00:15:02,160 –> 00:15:07,680
[Paul Tyler]: if you’re marketing products or retirement plans into a large company the needs

400
00:15:07,760 –> 00:15:13,120
[Paul Tyler]: start to tier like executive senior the super executive management team may have

401
00:15:14,000 –> 00:15:17,600
[Paul Tyler]: they may have a fee based only advisory service that helps them do

402
00:15:17,164 –> 00:15:18,164
[Tamiko Toland]: see

403
00:15:17,760 –> 00:15:19,040
[Paul Tyler]: this you to go down

404
00:15:18,724 –> 00:15:19,724
[Tamiko Toland]: or something

405
00:15:19,280 –> 00:15:24,560
[Paul Tyler]: another tier these people aren’t so they they’ve got some big balances but

406
00:15:24,640 –> 00:15:28,880
[Paul Tyler]: they’re not going to have an advisor you get down farther than the company where

407
00:15:28,940 –> 00:15:29,940
[Paul Tyler]: i think i think i heard

408
00:15:29,558 –> 00:15:30,558
[Ramsey Smith]: favorite

409
00:15:29,660 –> 00:15:30,660
[Paul Tyler]: you talking

410
00:15:31,440 –> 00:15:34,880
[Paul Tyler]: or speaking to are people who are you know they’re just trying to pay the bills

411
00:15:34,740 –> 00:15:35,740
[Paul Tyler]: oh by the way

412
00:15:35,238 –> 00:15:36,238
[Ramsey Smith]: lot of time

413
00:15:35,600 –> 00:15:37,280
[Paul Tyler]: oh gee i did have a four one k

414
00:15:38,400 –> 00:15:41,040
[Paul Tyler]: how do you do you see the segmentation

415
00:15:42,400 –> 00:15:45,520
[Paul Tyler]: the drivers of adoption being or should they

416
00:15:45,238 –> 00:15:46,238
[Ramsey Smith]: really

417
00:15:45,680 –> 00:15:49,440
[Paul Tyler]: be different based on your income inside a company

418
00:15:51,564 –> 00:15:52,564
[Tamiko Toland]: so

419
00:15:51,798 –> 00:15:52,798
[Ramsey Smith]: no

420
00:15:52,604 –> 00:15:53,604
[Tamiko Toland]: the thing is that the

421
00:15:53,318 –> 00:15:54,318
[Ramsey Smith]: yeah

422
00:15:54,524 –> 00:15:55,524
[Tamiko Toland]: really the

423
00:15:55,038 –> 00:15:56,038
[Ramsey Smith]: like that mind

424
00:15:55,384 –> 00:15:58,184
[Tamiko Toland]: mindset of thinking around this is that the

425
00:15:58,258 –> 00:15:59,298
[Ramsey Smith]: second actually

426
00:15:58,264 –> 00:16:03,304
[Tamiko Toland]: qt is the place where the assets fall because that is the you know the default

427
00:16:03,944 –> 00:16:10,264
[Tamiko Toland]: flows into the qa and that now has become target date funds right and so

428
00:16:09,878 –> 00:16:10,878
[Ramsey Smith]: yeah

429
00:16:11,864 –> 00:16:14,504
[Tamiko Toland]: it’s the same thing of how we think about income

430
00:16:14,260 –> 00:16:15,260
[Paul Tyler]: yeah

431
00:16:14,604 –> 00:16:15,604
[Tamiko Toland]: now i’m

432
00:16:15,358 –> 00:16:16,358
[Ramsey Smith]: thank you john

433
00:16:15,544 –> 00:16:17,864
[Tamiko Toland]: gonna be honest with you like rich people

434
00:16:17,638 –> 00:16:18,638
[Ramsey Smith]: s

435
00:16:18,104 –> 00:16:19,624
[Tamiko Toland]: are fine right

436
00:16:19,778 –> 00:16:20,978
[Ramsey Smith]: right they’re knowing somebody

437
00:16:20,024 –> 00:16:22,024
[Tamiko Toland]: there’s always somebody who’s willing to give them

438
00:16:22,184 –> 00:16:26,584
[Tamiko Toland]: advice they they have lots of access to advice but the people who truly benefit

439
00:16:22,498 –> 00:16:23,938
[Ramsey Smith]: why have that

440
00:16:26,198 –> 00:16:27,198
[Ramsey Smith]: yeah

441
00:16:27,544 –> 00:16:31,464
[Tamiko Toland]: within a retirement plan are those individuals who

442
00:16:31,600 –> 00:16:33,680
[Paul Tyler]: how do i smoke but

443
00:16:31,624 –> 00:16:37,224
[Tamiko Toland]: otherwise have no access to advice or guidance or anything right and so the

444
00:16:37,304 –> 00:16:40,424
[Tamiko Toland]: default all this entire structure that we’re talking about

445
00:16:41,600 –> 00:16:42,720
[Paul Tyler]: e really

446
00:16:41,600 –> 00:16:42,720
[Paul Tyler]: e really

447
00:16:41,604 –> 00:16:42,604
[Tamiko Toland]: is really

448
00:16:41,778 –> 00:16:43,218
[Ramsey Smith]: yeah sus

449
00:16:43,884 –> 00:16:44,884
[Tamiko Toland]: it’s

450
00:16:44,500 –> 00:16:45,500
[Paul Tyler]: i

451
00:16:44,744 –> 00:16:50,824
[Tamiko Toland]: designed to help those individuals who are much more on the margins and if if you

452
00:16:51,164 –> 00:16:52,164
[Tamiko Toland]: have outside

453
00:16:51,900 –> 00:16:52,900
[Paul Tyler]: i like

454
00:16:52,264 –> 00:16:56,024
[Tamiko Toland]: advice and your advice says no no no we have this different plan you don’t need

455
00:16:56,184 –> 00:17:00,024
[Tamiko Toland]: this you know we’ll put your money into something else that’s completely

456
00:17:00,104 –> 00:17:02,024
[Tamiko Toland]: fine and that is how the

457
00:17:00,198 –> 00:17:01,198
[Ramsey Smith]: why not

458
00:17:02,024 –> 00:17:04,264
[Tamiko Toland]: q is structured it’s a default it’s not

459
00:17:02,098 –> 00:17:03,138
[Ramsey Smith]: out thirty

460
00:17:03,878 –> 00:17:04,878
[Ramsey Smith]: not

461
00:17:04,344 –> 00:17:08,584
[Tamiko Toland]: like you’re not forced to stay in it right but but it needs to be

462
00:17:10,184 –> 00:17:11,704
[Tamiko Toland]: a quality solution

463
00:17:12,824 –> 00:17:16,424
[Tamiko Toland]: for those individuals who may not be

464
00:17:16,038 –> 00:17:17,038
[Ramsey Smith]: y

465
00:17:16,424 –> 00:17:21,304
[Tamiko Toland]: accumulating as much money in you know during their working years for retirement

466
00:17:21,460 –> 00:17:22,460
[Paul Tyler]: so

467
00:17:22,024 –> 00:17:27,064
[Tamiko Toland]: and who probably aren’t going to get other guidance right and so this is exactly

468
00:17:26,764 –> 00:17:27,764
[Tamiko Toland]: why

469
00:17:27,724 –> 00:17:28,724
[Tamiko Toland]: so

470
00:17:27,780 –> 00:17:28,780
[Paul Tyler]: so

471
00:17:27,958 –> 00:17:28,958
[Ramsey Smith]: so

472
00:17:28,344 –> 00:17:29,544
[Tamiko Toland]: many people are

473
00:17:29,420 –> 00:17:30,420
[Paul Tyler]: pla

474
00:17:29,784 –> 00:17:32,264
[Tamiko Toland]: passionate about this that it’s not yes

475
00:17:32,004 –> 00:17:33,004
[Tamiko Toland]: i mean

476
00:17:32,020 –> 00:17:33,020
[Paul Tyler]: i

477
00:17:32,664 –> 00:17:33,704
[Tamiko Toland]: it’s it’s great like that

478
00:17:32,738 –> 00:17:34,178
[Ramsey Smith]: i mean like the

479
00:17:33,380 –> 00:17:34,380
[Paul Tyler]: like that

480
00:17:33,844 –> 00:17:34,844
[Tamiko Toland]: from an asset gathering

481
00:17:34,838 –> 00:17:35,838
[Ramsey Smith]: now

482
00:17:34,904 –> 00:17:38,664
[Tamiko Toland]: standpoint whatever you know servicing all these people but you know you get

483
00:17:38,364 –> 00:17:39,364
[Tamiko Toland]: folks

484
00:17:38,918 –> 00:17:39,918
[Ramsey Smith]: smoke

485
00:17:39,224 –> 00:17:43,384
[Tamiko Toland]: like me who care deeply about it because you see this is a fantastic

486
00:17:43,238 –> 00:17:44,238
[Ramsey Smith]: not

487
00:17:43,464 –> 00:17:44,984
[Tamiko Toland]: way to reach

488
00:17:46,264 –> 00:17:48,184
[Tamiko Toland]: so many americans in a way

489
00:17:47,798 –> 00:17:48,798
[Ramsey Smith]: we

490
00:17:48,344 –> 00:17:50,424
[Tamiko Toland]: that the retail space is not going to

491
00:17:51,158 –> 00:17:52,158
[Ramsey Smith]: so

492
00:17:51,300 –> 00:17:52,300
[Paul Tyler]: oh

493
00:17:52,018 –> 00:17:56,978
[Ramsey Smith]: okay this is this is very you know interesting interesting element of it because

494
00:17:58,178 –> 00:18:04,658
[Ramsey Smith]: we live in a world where where this the same three the esg acronym comes up a lot

495
00:18:05,138 –> 00:18:09,858
[Ramsey Smith]: it comes up in investing it comes up certainly in board work i can tell you it

496
00:18:09,938 –> 00:18:11,938
[Ramsey Smith]: comes up in a lot of different places like esg

497
00:18:13,138 –> 00:18:14,498
[Ramsey Smith]: is is on the tip of

498
00:18:14,380 –> 00:18:15,380
[Paul Tyler]: i don’t know

499
00:18:14,498 –> 00:18:16,098
[Ramsey Smith]: everybody’s tongues because it’s it’s

500
00:18:15,878 –> 00:18:16,878
[Ramsey Smith]: it’s

501
00:18:16,044 –> 00:18:17,044
[Tamiko Toland]: expensive

502
00:18:16,260 –> 00:18:17,260
[Paul Tyler]: what

503
00:18:16,658 –> 00:18:18,578
[Ramsey Smith]: important in every aspect of business now

504
00:18:19,558 –> 00:18:20,558
[Ramsey Smith]: and you know one

505
00:18:20,100 –> 00:18:21,100
[Paul Tyler]: what

506
00:18:20,638 –> 00:18:21,638
[Ramsey Smith]: sort of sleeve of

507
00:18:21,278 –> 00:18:22,278
[Ramsey Smith]: esg

508
00:18:21,300 –> 00:18:22,300
[Paul Tyler]: yes

509
00:18:21,884 –> 00:18:22,884
[Tamiko Toland]: that’s pretty

510
00:18:22,338 –> 00:18:28,418
[Ramsey Smith]: that’s often talked about is banking to the un banked and you know here we’re

511
00:18:28,498 –> 00:18:34,418
[Ramsey Smith]: talking about i don’t have as neat a catch phrase as that but it’s sort of the it

512
00:18:34,498 –> 00:18:38,658
[Ramsey Smith]: is retirement income to the un income for lack of a better way

513
00:18:39,858 –> 00:18:41,858
[Ramsey Smith]: way to describe it but i’ve i very

514
00:18:41,780 –> 00:18:42,780
[Paul Tyler]: you

515
00:18:42,178 –> 00:18:45,698
[Ramsey Smith]: rarely heard it one described as an esg issue

516
00:18:46,818 –> 00:18:51,538
[Ramsey Smith]: and two i don’t really think i’ve heard any of the the current proponents of the

517
00:18:51,158 –> 00:18:52,158
[Ramsey Smith]: space

518
00:18:52,518 –> 00:18:53,518
[Ramsey Smith]: uh you

519
00:18:53,298 –> 00:18:59,218
[Ramsey Smith]: know describing it that way as as opportunistically as everybody else is using

520
00:18:53,360 –> 00:18:56,240
[Paul Tyler]: it was like that way yeah

521
00:18:59,858 –> 00:19:04,738
[Ramsey Smith]: using that acronym everywhere else in the business world so what your thoughts on

522
00:19:04,738 –> 00:19:07,298
[Ramsey Smith]: there is that a missed opportunity cause i think it’s real

523
00:19:09,164 –> 00:19:10,164
[Tamiko Toland]: um

524
00:19:12,024 –> 00:19:14,184
[Tamiko Toland]: i’m not sure i mean i i think that i

525
00:19:13,958 –> 00:19:14,958
[Ramsey Smith]: i

526
00:19:14,424 –> 00:19:15,544
[Tamiko Toland]: certainly have heard other people

527
00:19:15,238 –> 00:19:16,238
[Ramsey Smith]: it

528
00:19:15,704 –> 00:19:18,984
[Tamiko Toland]: talk about i’m not the only one who has articulated it like that

529
00:19:18,598 –> 00:19:19,598
[Ramsey Smith]: yeah

530
00:19:19,500 –> 00:19:20,500
[Paul Tyler]: yeah i

531
00:19:19,704 –> 00:19:22,584
[Tamiko Toland]: so i think there are other voices out there saying the same thing

532
00:19:23,544 –> 00:19:25,784
[Tamiko Toland]: and i definitely see that passion

533
00:19:23,600 –> 00:19:25,360
[Paul Tyler]: and i guess see that

534
00:19:26,824 –> 00:19:29,304
[Tamiko Toland]: um among other stakeholders um

535
00:19:29,380 –> 00:19:30,380
[Paul Tyler]: yeah

536
00:19:30,024 –> 00:19:31,624
[Tamiko Toland]: you know is this the marketing opportunity

537
00:19:32,684 –> 00:19:33,684
[Tamiko Toland]: i

538
00:19:32,980 –> 00:19:33,980
[Paul Tyler]: i don’t know

539
00:19:33,118 –> 00:19:34,118
[Ramsey Smith]: i don’t know

540
00:19:33,224 –> 00:19:36,904
[Tamiko Toland]: don’t know because ultimately when you look at the dynamics of how

541
00:19:33,224 –> 00:19:36,904
[Tamiko Toland]: don’t know because ultimately when you look at the dynamics of how

542
00:19:36,420 –> 00:19:37,420
[Paul Tyler]: how

543
00:19:38,264 –> 00:19:40,904
[Tamiko Toland]: the these solutions are going to be placed

544
00:19:41,300 –> 00:19:42,300
[Paul Tyler]: and

545
00:19:41,784 –> 00:19:42,824
[Tamiko Toland]: and that

546
00:19:43,724 –> 00:19:44,724
[Tamiko Toland]: the

547
00:19:43,980 –> 00:19:44,980
[Paul Tyler]: the can

548
00:19:44,084 –> 00:19:45,084
[Tamiko Toland]: mechanical

549
00:19:44,718 –> 00:19:45,718
[Ramsey Smith]: go back

550
00:19:44,984 –> 00:19:47,624
[Tamiko Toland]: factors the the choices

551
00:19:47,398 –> 00:19:48,398
[Ramsey Smith]: this

552
00:19:47,784 –> 00:19:49,064
[Tamiko Toland]: that sponsors need to make

553
00:19:49,244 –> 00:19:50,244
[Tamiko Toland]: i

554
00:19:49,760 –> 00:19:52,320
[Paul Tyler]: i don’t think that that but i i think that

555
00:19:49,864 –> 00:19:52,824
[Tamiko Toland]: don’t think that that’s the thing but i do think that that drives

556
00:19:49,938 –> 00:19:52,818
[Ramsey Smith]: i don’t think that that i think five

557
00:19:53,404 –> 00:19:54,404
[Tamiko Toland]: really

558
00:19:55,304 –> 00:19:59,704
[Tamiko Toland]: you know the the legislative components right and the fact that in the regulatory

559
00:19:59,684 –> 00:20:00,684
[Tamiko Toland]: piece say we want

560
00:20:00,358 –> 00:20:01,358
[Ramsey Smith]: want be

561
00:20:00,664 –> 00:20:02,744
[Tamiko Toland]: to make this easier we w we and we

562
00:20:02,598 –> 00:20:03,598
[Ramsey Smith]: if one is

563
00:20:02,824 –> 00:20:04,344
[Tamiko Toland]: want it to be safe so it’s

564
00:20:04,198 –> 00:20:05,198
[Ramsey Smith]: b

565
00:20:04,424 –> 00:20:05,944
[Tamiko Toland]: balancing those interests out

566
00:20:05,638 –> 00:20:06,638
[Ramsey Smith]: nine

567
00:20:06,184 –> 00:20:07,464
[Tamiko Toland]: because you want to

568
00:20:07,438 –> 00:20:08,438
[Ramsey Smith]: what do you ask

569
00:20:07,624 –> 00:20:09,224
[Tamiko Toland]: increase access to all

570
00:20:09,180 –> 00:20:10,180
[Paul Tyler]: all the american

571
00:20:09,198 –> 00:20:10,198
[Ramsey Smith]: of america

572
00:20:09,384 –> 00:20:14,024
[Tamiko Toland]: these americans which is you know that’s a very good goal for our our government

573
00:20:14,824 –> 00:20:16,744
[Tamiko Toland]: and you know folks working there to be

574
00:20:16,500 –> 00:20:17,500
[Paul Tyler]: think

575
00:20:16,904 –> 00:20:21,144
[Tamiko Toland]: thinking about and they also want to make sure that it’s done responsibly so you

576
00:20:21,100 –> 00:20:22,100
[Paul Tyler]: you know i i just

577
00:20:21,224 –> 00:20:23,144
[Tamiko Toland]: know i i think that that may be a more

578
00:20:21,298 –> 00:20:22,498
[Ramsey Smith]: you know i i think it’s that

579
00:20:23,478 –> 00:20:24,478
[Ramsey Smith]: well

580
00:20:23,704 –> 00:20:25,224
[Tamiko Toland]: relevant conversation there

581
00:20:24,820 –> 00:20:25,820
[Paul Tyler]: there

582
00:20:24,998 –> 00:20:25,998
[Ramsey Smith]: yeah

583
00:20:25,764 –> 00:20:26,764
[Tamiko Toland]: and it’s a

584
00:20:26,318 –> 00:20:27,318
[Ramsey Smith]: the one i

585
00:20:26,324 –> 00:20:27,324
[Tamiko Toland]: little bit different

586
00:20:26,324 –> 00:20:27,324
[Tamiko Toland]: little bit different

587
00:20:26,324 –> 00:20:27,324
[Tamiko Toland]: little bit different

588
00:20:28,258 –> 00:20:29,378
[Ramsey Smith]: um you know

589
00:20:28,584 –> 00:20:30,744
[Tamiko Toland]: because you know like i say when it

590
00:20:30,598 –> 00:20:31,598
[Ramsey Smith]: something

591
00:20:30,904 –> 00:20:34,184
[Tamiko Toland]: comes to building these q solutions this

592
00:20:34,184 –> 00:20:39,384
[Tamiko Toland]: is a different way of thinking about income than we’re really accustomed to in

593
00:20:34,258 –> 00:20:35,698
[Ramsey Smith]: which is a different way

594
00:20:39,464 –> 00:20:41,464
[Tamiko Toland]: retail because you know when you have an individual

595
00:20:41,540 –> 00:20:42,540
[Paul Tyler]: white

596
00:20:41,864 –> 00:20:45,384
[Tamiko Toland]: client and you know what their needs are then you make selections that are really

597
00:20:45,284 –> 00:20:46,284
[Tamiko Toland]: much more

598
00:20:47,304 –> 00:20:53,704
[Tamiko Toland]: optimized for you know what their goals are right and so you can use these you

599
00:20:53,324 –> 00:20:54,324
[Tamiko Toland]: know

600
00:20:53,780 –> 00:20:54,780
[Paul Tyler]: i

601
00:20:54,044 –> 00:20:55,044
[Tamiko Toland]: products that are as

602
00:20:55,198 –> 00:20:56,198
[Ramsey Smith]: i know

603
00:20:55,304 –> 00:20:59,224
[Tamiko Toland]: we all know like so much of the annuity industry has become highly specialized

604
00:20:59,324 –> 00:21:00,324
[Tamiko Toland]: you know you have

605
00:21:00,258 –> 00:21:01,618
[Ramsey Smith]: no that is

606
00:21:00,424 –> 00:21:03,144
[Tamiko Toland]: you know this benefit that’s torque one way

607
00:21:02,878 –> 00:21:03,878
[Ramsey Smith]: one way

608
00:21:03,304 –> 00:21:05,064
[Tamiko Toland]: and other benefit that’s toed in

609
00:21:04,838 –> 00:21:05,838
[Ramsey Smith]: another way

610
00:21:05,144 –> 00:21:08,264
[Tamiko Toland]: another way and they are different use cases right and

611
00:21:08,580 –> 00:21:09,580
[Paul Tyler]: that’s

612
00:21:08,904 –> 00:21:13,384
[Tamiko Toland]: that’s to the benefit of the end client of making it more focused right and that

613
00:21:12,518 –> 00:21:13,518
[Ramsey Smith]: i

614
00:21:13,140 –> 00:21:14,140
[Paul Tyler]: that what

615
00:21:13,164 –> 00:21:14,164
[Tamiko Toland]: doesn’t apply

616
00:21:13,198 –> 00:21:14,198
[Ramsey Smith]: think that a lot

617
00:21:15,064 –> 00:21:19,144
[Tamiko Toland]: right so much when you think about pda you’re not necessarily having a single

618
00:21:19,004 –> 00:21:20,004
[Tamiko Toland]: minded goal like

619
00:21:19,564 –> 00:21:20,564
[Tamiko Toland]: you’re

620
00:21:19,798 –> 00:21:20,798
[Ramsey Smith]: talk

621
00:21:19,860 –> 00:21:20,860
[Paul Tyler]: i my

622
00:21:20,264 –> 00:21:24,504
[Tamiko Toland]: not trying to maximize income for every single person you have to balance out

623
00:21:24,198 –> 00:21:25,198
[Ramsey Smith]: i

624
00:21:24,664 –> 00:21:26,824
[Tamiko Toland]: those interests because some people are going to end

625
00:21:26,678 –> 00:21:27,678
[Ramsey Smith]: and i

626
00:21:26,984 –> 00:21:31,464
[Tamiko Toland]: up at retirement not selecting that that benefit despite the fact that they’ve

627
00:21:31,544 –> 00:21:35,224
[Tamiko Toland]: paid into it whether it’s a decision made out of ignorance or they got diagnosed

628
00:21:35,224 –> 00:21:38,504
[Tamiko Toland]: with the terrible cancer right before they retired you know and they have

629
00:21:39,224 –> 00:21:42,664
[Tamiko Toland]: different goals um for their their post working years

630
00:21:43,458 –> 00:21:44,498
[Ramsey Smith]: about art

631
00:21:43,604 –> 00:21:44,604
[Tamiko Toland]: you know there are

632
00:21:46,904 –> 00:21:48,824
[Tamiko Toland]: it is just a different problem to solve

633
00:21:49,078 –> 00:21:50,078
[Ramsey Smith]: g

634
00:21:49,284 –> 00:21:50,284
[Tamiko Toland]: right then

635
00:21:49,980 –> 00:21:50,980
[Paul Tyler]: wow

636
00:21:50,424 –> 00:21:53,304
[Tamiko Toland]: looking at it as you know client a

637
00:21:52,398 –> 00:21:53,398
[Ramsey Smith]: it was funny

638
00:21:53,740 –> 00:21:54,740
[Paul Tyler]: yeah so i

639
00:21:53,884 –> 00:21:54,884
[Tamiko Toland]: and

640
00:21:54,438 –> 00:21:55,438
[Ramsey Smith]: what

641
00:21:54,504 –> 00:21:55,864
[Tamiko Toland]: fitting solutions to that

642
00:21:55,220 –> 00:21:56,220
[Paul Tyler]: okay

643
00:21:55,558 –> 00:21:56,558
[Ramsey Smith]: what

644
00:21:56,000 –> 00:22:03,680
[Paul Tyler]: so here here’s okay you are the in command of you’re running the hr benefits for

645
00:22:03,700 –> 00:22:04,700
[Paul Tyler]: a target i

646
00:22:04,438 –> 00:22:05,438
[Ramsey Smith]: b

647
00:22:05,280 –> 00:22:09,680
[Paul Tyler]: just took it take a job as uh you know somebody working in one of the stores i’m

648
00:22:09,760 –> 00:22:11,440
[Paul Tyler]: a assistant manager of a store

649
00:22:12,960 –> 00:22:16,640
[Paul Tyler]: how does how should the onboarding experience be when i fill at the application

650
00:22:18,000 –> 00:22:20,240
[Paul Tyler]: come to the point of okay set up your paycheck

651
00:22:21,520 –> 00:22:24,720
[Paul Tyler]: how much pal do you want to put into your four o one k o here’s the match

652
00:22:26,000 –> 00:22:30,000
[Paul Tyler]: how would you change that that setup for me to start putting money in there do i

653
00:22:30,080 –> 00:22:35,280
[Paul Tyler]: have a choice is there a default you know if you don’t say this paul you will get

654
00:22:35,920 –> 00:22:41,520
[Paul Tyler]: x percent of your savings in the four k and x percent is going to default into

655
00:22:41,540 –> 00:22:42,540
[Paul Tyler]: this income

656
00:22:43,060 –> 00:22:44,060
[Paul Tyler]: benefit

657
00:22:44,204 –> 00:22:45,204
[Tamiko Toland]: well

658
00:22:44,678 –> 00:22:45,678
[Ramsey Smith]: that

659
00:22:44,904 –> 00:22:51,064
[Tamiko Toland]: that’s the idea behind defaulting is that you don’t have to convince paul to sign

660
00:22:50,844 –> 00:22:51,844
[Tamiko Toland]: up

661
00:22:52,204 –> 00:22:53,204
[Tamiko Toland]: that you

662
00:22:54,024 –> 00:22:59,384
[Tamiko Toland]: don’t need to get educated about the benefits of of contributing to four o one k

663
00:22:59,624 –> 00:23:03,544
[Tamiko Toland]: the money goes in there you get your match and then you’re put into something

664
00:23:03,704 –> 00:23:07,864
[Tamiko Toland]: that’s suitable for you right and so conceptually yes that those are all

665
00:23:09,624 –> 00:23:10,984
[Tamiko Toland]: components of why

666
00:23:10,580 –> 00:23:11,580
[Paul Tyler]: why

667
00:23:11,064 –> 00:23:15,064
[Tamiko Toland]: we’re thinking so strongly about qa and not simply having sort of the

668
00:23:15,064 –> 00:23:17,304
[Tamiko Toland]: availability of options

669
00:23:18,664 –> 00:23:23,304
[Tamiko Toland]: before or at retirement that’s part of what the industry calls the retirement

670
00:23:23,464 –> 00:23:27,784
[Tamiko Toland]: tier right which is a range of different options to suit two different needs

671
00:23:27,724 –> 00:23:28,724
[Tamiko Toland]: right

672
00:23:28,158 –> 00:23:29,158
[Ramsey Smith]: you could

673
00:23:28,504 –> 00:23:34,104
[Tamiko Toland]: but a lot of that is elective and not defaulted um you know it was interesting i

674
00:23:33,724 –> 00:23:34,724
[Tamiko Toland]: was

675
00:23:34,380 –> 00:23:35,380
[Paul Tyler]: out uh

676
00:23:34,424 –> 00:23:37,384
[Tamiko Toland]: at the deci a innovation forum and

677
00:23:37,860 –> 00:23:38,860
[Paul Tyler]: oh

678
00:23:38,664 –> 00:23:40,504
[Tamiko Toland]: somebody was presenting information about

679
00:23:42,264 –> 00:23:47,304
[Tamiko Toland]: engagement with plans and that defaulting is great for getting people into the

680
00:23:47,464 –> 00:23:50,664
[Tamiko Toland]: plan but people don’t engage with their plans as much when

681
00:23:50,340 –> 00:23:51,340
[Paul Tyler]: maybe

682
00:23:50,824 –> 00:23:56,504
[Tamiko Toland]: they’re simply defaulted right and so there’s kind of a tension between these

683
00:23:56,744 –> 00:23:57,864
[Tamiko Toland]: facts because you want

684
00:23:58,104 –> 00:24:00,744
[Tamiko Toland]: people to understand what they’re in and to perhaps

685
00:23:58,158 –> 00:23:59,158
[Ramsey Smith]: one one three

686
00:24:00,558 –> 00:24:01,558
[Ramsey Smith]: i watch

687
00:24:00,824 –> 00:24:04,744
[Tamiko Toland]: decide to increase their allocation right and so this is actually kind of a whole

688
00:24:04,824 –> 00:24:09,464
[Tamiko Toland]: other conversation around participant engagement that would also be beneficial

689
00:24:09,544 –> 00:24:11,624
[Tamiko Toland]: and also enhances because you know

690
00:24:11,460 –> 00:24:12,460
[Paul Tyler]: we

691
00:24:11,784 –> 00:24:14,184
[Tamiko Toland]: frankly people aren’t used to they use the idea

692
00:24:13,940 –> 00:24:14,940
[Paul Tyler]: yeah

693
00:24:14,504 –> 00:24:16,584
[Tamiko Toland]: of receiving income from their employer

694
00:24:17,484 –> 00:24:18,484
[Tamiko Toland]: through a pension

695
00:24:18,980 –> 00:24:19,980
[Paul Tyler]: but they’re not

696
00:24:19,224 –> 00:24:22,744
[Tamiko Toland]: but they’re not used to this as part of the four o one k because it’s it’s not a

697
00:24:22,824 –> 00:24:27,544
[Tamiko Toland]: standard part of the landscape frankly you know relatively few plans even offer

698
00:24:27,624 –> 00:24:28,664
[Tamiko Toland]: it on on the

699
00:24:28,638 –> 00:24:29,638
[Ramsey Smith]: i don’t know

700
00:24:28,744 –> 00:24:30,584
[Tamiko Toland]: outbound you when you retire

701
00:24:31,164 –> 00:24:32,164
[Tamiko Toland]: but

702
00:24:31,680 –> 00:24:34,480
[Paul Tyler]: but you know i i wanna ask there’s

703
00:24:31,838 –> 00:24:32,838
[Ramsey Smith]: but you know i

704
00:24:32,104 –> 00:24:35,704
[Tamiko Toland]: you know i i want to add one other thing that there’s another trend right now for

705
00:24:32,104 –> 00:24:35,704
[Tamiko Toland]: you know i i want to add one other thing that there’s another trend right now for

706
00:24:36,504 –> 00:24:42,024
[Tamiko Toland]: um more sponsors to want to keep retiree assets in plan and designing these

707
00:24:36,504 –> 00:24:42,024
[Tamiko Toland]: um more sponsors to want to keep retiree assets in plan and designing these

708
00:24:42,184 –> 00:24:45,064
[Tamiko Toland]: solutions also serves that interest

709
00:24:42,184 –> 00:24:45,064
[Tamiko Toland]: solutions also serves that interest

710
00:24:46,104 –> 00:24:47,224
[Tamiko Toland]: um it you

711
00:24:46,820 –> 00:24:47,820
[Paul Tyler]: yeah

712
00:24:46,884 –> 00:24:47,884
[Tamiko Toland]: know s

713
00:24:47,798 –> 00:24:48,798
[Ramsey Smith]: some sometimes

714
00:24:47,864 –> 00:24:50,104
[Tamiko Toland]: some some designs they may roll

715
00:24:49,838 –> 00:24:50,838
[Ramsey Smith]: wow

716
00:24:50,184 –> 00:24:52,424
[Tamiko Toland]: out but a lot of them you’re keeping

717
00:24:53,844 –> 00:24:54,844
[Tamiko Toland]: if not all the

718
00:24:54,358 –> 00:24:55,358
[Ramsey Smith]: all that

719
00:24:54,744 –> 00:24:57,704
[Tamiko Toland]: acids are bulk of them inside the plan so

720
00:24:57,940 –> 00:24:58,940
[Paul Tyler]: right

721
00:24:58,278 –> 00:24:59,278
[Ramsey Smith]: so

722
00:24:58,640 –> 00:25:01,360
[Paul Tyler]: amy sorry we just one follow up on that

723
00:25:03,760 –> 00:25:07,840
[Paul Tyler]: my experience has been it is so hard to change a form from an insurance company

724
00:25:08,080 –> 00:25:09,440
[Paul Tyler]: or a fourk provider

725
00:25:11,280 –> 00:25:15,200
[Paul Tyler]: do you have models sort of best language for introducing an income conversation

726
00:25:15,760 –> 00:25:19,200
[Paul Tyler]: because you know four hundred one thousand okay everybody kinda understands four

727
00:25:19,280 –> 00:25:23,600
[Paul Tyler]: on k well how old is paul tyler you know if i’m twenty one

728
00:25:24,960 –> 00:25:29,760
[Paul Tyler]: gee maybe i’m defaulting here but i should sort of hm maybe i take it down maybe

729
00:25:29,620 –> 00:25:30,620
[Paul Tyler]: i’m

730
00:25:31,280 –> 00:25:36,320
[Paul Tyler]: actually in my fifty seconds maybe i should like allocate that initially more i

731
00:25:36,320 –> 00:25:41,040
[Paul Tyler]: mean do you have models that say this is the language it should be there for so

732
00:25:41,120 –> 00:25:44,800
[Paul Tyler]: paul makes the best optimal decision when i set it up

733
00:25:46,564 –> 00:25:47,564
[Tamiko Toland]: yeah it’s a good question

734
00:25:47,324 –> 00:25:48,324
[Tamiko Toland]: and

735
00:25:47,398 –> 00:25:48,398
[Ramsey Smith]: like you

736
00:25:47,620 –> 00:25:48,620
[Paul Tyler]: no

737
00:25:48,024 –> 00:25:52,664
[Tamiko Toland]: there aren’t models for it i mean the only model is you know i would say the

738
00:25:52,744 –> 00:25:55,624
[Tamiko Toland]: largest plan out there um if you look

739
00:25:55,300 –> 00:25:56,300
[Paul Tyler]: yeah

740
00:25:55,704 –> 00:25:59,864
[Tamiko Toland]: at rath on’s participant communications they do an excellent job

741
00:25:59,558 –> 00:26:00,558
[Ramsey Smith]: job

742
00:26:00,124 –> 00:26:01,124
[Tamiko Toland]: of

743
00:26:01,158 –> 00:26:02,158
[Ramsey Smith]: showing

744
00:26:01,224 –> 00:26:04,344
[Tamiko Toland]: showing different personas of different folks who would want to

745
00:26:03,958 –> 00:26:04,958
[Ramsey Smith]: one

746
00:26:04,424 –> 00:26:08,584
[Tamiko Toland]: stay in the plan or in in that uh guaranteed income option or

747
00:26:08,398 –> 00:26:09,398
[Ramsey Smith]: what else

748
00:26:08,684 –> 00:26:09,684
[Tamiko Toland]: not right

749
00:26:10,524 –> 00:26:11,524
[Tamiko Toland]: but you know

750
00:26:11,384 –> 00:26:14,504
[Tamiko Toland]: i think part of the understanding of this is that there are also

751
00:26:11,458 –> 00:26:13,058
[Ramsey Smith]: yeah i think more fun

752
00:26:14,100 –> 00:26:15,100
[Paul Tyler]: are

753
00:26:14,664 –> 00:26:18,024
[Tamiko Toland]: different models of how how they work and at

754
00:26:14,738 –> 00:26:16,098
[Ramsey Smith]: are watching house

755
00:26:17,798 –> 00:26:18,798
[Ramsey Smith]: that

756
00:26:17,804 –> 00:26:18,804
[Tamiko Toland]: what

757
00:26:18,300 –> 00:26:19,300
[Paul Tyler]: what point

758
00:26:18,584 –> 00:26:22,264
[Tamiko Toland]: point you are accumulating that future income and so much of that really

759
00:26:18,584 –> 00:26:22,264
[Tamiko Toland]: point you are accumulating that future income and so much of that really

760
00:26:22,424 –> 00:26:27,544
[Tamiko Toland]: ultimately comes down to how the solution works but for the most part there’s you

761
00:26:22,424 –> 00:26:27,544
[Tamiko Toland]: ultimately comes down to how the solution works but for the most part there’s you

762
00:26:27,544 –> 00:26:29,464
[Tamiko Toland]: know there’s an idea that at a certain age

763
00:26:27,544 –> 00:26:29,464
[Tamiko Toland]: know there’s an idea that at a certain age

764
00:26:28,780 –> 00:26:29,780
[Paul Tyler]: seventies

765
00:26:30,164 –> 00:26:31,164
[Tamiko Toland]: you have

766
00:26:30,620 –> 00:26:31,620
[Paul Tyler]: i like

767
00:26:30,824 –> 00:26:32,344
[Tamiko Toland]: a glide path into income

768
00:26:33,040 –> 00:26:34,880
[Paul Tyler]: it’s just like you have a good life

769
00:26:33,224 –> 00:26:37,384
[Tamiko Toland]: just like you would have a a glide path with a regular target day fund and so

770
00:26:37,084 –> 00:26:38,084
[Tamiko Toland]: that’s

771
00:26:37,300 –> 00:26:38,300
[Paul Tyler]: how

772
00:26:37,784 –> 00:26:41,064
[Tamiko Toland]: how a lot of them actually work um so it’s

773
00:26:42,084 –> 00:26:43,084
[Tamiko Toland]: you know when you think about

774
00:26:43,118 –> 00:26:44,118
[Ramsey Smith]: about the

775
00:26:43,224 –> 00:26:46,744
[Tamiko Toland]: the the range of different participants and their ages it

776
00:26:46,340 –> 00:26:47,340
[Paul Tyler]: you

777
00:26:46,824 –> 00:26:49,064
[Tamiko Toland]: may be completely irrelevant if you’re thirty

778
00:26:46,824 –> 00:26:49,064
[Tamiko Toland]: may be completely irrelevant if you’re thirty

779
00:26:46,898 –> 00:26:48,658
[Ramsey Smith]: it maybe holiday

780
00:26:50,504 –> 00:26:51,864
[Tamiko Toland]: because you’re not going to be

781
00:26:52,598 –> 00:26:53,598
[Ramsey Smith]: yeah

782
00:26:52,744 –> 00:26:55,784
[Tamiko Toland]: investing in it yet you know you’re not going to be accumulating that future

783
00:26:55,764 –> 00:26:56,764
[Tamiko Toland]: income

784
00:26:57,244 –> 00:26:58,244
[Tamiko Toland]: yet

785
00:26:57,478 –> 00:26:58,478
[Ramsey Smith]: yeah

786
00:26:58,264 –> 00:26:59,544
[Tamiko Toland]: knowing that that is something that

787
00:26:59,220 –> 00:27:00,220
[Paul Tyler]: y

788
00:26:59,704 –> 00:27:00,824
[Tamiko Toland]: will happen in the future

789
00:27:00,478 –> 00:27:01,478
[Ramsey Smith]: the future

790
00:27:01,484 –> 00:27:02,484
[Tamiko Toland]: can be quite

791
00:27:01,860 –> 00:27:02,860
[Paul Tyler]: we

792
00:27:02,424 –> 00:27:06,264
[Tamiko Toland]: reassuring to employees and it would be potentially an inducement to

793
00:27:05,860 –> 00:27:06,860
[Paul Tyler]: zero

794
00:27:06,264 –> 00:27:10,184
[Tamiko Toland]: stay at a company if you were considering you know going somewhere else so i

795
00:27:09,980 –> 00:27:10,980
[Paul Tyler]: ninety nine

796
00:27:10,238 –> 00:27:11,238
[Ramsey Smith]: ninety nine by

797
00:27:10,324 –> 00:27:11,324
[Tamiko Toland]: you know i i could see

798
00:27:11,740 –> 00:27:12,740
[Paul Tyler]: i get

799
00:27:12,184 –> 00:27:14,984
[Tamiko Toland]: again this goes more to the participants like

800
00:27:14,580 –> 00:27:15,580
[Paul Tyler]: like

801
00:27:15,144 –> 00:27:21,064
[Tamiko Toland]: the idea of income you know uh mindset as opposed to this is beneficial for the

802
00:27:20,964 –> 00:27:21,964
[Tamiko Toland]: sponsors i

803
00:27:21,460 –> 00:27:22,460
[Paul Tyler]: maybe

804
00:27:22,024 –> 00:27:23,864
[Tamiko Toland]: it’s beneficial for everybody frankly

805
00:27:24,518 –> 00:27:25,518
[Ramsey Smith]: so

806
00:27:25,120 –> 00:27:26,560
[Paul Tyler]: no i wanted to say that before

807
00:27:25,138 –> 00:27:29,298
[Ramsey Smith]: i wanted to pick up on what you were saying about staying in plan

808
00:27:30,338 –> 00:27:34,338
[Ramsey Smith]: and this is something that’s that’s been a particular interest to me and

809
00:27:35,538 –> 00:27:37,778
[Ramsey Smith]: i want to hear what you think about what the potential

810
00:27:38,898 –> 00:27:43,138
[Ramsey Smith]: implications are well first of all what are the what is the motivation start with

811
00:27:38,898 –> 00:27:43,138
[Ramsey Smith]: implications are well first of all what are the what is the motivation start with

812
00:27:39,060 –> 00:27:40,060
[Paul Tyler]: she

813
00:27:43,458 –> 00:27:49,218
[Ramsey Smith]: the motivation for for plan sponsors wanting to keep keep people in plan you know

814
00:27:43,458 –> 00:27:49,218
[Ramsey Smith]: the motivation for for plan sponsors wanting to keep keep people in plan you know

815
00:27:49,458 –> 00:27:54,658
[Ramsey Smith]: not just into retirement but through retirement then the second thing is would be

816
00:27:49,458 –> 00:27:54,658
[Ramsey Smith]: not just into retirement but through retirement then the second thing is would be

817
00:27:55,378 –> 00:28:00,178
[Ramsey Smith]: you know what are the implications and requirements for them and how that might

818
00:27:55,378 –> 00:28:00,178
[Ramsey Smith]: you know what are the implications and requirements for them and how that might

819
00:28:00,338 –> 00:28:04,338
[Ramsey Smith]: be different than what they’ve done in the past so let’s first start start with

820
00:28:00,338 –> 00:28:04,338
[Ramsey Smith]: be different than what they’ve done in the past so let’s first start start with

821
00:28:04,418 –> 00:28:09,858
[Ramsey Smith]: the motivation like why do you think a planned sponsor would not want to just

822
00:28:04,418 –> 00:28:09,858
[Ramsey Smith]: the motivation like why do you think a planned sponsor would not want to just

823
00:28:09,938 –> 00:28:13,618
[Ramsey Smith]: wash their hands of the retiree once they leave the company like

824
00:28:09,938 –> 00:28:13,618
[Ramsey Smith]: wash their hands of the retiree once they leave the company like

825
00:28:14,738 –> 00:28:18,178
[Ramsey Smith]: why where are we now in a world where maybe they want to keep people in plan for

826
00:28:17,958 –> 00:28:18,958
[Ramsey Smith]: longer

827
00:28:19,404 –> 00:28:20,404
[Tamiko Toland]: well

828
00:28:20,000 –> 00:28:21,200
[Paul Tyler]: what do you breakfast

829
00:28:20,024 –> 00:28:24,664
[Tamiko Toland]: i think they are recognizing the advantages of scale right you keep more folks in

830
00:28:24,744 –> 00:28:28,904
[Tamiko Toland]: your you plan you have larger assets and then you were able to drive down costs i

831
00:28:28,984 –> 00:28:34,424
[Tamiko Toland]: mean that that’s a that’s a pretty basic dynamic from a pricing perspective

832
00:28:36,264 –> 00:28:39,624
[Tamiko Toland]: and like i say there’s blended models and what have you in terms of like what

833
00:28:39,784 –> 00:28:42,664
[Tamiko Toland]: happens with the actual income component um

834
00:28:43,704 –> 00:28:45,944
[Tamiko Toland]: and i i think there’s there’s always

835
00:28:46,000 –> 00:28:47,840
[Paul Tyler]: we we settled from

836
00:28:46,264 –> 00:28:49,704
[Tamiko Toland]: there are much more subtle conversations and probably differences among different

837
00:28:49,864 –> 00:28:52,504
[Tamiko Toland]: types of sponsors um you

838
00:28:52,124 –> 00:28:53,124
[Tamiko Toland]: know

839
00:28:52,180 –> 00:28:53,180
[Paul Tyler]: yeah

840
00:28:52,278 –> 00:28:53,278
[Ramsey Smith]: so

841
00:28:52,904 –> 00:28:56,984
[Tamiko Toland]: i think the traditional mindset has really been like you know oh this

842
00:28:57,380 –> 00:28:58,380
[Paul Tyler]: it

843
00:28:57,398 –> 00:28:58,398
[Ramsey Smith]: yeah

844
00:28:57,624 –> 00:28:58,744
[Tamiko Toland]: participant isn’t

845
00:28:59,300 –> 00:29:00,300
[Paul Tyler]: even a work

846
00:28:59,304 –> 00:29:02,344
[Tamiko Toland]: isn’t a worker here anymore so we just we want

847
00:29:01,940 –> 00:29:02,940
[Paul Tyler]: what

848
00:29:02,424 –> 00:29:05,944
[Tamiko Toland]: to kind of sever that responsibility because it is a fiduciary relationship

849
00:29:02,424 –> 00:29:05,944
[Tamiko Toland]: to kind of sever that responsibility because it is a fiduciary relationship

850
00:29:06,844 –> 00:29:07,844
[Tamiko Toland]: um but

851
00:29:07,220 –> 00:29:08,220
[Paul Tyler]: like

852
00:29:07,718 –> 00:29:08,718
[Ramsey Smith]: but you

853
00:29:07,784 –> 00:29:11,784
[Tamiko Toland]: you know there there are advantages too frankly for the worker

854
00:29:12,664 –> 00:29:15,944
[Tamiko Toland]: right that you know this i because it is a fiduciary relationship

855
00:29:12,720 –> 00:29:14,720
[Paul Tyler]: right but you could be

856
00:29:17,304 –> 00:29:20,424
[Tamiko Toland]: and you know you may be able to take advantage of things you’re not gonna get

857
00:29:17,304 –> 00:29:20,424
[Tamiko Toland]: and you know you may be able to take advantage of things you’re not gonna get

858
00:29:17,378 –> 00:29:18,738
[Ramsey Smith]: yeah maybe you

859
00:29:20,664 –> 00:29:21,944
[Tamiko Toland]: elsewhere so

860
00:29:20,664 –> 00:29:21,944
[Tamiko Toland]: elsewhere so

861
00:29:22,898 –> 00:29:26,178
[Ramsey Smith]: so sorry i wanna just just follow up on this paul so

862
00:29:26,838 –> 00:29:27,838
[Ramsey Smith]: so

863
00:29:27,420 –> 00:29:28,420
[Paul Tyler]: what weekend

864
00:29:27,458 –> 00:29:32,818
[Ramsey Smith]: i’m with you i’m with you and i and i i agree a it’s it’s it’s part and parcel

865
00:29:32,580 –> 00:29:33,580
[Paul Tyler]: what

866
00:29:32,978 –> 00:29:37,218
[Ramsey Smith]: why this is an attractive opportunity for plan sponsors and frankly for asset

867
00:29:37,298 –> 00:29:38,578
[Ramsey Smith]: managers and carriers

868
00:29:39,778 –> 00:29:43,858
[Ramsey Smith]: the one question though was so at that at that point of transition so you are a

869
00:29:43,938 –> 00:29:49,698
[Ramsey Smith]: fiduciary and you now want somebody to stay in plan you know after age sixty five

870
00:29:50,418 –> 00:29:54,418
[Ramsey Smith]: but now this person in theory can go a lot of other places right they can roll

871
00:29:54,498 –> 00:29:56,178
[Ramsey Smith]: over and go to you know any number

872
00:29:57,298 –> 00:30:03,938
[Ramsey Smith]: of sort of established you know asset manager sort of providers or broker broker

873
00:30:04,018 –> 00:30:09,138
[Ramsey Smith]: dealer providers who have these entire suites of services and so in some sense

874
00:30:09,378 –> 00:30:12,898
[Ramsey Smith]: you’re telling the person well you should stay here with what we offer the

875
00:30:13,058 –> 00:30:16,898
[Ramsey Smith]: service offering we have which may or may not be as expansive as all the other

876
00:30:17,058 –> 00:30:22,018
[Ramsey Smith]: things that they might do like is that is there a fiduciary responsibility there

877
00:30:22,258 –> 00:30:27,538
[Ramsey Smith]: that that is that is also quite different literally at the point of at the point

878
00:30:27,698 –> 00:30:31,698
[Ramsey Smith]: of transition and not just not just managing but but basically saying please stay

879
00:30:31,638 –> 00:30:32,638
[Ramsey Smith]: as opposed to going

880
00:30:33,644 –> 00:30:34,644
[Tamiko Toland]: yeah and i

881
00:30:34,100 –> 00:30:35,100
[Paul Tyler]: i don’t know

882
00:30:34,344 –> 00:30:36,344
[Tamiko Toland]: don’t know that the rhetoric is you should stay

883
00:30:37,118 –> 00:30:38,118
[Ramsey Smith]: yeah right

884
00:30:37,260 –> 00:30:38,260
[Paul Tyler]: i think they’re

885
00:30:37,384 –> 00:30:41,784
[Tamiko Toland]: i think they the rhetoric is much more hey this is the benefit that you’ve

886
00:30:37,384 –> 00:30:41,784
[Tamiko Toland]: i think they the rhetoric is much more hey this is the benefit that you’ve

887
00:30:41,784 –> 00:30:45,224
[Tamiko Toland]: accumulated and then you know you can make your own decision whether that’s with

888
00:30:41,784 –> 00:30:45,224
[Tamiko Toland]: accumulated and then you know you can make your own decision whether that’s with

889
00:30:44,844 –> 00:30:45,844
[Tamiko Toland]: the

890
00:30:44,844 –> 00:30:45,844
[Tamiko Toland]: the

891
00:30:46,504 –> 00:30:51,784
[Tamiko Toland]: with some some degree of guidance um or if that’s independent of that um and

892
00:30:51,684 –> 00:30:52,684
[Tamiko Toland]: there’s just information

893
00:30:53,544 –> 00:30:55,784
[Tamiko Toland]: that’s conveyed i mean there are a lot of

894
00:30:55,398 –> 00:30:56,398
[Ramsey Smith]: what

895
00:30:55,864 –> 00:30:57,544
[Tamiko Toland]: different models of how to do that but i

896
00:30:57,420 –> 00:30:58,420
[Paul Tyler]: i think that

897
00:30:57,704 –> 00:31:02,024
[Tamiko Toland]: i think the premise that it’s you should say because we want to keep your assets

898
00:31:02,104 –> 00:31:03,304
[Tamiko Toland]: in plan it is

899
00:31:03,544 –> 00:31:08,824
[Tamiko Toland]: probably not the way that i would think about it and also you know the rollover

900
00:31:03,600 –> 00:31:06,720
[Paul Tyler]: probably no week i about it i it also

901
00:31:09,064 –> 00:31:10,744
[Tamiko Toland]: situation right now is in flux

902
00:31:10,838 –> 00:31:11,838
[Ramsey Smith]: yeah

903
00:31:11,224 –> 00:31:15,304
[Tamiko Toland]: and so the relative ease with which that can happen is like that

904
00:31:15,378 –> 00:31:17,618
[Ramsey Smith]: that’s i think that’s very important

905
00:31:16,000 –> 00:31:17,760
[Paul Tyler]: i think that that works

906
00:31:16,024 –> 00:31:17,944
[Tamiko Toland]: i think that’s a at question so

907
00:31:18,980 –> 00:31:19,980
[Paul Tyler]: very

908
00:31:19,464 –> 00:31:24,424
[Tamiko Toland]: there is more reason for the sponsors to be offering like good

909
00:31:25,704 –> 00:31:27,384
[Tamiko Toland]: options within their plans

910
00:31:28,164 –> 00:31:29,164
[Tamiko Toland]: right um

911
00:31:29,944 –> 00:31:32,584
[Tamiko Toland]: and we’ll we’ll just see we’ll see how things evolve it’s just going to say you

912
00:31:32,664 –> 00:31:34,744
[Tamiko Toland]: know adoptions not quick that and that’s reality

913
00:31:35,440 –> 00:31:36,560
[Paul Tyler]: yeah i’m trying to think if i

914
00:31:35,698 –> 00:31:40,338
[Ramsey Smith]: it’s just hard to figure out whether whether the new rollover rules create more

915
00:31:40,498 –> 00:31:45,458
[Ramsey Smith]: problems for the people that are trying to be rolled over into right or if they

916
00:31:45,060 –> 00:31:46,060
[Paul Tyler]: so

917
00:31:45,618 –> 00:31:51,298
[Ramsey Smith]: also create similar challenges for for for somebody that says don’t roll out

918
00:31:51,718 –> 00:31:52,718
[Ramsey Smith]: right that’s

919
00:31:53,858 –> 00:31:58,498
[Ramsey Smith]: these are open issues but uh it’s the complexity the complexity is striking to me

920
00:31:58,800 –> 00:32:03,760
[Paul Tyler]: yeah i think for our listeners who are independent agents or advisors

921
00:32:05,200 –> 00:32:10,240
[Paul Tyler]: you know the plus is the employers have started that income conversation

922
00:32:11,078 –> 00:32:12,078
[Ramsey Smith]: so

923
00:32:11,120 –> 00:32:15,440
[Paul Tyler]: temco in a way that they at least start to understand they all understood asset

924
00:32:15,520 –> 00:32:19,840
[Paul Tyler]: allocation now they’re starting to understand income rams you brought up a really

925
00:32:20,000 –> 00:32:24,080
[Paul Tyler]: good question which is wow this would be really difficult to roll over you know

926
00:32:24,160 –> 00:32:25,600
[Paul Tyler]: we already have some some

927
00:32:26,640 –> 00:32:31,520
[Paul Tyler]: you know rules from the dol you know coming in to making it very difficult to do

928
00:32:31,580 –> 00:32:32,580
[Paul Tyler]: this properly but

929
00:32:34,560 –> 00:32:38,080
[Paul Tyler]: now you i’ve got a little bit of tension you know with some of the plan providers

930
00:32:38,800 –> 00:32:39,840
[Paul Tyler]: and where that money’s going

931
00:32:43,804 –> 00:32:44,804
[Tamiko Toland]: i mean i think that would

932
00:32:44,420 –> 00:32:45,420
[Paul Tyler]: we

933
00:32:44,824 –> 00:32:45,944
[Tamiko Toland]: be more true if we

934
00:32:45,700 –> 00:32:46,700
[Paul Tyler]: had

935
00:32:46,104 –> 00:32:49,784
[Tamiko Toland]: had current wider adoption of lifetime income within

936
00:32:49,540 –> 00:32:50,540
[Paul Tyler]: like

937
00:32:49,864 –> 00:32:52,184
[Tamiko Toland]: plants and it’s just that it’s it’s not significant

938
00:32:53,224 –> 00:32:55,784
[Tamiko Toland]: right we we need to see more of it and

939
00:32:56,364 –> 00:32:57,364
[Tamiko Toland]: it

940
00:32:58,284 –> 00:32:59,284
[Tamiko Toland]: the

941
00:32:58,660 –> 00:32:59,660
[Paul Tyler]: like

942
00:32:58,904 –> 00:33:01,624
[Tamiko Toland]: cycle of getting things adopted is very

943
00:33:01,380 –> 00:33:02,380
[Paul Tyler]: very different

944
00:33:01,784 –> 00:33:06,824
[Tamiko Toland]: different from simply selling somebody an annuity in the retail space right so i

945
00:33:07,544 –> 00:33:09,144
[Tamiko Toland]: i mean i don’t see that as being a

946
00:33:10,424 –> 00:33:15,864
[Tamiko Toland]: a present issue and we don’t know actually what will ultimately happen as far as

947
00:33:16,184 –> 00:33:21,784
[Tamiko Toland]: rollovers out of plans so i you know we can we can speculate we want about that

948
00:33:21,220 –> 00:33:22,220
[Paul Tyler]: about that

949
00:33:23,040 –> 00:33:24,480
[Paul Tyler]: i never said what

950
00:33:23,064 –> 00:33:26,904
[Tamiko Toland]: i mean i think that a lot of this conversation frankly and i’ve i’ve said this

951
00:33:27,064 –> 00:33:32,664
[Tamiko Toland]: whole time and with uh the lifetime income illustrations that are going to be

952
00:33:32,744 –> 00:33:35,064
[Tamiko Toland]: peering on people’s four o one k statements

953
00:33:35,484 –> 00:33:36,484
[Tamiko Toland]: that’s

954
00:33:35,580 –> 00:33:36,580
[Paul Tyler]: i know

955
00:33:35,878 –> 00:33:36,878
[Ramsey Smith]: that’s all

956
00:33:36,184 –> 00:33:39,304
[Tamiko Toland]: all of an opportunity for retail right

957
00:33:38,998 –> 00:33:39,998
[Ramsey Smith]: dr

958
00:33:39,624 –> 00:33:41,224
[Tamiko Toland]: because you know when you see

959
00:33:40,900 –> 00:33:41,900
[Paul Tyler]: see oh

960
00:33:40,924 –> 00:33:41,924
[Tamiko Toland]: oh

961
00:33:41,544 –> 00:33:44,504
[Tamiko Toland]: i my four o one k could turn into this

962
00:33:41,618 –> 00:33:43,298
[Ramsey Smith]: oh i like he’s good

963
00:33:44,598 –> 00:33:45,598
[Ramsey Smith]: your

964
00:33:44,724 –> 00:33:45,724
[Tamiko Toland]: guaranteed income

965
00:33:46,844 –> 00:33:47,844
[Tamiko Toland]: yet

966
00:33:47,060 –> 00:33:48,060
[Paul Tyler]: they

967
00:33:47,464 –> 00:33:50,824
[Tamiko Toland]: there’s literally no way to possibly do that within my existing plan

968
00:33:50,980 –> 00:33:51,980
[Paul Tyler]: break

969
00:33:51,324 –> 00:33:52,324
[Tamiko Toland]: right so when

970
00:33:53,544 –> 00:33:56,024
[Tamiko Toland]: when you you you run into this logistical challenge

971
00:33:56,664 –> 00:34:00,584
[Tamiko Toland]: but you start thinking about what to do with your retirement savings in a

972
00:33:56,720 –> 00:33:58,080
[Paul Tyler]: like think about

973
00:34:00,664 –> 00:34:03,064
[Tamiko Toland]: different way you know like i say i think that that is a

974
00:34:02,660 –> 00:34:03,660
[Paul Tyler]: g

975
00:34:03,144 –> 00:34:05,384
[Tamiko Toland]: great opportunity in the face of some potential

976
00:34:06,500 –> 00:34:07,500
[Paul Tyler]: right

977
00:34:06,984 –> 00:34:12,584
[Tamiko Toland]: compliance challenges right so there’s a lot of forces at play right now for sure

978
00:34:13,440 –> 00:34:14,560
[Paul Tyler]: now there are a

979
00:34:14,118 –> 00:34:15,118
[Ramsey Smith]: are

980
00:34:14,640 –> 00:34:18,720
[Paul Tyler]: large number of big plans like you described like raytheon with

981
00:34:20,140 –> 00:34:21,140
[Paul Tyler]: good hr

982
00:34:20,598 –> 00:34:21,598
[Ramsey Smith]: t

983
00:34:20,900 –> 00:34:21,900
[Paul Tyler]: benefits

984
00:34:22,880 –> 00:34:28,320
[Paul Tyler]: professionals tremendous support from from advisors for the plan but they are

985
00:34:28,480 –> 00:34:32,720
[Paul Tyler]: like a lot more small plants with fewer participants

986
00:34:32,684 –> 00:34:33,684
[Tamiko Toland]: just

987
00:34:34,000 –> 00:34:39,120
[Paul Tyler]: tim k do you think the equation or how sponsors are going to think about it will

988
00:34:39,280 –> 00:34:42,560
[Paul Tyler]: change when you start to go down and maybe you only have ten employees maybe have

989
00:34:42,720 –> 00:34:47,680
[Paul Tyler]: fifteen employees um do you think the adoption challenge will be any different or

990
00:34:47,920 –> 00:34:51,760
[Paul Tyler]: will it’ll be just effectively same set of considerations

991
00:34:53,484 –> 00:34:54,484
[Tamiko Toland]: well i think you know

992
00:34:56,344 –> 00:35:00,664
[Tamiko Toland]: really what’s going to happen is we’re going to see an increase in adoption right

993
00:35:00,844 –> 00:35:01,844
[Tamiko Toland]: it it

994
00:35:01,260 –> 00:35:02,260
[Paul Tyler]: eating

995
00:35:01,544 –> 00:35:05,384
[Tamiko Toland]: is going to happen for sure is it is happening right now but

996
00:35:04,980 –> 00:35:05,980
[Paul Tyler]: what

997
00:35:05,078 –> 00:35:06,078
[Ramsey Smith]: what

998
00:35:05,204 –> 00:35:06,204
[Tamiko Toland]: it’s um

999
00:35:06,100 –> 00:35:07,100
[Paul Tyler]: that

1000
00:35:06,504 –> 00:35:12,344
[Tamiko Toland]: as that picks up i think it will make um make it more of a competitive issue for

1001
00:35:12,044 –> 00:35:13,044
[Tamiko Toland]: than

1002
00:35:12,260 –> 00:35:13,260
[Paul Tyler]: that

1003
00:35:12,744 –> 00:35:17,624
[Tamiko Toland]: it shifts to making a competitive issue for employers right in addition to all

1004
00:35:12,744 –> 00:35:17,624
[Tamiko Toland]: it shifts to making a competitive issue for employers right in addition to all

1005
00:35:17,704 –> 00:35:21,544
[Tamiko Toland]: the other reasons that people should be or you know plant sponsor should be

1006
00:35:17,704 –> 00:35:21,544
[Tamiko Toland]: the other reasons that people should be or you know plant sponsor should be

1007
00:35:21,624 –> 00:35:25,704
[Tamiko Toland]: considering it and i think we’ll see more solutions that are particularly

1008
00:35:21,624 –> 00:35:25,704
[Tamiko Toland]: considering it and i think we’ll see more solutions that are particularly

1009
00:35:25,784 –> 00:35:31,144
[Tamiko Toland]: tailored for that market right so you know some of them are really designed more

1010
00:35:25,784 –> 00:35:31,144
[Tamiko Toland]: tailored for that market right so you know some of them are really designed more

1011
00:35:31,304 –> 00:35:33,864
[Tamiko Toland]: for the larger plants for i think obvious reasons

1012
00:35:31,304 –> 00:35:33,864
[Tamiko Toland]: for the larger plants for i think obvious reasons

1013
00:35:35,064 –> 00:35:38,264
[Tamiko Toland]: and we’ve seen availability for smaller plans but then adoptions low because

1014
00:35:38,364 –> 00:35:39,364
[Tamiko Toland]: they’re not necessarily they

1015
00:35:39,398 –> 00:35:40,398
[Ramsey Smith]: what

1016
00:35:39,864 –> 00:35:44,664
[Tamiko Toland]: may include it in the plan but it’s not the qa and so like that’s

1017
00:35:44,824 –> 00:35:47,864
[Tamiko Toland]: that’s like the big shift i think for everyone and and we

1018
00:35:44,898 –> 00:35:46,418
[Ramsey Smith]: like that that’s like the

1019
00:35:44,940 –> 00:35:45,940
[Paul Tyler]: not se

1020
00:35:47,944 –> 00:35:50,744
[Tamiko Toland]: whether that’s an appropriate choice for a small sponsor that’s

1021
00:35:48,000 –> 00:35:49,280
[Paul Tyler]: it was a hurry

1022
00:35:50,980 –> 00:35:51,980
[Paul Tyler]: that’s

1023
00:35:51,144 –> 00:35:52,264
[Tamiko Toland]: a different question i i’m

1024
00:35:52,620 –> 00:35:53,620
[Paul Tyler]: yeah i’m not think it is

1025
00:35:52,664 –> 00:35:54,184
[Tamiko Toland]: not saying it is or isn’t um

1026
00:35:54,904 –> 00:35:58,504
[Tamiko Toland]: but i think that that’s a thing to think about when you have very few employees

1027
00:35:54,904 –> 00:35:58,504
[Tamiko Toland]: but i think that that’s a thing to think about when you have very few employees

1028
00:35:54,960 –> 00:35:57,360
[Paul Tyler]: oh but i think i think about

1029
00:36:00,024 –> 00:36:01,064
[Tamiko Toland]: you’re gonna be thinking about their

1030
00:36:00,900 –> 00:36:01,900
[Paul Tyler]: saturday

1031
00:36:01,224 –> 00:36:03,384
[Tamiko Toland]: needs really differently and much more

1032
00:36:05,144 –> 00:36:10,344
[Tamiko Toland]: for those individuals and you know then let’s think about peps and and what have

1033
00:36:10,044 –> 00:36:11,044
[Tamiko Toland]: you

1034
00:36:10,740 –> 00:36:11,740
[Paul Tyler]: like

1035
00:36:10,804 –> 00:36:11,804
[Tamiko Toland]: but um

1036
00:36:12,404 –> 00:36:13,404
[Tamiko Toland]: you know it

1037
00:36:12,844 –> 00:36:13,844
[Tamiko Toland]: like

1038
00:36:13,060 –> 00:36:14,060
[Paul Tyler]: like

1039
00:36:13,138 –> 00:36:15,058
[Ramsey Smith]: you know it’s like a different type of story

1040
00:36:13,464 –> 00:36:15,864
[Tamiko Toland]: i say it’s a different set of considerations in the space

1041
00:36:15,460 –> 00:36:16,460
[Paul Tyler]: see

1042
00:36:16,404 –> 00:36:17,404
[Tamiko Toland]: and that

1043
00:36:16,980 –> 00:36:17,980
[Paul Tyler]: that one

1044
00:36:17,138 –> 00:36:18,578
[Ramsey Smith]: and c sp

1045
00:36:17,224 –> 00:36:22,184
[Tamiko Toland]: learning curve which is one of the reasons that you know we really uh wanted to

1046
00:36:21,844 –> 00:36:22,844
[Tamiko Toland]: see the

1047
00:36:22,220 –> 00:36:23,220
[Paul Tyler]: you like

1048
00:36:22,504 –> 00:36:24,024
[Tamiko Toland]: lifetime income consortium come

1049
00:36:23,700 –> 00:36:24,700
[Paul Tyler]: yeah

1050
00:36:24,184 –> 00:36:28,344
[Tamiko Toland]: together because we can get the education out there you know it’s a large group

1051
00:36:28,584 –> 00:36:30,344
[Tamiko Toland]: of very very different solution

1052
00:36:30,744 –> 00:36:32,024
[Tamiko Toland]: providers that are

1053
00:36:31,040 –> 00:36:32,240
[Paul Tyler]: was saturd

1054
00:36:31,638 –> 00:36:32,638
[Ramsey Smith]: yeah

1055
00:36:32,264 –> 00:36:38,744
[Tamiko Toland]: you know really deciding that it’s more important for them to work in concert

1056
00:36:38,678 –> 00:36:39,678
[Ramsey Smith]: yeah

1057
00:36:39,544 –> 00:36:41,544
[Tamiko Toland]: to get the message out to improve education

1058
00:36:39,544 –> 00:36:41,544
[Tamiko Toland]: to get the message out to improve education

1059
00:36:42,744 –> 00:36:45,704
[Tamiko Toland]: and to reduce some of the the compliance hurdles

1060
00:36:47,118 –> 00:36:48,118
[Ramsey Smith]: so how

1061
00:36:47,780 –> 00:36:48,780
[Paul Tyler]: how do you think about it

1062
00:36:47,858 –> 00:36:52,658
[Ramsey Smith]: do you think about you know the mandate of of this new organization versus there

1063
00:36:52,738 –> 00:36:56,018
[Ramsey Smith]: are some other educational organizations in the space right

1064
00:36:55,964 –> 00:36:56,964
[Tamiko Toland]: yeah

1065
00:36:56,738 –> 00:37:00,338
[Ramsey Smith]: there’s the alliance for lifelong income there’s limma the all friends of the

1066
00:37:00,198 –> 00:37:01,198
[Ramsey Smith]: show by the way

1067
00:37:01,644 –> 00:37:02,644
[Tamiko Toland]: yeah

1068
00:37:03,298 –> 00:37:05,698
[Ramsey Smith]: uh curious how like you view

1069
00:37:06,738 –> 00:37:10,498
[Ramsey Smith]: the mandate of this consortium as being

1070
00:37:10,204 –> 00:37:11,204
[Tamiko Toland]: so

1071
00:37:10,658 –> 00:37:14,898
[Ramsey Smith]: different or what’s the sort of unique element that you guys are focusing on

1072
00:37:16,338 –> 00:37:19,938
[Ramsey Smith]: is it the complete focus on this one particular space is there anything else

1073
00:37:20,098 –> 00:37:21,138
[Ramsey Smith]: about it stylistically

1074
00:37:22,738 –> 00:37:25,378
[Ramsey Smith]: that’s part of your mo that you can share with us

1075
00:37:26,204 –> 00:37:27,204
[Tamiko Toland]: sure

1076
00:37:26,780 –> 00:37:27,780
[Paul Tyler]: sure i mean i think

1077
00:37:26,904 –> 00:37:28,504
[Tamiko Toland]: i you know i think you

1078
00:37:28,984 –> 00:37:31,544
[Tamiko Toland]: we’re also very friendly with the other

1079
00:37:29,040 –> 00:37:31,920
[Paul Tyler]: we’re also great friends the other one

1080
00:37:31,878 –> 00:37:32,878
[Ramsey Smith]: yeah

1081
00:37:31,884 –> 00:37:32,884
[Tamiko Toland]: organizations out there

1082
00:37:33,964 –> 00:37:34,964
[Tamiko Toland]: and

1083
00:37:34,598 –> 00:37:35,598
[Ramsey Smith]: and yeah

1084
00:37:34,604 –> 00:37:35,604
[Tamiko Toland]: yes

1085
00:37:35,140 –> 00:37:36,140
[Paul Tyler]: get married

1086
00:37:35,384 –> 00:37:37,944
[Tamiko Toland]: education is a component of what we’re doing

1087
00:37:39,064 –> 00:37:42,664
[Tamiko Toland]: but we’re not an educational organization we’re we’re actually our

1088
00:37:42,460 –> 00:37:43,460
[Paul Tyler]: mm hm

1089
00:37:42,804 –> 00:37:43,804
[Tamiko Toland]: goal is commercial

1090
00:37:44,078 –> 00:37:45,078
[Ramsey Smith]: there we go

1091
00:37:44,504 –> 00:37:47,064
[Tamiko Toland]: and commercially we want to see

1092
00:37:48,104 –> 00:37:50,504
[Tamiko Toland]: broader adoption of these solutions and

1093
00:37:50,420 –> 00:37:51,420
[Paul Tyler]: so it

1094
00:37:50,664 –> 00:37:51,784
[Tamiko Toland]: so it’s a commercial

1095
00:37:52,824 –> 00:37:54,904
[Tamiko Toland]: look at the problem not simply throwing out

1096
00:37:54,678 –> 00:37:55,678
[Ramsey Smith]: got

1097
00:37:55,064 –> 00:37:58,184
[Tamiko Toland]: education but education saying okay well what are the challenges how

1098
00:37:58,140 –> 00:37:59,140
[Paul Tyler]: how c

1099
00:37:58,264 –> 00:37:59,704
[Tamiko Toland]: can we help close those gaps

1100
00:37:59,844 –> 00:38:00,844
[Tamiko Toland]: and then

1101
00:38:00,320 –> 00:38:02,000
[Paul Tyler]: and then where are their an

1102
00:38:00,398 –> 00:38:01,398
[Ramsey Smith]: and we

1103
00:38:00,584 –> 00:38:05,224
[Tamiko Toland]: you know where are their actual like logistical adoption issues like say with the

1104
00:38:05,304 –> 00:38:08,744
[Tamiko Toland]: record keepers right ’cause the record keepers are the ones that

1105
00:38:08,340 –> 00:38:09,340
[Paul Tyler]: that

1106
00:38:08,978 –> 00:38:10,098
[Ramsey Smith]: yeah like you

1107
00:38:09,224 –> 00:38:11,064
[Tamiko Toland]: frankly are holding the keys on this

1108
00:38:11,380 –> 00:38:12,380
[Paul Tyler]: oh

1109
00:38:11,784 –> 00:38:13,304
[Tamiko Toland]: ultimately right

1110
00:38:13,220 –> 00:38:14,220
[Paul Tyler]: and

1111
00:38:13,624 –> 00:38:14,744
[Tamiko Toland]: and you know they

1112
00:38:14,804 –> 00:38:15,804
[Tamiko Toland]: are they are

1113
00:38:14,880 –> 00:38:16,080
[Paul Tyler]: they they are not

1114
00:38:15,478 –> 00:38:16,478
[Ramsey Smith]: they are

1115
00:38:15,864 –> 00:38:17,704
[Tamiko Toland]: not jumping into the pool

1116
00:38:18,924 –> 00:38:19,924
[Tamiko Toland]: right

1117
00:38:19,318 –> 00:38:20,318
[Ramsey Smith]: spray

1118
00:38:19,784 –> 00:38:20,904
[Tamiko Toland]: and so you know

1119
00:38:20,660 –> 00:38:21,660
[Paul Tyler]: got

1120
00:38:20,724 –> 00:38:21,724
[Tamiko Toland]: that is

1121
00:38:23,224 –> 00:38:27,304
[Tamiko Toland]: it’s a concern that we’re all listening to and we just want to make sure that all

1122
00:38:27,384 –> 00:38:28,504
[Tamiko Toland]: the dots are lining up

1123
00:38:29,544 –> 00:38:32,104
[Tamiko Toland]: to make this a reality and we want to hear from

1124
00:38:33,304 –> 00:38:35,464
[Tamiko Toland]: from the folks that are are really in the front

1125
00:38:35,140 –> 00:38:36,140
[Paul Tyler]: why

1126
00:38:35,544 –> 00:38:36,824
[Tamiko Toland]: lines and

1127
00:38:36,740 –> 00:38:37,740
[Paul Tyler]: you

1128
00:38:36,984 –> 00:38:40,664
[Tamiko Toland]: hearing the objections dealing with those challenges to help

1129
00:38:40,260 –> 00:38:41,260
[Paul Tyler]: help

1130
00:38:40,904 –> 00:38:42,344
[Tamiko Toland]: solve those challenges so

1131
00:38:42,980 –> 00:38:43,980
[Paul Tyler]: where you

1132
00:38:43,064 –> 00:38:46,504
[Tamiko Toland]: we’re just in year one right of the consortium so we’re just

1133
00:38:46,744 –> 00:38:50,744
[Tamiko Toland]: establishing really the basics and then that work will continue and one of the

1134
00:38:46,838 –> 00:38:47,838
[Ramsey Smith]: yeah

1135
00:38:50,564 –> 00:38:51,564
[Tamiko Toland]: issues too is

1136
00:38:51,078 –> 00:38:52,078
[Ramsey Smith]: two

1137
00:38:51,544 –> 00:38:56,504
[Tamiko Toland]: like how do you compare these different solutions and how do you make a selection

1138
00:38:56,584 –> 00:39:00,424
[Tamiko Toland]: and that’s something that that we’re working on from an analytical perspective

1139
00:39:01,064 –> 00:39:05,944
[Tamiko Toland]: right that saying well what kind of quantitative support is there the conclusion

1140
00:39:05,564 –> 00:39:06,564
[Tamiko Toland]: is

1141
00:39:05,804 –> 00:39:06,804
[Tamiko Toland]: never

1142
00:39:05,860 –> 00:39:06,860
[Paul Tyler]: never

1143
00:39:06,278 –> 00:39:07,278
[Ramsey Smith]: never did

1144
00:39:06,664 –> 00:39:07,784
[Tamiko Toland]: there’s one best

1145
00:39:08,684 –> 00:39:09,684
[Tamiko Toland]: solution

1146
00:39:09,964 –> 00:39:10,964
[Tamiko Toland]: right there

1147
00:39:10,738 –> 00:39:12,498
[Ramsey Smith]: like they need to work different

1148
00:39:10,984 –> 00:39:12,824
[Tamiko Toland]: solutions are to work differently in different

1149
00:39:12,660 –> 00:39:13,660
[Paul Tyler]: we

1150
00:39:12,804 –> 00:39:13,804
[Tamiko Toland]: ways and

1151
00:39:13,598 –> 00:39:14,598
[Ramsey Smith]: and was very

1152
00:39:13,784 –> 00:39:17,704
[Tamiko Toland]: what’s very important is for people to have some quantitative basis to say well

1153
00:39:17,398 –> 00:39:18,398
[Ramsey Smith]: people

1154
00:39:17,884 –> 00:39:18,884
[Tamiko Toland]: this is better in this

1155
00:39:18,838 –> 00:39:19,838
[Ramsey Smith]: the car

1156
00:39:18,904 –> 00:39:20,664
[Tamiko Toland]: regard and then but this

1157
00:39:20,744 –> 00:39:24,504
[Tamiko Toland]: one’s better in this regard what works best for for our

1158
00:39:20,798 –> 00:39:21,798
[Ramsey Smith]: is instead of

1159
00:39:24,100 –> 00:39:25,100
[Paul Tyler]: r

1160
00:39:24,924 –> 00:39:25,924
[Tamiko Toland]: you know

1161
00:39:25,380 –> 00:39:26,380
[Paul Tyler]: what

1162
00:39:25,704 –> 00:39:27,224
[Tamiko Toland]: worker population and

1163
00:39:27,300 –> 00:39:28,300
[Paul Tyler]: that

1164
00:39:27,544 –> 00:39:30,504
[Tamiko Toland]: that’s the kind of decision making that we really want to support a can

1165
00:39:31,280 –> 00:39:35,760
[Paul Tyler]: okay so here here’s literally a million dollar question just set it up i was at

1166
00:39:35,840 –> 00:39:40,400
[Paul Tyler]: an insure tech conference here monday ramsay we actually had former guests there

1167
00:39:40,480 –> 00:39:43,440
[Paul Tyler]: at this event new york so jerry golden was there spent some time with

1168
00:39:43,318 –> 00:39:44,318
[Ramsey Smith]: yeah

1169
00:39:43,520 –> 00:39:49,440
[Paul Tyler]: jerry our friends remaining best a m s t v was broadcasting there you missed but

1170
00:39:50,240 –> 00:39:54,240
[Paul Tyler]: actually people came up and talked to us better me about our show so we’re uh you

1171
00:39:54,400 –> 00:39:55,920
[Paul Tyler]: crossing a lot of wires here

1172
00:39:55,478 –> 00:39:56,478
[Ramsey Smith]: what

1173
00:39:56,080 –> 00:40:02,320
[Paul Tyler]: but temco we took out some very prominent vcs for dinner night before and the

1174
00:40:02,400 –> 00:40:06,080
[Paul Tyler]: question i got was yeah i’m reading about this and hearing about this paul but

1175
00:40:06,240 –> 00:40:08,400
[Paul Tyler]: like when you know is this a

1176
00:40:09,260 –> 00:40:10,260
[Paul Tyler]: when is this

1177
00:40:09,638 –> 00:40:10,638
[Ramsey Smith]: what

1178
00:40:10,060 –> 00:40:11,060
[Paul Tyler]: going to be a meaningful market

1179
00:40:10,838 –> 00:40:11,838
[Ramsey Smith]: work

1180
00:40:11,280 –> 00:40:16,000
[Paul Tyler]: is it three years five years ten years from now to invest i mean what’s

1181
00:40:15,558 –> 00:40:16,558
[Ramsey Smith]: what

1182
00:40:16,000 –> 00:40:17,360
[Paul Tyler]: your what’s your

1183
00:40:17,278 –> 00:40:18,278
[Ramsey Smith]: your respect

1184
00:40:17,440 –> 00:40:19,200
[Paul Tyler]: perspective like when will

1185
00:40:20,400 –> 00:40:24,640
[Paul Tyler]: this be a material a business that you know people are going to fund a lot of the

1186
00:40:24,720 –> 00:40:27,280
[Paul Tyler]: businesses that are making big bets in the space

1187
00:40:30,044 –> 00:40:31,044
[Tamiko Toland]: so

1188
00:40:31,944 –> 00:40:33,784
[Tamiko Toland]: it it’s a it’s a slow play

1189
00:40:33,478 –> 00:40:34,478
[Ramsey Smith]: one

1190
00:40:33,644 –> 00:40:34,644
[Tamiko Toland]: still

1191
00:40:34,904 –> 00:40:38,744
[Tamiko Toland]: honestly like it’s not like all of a sudden everybody’s gonna start throwing this

1192
00:40:35,218 –> 00:40:36,978
[Ramsey Smith]: ho not like all the

1193
00:40:38,824 –> 00:40:42,584
[Tamiko Toland]: on their plans and my feeling is a and i

1194
00:40:42,404 –> 00:40:43,404
[Tamiko Toland]: think this gets

1195
00:40:42,540 –> 00:40:43,540
[Paul Tyler]: i think it’s

1196
00:40:42,918 –> 00:40:43,918
[Ramsey Smith]: get

1197
00:40:43,224 –> 00:40:45,224
[Tamiko Toland]: missed a little bit with like the

1198
00:40:44,918 –> 00:40:45,918
[Ramsey Smith]: like that

1199
00:40:45,464 –> 00:40:48,184
[Tamiko Toland]: ramsay’s press release survey right a lot

1200
00:40:47,780 –> 00:40:48,780
[Paul Tyler]: what

1201
00:40:48,264 –> 00:40:51,784
[Tamiko Toland]: of the companies that are really engaged now have been engaged for a very long

1202
00:40:51,484 –> 00:40:52,484
[Tamiko Toland]: time

1203
00:40:53,304 –> 00:40:54,344
[Tamiko Toland]: right and

1204
00:40:54,498 –> 00:40:56,258
[Ramsey Smith]: and they feel that

1205
00:40:55,224 –> 00:40:57,064
[Tamiko Toland]: they feel like this is an important opportunity

1206
00:40:58,284 –> 00:40:59,284
[Tamiko Toland]: right

1207
00:40:58,998 –> 00:40:59,998
[Ramsey Smith]: um

1208
00:40:59,644 –> 00:41:00,644
[Tamiko Toland]: but

1209
00:40:59,700 –> 00:41:00,700
[Paul Tyler]: like

1210
00:40:59,878 –> 00:41:00,878
[Ramsey Smith]: what

1211
00:41:01,224 –> 00:41:02,584
[Tamiko Toland]: uh you know when

1212
00:41:02,278 –> 00:41:03,278
[Ramsey Smith]: it would

1213
00:41:02,664 –> 00:41:03,944
[Tamiko Toland]: you’ve been doing it for a

1214
00:41:03,860 –> 00:41:04,860
[Paul Tyler]: decade

1215
00:41:04,024 –> 00:41:05,944
[Tamiko Toland]: decade or perhaps longer

1216
00:41:06,740 –> 00:41:07,740
[Paul Tyler]: and not quite she

1217
00:41:06,744 –> 00:41:11,704
[Tamiko Toland]: and not quite nailed it i mean there’s a lot of conviction around the space and

1218
00:41:12,024 –> 00:41:14,184
[Tamiko Toland]: being present and planting the flag

1219
00:41:15,224 –> 00:41:16,344
[Tamiko Toland]: where you know i don’t

1220
00:41:16,038 –> 00:41:17,038
[Ramsey Smith]: don’t

1221
00:41:16,424 –> 00:41:20,024
[Tamiko Toland]: think the expectation is oh yeah we’re gonna be getting our money back in the

1222
00:41:20,104 –> 00:41:21,544
[Tamiko Toland]: next year or two right

1223
00:41:21,140 –> 00:41:22,140
[Paul Tyler]: great

1224
00:41:22,504 –> 00:41:23,544
[Tamiko Toland]: um so

1225
00:41:24,444 –> 00:41:25,444
[Tamiko Toland]: it it’s

1226
00:41:26,244 –> 00:41:27,244
[Tamiko Toland]: i think

1227
00:41:26,420 –> 00:41:27,420
[Paul Tyler]: i think it

1228
00:41:26,558 –> 00:41:27,558
[Ramsey Smith]: i think

1229
00:41:26,984 –> 00:41:29,304
[Tamiko Toland]: at at a high level firms

1230
00:41:29,620 –> 00:41:30,620
[Paul Tyler]: like

1231
00:41:29,784 –> 00:41:31,784
[Tamiko Toland]: decide this is where we want to be

1232
00:41:29,784 –> 00:41:31,784
[Tamiko Toland]: decide this is where we want to be

1233
00:41:32,524 –> 00:41:33,524
[Tamiko Toland]: right

1234
00:41:32,758 –> 00:41:33,758
[Ramsey Smith]: right

1235
00:41:32,820 –> 00:41:33,820
[Paul Tyler]: right yeah

1236
00:41:33,544 –> 00:41:34,744
[Tamiko Toland]: and if you

1237
00:41:33,544 –> 00:41:34,744
[Tamiko Toland]: and if you

1238
00:41:35,884 –> 00:41:36,884
[Tamiko Toland]: if you need to

1239
00:41:37,864 –> 00:41:39,944
[Tamiko Toland]: like replenish the coffers quickly i

1240
00:41:40,020 –> 00:41:41,020
[Paul Tyler]: i think it still

1241
00:41:40,024 –> 00:41:43,944
[Tamiko Toland]: think it’s it’s still going to be tough because it’s still very very difficult to

1242
00:41:44,204 –> 00:41:45,204
[Tamiko Toland]: predict

1243
00:41:44,978 –> 00:41:48,658
[Ramsey Smith]: predict health it is not a really fast

1244
00:41:44,984 –> 00:41:49,624
[Tamiko Toland]: and history tells us that this is not a really fast moving space right

1245
00:41:49,478 –> 00:41:50,478
[Ramsey Smith]: right

1246
00:41:49,760 –> 00:41:51,440
[Paul Tyler]: crazy i think

1247
00:41:50,204 –> 00:41:51,204
[Tamiko Toland]: um but i i mean i

1248
00:41:50,998 –> 00:41:51,998
[Ramsey Smith]: i mean i think that

1249
00:41:51,144 –> 00:41:53,064
[Tamiko Toland]: think the opportunity is obviously still there

1250
00:41:52,838 –> 00:41:53,838
[Ramsey Smith]: there

1251
00:41:53,464 –> 00:41:55,464
[Tamiko Toland]: and we’re getting so close like it really

1252
00:41:55,538 –> 00:41:58,738
[Ramsey Smith]: you do like really a once but i’m talking

1253
00:41:55,624 –> 00:41:59,304
[Tamiko Toland]: it feels like we’re really on the cusp but on the cusp of something that’s still

1254
00:41:59,318 –> 00:42:00,318
[Ramsey Smith]: really

1255
00:41:59,464 –> 00:42:02,104
[Tamiko Toland]: relatively slow moving right and

1256
00:42:01,540 –> 00:42:02,540
[Paul Tyler]: right and

1257
00:42:03,144 –> 00:42:06,504
[Tamiko Toland]: you know especially large punches want to see what the other ones are doing like

1258
00:42:06,204 –> 00:42:07,204
[Tamiko Toland]: what

1259
00:42:06,420 –> 00:42:07,420
[Paul Tyler]: what

1260
00:42:06,904 –> 00:42:08,664
[Tamiko Toland]: oh what choices are you making you know how

1261
00:42:08,364 –> 00:42:09,364
[Tamiko Toland]: are you

1262
00:42:08,500 –> 00:42:09,500
[Paul Tyler]: i mean

1263
00:42:08,798 –> 00:42:09,798
[Ramsey Smith]: how are you

1264
00:42:09,064 –> 00:42:13,864
[Tamiko Toland]: implementing this how did that go right and i think that that experience feeds

1265
00:42:14,024 –> 00:42:15,944
[Tamiko Toland]: into the willingness of others to jump

1266
00:42:15,638 –> 00:42:16,638
[Ramsey Smith]: ju

1267
00:42:15,924 –> 00:42:16,924
[Tamiko Toland]: into it because it’s not

1268
00:42:16,420 –> 00:42:17,420
[Paul Tyler]: not

1269
00:42:16,824 –> 00:42:17,864
[Tamiko Toland]: simply about saying oh great

1270
00:42:17,678 –> 00:42:18,678
[Ramsey Smith]: hungry

1271
00:42:18,024 –> 00:42:19,064
[Tamiko Toland]: you know we’re gonna pick this thing

1272
00:42:21,860 –> 00:42:22,860
[Paul Tyler]: ramsey

1273
00:42:22,438 –> 00:42:23,438
[Ramsey Smith]: all right

1274
00:42:22,800 –> 00:42:27,360
[Paul Tyler]: we’re we’re we’re kind of the top of top of the the hour here i don’t know final

1275
00:42:27,760 –> 00:42:28,800
[Paul Tyler]: thoughts questions here

1276
00:42:28,978 –> 00:42:35,618
[Ramsey Smith]: yeah so much so much to chew on there um i was you know i was really struck by

1277
00:42:35,858 –> 00:42:41,778
[Ramsey Smith]: your comment about sort of the culture here the culture of the target audience

1278
00:42:41,858 –> 00:42:45,058
[Ramsey Smith]: and if you think about the there’s two target audiences right the first one is

1279
00:42:45,618 –> 00:42:47,858
[Ramsey Smith]: the plan sponsors the folks that are holding the

1280
00:42:49,218 –> 00:42:53,938
[Ramsey Smith]: that have the assets then the ultimate target obviously is the end conser but

1281
00:42:55,938 –> 00:43:00,178
[Ramsey Smith]: you pointed out quite rightly so that you have all the people that are in

1282
00:43:00,338 –> 00:43:01,378
[Ramsey Smith]: decision making position

1283
00:43:02,978 –> 00:43:08,178
[Ramsey Smith]: don’t necessarily have a culture of of talking about income at maybe the the

1284
00:43:08,258 –> 00:43:12,098
[Ramsey Smith]: depth that it needs to be for them to be comfortable to move forward with things

1285
00:43:12,178 –> 00:43:17,378
[Ramsey Smith]: like this so it’ll be it’s just an interesting uh conundrum to figure out how to

1286
00:43:17,538 –> 00:43:21,618
[Ramsey Smith]: how to how to get past that point is it the same people be getting educated is it

1287
00:43:21,698 –> 00:43:23,778
[Ramsey Smith]: new people in those roles i don’t know

1288
00:43:24,818 –> 00:43:28,418
[Ramsey Smith]: but that that is of the many of the many interesting things you said that’s the

1289
00:43:28,418 –> 00:43:31,778
[Ramsey Smith]: one that sticks with me because i feel like that’s that’s often the hardest thing

1290
00:43:31,598 –> 00:43:32,598
[Ramsey Smith]: to overcome

1291
00:43:34,844 –> 00:43:35,844
[Tamiko Toland]: but it’s

1292
00:43:35,420 –> 00:43:36,420
[Paul Tyler]: i need know

1293
00:43:35,704 –> 00:43:39,304
[Tamiko Toland]: it’s an opportunity as well for the intermediaries

1294
00:43:39,398 –> 00:43:40,398
[Ramsey Smith]: sure

1295
00:43:40,344 –> 00:43:45,704
[Tamiko Toland]: and let’s not let that point get lost right um ’cause when you talk to folks

1296
00:43:45,784 –> 00:43:47,464
[Tamiko Toland]: about like target date funds

1297
00:43:48,504 –> 00:43:50,264
[Tamiko Toland]: and you know people who missed the

1298
00:43:49,940 –> 00:43:50,940
[Paul Tyler]: w

1299
00:43:50,264 –> 00:43:52,104
[Tamiko Toland]: bus really missed the bus on that

1300
00:43:52,764 –> 00:43:53,764
[Tamiko Toland]: so

1301
00:43:53,220 –> 00:43:54,220
[Paul Tyler]: do i think that

1302
00:43:53,384 –> 00:43:57,144
[Tamiko Toland]: i think that the same the same goes for in common and

1303
00:43:58,904 –> 00:44:00,504
[Tamiko Toland]: even if you have not been

1304
00:44:00,100 –> 00:44:01,100
[Paul Tyler]: sh

1305
00:44:00,484 –> 00:44:01,484
[Tamiko Toland]: a passionate

1306
00:44:01,300 –> 00:44:02,300
[Paul Tyler]: about

1307
00:44:01,384 –> 00:44:05,064
[Tamiko Toland]: advocate of of income solutions right

1308
00:44:05,280 –> 00:44:08,640
[Paul Tyler]: right i think the i know i have heard about

1309
00:44:05,784 –> 00:44:08,104
[Tamiko Toland]: i think now is a really good time to learn

1310
00:44:08,118 –> 00:44:09,118
[Ramsey Smith]: learn about

1311
00:44:08,344 –> 00:44:09,944
[Tamiko Toland]: about them and w how does

1312
00:44:09,678 –> 00:44:10,678
[Ramsey Smith]: not good

1313
00:44:09,964 –> 00:44:10,964
[Tamiko Toland]: this really apply

1314
00:44:11,564 –> 00:44:12,564
[Tamiko Toland]: to

1315
00:44:12,924 –> 00:44:13,924
[Tamiko Toland]: to the

1316
00:44:13,864 –> 00:44:17,624
[Tamiko Toland]: workplace savings right and it is different and there are different ways of

1317
00:44:14,080 –> 00:44:16,000
[Paul Tyler]: what we i didn’t eat

1318
00:44:17,704 –> 00:44:20,904
[Tamiko Toland]: thinking about it there are different ways of breaking down the client cause the

1319
00:44:21,144 –> 00:44:22,904
[Tamiko Toland]: the client is this like

1320
00:44:22,580 –> 00:44:23,580
[Paul Tyler]: like

1321
00:44:23,224 –> 00:44:26,104
[Tamiko Toland]: or the end user is the sponsor right but it’s

1322
00:44:25,860 –> 00:44:26,860
[Paul Tyler]: what

1323
00:44:26,104 –> 00:44:29,464
[Tamiko Toland]: funny because there’s a parallel between retail and how we think about you who’s

1324
00:44:29,464 –> 00:44:31,064
[Tamiko Toland]: the client is is the client

1325
00:44:30,678 –> 00:44:31,678
[Ramsey Smith]: like

1326
00:44:31,144 –> 00:44:32,184
[Tamiko Toland]: the persons ends

1327
00:44:31,798 –> 00:44:32,798
[Ramsey Smith]: eight

1328
00:44:32,184 –> 00:44:33,624
[Tamiko Toland]: up with the annuity or is the

1329
00:44:33,478 –> 00:44:34,478
[Ramsey Smith]: the plane

1330
00:44:33,624 –> 00:44:36,984
[Tamiko Toland]: client actually the financial intermediary who

1331
00:44:36,980 –> 00:44:37,980
[Paul Tyler]: that’s

1332
00:44:37,144 –> 00:44:38,824
[Tamiko Toland]: ends up making that recommendation and

1333
00:44:38,420 –> 00:44:39,420
[Paul Tyler]: and

1334
00:44:38,984 –> 00:44:40,424
[Tamiko Toland]: we know that the industry has always

1335
00:44:40,380 –> 00:44:41,380
[Paul Tyler]: he out

1336
00:44:40,504 –> 00:44:42,904
[Tamiko Toland]: seen it as that financial intermediary right

1337
00:44:43,140 –> 00:44:44,140
[Paul Tyler]: and

1338
00:44:43,544 –> 00:44:45,464
[Tamiko Toland]: and the same kind of goes here but

1339
00:44:45,340 –> 00:44:46,340
[Paul Tyler]: you all

1340
00:44:45,544 –> 00:44:47,064
[Tamiko Toland]: they’re also they’re providing advice

1341
00:44:46,780 –> 00:44:47,780
[Paul Tyler]: you like

1342
00:44:47,144 –> 00:44:49,064
[Tamiko Toland]: and they you know they may be providing other other

1343
00:44:48,820 –> 00:44:49,820
[Paul Tyler]: other

1344
00:44:49,624 –> 00:44:51,144
[Tamiko Toland]: fiduciary services as well

1345
00:44:51,100 –> 00:44:52,100
[Paul Tyler]: well we

1346
00:44:51,784 –> 00:44:53,864
[Tamiko Toland]: where it’s very relevant for them to need to be

1347
00:44:53,940 –> 00:44:54,940
[Paul Tyler]: i

1348
00:44:54,264 –> 00:44:56,264
[Tamiko Toland]: educated to a higher degree you’re

1349
00:44:56,318 –> 00:44:57,318
[Ramsey Smith]: you’re certainly not

1350
00:44:56,344 –> 00:44:57,624
[Tamiko Toland]: certainly not gonna be like

1351
00:44:58,684 –> 00:44:59,684
[Tamiko Toland]: seeing people

1352
00:44:59,444 –> 00:45:00,444
[Tamiko Toland]: change seats in

1353
00:44:59,458 –> 00:45:00,738
[Ramsey Smith]: c g c c

1354
00:45:00,020 –> 00:45:01,020
[Paul Tyler]: oh

1355
00:45:00,424 –> 00:45:01,864
[Tamiko Toland]: h r departments or

1356
00:45:01,958 –> 00:45:02,958
[Ramsey Smith]: k

1357
00:45:02,024 –> 00:45:04,264
[Tamiko Toland]: cfos change because of income okay

1358
00:45:04,924 –> 00:45:05,924
[Tamiko Toland]: so we

1359
00:45:05,638 –> 00:45:06,638
[Ramsey Smith]: yep

1360
00:45:06,024 –> 00:45:07,464
[Tamiko Toland]: got to work with what we got here

1361
00:45:07,380 –> 00:45:08,380
[Paul Tyler]: huh

1362
00:45:07,478 –> 00:45:08,478
[Ramsey Smith]: right

1363
00:45:07,484 –> 00:45:08,484
[Tamiko Toland]: ramsey

1364
00:45:11,140 –> 00:45:12,140
[Paul Tyler]: no this

1365
00:45:13,200 –> 00:45:14,320
[Paul Tyler]: this is this is terrific

1366
00:45:16,000 –> 00:45:21,120
[Paul Tyler]: uh i guess for the listeners who are hungry to learn more

1367
00:45:21,238 –> 00:45:22,238
[Ramsey Smith]: yeah

1368
00:45:22,000 –> 00:45:26,320
[Paul Tyler]: or i want to follow you what’s what’s the best way is it is it linkedin is it

1369
00:45:27,760 –> 00:45:28,800
[Paul Tyler]: your corporate website

1370
00:45:30,900 –> 00:45:31,900
[Paul Tyler]: think he

1371
00:45:30,904 –> 00:45:33,224
[Tamiko Toland]: linkedin is great i mean you know can x is

1372
00:45:32,980 –> 00:45:33,980
[Paul Tyler]: exact

1373
00:45:33,164 –> 00:45:34,164
[Tamiko Toland]: active on linkedin

1374
00:45:33,998 –> 00:45:34,998
[Ramsey Smith]: and i

1375
00:45:34,184 –> 00:45:35,384
[Tamiko Toland]: i’m active on linkedin

1376
00:45:35,644 –> 00:45:36,644
[Tamiko Toland]: we

1377
00:45:35,700 –> 00:45:36,700
[Paul Tyler]: oh

1378
00:45:36,258 –> 00:45:37,858
[Ramsey Smith]: i there all on twitter

1379
00:45:36,264 –> 00:45:40,504
[Tamiko Toland]: are also on twitter um there’s if you’re interested in any of the research

1380
00:45:36,264 –> 00:45:40,504
[Tamiko Toland]: are also on twitter um there’s if you’re interested in any of the research

1381
00:45:39,280 –> 00:45:42,000
[Paul Tyler]: hear any of the uh oh

1382
00:45:41,564 –> 00:45:42,564
[Tamiko Toland]: and

1383
00:45:42,264 –> 00:45:44,504
[Tamiko Toland]: articles commentary and what have you also

1384
00:45:42,398 –> 00:45:43,398
[Ramsey Smith]: article

1385
00:45:44,284 –> 00:45:45,284
[Tamiko Toland]: our

1386
00:45:44,658 –> 00:45:46,338
[Ramsey Smith]: also our web film

1387
00:45:44,660 –> 00:45:45,660
[Paul Tyler]: really

1388
00:45:44,904 –> 00:45:49,464
[Tamiko Toland]: website has a wealth of information under thought leadership as well as if videos

1389
00:45:49,544 –> 00:45:50,744
[Tamiko Toland]: and all all kinds of stuff

1390
00:45:50,598 –> 00:45:51,598
[Ramsey Smith]: stuff

1391
00:45:50,960 –> 00:45:52,240
[Paul Tyler]: stuff and they

1392
00:45:51,464 –> 00:45:53,784
[Tamiko Toland]: um and there’s there you know there is

1393
00:45:53,540 –> 00:45:54,540
[Paul Tyler]: there’s

1394
00:45:53,558 –> 00:45:54,558
[Ramsey Smith]: here

1395
00:45:53,944 –> 00:45:56,824
[Tamiko Toland]: some stuff on lifetime income there as well so just

1396
00:45:53,944 –> 00:45:56,824
[Tamiko Toland]: some stuff on lifetime income there as well so just

1397
00:45:56,320 –> 00:46:00,560
[Paul Tyler]: excellent alright let listen thanks so much there there’s a there’s a lot

1398
00:45:57,458 –> 00:46:00,658
[Ramsey Smith]: i’m sure there’s a lot of stuff on lifetime income there not some

1399
00:46:01,284 –> 00:46:02,284
[Tamiko Toland]: what guess

1400
00:46:02,780 –> 00:46:03,780
[Paul Tyler]: there’s a lot and

1401
00:46:03,484 –> 00:46:04,484
[Tamiko Toland]: a wea bit

1402
00:46:03,680 –> 00:46:05,200
[Paul Tyler]: we will put those links we will put

1403
00:46:04,838 –> 00:46:05,838
[Ramsey Smith]: yeah

1404
00:46:05,280 –> 00:46:07,360
[Paul Tyler]: those links in the show notes if you want to click in and

1405
00:46:08,020 –> 00:46:09,020
[Paul Tyler]: connect

1406
00:46:09,920 –> 00:46:15,440
[Paul Tyler]: or visit the website so taco thanks so much ramsey as usual appreciate all the

1407
00:46:15,060 –> 00:46:16,060
[Paul Tyler]: great

1408
00:46:16,640 –> 00:46:21,200
[Paul Tyler]: questions and thought behind this uh this show um please join us again next week

1409
00:46:21,680 –> 00:46:25,520
[Paul Tyler]: and uh for another very interesting episode of that annuity show

The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 141: Diving Deeper Into The Qualified Default Investment Alternative Market With Tamiko Toland
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Episode 140: A Chat With The Father of 4% Percent Rule With William Bengen

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How many times have we discussed, debated, and loved the retirement rule of thumb known as the “4% Rule”? Today, we had the opportunity to speak with William Bengen, the creator of that exact rule. And as we learned, there are very good reasons why a seemingly simple concept like this continues to guide retirement planning today.

Also, do you want to get regular updates on news about guests of our show? Go to https://thatannuityshow.com and subscribe to our newsletter.

We hope you enjoy the show.

Links mentioned today:

https://www.linkedin.com/in/william-bengen-21b159196/

Thank you to our show sponsor; The Index Standard!

Fixed Index Annuities and RILAs are getting more complex and technical just when fiduciary rules are getting stricter. How do you choose the right index and allocate to them? The Index Standard is your answer. They are an independent provider ratings and forecasts on all indices and ETFs used in the US insurance space. Their process is systematic and unbiased, identifying robust and well-designed indices. We all know finance is complex and The Index Standard has a clear ratings system and uses approachable language to demystify this complexity. Visit theindexstandard.com for more information.

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The discussion is not meant to provide any legal, tax, or investment advice with respect to the purchase of an insurance product. A comprehensive evaluation of a consumer’s needs and financial situation should always occur in order to help determine if an insurance product may be appropriate for each unique situation.

Ashley SaundersEpisode 140: A Chat With The Father of 4% Percent Rule With William Bengen
read more