On this episode of A Wiser Retirement™ Podcast, Casey Smith is joined by Missie Beach, CFP®, CDFA®, and Andrew Pratt, CFA to talk about financial concerns that are unlikely to happen. They bring up various political, financial, and market-related predictions and concerns that never materialized. They also highlight the necessity of having a robust financial plan that aligns with your goals, risk tolerance, and lifestyle.
Podcast Episodes Referenced:
- Ep 181: 5 Common Financial Myths Debunked
- Ep 141: What is holistic financial planning?
Youtube Videos Referenced:
- Financial Habits to Avoid in Retirement
- Pitfalls of Living Rich but Not Building Wealth
Learn More about Wiser Wealth Management:
- Our website
- Schedule a complimentary consultation (learn more about our services)
- Click here to download one of our free guides that covers financial planning topics like retirement, investing, taxes, divorce, and more!
Connect With Wiser Wealth Management:
- YouTube Channel
- Facebook
- LinkedIn
- Instagram
- Twitter
- Casey Smith's Twitter
- Podcast
- Blog
This podcast was produced by Wiser Wealth Management. Thanks for listening!
On this episode of A Wiser Retirement™ Podcast, Casey Smith is joined by Missie Beach, CFP®, CDFA®, and Andrew Pratt, CFA to talk about financial concerns that are unlikely to happen. They bring up various political, financial, and market-related predictions and concerns that never materialized. They also highlight the necessity of having a robust financial plan that aligns with your goals, risk tolerance, and lifestyle.
Podcast Episodes Referenced:
- Ep 181: 5 Common Financial Myths Debunked
- Ep 141: What is holistic financial planning?
Youtube Videos Referenced:
- Financial Habits to Avoid in Retirement
- Pitfalls of Living Rich but Not Building Wealth
Learn More about Wiser Wealth Management:
- Our website
- Schedule a complimentary consultation (learn more about our services)
- Click here to download one of our free guides that covers financial planning topics like retirement, investing, taxes, divorce, and more!
Connect With Wiser Wealth Management:
- YouTube Channel
- Facebook
- LinkedIn
- Instagram
- Twitter
- Casey Smith's Twitter
- Podcast
- Blog
This podcast was produced by Wiser Wealth Management. Thanks for listening!
So that's why I said we're a financial planning firm. First. That happens to do asset management, because you have to start with a plan, can't go invest money and then you're gonna end up being out of a job. Now I have any cash and what are you doing? You're liquidating your 401k, your IRA. You're paying ridiculous tax rates for it because there wasn't really this stopgap put in place.
Speaker 2:So yeah, I think clients are sometimes surprised when they realize that, yeah, we don't even talk about like how we Would invest your assets till the very end of the process because we don't have a plan yet. So we have to build that plan to figure out how the investments would even work in terms of riskiness, volatility will understand their goals, their lifestyle needs. Yeah, so investments were just kind of one tiny piece of that planning puzzle.
Speaker 1:Welcome to a wiser retirement podcast. What we believe the best financial advice should always be conflict free. I'm your host, casey Smith. Today, I'm joined with Missy Beach, the world's best financial planner, and Andrew Pratt, the king of data.
Speaker 2:Wow, king wow king of data.
Speaker 4:I don't know what my coordination was, but All right.
Speaker 1:So I thought it would be a great idea to have a topic on market concerns that are unlikely to happen, but I feel like even to get to that conversation, you have to start with things that were supposed to happen, that didn't oh, all the hype, all the hype, all the buildup yeah you know I just it's that time of year I think we're gonna talk about on every podcast this year. We're entering this big political season and it's gonna be nasty.
Speaker 2:Yeah, I agree.
Speaker 1:So there's gonna be fear on both sides, gnashing of teeth, you know, to promote their candidate and why you shouldn't vote for the other person, and it's just gonna be nasty, you know. I guess you guys saw Trump won the Iowa caucus by a landslide and the same.
Speaker 2:This is gone.
Speaker 1:The Santas is gone, haley's only remaining, and it was, I think I saw, was it he's either CNN or MSNBC. You can Google it, but it was the white Christian that did this. Oh really, Evangelicals it's the white Christians that that are causing people now. Oh my god we're victimizing the white Christians. This is awesome. It's not even. It's not even July.
Speaker 2:It's not gonna be good, but the good thing is, if it comes down to Trump and Biden, neither one will debate so I mean, at least we won't have debates to listen to.
Speaker 1:I think that's. I think that's un-American and very sad, but but yeah, just more campaign ads.
Speaker 1:It's just just more campaign ads. Yeah, so here we go. Right, you've got Jamie Diamond at Davos. I don't really pay attention to Davos is just a bunch of like Billionaires talking about how to save the world and they're really talking about how to save themselves. And anyway, jamie Diamond had some interesting comments, basically along the lines of hey, you know what, maybe Trump's China policy wasn't that bad, maybe, maybe. Maybe, you know, growing the economy is not a bad idea. Maybe maybe the you know, I gave him credit for NATO.
Speaker 1:Actually done during his treat during during his first impeachment. They rewrote NATO. No one ever talks about that, so anyway, it's just it's gonna be. You can mention when you have businessmen like that coming out, which I think was only one of two positive comments, davos, that I read anyway.
Speaker 2:Well, at least hindsight is, you know, being a little Factual in some cases.
Speaker 1:Yeah, he was very factual and he definitely didn't didn't say he was a great guy. He didn't say that his tweets weren't childish. I mean that's good yeah. Factual right but he just stuck to the economic facts. So I think you, look from economic lens, it's, it's it. The facts speak for themselves during that time period. But all the chaos around it, I don't know, I don't know. Is it worth it? That's, that's what voters have to decide, you know Anyway. So let's let's tie de Gress into the deep past in 1999.
Speaker 2:Oh yeah, prince.
Speaker 1:I was.
Speaker 3:I was younger.
Speaker 1:Yeah, back then in 1999, the book Dow 36,000, james Glassman, kevin Hassett predicted the Dow Jones industrial average would reach 36,000 points by the early 2000s. This was. This prediction was made during the dot-com Bubble, when the markets were just going through the roof down. 36,000 at the time was just unthinkable. What's interesting is you know the the bubble burst and in 2000, and then you fast forward eight more years. You know, with the financial crisis, and they actually not them. But other books are written about Dow zero. People are just, you know, predicting down zero and gloom.
Speaker 1:Yeah, so that's what happens. You have irrational exuberance, right. You have time periods where Everyone's like, oh it's, it's gonna keep going straight up and it just doesn't happen that way, right? The 1929 crash Anybody here was around, and my grandfather was around for that. He was born in 1928. His birthday was yesterday, 96 years old.
Speaker 2:Did you talk about the great?
Speaker 1:He'd only been one year old. I don't know he really remembers that much about that.
Speaker 2:Not a topic.
Speaker 1:Economist Irving Fisher famously declared, just before the stock market crash of 1929, that the stock prices had reached what looks like a permanently high plateau. The prediction came right before the crash and led into the Great Depression. Hmm, it was economist.
Speaker 2:Yes.
Speaker 1:Fast forward Reference back again to 2008 financial crisis. Prior to 2008 financial crisis, many analysts and economists failed to predict the collapse of the housing market and the ensuing global financial crisis. The crisis results in a significant drop in stock market. Well, why do we all know that we live through that? Very, very well, let's do it.
Speaker 2:Still have the scars, yeah there's just some bad financial instruments going on. Back then I was just entering into the workforce but I was a construction, so I was out of the finance world. That's an interesting combo because, of that. Right.
Speaker 4:Well, that's actually. I graduated in 2008. So in my first job I was in construction industry. I was in a big project in and nowhere Alabama. So I was kind of isolated and I came back after about a year I was like what is going on?
Speaker 1:That's funny no, when the whip you don't really follow that much, or maybe listeners remember this. But Japan's stock market in the 1980s. So during the 80s there was a widespread belief that Japan's economy and stock market would dominate the world. The Japan's index reached a stock index, reached a peak in 1989 and then that all burst, leading to a Perlong period of economic stagnation. That's what I remember the most. I remember the stagnation part of that. I do remember this one Brexit. Remember Brexit that was going to change the world.
Speaker 1:Oh yeah and Brexit was just gonna. It was into being much to do about nothing really.
Speaker 2:Like a lot of these events, Casey.
Speaker 1:So, if you don't remember, leading to the 2016 Brexit referendum, many predictions suggested that a vote to leave the European Union would lead to an intimate or immediate Insignificant adverse effect in the US or in the UK stock markets. Well, there was initial volatility. The markets quickly recovered, defying many dire predictions. But, yeah, I remember, if you was a, what are the effects of the UK? And then you leaving the, leaving the EU and Just not not coming out of it.
Speaker 1:Yeah, really, I think they just kind of because you lose all your your trade treaties, right. That was the big issue. But they were quickly rewritten right and they seem to be doing okay.
Speaker 2:Yeah, they were all grown-ups. They worked it out.
Speaker 1:Dot-com bubble predictions. So in the late 90s, I mean, everything was dot-com.
Speaker 2:I remember even seeing the US Airways 737, us Airways dot-com like all the time right, everybody just put dot-com on top of all, and then the value is supposed to go up and I kid you not, mr Weiser himself. Wanted to add it.
Speaker 1:He created some LLC and call it dot-com, like it was like oh, everything's gonna be dot-com, we have to you just name it dot-com, and it would. It was supposed to just be worth all this money. I was wondering if the AI.
Speaker 4:In today's world is so much of that just? Slap on AI onto your earnings call. And that's true. Your stock price goes up.
Speaker 1:Yeah, well, same way for ESG. I mean right, but say you're an ESG fund for the last two years and you got extra attention and Pat's on the back and he's a nice social credit score yeah even though your fees are higher. Yeah, and there's nothing ESG about it. Actually in the end oh that's right. Why 2k stop market crash oh.
Speaker 2:Yeah. I remember we're not gonna know what happened when the clock turns.
Speaker 1:That's right. I remember in 2000 and I was in Disney World for New Year's and I was like, huh, we're gonna be standing right here in front of the Magic Kingdom, we're gonna watch this, all these fireworks, and there's gonna be no lights because all the stuff just gonna turn off right.
Speaker 4:What happened? Planes are gonna fall from the sky, yeah.
Speaker 2:Computers are gonna blow up nothing nothing nothing happened. That was great.
Speaker 1:This is all more serious and it could have happened that Cold War fears true. You know, I mean, those were not unfounded, but thanks to, I guess I don't know who we think for that Ronald Reagan.
Speaker 2:I was gonna say Reagan, I would say I'd say yeah.
Speaker 1:Standing strong the Eurozone collapse. So in the early 2010s, they were concerned that the Eurozone would collapse, leading to cash-driven consequences in global stock markets. There was a lot of volatility of around that. Not to make light of any of this, there is stock market volatility around every single one of these headlines.
Speaker 2:Oh yeah, we're not saying that it doesn't, but nothing implodes completely. That's what everybody, that's, I think, how clients go sometimes. This time is gonna be really different and everything is gonna blow up and what do we do?
Speaker 1:Yes, yeah.
Speaker 2:And that's the takeaway that all these bad things you know we experience. But hey, everything's still here, everybody still has long-term value in your portfolio, it's good.
Speaker 1:I mean everyone's fears should be. You're allowed to have fears of things I don't want to. I want to discount that.
Speaker 2:Oh yeah.
Speaker 1:But the latest one and I had to chuckle out a little bit was like maybe we should not take sell everything in the 401k because the market's usually down in January. I'm like, why aren't we worried about January? You know, it's just because the market's always down in January. I mean, statistically actually, it's up in January.
Speaker 2:And you're gonna rebuy yeah.
Speaker 4:I feel like tax loss, harvesting and repositioning. There's a lot of purchasing going on in January usually I actually just quickly Google this, but you know that's pretty common to have. You know, pullbacks, sizable pullbacks throughout the year. And you know this one Schwab article just start stock market corrections are fairly common. Pullbacks of 10% are more of occurred in the 10 of the past years, 10 of the past 20 years. So again, there's always volatility in the market. You just gotta be able to handle it and stay the course.
Speaker 5:Are you curious why annuities keep coming up as a potential investment option? People are often told that annuities can effectively mitigate investment risks and help secure their financial future. However, annuities often benefit the salesperson and might not be the best choice for you as a consumer. To learn more about the various types of annuities, the negatives of owning them and better investment alternatives, we have a free ebook on our website just for you. To download our ebook, buy or be aware why do they keep trying to sell you that annuity? Simply click the link in the episode notes or visit wisereinvestorcom slash guides. Now let's get back to the episode.
Speaker 1:So yeah, another one be like the 9-11 terrorist attacks. Obviously, that was very real, it actually happened. But the stock market you know, people selling out of the stock market was a real thing.
Speaker 2:Yeah, the market closed. Right it did. I can't remember how long we closed.
Speaker 1:It opened up positive. When that reopened, I think there was a big it was like a big rally, I kind of.
Speaker 1:Yeah, there were some Ring in the bell, big carol, some, big, big fish that made sure that the market was going to be up that day, but I don't believe it was up later. No, sold off, this is a big one. Obviously, we talked about that already. But political election outcomes People think, oh man, if Trump gets in, we're screwed, or if Biden gets in, we're screwed. And I keep telling people it just doesn't really matter. Nope.
Speaker 2:It just doesn't really matter.
Speaker 1:There is very little correlation between stop market returns and Republican versus Democrat, and you just sound ignorant when you say it. Don't sound ignorant.
Speaker 4:Just stay invested.
Speaker 1:Or when the market goes up, you're like I don't understand why this market keeps going up so and so is in office and I'm like, but it has anything to do with it? Because you're still selling Coke bottles, People are still flying on airplanes, people are still buying software, the world continues going on. I know it's not a dictatorship.
Speaker 2:Half the country doesn't move.
Speaker 1:As much as they say they're going to leave the country that half stays, no matter who wins.
Speaker 2:It's so good to work every day.
Speaker 1:Yeah, yeah, I mean on other big key issues like abortion or social type issues. Okay, yeah, there's some radical changes on those fronts and that should help you decide how you vote. But economically speaking, right, it's just really hard for one person to create a train wreck of the economy. You know, because you have the Fed.
Speaker 2:Oh yeah.
Speaker 1:That's out there controlling and manipulating right. So maybe there's some political bias there. Maybe there is, but you know what the bias is during election years, they want it to be better to keep their guy in. Okay, if that's the case, great.
Speaker 2:I'll make more money If you want to Join the red.
Speaker 1:So again it's not. I'm not saying don't vote, I'm just saying that you got to. Is that all the same? Now, if you see, if you see government taking over sectors of the economy, that's a problem. If they say, okay, we're going to, we're going to take over all home buying, all home buying has to be run through the government and we decide who gets to buy and who. You know that's a problem, Right.
Speaker 2:If we lose our free market, we're going to lose our free market.
Speaker 1:Yes, yeah, yes, exactly Just saying.
Speaker 2:Right.
Speaker 1:Well, they need to turn in by Venezuela at that point right.
Speaker 2:Oh yeah, because they're winning. Yeah, that is just it. Yeah, that is just yeah, yeah, yeah.
Speaker 1:Yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah. Typically, things that happen, it's like trying to you know. People blame, and I was even at a conference. This has been a long time ago, but I was at a conference and they actually had President Bush and Bill Clinton on the stage at the exact same time.
Speaker 2:Ooh.
Speaker 1:And yeah, it was. It was crazy it, yeah, I mean President Bush had people just rolling the jokes and laugh at things like that and they would try to ask him serious questions about the economy. He was so checked out. He's like I have no idea. Bill Clinton would always have these very thought out.
Speaker 5:Yeah, he studied for the job right.
Speaker 1:And I think George W Was there to collect the half million dollars speaking fee. But I remember, just sitting behind this guy, that that was basically. He just kept talking to him the whole time. We were so far back he could. These guys were like dots. You know, they were like so far back, there's something you could hear. But he, just he kept saying you know calling Mr, Mr Housing Crisis Mr.
Speaker 1:You know, just just blaming him for the complete meltdown and it's like they're just if you chase back that financial crisis. It kind of started back when everyone thought it was a right to have a home or, instead of a privilege, three or four, five homes.
Speaker 2:Yeah, I know, Right.
Speaker 1:So yeah, you can trace it back to the Carter administration if you really wanted to. Just just the idea of what they, what they wanted to do. And then the Wall Street made it worse with the wrapping of everything. But there's no way a sitting president knows about any of that.
Speaker 4:No, no one did.
Speaker 2:There's. Just that was just no way that happens.
Speaker 1:It's not even logical to think that. So anyway it just you got to be careful about your, about your assumptions, and you tell yourself that something along enough you start believing it right. So I don't know. Those are.
Speaker 2:Yeah. So you just have to not get caught up in the hype, I think, because long term, we've looked at all these events and, hey, the world bounces back. Your safety, your principle, it's still there. Might take a minor hit, but over the long run, yeah. How else are you going to build wealth in today's world?
Speaker 1:Yeah, I don't know. I mean, I think twenty. Twenty two is a perfect example where everyone said there's going to be a deep recession. Everyone said that there's going to be a terrible, terrible stock year or, I'm sorry. Twenty three going into twenty, twenty, twenty twenty twenty twenty two, going into twenty twenty three, yeah, and it was one of the best rate of returns we've had in the last ten years S&P up over twenty seven or twenty six percent.
Speaker 2:Wow yeah, and people were saying what should we do? Should we go to cash?
Speaker 1:Yeah, heck, no, right, yeah. Now, equally In twenty one, twelve, thirty one, twenty one. Everyone was saying oh yeah, twenty twenty two is a chip shot. It's going to be super easy, right, it's going to be a 10 percent rate of return minimum.
Speaker 2:Oh yeah, Everybody was saying that, that's right and then what happened?
Speaker 1:on one one, the Fed just starts. Or one two, the Fed came back to work and we're like we're going to rise interest rates because inflation is a real problem where they denied it all through. You know, twenty twenty one, right, right. So then we had this big sell off because of rapidly rising rates, because the Fed had to make up for their mistake. So you just don't know. But what do we learn in all that? You just stay the course and if you go through, if you go through proper planning, you shouldn't be, you shouldn't be taking losses in your portfolio, realize losses realize something yeah.
Speaker 1:Yeah, so we would. Only, what do we learn in the financial crisis? We learned to hey, cash is king and you got to always make sure that you have plenty of cash on hand to get through a crisis so you don't have to take losses and sell things.
Speaker 2:Amen, yeah, so don't have any debt going into it. And then, yeah, have your cash or have your debt have your debt manageable with cash on hand, I mean a lot of people have mortgages, Sure, but yeah, it's good you know it's bonds also you know they're there to help provide liquidity as well.
Speaker 4:if you need to tap into that, Mm hmm, yeah, so it's.
Speaker 1:it's just going through the planning process. That's why I said we're a financial planning firm first, that happens to do asset management, because you have to start with a plan. Yeah, exactly, you can't go invest money and then you end up being out of a job, not having any cash. And what are you doing? You're liquidating your 401k, your IRA, you're paying ridiculous tax rates for it, because there wasn't really this stopgap put in place.
Speaker 2:So, yeah, I think clients are sometimes surprised when they realize that, yeah, we don't even talk about like how we would invest your assets till the very end of the process because we don't have a plan yet. So we have to build that plan to figure out how the investments would even work in terms of riskiness, volatility.
Speaker 4:We'll understand their goals, their lifestyle needs.
Speaker 2:Yeah so investments are just kind of one tiny piece of that planning puzzle.
Speaker 1:But in putting together a future, a future model for them to say based on what you're doing, this is where you end up down the road.
Speaker 2:You're retired.
Speaker 1:How do you stay retired?
Speaker 2:Oh yeah, because I think the biggest shock for clients is when we look at that long term cash flow sometimes to see that huge deficit number in retirement and how much is going to come out of the portfolio, and they're like, oh my God, I have to take that much out of my portfolio and I'm like, yes, but it's fine, it all works out. You have a high probability of success and this is why we plan, this is why you save and this is why we're here to see that it all works out over time.
Speaker 1:Yeah, it. Unfortunately, our industry is full of people that just sell stuff.
Speaker 2:I know.
Speaker 1:Yeah, it's very sad. I don't know it's going to take government regulation to fix it. The industry will not fix it on its own. But yeah, for people who people who come in and say I have a financial plan already they're always crap. I'll look at them like this is this is a time value money calculation on a really nice piece of paper that I could have done with my TIA, or what is it? The HP? 80p retirement planner no, no, no, no, the the financial calculator we all use retirement calculator.
Speaker 1:The one we use in college.
Speaker 4:Oh yeah, tia 80. Right.
Speaker 1:No, it's basically a fancy one of those, and it's just like oh, this is so frustrating.
Speaker 2:Or it's five years old and you're like, well, did you not have it up? That's true.
Speaker 1:We are firms that do some more comprehensive planning, but yeah, they don't update it, they don't make it a focus of conversation each year. So we did a plan for your fine, and they assumed that that's just how that works.
Speaker 4:But or they're just putting a bunch of annuities, oh yeah or annuities.
Speaker 1:Don't get me started on the new part. She's sorry to bring it up.
Speaker 2:You brought Anna. He said the word.
Speaker 1:There's a download on our website why you shouldn't buy annuities. You know I had I had speaking of using fear to sell things. We have a client who's been here a very long time but I met her. She came in and she put her statement down in front of me. Her husband had passed away a few years prior, her son had referred her to us and there was all these red circle marks on the statement and she said my friend from my son's little class wants me to buy an annuity and she wants me to put $3 million into an annuity. And she says my son kept saying no but he said come see you because he wasn't sure why. But just the answer was no.
Speaker 1:So I came here to figure out why I shouldn't do this. Because she had certain what the agent or salesperson had done. She had circled all the negatives, not even for the lifetime of the fund but just for the month. And so she circled all the negative for the month in the portfolio and she said and she wrote on there this would never happen with an annuity. And so I'm going through. And her husband had been more of a buy hold investor.
Speaker 1:And so the net at the very bottom is a very large number.
Speaker 2:Oh, I bet that game.
Speaker 1:Oh yeah, Because he's been in this since, like the 80s right.
Speaker 2:Yeah.
Speaker 1:And he owned a lot of individual company stock where he worked. I assume their shares are granted and such, and so I circled that number at the bottom and I said neither with this.
Speaker 2:That's all I knew you were going to go there.
Speaker 1:I was like annuity is a great way to go stagnant. Just nothing good is going to happen. But nothing bad is going to happen. In 20 years You're going to lose all your purchasing power when you can actually get your money back out of it.
Speaker 2:And you're going to give your Sunday school friend a really nice commission. I hope you like them.
Speaker 1:I tried to tell her she's going to get nearly $300,000 on that sale.
Speaker 5:It's a 10% commission to the advisor now.
Speaker 1:I'm sure part of that was Cappire Company, but still, even a 6% commission was crazy. Yeah, yeah, just the math just doesn't add up. And we're interviewing, so we're interviewing here at Wiser for multiple positions. Oh, yeah. And Missy and I were going to interview recently and I told the guy because he's coming from a world of annuity sales and I said I'm really good at math. Math doesn't add up for annuities. He's like oh, but let me just, let me be able to show you and I'm like there's nothing you can show me dude.
Speaker 1:Yeah, I've seen it all. He was in full sales mode yeah, he went into full sales mode during his interview. I'm like that was probably not the best move. Have you looked at the website?
Speaker 2:Yes, You've done your research.
Speaker 1:See only so let's talk about some things that people have fears of going forward and I pulled these off of. I asked ChatGbt, I said ChatGbt.
Speaker 2:What are people scared of?
Speaker 1:What are most people scared of when it comes to the stock market? And I was. I was very surprised. I actually ran it a couple of times. Did we ask him the questions differently? And I'm like there's a lot of scared people out there. Even with the number one was total collapse to zero. I know, Like that, people that are concerned about going to zero.
Speaker 2:Yeah, a couple people. And I'm like, if that's your biggest fear, then you know there's bigger fish to fry. I mean, you got to worry about zombies.
Speaker 4:And like asteroid hitting the earth.
Speaker 2:Yeah.
Speaker 4:Yeah.
Speaker 2:Like prepping for food and water.
Speaker 4:I don't know, I just don't see that I mean celebrities are building bunkers in 2024. I know right.
Speaker 2:Find your celebrity buddy, then I mean the market.
Speaker 1:What I don't understand about these whole bunker things is how do you get to the bunker?
Speaker 2:You mean down, there's a ladder.
Speaker 1:I know how you get into a bunker. These bunkers are not in the East Coast. These bunkers are out in the Midwest somewhere.
Speaker 3:I thought you had one Somewhere in Hawaii.
Speaker 1:They're like they're in Hawaii.
Speaker 4:I think Zuckerbergs in Hawaii.
Speaker 2:That doesn't seem like a good place to be underground.
Speaker 1:That's an island. That's where the volcano is.
Speaker 2:I don't think he's that smart.
Speaker 1:Seeing you got lucky. Seeing Zuckerberg got lucky.
Speaker 2:No, I said he's not that smart, OK, so anyway. Yeah, so total collapse to zero. Yeah, I mean, you want to no, no, no, no.
Speaker 1:I'm showing the bunker topic Now. These bunkers are like in the Midwest right.
Speaker 2:They're all over. Wherever you want one, you can have a bunker. You could have one up in the mountains.
Speaker 3:I thought they were taking these old silos, these nuclear silos or something like in the ground.
Speaker 1:But I was like how do you get there? I guess they're so expensive. You're probably flying on your private jet.
Speaker 2:How do you do that if there's already been an event?
Speaker 1:That's what I understand, to me it's got to be in your backyard and it's like a five minute drill or something. But if it's like for a nuclear type thing, I just don't see how you race it there in your G5.
Speaker 4:And you really what?
Speaker 1:happens to a pilot. You're asking the pilot to leave their family to take you to your bunker.
Speaker 2:And what good is it if you're in your bunker and the rest of the world is dead and gone?
Speaker 1:Yeah, I know.
Speaker 2:That would, I don't know Well this whole Russia-Ukraine thing.
Speaker 1:I did get into this deep hole one night on my computer and I was like how do you survive nuclear fallout? And I was like you don't want to yeah.
Speaker 2:That's what I determined. Go with it Like radiation poisoning.
Speaker 1:Yeah, you don't want to, it just sounds bad. It's not a good thing, man. But yeah, total collapse is zero. It's going to take certainly nuclear war. And I would kind of add at that point, does it really matter? This business doesn't matter if the whole East Coast is gone.
Speaker 2:Yeah, no. I mean does your cash matter?
Speaker 1:Does gold matter? Does Bitcoin matter? I don't know.
Speaker 2:Well, that ties into the next one end of capitalism. So people are talking about well, should I hold gold and silver bars? And I'm like, well, do you really think if everything is gone and money doesn't matter you're going to be able to trade your gold bar for alofa bread or some milk from a cow.
Speaker 1:I don't know, I just don't see that working. I remember when gold was going crazy and you could take your gold into the mall, one of those kiosks, and sell gold to those people. I was very curious by that. We didn't have any gold to sell. But I was like, what's the buy price? And he was kind of telling me and I said, okay, well, we also had gold you could buy. I assume it's not the same gold people were turning in, but I think they melted or something like that new stuff, but then the ounce what you're buying for the spread is
Speaker 2:huge, like 200% right.
Speaker 1:So does that mean if you're buying a gold bar, it has to appreciate by 20% before you get back to break even? Is that a fair?
Speaker 4:statement.
Speaker 2:Yeah.
Speaker 4:I mean, if you're buying from a shop like that.
Speaker 1:So if I go down to the coin store it's a great coin store, just down from our office here If I went down to the coin store and I bought a gold coin, someone you know Lincoln or somebody on it, I don't know JFK, whatever that's a 20% plus markup. So how do you ever make money? You don't. That means when you buy those things on TV, you've lost money it's depreciated.
Speaker 2:Well, I had a client whose husband, who had passed, had bought all kinds of gold and silver through a reputable dealer and she asked me well, what should I do? I said, well, I think your best bet's to go back to that dealer to see what you could get. She had all the original invoices and everything and it was about a 20% haircut. Wow, wow, thinking this wasn't an investment, and I had to explain this is more like a hobby, not an investment.
Speaker 1:So yeah, I would not recommend that. Silver's huge for manufacturing. But silver's a little different. Maybe you know there's more purpose to it, I guess. But this was golden, silver, gold and silver and she didn't make any money. Nope, and how long do you think she'd held it?
Speaker 2:Oh, probably over 10 years, 10, 20 years.
Speaker 4:Good grief. And have you seen Costco's selling gold bars?
Speaker 2:Really they are.
Speaker 4:I think they sell out apparently they sell out of gold bars at Costco.
Speaker 1:I can see that they sell online, they sell out. Do you have to buy by the pallet size? I don't know.
Speaker 4:A pallet of gold.
Speaker 1:Family, value pack.
Speaker 3:Family value pack, one for each family member.
Speaker 1:Yeah, okay, so the only thing we have in modern history of something like this, where you have complete collapse, would be the complete collapse of the USSR. And it was cigarettes, ammunition, Alcohol and alcohol hard liquor actually.
Speaker 2:Vodka.
Speaker 1:Those are the three things that people were trading at that particular time. So there's your history. Is that we're pretty clean here in the US, I would think, but I guess we're all gonna be smoking drinking.
Speaker 2:Good thing, you have a whiskey collection.
Speaker 1:Yes, my whiskey collection would probably get me an equivalent of $100.
Speaker 2:A meal for Weiser.
Speaker 3:We could survive a day on Casey's whiskey collection Awesome.
Speaker 1:Permanent stagnation, so basically that the markets don't actually grow. That was fear number three. Oh, I guess we can go back to end of capitalism. I mean, that's a collapse of the US. Oh yeah, we're the world. The entire world comes here for free markets.
Speaker 2:Yeah, so. We control our own dollar. It's like the end of time. Control our own currency I just.
Speaker 1:there is the benefit of no one in our own country to end capitalism. No no despite the rhetoric of the some of the politicians that are.
Speaker 2:Oh yeah, Come out of nowhere. This is the end of time. If we don't vote correctly, whatever. Okay.
Speaker 1:Permanent stagnation, the economy, I don't know. I mean, we kind of went through that. It takes some big negative things to happen. 2000 to 2010 was kind of a flat time period. Yeah, you know that's where, like divin, investing comes in, real popular because you usually driving income from the companies and when you're not having big growth.
Speaker 4:Oh yeah, price growth, the yields on fixed income.
Speaker 1:You know investments now are that's true, the highs that they've been, so it's earning a good yield If I buy the aggregate right now. What am I yielding? What am I getting? It's still probably like four and a half Four, and a half percent which means if I go out on the yield curve it's gonna be a little lower at this point, but something between probably four and six year duration. I'm getting anywhere from about four and a half to 6% probably.
Speaker 4:Yeah, about that yeah okay.
Speaker 1:Global synchronization of crashes. I was like man, someone's like really specific in there. In their worry. But basically our global stock markets are all interconnected and if one blows up, then they all blow up.
Speaker 2:Do you think that means forever or just temporarily hacked?
Speaker 1:Oh no, it's probably not a flash crash.
Speaker 2:This is just going dark.
Speaker 1:I think it's just going dark globally. I mean you've got to have it's interesting, because going total collapse is zero and this one are pretty close, like so number one and four are pretty close. You gotta have to have 6,700 publicly traded companies go out of business. You have to have 12,000 companies default on their bonds. I mean that's a.
Speaker 2:Yeah, I mean how could that? I mean, I'm not gonna say it's not possible, Never say, never it's certainly possible.
Speaker 1:All it takes is a humongous natural disaster. Probably COVID was probably the test run for something like that.
Speaker 2:And that was like self-imposed. We didn't need to do that.
Speaker 4:Right, yeah.
Speaker 1:Well, the whole COVID thing actually was a boom for so many people. I mean, the Marriott Country Club had more applicants in 2020 than ever before, Wow and they had to start having tea times. We're in the past. There were no tea times on the except for Saturday.
Speaker 3:Are you kidding me?
Speaker 1:No, it was. I've talked about this before in the podcast. It was the strangest time. At the time I was on the Well-Star Foundation Board and I was getting reports like wellness reports of the community. At the same time, I'm eating at the Marriott Country Club and I'm like, oh my gosh, like where are all these people come from? And I'm like Cobb County had the most people ever like, unable to get a meal because you had all the service people that have layoff jobs.
Speaker 1:And then you had all these other people that were still working, working from home, doing whatever had all those free time all of a sudden.
Speaker 2:Yeah, just their normal lives.
Speaker 1:And so you had record number here, so I literally saw the economic divide firsthand Wow. Wow. There's people who are looking for a meal and there's people who've never made so much money in their life. I mean for Weiser. That was one of our biggest growth years was 2020. Yeah, yeah, so it's very eye-opening, which is just a reminder that you have to get outside your bubble and you have to look it around and there are people who need help that you should help.
Speaker 2:I'm not talking about the homeless druggy, absolutely.
Speaker 3:No yeah, I'm talking about real people.
Speaker 2:Hardworking.
Speaker 1:Americans that get used in hand and we need to find them and help them up. You'll let our control by a single entity I thought that was kind of funny way of saying one world government.
Speaker 2:Yeah.
Speaker 1:But someone you know Worries about that, or at least by chat. Dbt and what they found in studies out there were concerned about just the whole world. Merging is one.
Speaker 2:Dr Evil taking over.
Speaker 1:I guess so Clous Schwab, or yeah, charles Schwab, right exactly.
Speaker 4:No, clous Schwab, who are you talking about? The leader of the World Economic Forum?
Speaker 1:Oh, that's right, that's right, I was thinking Charles Schwab.
Speaker 2:Because all their acquisitions they're just gonna acquire all the financial companies where they control everything, or Weiser just dominates the world Right? This is my evil plan.
Speaker 1:Elimination of all risk. So that's the idea that risk can be completely eliminated from the stock market, right? So investing in markets inherently involves risk, and so risk can be managed or mitigated. It cannot be entirely eliminated. I still don't understand that. One Like I'm not gonna invest anything because if all the risk goes away then yeah there's no free lunches.
Speaker 2:Yeah, and investing in, like everything, still doesn't eliminate all the risk.
Speaker 3:Right Just having all the risk.
Speaker 1:Last one, number seven permanent loss of public trust. So basically, people just don't trust the system anymore.
Speaker 2:I think there's a little bit of that.
Speaker 1:I'm surprised at seven, but still you have to trust the system. I'm surprised at seven. I thought that'd be number two, or?
Speaker 2:three. Yeah, I'm like yeah.
Speaker 1:Because I feel like I talk to a lot of people that don't trust the government, Especially with light of things that have happened in the last couple of administrations. You're just kind of like oh, weaponizing Huh the government. Maybe there is a remember not being told the truth about everything. Right, I'll just put it that way Again I don't know. I mean, these are all legitimate fears you don't want to discount any of those fears.
Speaker 1:I just come back to okay, well, what's happened? And when you look at the S&P 500 and you look at over, even in 10 year segments heck, even in three year segments it has mostly positive upward trends. I mean, the worst thing that ever happened over 10 years is you broke even. That's the worst thing that's ever happened. What's worst thing that's ever happened over 20 years, I think, is a 5% gain each year. The worst thing to happen in a one year period is like 60% loss, so you can't invest for one year.
Speaker 2:No, and we tell all our clients that. I mean, if you need your money in the short term, the market is not the place to park it?
Speaker 1:Heck, you can get 5.2% on a Charles Schwab money market right now. I know that's bigger than the US Treasury. So why the heck would you, why the heck would you go invest money when you need it in 12 months when you can get a 5.2% right at return? You don't Exactly, you don't do that.
Speaker 2:No yeah.
Speaker 1:I don't know it. Just there's always going to be people out there who, who are just fearful. I think education solves a lot of that.
Speaker 2:Right.
Speaker 1:Which is why you have so many annuity sales. When people buy index annuities and variable, variable news are usually they're buying it for tax tax shelter. Index annuities are the ones people buy when they're scared. But it's just. You have to be educated and that's part of our processes, advisors. We have to educate our clients who want to be educated. Some people just walk in and go here, just do this, take my money, I don't want to worry about it.
Speaker 2:Right, you worry about it.
Speaker 4:Which is probably the best situation Not watching CNBC every minute.
Speaker 2:You're right yeah.
Speaker 1:Well, CNBC is entertainment. That's not really news.
Speaker 4:Yeah.
Speaker 1:Our day trading.
Speaker 4:Our day trading.
Speaker 1:Our day trading. Yeah, you're getting your economic analysis from Jim Kramer. He has really good comments, but you know bye, bye, bye and all the flashing lights and you know it's entertainment. Everyone thinks that there's a secret sauce to investing, and the secret sauce, if there is one, is to keep it simple.
Speaker 2:Stay the course, keep it simple.
Speaker 1:Yeah, Stay invested. If you don't understand it, don't invest in it and keep your costs low. Focus long term. How many people beat the S&P 500 over 20 years? 2% 2% of active managers beat the S&P 500. Or any index that they're assigned to, not just the S&P If it's a growth mutual fund only 2%. Actually less than 2%. Actually, less than a half a percent beat the index over a 20-year period.
Speaker 2:How are you going to find that For every asset category that less?
Speaker 1:than 2%. No, you can't, you can't. The guy's probably retired on the beach somewhere.
Speaker 2:Well, yeah, if he did that.
Speaker 1:So you have to keep it simple. This is why we focus on the planning side, because there's so many other things you can control your cash savings. Are you properly insured?
Speaker 2:That's the biggest thing, like risk exposure. You saved all this money, but is it protected If you have an accident?
Speaker 1:and you're at fault and you didn't buy an umbrella policy for $245 a year. Right, there's a good chance you could lose some of it in a lawsuit, right?
Speaker 2:Oh yeah, what about estate planning?
Speaker 1:even it's like, you saved all this money but then you lost it to estate tax because you didn't plan it properly or you made a mess of it.
Speaker 2:Or it's going through probate. You didn't want it to.
Speaker 1:Next generation challenges each other on how much they should be getting. You didn't put easy provisions to prevent that from happening. I mean, there's just so many other angles as planners that we focus on that don't show up in rate of return or things of that nature, right?
Speaker 2:Oh, exactly, yeah, It'd be so easy if it was just investments.
Speaker 1:We're independent advisors. We can buy anything for anybody.
Speaker 1:Oh, in their portfolios, absolutely we have unlimited choices, but yet we choose simplicity because it's what wins. I hate losing. I hate losing by the passion. It's losing so much that all I can think about is how do I win? So because of that? Yeah, I mean, that's what I don't understand. I said we get new clients every week. Probably four to six come through here every week and you see some of these portfolios other firms are doing and just like why you trying to justify your paycheck?
Speaker 2:Yeah, you got expenses over 1%. You've got a load that you paid of 5.75%.
Speaker 1:Yeah, 4.25 is bad. So there's just so much. That is a part of the planning process Tax efficiency. It's like why are people not, why are advisors not recommending more people? Not roll their money to them, but roll it in their 401k plan so they can do backdoor russ?
Speaker 2:Oh, I know Right. Well, we know why because they want the assets under management and we do what's best for the client. Say no, we don't need your assets. It's better for you, mr Client, to put it in your current 401k.
Speaker 1:The state of our industry is really sad, but it's because most firms are out there selling. But I digress on that. Bottom line is there are a lot of things to be fearful of, and fear should never be the policy setter for your portfolio. That's what it comes down to.
Speaker 2:No, no, what's it? The only thing to fear is fear itself.
Speaker 1:That's right Help or found. I think someone said that before you.
Speaker 2:But yes, oh, really Like someone presidential Right.
Speaker 1:Good theme for 24. But anyway, let's wrap this up, and it's always good to have the world's best financial planner and the king of data on podcast every episode.
Speaker 2:So thanks, Casey.
Speaker 1:See you guys next time.
Speaker 2:See you.
Speaker 1:Right before we go. Don't remember that, or don't forget that we have a YouTube channel called AY's a retirement. There we have a couple of videos of financial habits to avoid in retirement, which are linked here in the show notes. Pitfalls of living rich but not building wealth. I love that little episode that's available on YouTube. Also podcast episodes 181, five common financial myths debunked, and episode 141, what is holistic financial planning. You might be interested in those. Thanks for listening today's episode. If you're interested in learning more about why is a wealth management or when I schedule a consultation to meet with one of our very best fiduciary financial advisors, you can do so by going to wiserinvestorcom. Click on the schedule now you can book a time with us and also you can click on the episode notes to get there as well. Thanks so much. See you next week.
Speaker 3:This podcast is strictly for informational purposes only and is not to be considered as investment advice or a solicitation to buy or sell any financial products, securities, digital assets or any other investment vehicles or a basis to make any financial decisions. Wiserwealth Management Incorporated is a registered investment advisor with SEC. The host and or guest may personally own securities, digital assets or other investment vehicles mentioned on this podcast. Neither the host nor guest of the show are compensated for their participation and no referral fees are paid to or received by any host or guest for clients, listeners or similar interests. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor, tax professional, insurance professional and or a legal professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.