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In this latest pile of TRAP, the Trap Pack discuss
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Welcome to The Real advisor podcast, t r a p twerp please follow us and join in the conversation on Twitter at advisor podcast where you can suggest ideas and themes you'd like the truck team to discuss. Also remember to like and subscribe to our YouTube channel and leave a six out of five star review on iTunes. Doing all this really really helps us which means we can do more to help you. Now let's head over to the studio for the latest pilot track
Nick Lincoln:Yes, indeedy, TRAPPIST, welcome back to what many people are calling episode 29 of the real advisor podcast te R A P trap. My name is Lincoln and joining me as ever are the three of the Horsemen of the Apocalypse and the heart called Alibaug j which are an Alan l Nana Torrey Smith. Now gentlemen, we have a show packed full of absolutely nothing. So let's start unpacking it straight away with any number of high energy review reads and my good friend the Right Honourable Mr. Andrew Hart.
Andy Hart:Thank you very much boss. Okay, so the first review is a negative review. And we will read out all of the reviews warts and all. So this is from synergy UK, it's entitled bottled it three stars out of five, we can all stick to the stock line that a client being correctly advisors better than the client not getting no advice. It's telling Andy has income at stake and the flak and loss of listeners prevented the warts and all summary of SJP it remains the case their fees are commissioned by another name. And Andy, the self proclaimed behaviorist to turn a blind eye to the fact that there's potentially this doesn't potentially make a difference to the outcomes is telling. I don't mind high charges if the client perceives value but let's not pretend the remuneration doesn't distort behavior. As I say we're gonna read out all the reviews warts and all. I made it clear on that show that yes, I've worked with SJP and I still work there show up on their program rolling out, you know, proper goal based financial planning for their clients. You know, I see it from the inside, I've trained hundreds of their advisors. And I've also made it clear that I believe there's other factors that have a much more impact for client's financial success than fees such as real financial planning, proper investing, avoiding mistakes, you know, a human advisor holding your hand, etc, etc. Fees are yes, one factor but a simple thing to focus on. However, I appreciate the review. But in fighting, we're not progressed this mighty profession also this them against us. Again, I don't think helps. So appreciate your review. Skinner, G. UK. Finally, I'll finish
Alan Smith:in briefly sure and respond. First of all, I can assure anyone tuning into this, that if we felt the other part of this group, if we felt that Andy was out of integrity or compromised or somehow saying one thing when believing in other, he wouldn't get away with a gentleman. He wouldn't get we would not allow that to happen. We discussed all a lot of this stuff offline. And we wouldn't allow we've got an accountability partnership amongst the four of us and other people that we know and hang out with, and you wouldn't get away with it. So that's it's not actually it's not accurate. What Skinner G said, the worst thing about that review was is a three star review, I can deal with a one star review and Andy Hart gave me a one star review of my own podcast. I thought that's what you want. You want to divide opinion you want people to love it or hate it three years kind of Yeah, that's the worst thing about it. But fair enough, we can't always get five and six star reviews. Onto the next one.
Andy Hart:On to the next one. J M. from one brah what a big pile of trap five stars love these podcasts ideal for new starters and old legs like myself client outcome focus nicely irrelevant about a regulation serious topics done in the music way. I'm agreeing so much with what you guys are saying looking forward to the next steaming delivery. Thanks, chaps, back to you boss.
Nick Lincoln:Excellent. Thank you for that and thank you TRAPPIST as ever for the reviews. And as I said in a previous episode going forward if you want you don't have to by the way, but if you want to put your proper name in your review, I know a lot of these are just anonymous handles that you have to use. So if you want to put your name in the review and the firm you work for, you don't have to but just means it will just help create the sense of community. Because if we get a review from Angel 69, for example, we might have no idea who that person is we have an idea of what they get up to in their spare time. There's nothing wrong with that. It doesn't tell us about the person so put your name and firm in the review. Obviously, if you're thinking about leaving your firm because trappers inspired you to do so and we'd get quite a few of those reviews. stay anonymous but just throwing it out there. And also please do remember to to subscribe to our podcast channel, just download in the old episode. It doesn't really help you if you want listen twist on the radio on the go. Make sure you subscribe there it is in your phone of choice every other Thursday right great stuff. Thank you for that Andy. Topical tidbits the love of Christ come on and card
Alan Smith:with a jingle neck
Nick Lincoln:Yes, Ireland Come on.
Carl Widger:And then also they'll also see that I was deeply uncomfortable with the content of some of today's going to the Irish versus UK cultural differences yes, indeed, Dara Trappists deeply uncomfortable with some of the content from this morning show already. But there you go. Yes, Ireland have beaten South Africa in the pool stages. And it was the most tense and brutal test match I've seen in so long. It was just bloody amazing. Two teams just gone toe to toe. Literally nothing between them. I I wouldn't fancy having to play South Africa again. They're just a bloody awesome team so far. Okay. The reason I taught in the topical tidbits was to enjoy the journey is number one, we have no idea where this journey for Ireland might end. So all of us Irish rugby supporters need to definitely be enjoying it as we go along. But more to the point. So the crowd, these nine o'clock French time kickoffs are allowing the Irish to really enjoy their afternoon before they go to the match, which sets out a raucous atmosphere and a lot of singing so they have the shoulder to shoulder at the at the outset. And then we have the fields abandoned, right and then we've taken to singing zombie which is a cranberry song. Which monster supporter started last year when monster played to loosen the Aviva Stadium and was not that much and zombie was broken out so zombie seems to be be the tune of choice post game for our all of our victories to date. And some people on Twitter are not happy. It's a song and people are enjoying the game. So just bloody well go and enjoy it everybody and stop moaning about what songs people might be seeing. Anyway, we have the next match a very big game against Scotland. It's mad the way the pools are going while on the the competitive pools because of Ireland lose to Scotland, it could be that they actually go out. So this is yeah, it's gonna be a big couple of weeks coming up mad that England and Wales are looking like they'll get into a semi final. But anyway, it is what it is what it is. We won't dwell too much more on that. But I'm certainly enjoying the journey and weld on Ireland. What a fantastic rugby team.
Alan Smith:Yeah, absolutely. Well done Ireland. And as you say this these 9pm Paris kickoffs and a couple of weeks we've got Scotland versus Ireland, in Paris 9pm kickoff, and I hear that some of us may be there. Some of that she may be in attendance just to see what unfolds so we might be realistic.
Carl Widger:I also hear that the Scotsman amongst us has booked lunch for 1pm that day. As a colleague of mine here, yes is what could possibly go wrong. Anyway, really, really quite just so looking forward to it. It just can't wait. It's yeah, I just love rugby. Anyway, that's it, Nick. You've been very quiet during that little segment.
Nick Lincoln:No, it's It's good. I don't I'm conscious that not all of us are rugby fans but it was it the rugby is going well. I mean, well, the Wales performance was amazing. They thoroughly deserved that and England, you better be careful what you wish for a wicket with each match. We're sort of sloughing off the Eddie Jones impact which has worked so well for Australia and slowly slowly perhaps regaining something approaching some kind of outside form but so it's yeah, this the World Cup is progressing nicely although this week is rubbish. The fixtures are rubbish University rubbish. The best game of the week is Scotland versus Romania. Yeah, exactly. They're Trappists Okay, now I'm not sure if Mr. Hart sound is working. So we'll come back to the HUD Cape Town part in a minute Alan, you just crack on with your pot thing about IHT plans and aim investing and the performance of such plans.
Alan Smith:Oh, it was just a comment. There was a lot in the press recently last weekend about potential current government potentially disbanding or doing away or significantly changing and minimizing inheritance tax. Now inheritance tax tax planning in the UK is a huge I want to say I don't know the date of I'm gonna guess it's a multi billion pound industry in terms of the plans, the structures are kind of tax minimization strategies. And if IHT is kind of done away with or significantly changed or minimized, it's going to kind of guess it's going to wipe out or decimate a huge part of our, of our industry. And I just happened to be looking because one of the one of the tools in the toolbox that advisors have historically been able to use is an ame portfolio within an ICER wrapper. So traditional ICER if you hold aim, so the underlying holdings are stock and securities held in the aim market, which as everyone knows, is the kind of smaller early stage kind of micro company startup companies, undoubtedly much higher risk and of course, the HMRC and the Treasury, they don't give away anything for nothing. So if you want to minimize your inheritance tax potential liability, you need to allocate certain amount of funds into these high risk companies. And I just happened to be looking at historical performance of the aim IHT portfolios five year discrete performance. Now five years is short. So we will recognize that but the numbers are pretty telling like it again, doesn't take much research to find this out. For example, the and I'm not trying to single out any particular companies just do a quick Google search, you'll find that the octopus aim IHT portfolio, the five years to June 2023 is minus 26.9%. I think hell every time you do that again buddy heart attack, and maybe rightly so for some of these some of these numbers Kuma aim, third, that's a positive looks like 13.4, interesting, RC brown ame ih t minus 21.5, unicorn dividend, minus 13.1. And if you think what like a global equity portfolio would have done over the same five year period, you add in most of these portfolios, last time I looked, I've got significant charges, initial charges, spreads, or significant annual charges. I'll tell you what, alright, after two years, they're kind of exempt from your otherwise taxable estate. But you're better off not even bothering with these things based on the recent investment performance based on the very high significant charges. And based on the amount of risk that you're being asked to take, I've never really been a fan. It's the old adage borders, blah, blah, blah, tax tech tax tail investment dog, don't let the tax tail wag the investment dog. That is another prime example. And it's just gonna be interesting to see how this significant part of our industry is impacted by the removal or reduction of inheritance tax in the UK. Should it happen? Thoughts, anyone?
Carl Widger:I know this is gonna come across as a little bit childish, but it's one of those portfolios called RC brown.
Nick Lincoln:Now I was thinking that I was I'll see brown, it's like taking the mick, isn't it? Yeah. So
Alan Smith:the Aussie brown ame portfolio minus 21.5. So make up your mind about our super
Andy Hart:portfolio or the aim index is always been a bit of an anomaly to me, in some ways goes against our investing philosophy as invest in small, almost value. Younger companies, obviously, you're taking a lot more sort of volatility risk, but the returns should be there, but they're not. So it's a very old index. It hasn't done anything for I think, about 30 years. So any company trying to individually select stocks inside this thing that does nothing? I think they're up against a tough ask. Again, I haven't looked into it for a while. But the AME index has done nothing ever since it's been launched. It's a very odd index. As I say, it's slightly goes against our sort of investing principles. So yeah, I just thought I'd mention that. So if you're trying to pick winners within it, you know, good luck. And as you can see there, three of them haven't, and one of them has, but once you factor in
Alan Smith:the last year, yeah, but inheritance tax, inheritance tax, that's the thing everyone gets excited about. Are you going to have minus 26% returns plus a 5% spread or 3% a year fees? Yes, by inheritance tax. But
Andy Hart:as you say, 40% have a much lower number. Thank you very much for for decimating my wealth. Yeah, this is Uber like to be sold Shiny, shiny, shiny, shiny solutions to things. Yeah, if they lend me money, and in a portfolio, it needs to grown by x to then swallow up the tax hit. There's various ways to slice and dice it and obviously we've picked a sort of period in time, but not cherry picked it. We just pick the latest information we can find for five years but yeah, the aim index has always baffled me. One day it might shoot the lights out for a period. Over to you Nick,
Nick Lincoln:on that put out on on that point. I think more than anything other indexes obviously when firms jump from like the footsie 250 to the footsie 100 They're their future performance falls out of the footsie 250 And I think with aim it's such a when they won in 20 companies one in 30 Whatever the odds are actually take off they of course then become properly listed and they come out of the a market and that's where their performance so what you're left with the name is all these companies that never quite make it a lot that go bust. So in some ways, doesn't surprise me that the index has gone has gone nowhere for 30 years if that's true, and and I have no reason to doubt you, so that's probably a contributing reason why. Okay, thank you for pointing that out. Alan. Yes, nice tea. Will the will the will the Tory government get rid of it? I mean, they might do I don't see any labour voters suddenly voting Tory I don't see any Tory voters. Not voting Tory anyway. I mean, whatever. It's, I think some of those taxes actually I wouldn't mind getting wrong because it's just a pain in the bum. I thankfully I've yet to administer an estate for anybody but I know that having to do so is a pain. And Andy, you made a comment in the group chat earlier, there's probably more time spent on collecting IHT and all the bureaucrats trying to get it than the national tax it raises. Okay, we can't afford it any longer. Smith Hart he'd been to where have you been somewhere somewhere abroad?
Andy Hart:We've been to the southern hemisphere. We've been to Cape Town here. We've recently returned or spent just under a week there. It was my humans on the management Cape Town conference. It was last Tuesday for people listening to this on the current Thursday. Mr. Smith was the international keynote speaker. So he spoke last at the event. I've had five events there to being virtual. So this was the third live one. Around 250 people in the Alan Gray Building. Alan Gray's one of the big sort of supporters of the event. They're a sort of discretionary fund manager, fund manager and platform in South Africa. Fantastic days. 12 speakers good mix. Yeah, great people in the crowd. Lots of people that isn't the trap. I think the score out of 10 so far is 9.1 out of 10 which is fantastic for a conference. Yeah, we had an absolutely fantastic week, lots of shenanigans and obviously lots of work was taking place. Yeah, I stayed with Mr. Smith for five nights in in lovely, just to give some context about sort of the prices in Cape Town. This was sort of a four storey house overlooking, you know, one of the sort of prime areas in Cape Town. Four of us were staying there for ensuite bedrooms, you know, just beautiful balconies, etc. It was 130 pounds a night for the whole place. Chi. I mean, if you put that place in Ibiza would be 10,000 pounds for the one night. So yeah, it's Yeah, well, we had a great time. Lots of lots of fun, but also some serious business as well. over to Mr. Smith.
Alan Smith:You just want to endorse what you said. I mean, you had to kind of twist my arm to go out there. I thought there's a long way to go for a conference, blah, blah, blah. I must. I had a fantastic time. We all had a fantastic time. The list. I mean, speak about the conference briefly. It's a great, it was a great success. Lots of different people. I love the community. I'm going to talk about community later on site. Another event I attended recently, but I just love random people I've never met before in my life just sort of coming up and speaking during the, during the sessions and in between and obviously we went for a drink afterwards. And it was just fabulous. It just there was a real sense of positivity that South Africa, as everyone knows, has got its challenges economically, politically and otherwise. But there's just a great number of outstanding positive people out there just doing doing the right thing. A lot of them spoke a lot of them were sort of speaking in between the sessions really good. Yeah, the place we stayed in was just I just, it was jaw dropping, as you walked in was overlooking the bay had its own swimming pool that had just different levels. I had the best room obviously, being the international keynote keynote speaker.
Andy Hart:Well, no Bear Bear the older style and I respect my elders. Right.
Alan Smith:It was it was fabulous. And one thing I would say as well. A tip to anyone who ever goes on one of the day after the conference, then we went out to call the graph wine estates about and that in Stellenbosch about an hour outside of Cape Town, what a spectacular experience that was. So you know, just at the foot of the mountain range there. Absolute five star it's as good as any restaurant experience you're ever going to have. Unlimited. We were just like we you know, hit up the wines. They were amazing wine, the food, the meat, the prawns, the steak, everything. And I can't remember exactly. I did pay one thing. The only thing I did pay the whole trip because it was calmer what it was but it was really inexpensive. It was really expensive. That's why I paid I say so anyway, it was it was a really great experience. I loved it. Really, really positive.
Andy Hart:It was lots of fun. Yeah, lots of fun. On when everything went according to plan, it was a almost like a Carlsberg trip. So, yeah, that's a high bar for next year. Back to you guys or unless you want to ask any questions. No,
Carl Widger:I look, you know what I think it's like absolutely amazing to be able to fill a conference all in South Africa, with humans under management. So what you're doing is just spectacular. Well done. Kudos to you and respect. fairplay,
Andy Hart:I just want to want to do so my co host in South Africa, Pierre taljaard, who's been absolutely instrumental when taken out there. And also Rob McDonald, who also came to the graph vineyards with us that, that maybe three or four bottles of wine in was sort of somewhat regretting taking me and Alan, they're a lot of screaming over each other, but also a lot of fun. And finally, Carrie Bender also helps us with all the speakers. So yeah, there's a lot of work that goes into it. And also special thanks really, to Alan Gray, who hosted us and obviously you don't go to the conference for food, but my God that food is second to none. Yeah, that's That's it almost the next year.
Alan Smith:And it was great that our our CO hosts on this supported us throughout the group. And they didn't leave our private Whatsapp group during the time we were away.
Andy Hart:That's in the support from them was just absolutely amazing. Excuse me.
Alan Smith:Absolutely non existent. Thanks. Nice and
Carl Widger:a number of tweets and liked and commented, tweets. I was supporting from the background, although I was led astray by our chairman. Any comments to make on that Nick?
Nick Lincoln:No. Allen progressive planners conference.
Alan Smith:Right, you're right. Yeah. I mean, on the subject of conferences, as we've said, before, we are in conference season, there's quite a few of them going on. I attended a did a little thing at the Lee Robertson and his organization who had this thing called progressive planters. Really interesting, quick, quick observation. It's almost like a different group of different community there. There's people that go there that I don't see it humans under management or other things. So they've got to you know, they've got their own community. There's not a lot, not a lot of crossover as far as I can see. But it's fantastic. I went last year, it's it's a much I can't remember the people there. It's not, it's not in the hundreds, it'd be below 100. So it's quite a kind of discreet isn't a great venue, just off the strand in central London. And I thoroughly enjoyed it. And I'm going to single out a couple of people for commentary I didn't I had to get away lunchtime, so I was only there for the morning. But you'll be familiar with another another guy who I believe tunes into Dan Hale it then he'll it spoke now he's really kind of from what I've seen, has really upped his game, he's really got deep into the kind of the content creation is really focusing on the at retirement, the pre post retirement market is creating a lot of stuff. He's got his own, his own podcast, which he's launched. And he did a talk, which I thought was fabulous. It was absolutely fabulous. It will come up on the octa platform in due course worth checking out, it's worth actually looking or listening to his podcast and seeing the stuff that Dan's doing, because he's doing some really, really positive things, which is what we all want to hear. And the other thing I want to mention and just just to to see I've got this guy's permission to share this. During one of the breaks, I'm standing there chatting away as always, and a gentleman came up and approached me said Hi Alice, I've never met him before. His name's Kevin Conlon. And he told me a story which I won't have time to go into now but he's been through a very, very difficult period of his life. He got he was a trader in the city, you know, working crazy times are getting really stressed out. And he kind of just had a breakdown, he just physically broke down and he was hospitalized for quite a long period of time. And sadly during that period, his father died he was quite close to so there's he was telling me all this during anything go you know, where's this going but I'm still I'm listening and and showing some empathy and and he said, I just want you to let you know that your podcast helped me it really got me through that whole period because I needed to reassess my life and you couldn't carry on doing what I was doing up to now I wanted to study resumes only 50 So I wanted to carry on working and I decided to retrain as a financial planner. And the you know the conversations that you guys are having I can see it's a really positive community you've got it's an interesting it's interesting work is I've got no shortage of potential clients. I know a lot of wealthy people through my job and city over over several decades. And he said I just want you to let you know I want to be I want to say thank you to you and I'll tell you it was it was one of those moments you know the hairs on your on the on the back of your arm Standing up the back of your neck standing up. Really, really emotional, really positive, you know, shook his hand several times and said, you know, thanks very much, and we're still in contact, and he's going to continue to train as an advisor, he should be qualified at kind of CFP level next summer. And you know, who knows, maybe you'll come and work with us, maybe it'll go on, but you'll certainly join our sector and our community in our industry. And I think the industry will be better for it. People like Kevin will be additive will be positive to our community. So that was just kind of out of left field. I haven't really shared that with you guys before this conversation. But I thought that was really you know, sometimes the stuff we're doing we're just having a natter talking nonsense, often, it can be impactful. It can be really amazing. sitive in the life of science people.
Nick Lincoln:Yeah, that's amazing. Thank you for sharing that. And Kevin, yeah,
Carl Widger:good. Good luck to that man.
Nick Lincoln:And indeed,
Carl Widger:yeah, fair play well done. Brilliant.
Nick Lincoln:Okay. And and we can't have an episode of track without an update about future you mister watch crack on.
Carl Widger:So Andy said, in our private Whatsapp group, oh, here comes the 14 minute segment on future who, right so I'll be brief. Future you happened a couple of weeks ago, in the Armada hotel. It's a lot of work, right. So that's why I'm saying hot tip to Andy, you know, like doing these things every year. Susan Walcheren Metis, organizes everything. But she used to coordinate all the speakers, the effort the speakers put in, we took a few risks. We did do. Sinead Geary did chair yoga, we went for a group walk. You know, we we, what I would say to people is, you know, we got 100 people in the room 98 to be absolutely precise. We didn't know about 50 of them, which was brilliant for us, obviously, because we have lots of meetings lined up afterwards. But what I would say is if you're going to do these conferences, just don't make the same as everybody else. And do take a few risks. Because what's the worst thing that can happen? You kind of go Well, that didn't really work. We'll move on. So amazing. Shout out to the folks in the Armada hotel. It's an absolutely incredible venue in an incredible location. couldn't have gone any better. For us. I think the feedback has been phenomenal. So thanks to everybody who attended. And I would encourage all financial planning firms who are all about lifestyle and matching your lifestyle with your resources. That's real financial planning. do stuff like this, you know, we had psychologists, we had fitness and nutritionists. It's not all about the money. It can't all be about the money. So do it. Take a risk and do it. You'll be thankful that you did it. Is that okay? Andy? Super. Thanks, guys.
Nick Lincoln:Keep keeping the
Alan Smith:credit again, credit to you call because these things are risky. You took a risk. It's a lot of effort cost money. And it sounds like it did pay off. And it worked out. But it just a moral. There's a message for many people there. Sometimes it's worth taking a risk. What's the worst that could happen? It didn't work fine. We learned another way of not doing it. We'll try again next year. So again, credit to you. You're the Man in the Arena.
Carl Widger:Thank you agree.
Andy Hart:I agree. Good.
Nick Lincoln:Keeping with the Irish theme. Smithy. You've been to Dublin with your crew. Yeah, I just
Alan Smith:wanted to throw this in there in terms of tropical tidbits. Every year we like to me and my colleagues will go on a on an adventure somewhere into Europe just to kind of team building bonding. We've been to Paris for lunch been to Brussels been to Amsterdam, and it was Ireland's turn so a few weeks ago to caulk our crew and this this time we decided to stay over stay the night which is the first time we've done that which is always a bit high risk knowing my colleagues if you're listening boys and girls, you know what I mean? But and my my good friend Mr. wigy here the man on the spot the Irish man give us a few tips and hints and sorry Shareen that we did we canceled our trip to the museum and the Book of Kells and went to the pub instead. But it was a thoroughly enjoyable experience. We I mean the restaurant card has anyone ever gets themselves into Dublin the restaurant called fire right in central Dublin was absolutely first class really good food really good fun. The obviously we did what every tourists would do apparently is the most popular paid for tourist attraction in Europe, which is the tour of the Guinness factory. Read a really fun really interesting question for you Nick Lincoln. What color is Guinness?
Nick Lincoln:I don't know. I don't know. I know I didn't obviously not black.
Alan Smith:It's not black. Guinness is red. Isn't that right call Guinness is red. And then you know, yeah, so I learned a lot. Thank you, Arthur. It is incredible, incredible story, you know, took out a 9000 year lease when he when he got that piece of land St. James, right?
Unknown:Grab yourself a drink, a very long drink. It's story time with Alan Smith.
Alan Smith:The only real story that I can share because obviously what goes on in Dublin stays in Dublin was you know, everyone's behaving themselves wrong, have a really good good old time you did go to the Guinness factory tried to Guinness and everything it was it was a good experience. And we go out in the evening. And we were in this restaurant called Fire and everyone's drinking cocktails and everyone's having a good old time. And inevitably, I move across to sit beside Olivia, who will have been mentioned on this podcast before his the lady who used to work with worked for Amazon, and is now working with us and deeply entrenched in the world of financial planning, which she is loving. And I was going to have a chat with Olivia and the inevitable coming together of a glass of red wine on the table. And Olivia wearing white trousers and me gesticulating I gotta had it couldn't happen to a nice person. I not the glass of red wine when all over her white trousers. I was cringing are dying. It could not have been more apologetic. I'm so sorry. You know some of the dry cleaning bill, tell me where did you get. So it was a bit embarrassing as she had to walk through the rest of the evening for the night wearing red wine stained white trousers so couldn't happen to a nicer person pologize to a million times. But hey, that was the if that was the only casualty which was Olivia is white trousers. And I think we've probably got away likely, but it's a great, great fun thing to do. And people are doing and teams and what have you, I think it's just it's just a good thing to do. Take a bunch of people, you know, to, you know, on a trip, if it's a day trip, an overnight trip, it is a positive thing in terms of the team building, you don't have to do tough Mudders and outer bounds and climb mountains, you can just go have a walk around the city have a nice lunch, where you have a couple of drinks, and also to meet up and hang out with each other. So it was a really successful trip, apart from the famous red wine on the white trousers incident which I'll never be forgotten around these parts.
Nick Lincoln:Thank you. Thank you and Olivia, our hearts go out to you for numerous reasons. My son just got a tough mudder with his firm, Delta financial management went down to Sussex last week, there's going to be filled there and it threw it down in England last week, maybe not as well. So he, it was a it was a very, very money but great fun. I might do a team building exercise here actually about managed division. Okay, moving on. Let's have a look. Mr. Hart, nucleus fIying Curtis banks.
Andy Hart:Yeah, I'll get onto that in a second just to close the loop. And the point I made earlier about the aim index, I believe the aim launched in 1996. Keep it simple. 1027 years later, it's 731. So I've over 27 years, it's just slowly lost about a third of its value, which is, which is a very odd index. Okay, moving on to
Nick Lincoln:be buying. Yeah.
Andy Hart:Just like the units are very cheap at the moment pound cost average yourself for the next 27 years. It's an incredibly odd index. Yeah, this is a story that I think has happened some time ago. But nucleus obviously sort of merged with nucleus Jas Haider, obviously on sort of a bit of an acquisition trail. They bought Curtis banks, who I didn't have any dealings with personally, but I know quite a few other advisors use them. It was really it's relatively cheap purchase price, there must have been a reason behind it. 242 million. They've set up a new a new company to sort of deal with it. But yeah, they're there. Obviously, their assets on the management for the nucleus brand are growing. I think they're just over 80 billion now. Yeah. Did anyone have any points on that? Or was that? No, John? No. No, John. Okay. My next point is the US credit card debt breaches 1 trillion, which is somewhat of a milestone in the history of debt. Anyone who's sort of a fan of Ray Dalio has probably heard him talk a lot about debt cycles, short term debt cycle, long term debt cycles. There's a good link in the show notes of the Carlson group in the US who go through this and there's loads of useful charts. So if you're interested in this kind of stuff, like I am, do check it out. I think that's it for me, boss back to you.
Nick Lincoln:Okay, thanks, Andy. So, okay, me, I just saw something this morning, actually. In episode 17. Of trap we had a topical tidbit around the UK stock market and its relative decline. No, it's absolute decline over the last 2030 years, too. The situation now where it's about 3.7% of global market capitalization, it was around 10% of global cap 20 years ago. And the court apparently according to the Telegraph, take it with a pinch of salt, the Bank of England are going to launch an a new initiative, searching for unconscious bias in the finance industry. And I'm going to ask all these companies in the city to submit these new returns showing the exact gender breakdown of their staff, their ethnicity, everything else and you're just wondering, if you wonder why firms don't list in the UK why the UK stock market is becoming less and less relevant to global capitalization. It's just because most boardrooms can't be asked with this crap. And you have to wonder what the bank have been. And what they can get away with. Their key job is just to keep inflation at two and a half percent, maybe focus on doing that. And not playing around with this with this nonsense. There's a link to that in the show notes. And with all telegraph stuff that is behind a paywall, but when you load when the page is loading up, just just crashed the escape button like a bugger, and that will get the page loading up. They've got a very weak paywall. And that's how you get telegraph articles for nothing. If you're, if you're on the telegraph board, and you're listening to this, get back to doing your ethnicity studies. Okay, get back to filling out those forms. That share price won't collapse by itself. Okay, are we done? Are we good? I think we are. We're only 36 minutes in Jesus. Oh, you're
Alan Smith:a good form this morning. Needless to say,
Nick Lincoln:right. Meat and Potatoes time, I think gentleman. And this is an interesting one. We got to be careful. Yeah, okay, I'm gonna, I'm gonna go down there. This is about alternative investing for high net worth clients. And Andy will lead us off on this, I think that the theme of this is going to be why do we as a profession, sometimes feel obligated to put shiny objects in front of high net worth clients win? Actually, they'd be best served by keeping it simple, stupid, Mr. Hall.
Andy Hart:Oh, well, that's a good, good place to start. So this crops up all the time. And this is not going anywhere, even if we you know, address it head on. Now, this is going to be a recurring theme forever. The issue is wealthy people on their journey to becoming wealthy. have, you know, the thought experiment is if you want to buy, you know, the best bag, you know, it's expensive and exclusive and hard to find. You want to go to the best restaurants is expensive, exclusive and hard to find. You want to find the best investment solutions for your wealth, or it's exclusive, expensive and hard to find. And then someone comes into their lives and tells them the truth around money. You know, the lower fees you pay, the better the simpler it is keep it simple. All this sort of stuff. You know, it's this misconception that wealth equals more complexity, more wealth equals more complexity. You know, the most laughable, old, you know, ultimate oxymoron, I believe in the wealth creation, businesses, wealth preservation, you know, they want to preserve their wealth. I mean, in real time, their wealth is just absolutely decimated, the purchasing power is absolutely hammered the loss of returns inside the portfolio. So yeah, the ultimate oxymoron is preserving wealth. But again, wealthy people like to hear that, and then people pander around it. So anyway, the sort of thought experiment is, let's say you have a client that starts off with a low amount of money that let's keep it simple, they've got 1000 golden coins, and they come to you and say, What do I do with it? And we tell them the truth and we say well, all the returns generally come from global equities the best portfolios when you stick to here's a solution Off you go, they then get 100,000 golden coins and they go I got 100,000 golden coins now is there something new what's what you know, people love to be sold new and exciting things? And he said, The same applies. Same thing. Germany global equities, the highest proportion you can ever go back to the better the best portfolio is when you stick to them they get a million golden coins and that right there must be a secret door something you know, give me give me the give me the code give me give me the you know, give me the key give me the exclusive stuff and this goes on and on and on and they get 100 million they go surely there must be something secretive now. You know, I've I've earned the right now you need to show me the secret door. And the follow on from this is the Norwegian sovereign wealth fund. The Norwegian sovereign wealth fund is about 15 trillion kronor and Norwegian kroner, which works out to be about 1.5 trillion US dollars. And they're public in what they invest in. And they've got the deepest pockets of anyone in the world. You know, if there was a secret door, they would have the keys to it. And what they've basically done is they've invested 70% of their assets and global equities, they bought over 9000 companies on public markets. They own about 1.6% of the world stock markets, and the rest they put into generally fixed income and a couple of alternatives. So if that's not an example of and also Warren Buffett's kept it very simple. Charlie Munger has kept it very simple. You know, they say the returns are going to come from global equities investing in the great companies and the businesses the world. The rest is generally you know, sort of noise and sort of faff around the edges. And that's it. And financial advisors are are always caught between this or the clients got a little bit more wealth now. So I've got to add a little bit more complexity in their life, what can I find this alternative? And if you sort of back tested all these numbers, you'll probably realize that not all of it is a probably an utter waste of time, once you, you know, look back on what they're potentially been been up to. So, yeah, pandering to high net worth clients are looking for alternatives is very present, and is here to stay, and it isn't going anywhere. And we see it all the time. So that's my, my startup who's next?
Alan Smith:I'll throw in just to continue this work. First of all call question, Norwegian sovereign wealth fund, are they one of your clients that met us Norway, it must be one of your bigger clients,
Carl Widger:searching, pitching,
Alan Smith:pitching with an alternative, if you
Carl Widger:were one of the 9000 companies that they've invested in?
Alan Smith:You wish we kind of talked about this a little bit in the past, and I'm aware of a number of things that aren't exactly right. You know, as you know, we will I guess all of us have different degrees, we'll, we'll deal with people who have had liquidity events, people have sold the business. And that's the classic thing, you get a chunk of money, then you get an urn out, it's the year after five years or three years to get more money. And the natural thing is the client comes back and says What shall we do, and you say exactly the same thing. And you can say, and then we've got another next year, get another one out, it's exactly the same thing. And so there's a kind of behavioral psychological kind of mismatch there, because everyone wants diversification. But you've already got 9000 companies really good 10, or 15, or whatever it is 1000 companies. So one of the things I reflect on, and I'm aware of a number of things kicking around, and some good advisors are here talking about some sort of investment strategies and structures where, you know, returns were 19%, last year or something, and, and it all sounds a little bit esoteric, and out there. So one of the key things, I think this is really, really important, anyone listening to this, anyone who's running an advice business, or anyone's thinking of doing an early stage, you've got to have a philosophy, you've got to have a structure and a philosophy through which you decide everything. And some of those programs and investments and what have you that you see kicking around, because we've got a filter, it wouldn't pass the first test is simply wouldn't do that that might be amazing, it might well be the chances are looking at, you know, many, many years of historical returns, the chances of you stumbling across some alternative investment, that's suddenly going to give you in a risk adjusted basis, a greater return than a simple portfolio of global equities. And chances of that are close to zero, there might be some chance, but it's pretty small. But the key thing is unless you've got a robust philosophy, and a filter through which you see every potential investment, you drive yourself crazy, because there's always there's always a good story. There's always a good piece, it's always my mate invested in it, and it got 19% last year, and so therefore, I feel duty bound to share it with my high net worth clients, which is the other crazy thing. So my advice to anyone considering this is build a philosophy, build a filter, build a series of questions to see, Does this meet with our philosophy? Yes, no. If yes, on to the next level, if yes, on to the next level, because none of these things that I've seen kicking around would put there might pass the first one, they wouldn't pass a second or third, most things I've see. So that's my advice to anyone build a philosophy and stick to it. Thoughts?
Carl Widger:Yeah, I'll go next. I've kind of two two thoughts about this. So if I can start the first point by using a kind of live example here in Ireland, so there's a there's a product that has gone an investment product that has gone pear shaped here, and it's been in the financial press a lot over the last probably for all of this year. It's called solar 21. And I've put a link to an article at the currency did kind of detailing this investment and what's gone wrong. They raised over 230 million I think for a for solar, do you call them wind, solar, or wind farms or solar farms anyway? You know what I mean? And
Unknown:basically, there's solar wind farms.
Carl Widger:So yeah, you know what I mean, anyway, it doesn't really matter. The point is, right, it's an alternative investment clean energy. Well, it's it's specifically solar and that there were building these things in the UK, by the way. So anyway, 230 million was raised. And there's kind of seems to be to kind of tranches of this and trying to on as in big, big problems. Yes, Nick. Sorry.
Nick Lincoln:Sorry. Great. Are these solar farms for Ireland?
Carl Widger:No, well, there'll be built into UK so no separate
Nick Lincoln:you don't yeah, it can't be run in the kind of wind farms I'd get sorry. Back Back Back to you.
Carl Widger:Anyway, getting on with my story, which is all been a little bit disjointed thus far, so I'll try and do be short and brief the way Andrew likes it 26 million has gone and fees 26 million has gone in fees. Now 300 financial advisory firms in Ireland are brokerages, as they're called in their article, have recommended this to their clients. As far as I know, there are somewhere between 12 and 1300 firms in Ireland. So 25% of the brokerages in Ireland have recommended this that our clients see have it bloody hell is right now, is this because the solar project was deemed this is gonna be the one? Or is this because there was large fees attached? I don't know. Only each firm can tell you the answer to that. And I know there are some people who I like and respect have recommended this to their clients. So just putting that out there as well. But 26 million in fees, and that money is now illustrated in the article non recoverable. So this is the quintessential wealthy client, I'm not going to go with my passive ETF because that will be too boring. I'm going to go swit, something a little bit sexier. So clients don't need it. And these alternative investments have an awful habit of going pear shaped Yes, of course, you can be lucky, but they just have a habit of not going pear shaped. Do you want to jump in there before and make point to?
Alan Smith:Yeah, just just briefly call, I just want to say your credit to you, again, for mentioning this because you said something in a few episodes before and you've gotten a little bit of trouble about it with within the kind of Irish financial planning community. Because what you were effectively doing was calling out bad practice sharp practice. And you're doing this again. And you're probably going to get a bit of flack for sharing this. But on a headline level. You know, quarter of the Irish advisory community supported this esoteric investment a quarter, not a tiny outlying handful of Mavericks, but a significant number. And I don't Well, I'm not done in the Irish community at all. I know a lot of fantastic Irish financial planners. But it tells you something, and I'm sorry, but I do think is part of our role here on this podcast. To mention it to call it out. We're trying to just oh, you know, we're not perfect by any means. But we're trying to call out things where we feel that the work the the profession can do better. And this, this is an example. So again, I just want to support you and publicly say that, you know, you're doing the right thing by calling out sharp practice. And we will do the same with a saw the same in the UK. With that sort of numbers. I mean, 25% versus 25% of the UK vice market. We're involved in something like this. We certainly want to talk about it. And you got a point.
Andy Hart:Yeah, no, I agree with you. 25%. Sounds like an astronomically high number. I mean, I've put this into the financial trash bucket. Again, it's the principles, we're going to do things here, which investment wise have always worked, anything which is working now we avoid, actually a huge chunk of your fee that you're paying me is to help you avoid anything which is going to be working now. You know, again, we passionately do things from an investing point of view that so far have always worked, you know, 200 years worth of data. Yeah, a final point on the you're wealthy, therefore, you need to have something complex. Warren Buffett's advice to his widow who's obviously going to inherit a few quid even though a lot of its going to go to philanthropic causes. He says to put 90% of your money in the s&p 500. He mentioned the name he mentioned the vanguard and keep 10% in cash. And he's the smartest, wisest investment, business human being that's ever lived. That's his advice. Again, wealthy people just don't want to listen to it. They want to be you know, wowed by pirates and pinstripes, flashy masterminds flying around the city, and all the other stuff that they the forces that are against them. Yeah, any final points on the meat and potatoes matter? Karl
Unknown:Karl wasn't finished yet.
Carl Widger:Yeah. So look, I am gonna get myself in bother. No. And I did before. Right. And I suppose look, what I had kind of decided on before was that look, I'm going to just focus on what we do, and maybe not, you know, mentioned stuff in terms of negative right. But I think it just needs to be said, right. By the way, I'm basing all of my that what I'm sharing here on the article. So I'm assuming that the article and currency has the numbers correct. And my second point, and my second point is going to totally and utterly contradict myself, and I'm probably a little bit alone in this group on this or maybe I'm not If somebody comes into an awful lot of money, right through sale of a business or whatever, I am totally and utterly okay with carving some money out for a playpen, our, you know, stuff
Andy Hart:around account the dicking. Around account, we perfectly free.
Carl Widger:Yeah, exactly. But I think that that money should be just go and look at these, you know, types of investments yourself. And maybe it's for kind of startups or maybe it's for individual stocks and shares that you'd like to kind of pursue yourself and that kind of stuff. So I am, you know, I think that's relevant, because all I can ever base, the advice that I would give people on is what I would do myself. And I know, I would, if I ever came into a lot of money, that's what I'd like to do, I would put the vast, vast, vast majority into what has always worked, you know, I do dimensional world allocation funds from my own pension fund, that's what I would do, I would probably tag on some Vanguard lifestyle strategies, that kind of stuff. And then I would carve out some money to maybe go and do stuff that would keep my own brain ticking over and where maybe I could add value to some startups, that kind of stuff. So I'll always only give the advice that I would do myself. And that is what I would do myself. So I have to be honest about that.
Alan Smith:I think there's no, I think we all are broadly in agreement with that. We've talked about this before, we've talked about the family fortress, and the investment playpen. And recognize we always say never make some long term investment with entertainment. Because that's what you're doing. That's what you do. The story behind solar farms, wind farms is kind of entertaining. It's interesting, isn't it, there's other, there'll be some data and numbers that sound vaguely interesting. And of course, startups, you know, to put money into a new like your friends, new tech idea, your friends children's idea or something, it's all very entertaining. And the story is dinner party stories, global index funds are not dinner party stories. And that's perfectly reasonable. Well, what you were doing, and I bet this didn't happen with the solar farms investments is you're assuming they're gonna go to zero. That's, that's the starting point, this investment, I'm going to assume within the plan is going to go to zero. If it doesn't, happy days, if you tell that to a client investing in a solar farm, I'm going to assume this goes to zero, you might get a different response, you might not invest in it. But if they say that's fine, I expected and find that might be part of their five or 10% of their total wealth. But I think we're all in agreement. It's fine to have a Russia blood fund or investment, wherever you want to call it. It's just a scratch or an itch. That's that's fine. If you've got if you've got enough wealth to do it. What are you thinking about this Nick?
Nick Lincoln:Newman, numerous things. I'm gonna go through them in in order. I, yeah, I had a client who was going to a solar solar startup project or what have you, I would take your lead there. And I would say yeah, okay, we're gonna write this off then. And just let that let them cogitate on that for a little while. Because even if you can get a value on it, you never know what these things are worth until you come to sell it anyway. So it's not like it's, it's not it's not, it's not in their bucket to use the financial planning terminology. It's not, it's not really a liquid asset is okay, we're gonna put that down to zero. And you go and play with it. Yeah, you know, playpen money, whatever you want to call dicking around fund the rush of blood account the Rober Carl totally with him. And if someone comes into the significant amount of money and wants to have a little dig around on the side with some of that money, that's absolutely fine. But framing in the way that you did is absolutely essential. And tying that back to Anna's point, we will assume this goes to zero in your financial plan going forward, this will be zero, okay, we are not having any future cash flow liabilities met by this asset class, because we don't know if it's gonna be there. And if even if it is still there, we don't know if you can get your hands on it. Because it's pretty illiquid. From a professional kind of point of view. I really do wish that we could hive off these kind of esoteric investments to a to a category of of regulated individual is not part of our milieu because we're the we're the most that pick up the bills for these things when they go wrong. And they they these things are so far off our radar. That nothing to do with us. You know, insurance syndicates, nothing to do with that, you know, I don't know. So yeah, but that's just that's just a wish it's a wish list and I shouldn't go on about wish lists. And the last thing so the Norway the Norway sovereign fund really interesting story there's there'll be a link to it in the in the so called sureness has a really lovely website very, very open, and they just tell you everything you want to know about it. That's the reason why they did it, how it's gone on. And it's returned since 1998 6% A year annualized, which actually is a pretty good return because they were going in towards the end of the tech boom, the end of the 1990s. They survived the last decade of 2000 2000 to 2009 10. And the various travails we've had since then, and that fund has beaten inflation buy their metrics by about three and a half percent a year and that's what we're trying to do all the time when we invest. And on the website. They say most of the wealth of that Norwegian sovereign wealth fund has come from not for the amount of money They put in it just from the compounding effect of growth at 6% a year. Yes, it lags a little bit behind the MSCI World or all World Index buts everybody does really hard to beat that. So an interesting and interesting story in it kind of validates my beliefs and employees. You guys hear it the most clients are best served by having one or two funds and massively diversified. You know, the Norwegian wealth fund has 9000 of the great companies within it. I mean, it's just, it's just beautiful, but keep people away from Shiny, shiny toys that they're gonna if they want to play with them, carve out a Russia blood account and just assume is zero. That's That's my overarching thoughts. And and yeah, I do get a little bit upset with with those in who were who had the same nominal criteria as us being allowed to peddle this stuff. And then we're left behind to pick up the pieces. And this, this is a repeating thing, rinse and repeat, you can go back to three decades on rubbish that's been sold in quotes to people by ifas. And then it's that everybody else has to pick up the pieces. Nobody know about that. And that those are my thoughts, gents. And the yield, you're waving digit.
Andy Hart:Yeah. Final point on Norway. All of my presentations this year, I've been shoehorn in Norway into it and sort of trying different material. The other thing that was quite funny than they bought 9228 companies around the world, I think it's 1470 countries maybe. And someone said to me, Are they active or passive? 9228 companies, they're not active or passive. They're everything that they couldn't buy more if they tried. So I think that's quite a quite an extreme point. Yeah.
Nick Lincoln:I mean, it's a new money in the dimensional world Equity Fund, which is 13,000 of the great companies, but there were nothing on the hoof.
Carl Widger:Correct. Two final points on this. Yeah, I totally get the point, Nick. And I've, I think that, you know, the regulators need to step in here. Because having regulated firms selling unregulated products just consumes the retail art confuses the retail investors. So just just say, if you want to be regulated, you've got to sell regulated products, you can't do the other stuff, right? And let some other cohort of investment gurus go off and do that. But do not call yourself a regulated adviser. And the final point, right, because no doubt, I'm going to get myself in trouble. Right. One piece of feedback I got, which was valid, from the previous article that I did myself with currency was, does your memory only go back? 10 years? All right. So putting this one out there? Because did I make mistakes back in the, you know, in the mid 2000s? And did I recommend some stuff that I regretted recommending to clients? I did. There is no point in me saying otherwise. But what I did after that, I learned my lesson I came up with, right, what are my values, what's my investment philosophy, and what's really important, which is real financial planning. So what I would urge, after all, this is dedicated to financial advisors, I know we do have some investors listening in before the financial advisors, you know, try to write if you've made a mistake, but then you need to do some work on what your core values are, what your business values are, and what is your investment philosophy. And then you do what it says behind me here, you just stick with the plan, and do not waver at all, stick with the plan. So look there my final comments on it.
Nick Lincoln:Very good have an ideology is to start with first principles. And then
Alan Smith:we've all been on a journey. That's the point. The point is to be continually curious to be. I mean, when I first started all these years ago, a lot of this stuff didn't even you know what I mean, Vanguard weren't in the UK index in index funds existed, but there were about 1%, a year or more. And
Nick Lincoln:one is still 1%, and may origin Halifax,
Alan Smith:all these ones and what I mean, one of them, one of them's one and a half percent or something, I can't remember which one it is, it's just nuts to the existence. So I was thinking at the time when I'm not using index funds, because you might as well have a good as the same price, you might as well have a chance been active funds. So we were used, that's all we did recommend that we use multi managers because I thought fund the funds type thing. And you look back, now we get is quite funny because now we get sort of agitated about, you know, five basis points of difference in a fund or something back in those days. There were there were hundreds of basis points per year and you knew knew better. But that's the point. You stay continually curious, you continue to learn. And you look back maybe 10 years ago, in my case, 19 years ago, we never invested in the famous shipwreck fund though. That's my claim to fame, which we've talked about on this podcast in the past, but that's the point. Things that you do in the past, you learn from it, and you move move on and hopefully others who were recommending some of these crazy esoteric fund's might have, might have learned a lesson, hopefully and it's all about better outcomes for our clients which after all, pay our bills and they are the most important person and people in the whole setup.
Nick Lincoln:Cool. Okay, I think we've been the meat potatoes are damn good thrashing there, but you're just as well because I can see it on my nest camera. That postie post has come up my drive. The sack is bulging full of questions posed by our beloved traffice. Yes, you are beloved audience. This is your chance to fire questions into us. And we will give our opinions as and when we can. Sometimes the questions are a bit verbose. Sometimes they're not. If you want to send us a question, there's a link in the pinned tweet at advisor podcast. Just click on there, dump your details in and we will get around to it. Today's questions we're now up to June. So what are we about? Coming to October? We're about three or four months behind with the questions but we will get to them. It's our duty to all of you to make sure that we do because you are the show. So let's have a look here and see who this first one is from as I desperately search for an effect. There we go. Jonathan laws. Who's on Twitter as at J laws number four J laws four. Oh God, here we go. No one. What are your thoughts on providing access to cash flow software direct to the client, I avoid client go. My thoughts are that whilst it is of great value adds the clients who use it sensibly and numerous, it could end up causing more problems than it solves. By helping clients go down a rabbit hole and or creating their own plans on suspect and or unrealistic assumptions. Whilst the advisor would still maintain oversight and the main base case plan won't change. They would not be controlling the planning process and could generate a lot of extra work that won't add any value. Long story short. Thanks, Jonathan. Only 20 minutes and your question Long story short, I think it probably causes more problems for clients and achieving their goals than it achieves. But I would love to hear your opinions on other first quit them. And yes, absolutely. Don't do it. No, no value. Anyone else?
Andy Hart:Yeah, I'll take this question. The other boys have sort of bought a knife to a gunfight in relation to this one. I think he's sort of answered his own question. Long story short, obviously, you have the option to do it within voyant go. I've not done it. I trained financial advisors who have been in the business 2030 years, and they struggled to get their head around the software. So I would say Do try it with a couple of clients and see how you go. I know Pete Matthews has done this very successfully and has hundreds of no help DIY clients using voin go software. And I believe it's not too cumbersome in terms of him managing that, on the back of that I have taken on a superb client recently that had access via Pete Matthews, but then realize the limitations of it. And we're seeking a real human financial adviser wanting to get help. So yeah, I think just try different strategies with it. If you've got a client that is dead keen to get in the back end of it, then obviously you open that up to them Do I think this is going to be the future, in terms of every single client that is invoiced has potential access to the plan themselves, and they can play around with it in their own time? I probably think that's where the pucks going certainly with some of those sort of more tech savvy younger clients that were taken on. But yeah, it's definitely an interesting space. But I think you've answered your own question over to your voice.
Alan Smith:But to me isn't, isn't it like a doctor giving you his stethoscope and his heart rate monitors it just you have a go yourself at home and then come in? It just this is the these are the tools of your professional trade? That's why somebody hires you. You don't want to see a surgeon and say, Can I have a scalp or your scalpel? How about I'll have a go at doing a little operation? How? So? I mean, I would I would just say no, I'm the professional you. I mean, does is it? Is the void thing available to anyone. Anyone could just go online or do you have to get access to an advisor, I believe
Andy Hart:anyone can go online and sort of have access to it as a client or it used to be like that, well. This whole area is called the DI T movement that do it together. Another example is a bit like Xero so obviously I use Xero within my businesses. I know Nick uses free agent but also our professional accountant has sort of Yeah, we use all over Yeah, yeah. So it's called the DI T movement that do it together movement and in our space. It's yeah, it's sort of early stages with it as in the client fills in some information, they build a loose plan, we then come in as a professional make some tweaks, then it goes back to them. So maybe it's you know, gamification doing it together. Yes, quite a quite an interesting space.
Alan Smith:Call you any thoughts on that? No, don't do it. You're the professionals. I'm actually to me is a slight red flag. I mean, we I like working with clients who are delegators they say it's all you know, I'm busy running a company or doing whatever, or retired and enjoy my life. I'm not gonna sit around play around with Buddy spreadsheets and online digital projections and forecasts and spreadsheets is not is that that's not the ideal client for me. It might be for others. think we've done that, Nick.
Nick Lincoln:Okay, good. Good question. Thanks, James, for your input to that. Okay, who's the next the next question from ah, Gorgeous George George agan close friend of the show close friend of I think all of us in in the trap pack. He's on Twitter at principles PF principles. Papa foxtrot. Hi gents love the show. Keep up the great work. Whilst the advice industry has been around for some time it feels the profession of being a real financial planner is still in its early stages. With a fair bit of innovation happening in tech service models and even selling parts of business equity to clients, which we did discuss that was a Colin Lawson's idea. As mentioned in an earlier episode, do the TRAPPIST have any views on trends or how they feel the mighty profession may change in the next 10 to 20 years? Now? That's almost as almost a deep enough question to have as a proper meat and potatoes if we want to do kind of forecasting, which is maybe we don't? I don't know, I'm not gonna have a stab at that. Anybody? Carl, you're quiet last time. So on the spot, answer that question and be sure you're right with your answer.
Carl Widger:Yeah, I thought I thought this one was Alan just sending it in. So he could discuss AI. So obviously, yeah, AI is gonna be just to link the last question to this one, right. So I'm not like ruling out giving clients voice and it's not as straightforward I don't believe anyway, as just everyone can have it, it's, you've got to organize your licenses and all that. But surely, that's one thing that's gonna happen over time, you know, the, the, the younger clients now roll it on 10 years, there'll be they'll be they'll want this stuff, they'll want these tools. So do I know what's going to happen next, I can only talk from the Irish market. There are some seriously good firms who are now doing real financial planning, I see the Irish market is going to go that way, if you're not doing it, and I've spoken to some of them, who aren't going to do it on are going to try and get out before this becomes just the norm. So I think in Ireland, real financial planning, that's where it's going to be at. And I would certainly hope then that, you know, in terms of platform technology to be driven on in terms of platform pricing to be driven on, the problem we have here, of course is that we are a very small market. So you know, bringing competition in, we're gone down to two main pillar banks now, right. So that's why interest rates are rising, and the banks are gone. Now, we're not going to pass that on, because there's no competition. So we do need more competition. But we don't need it in the traditional sense. We don't traditional sense. We don't need more pension providers, that kind of stuff, we need more platforms, we need more, you know, better technology that we can pass on to our clients. So it's all around technology. For me, it's all around real financial planning. And it's all around competition, they'd be the three things that I would like to see and I think will happen in the Irish market over the next five to 10 years.
Alan Smith:Yeah, that I think that will, to varying degrees b be repeated around the world, we repeated in the UK, that kind of what I see the future is being is absolutely playing into the hands of see the world and the market moving towards people like us and the human focused financial planners that listen to this. And those are attempting to do just to on that. And of course, you know, it's just about technologies and AI is part of the story. But it's an evolution. If you can nevermind about you know, inputting data on voyant, you will just be able to your client real to speak to a screen open up their laptop or their phone more likely. And say, I'm thinking of, you know, taking a year off and traveling, but I'm ticket whatever this stuff is, and it will be done automatically. So this is So historically, our entire industry and a lot of industries around the world have been built on what they call asymmetric information. We know more than our customer. That's why you got doctors and lawyers and financial planners. We know the tax rules, we know everything else that is going to be just eliminated over the next few years because you will just be able to ask your phone a question as it pertains to you. In fact, your phone will be trained to give you a nudge and remind you the tax inheritance tax rules have changed. You might need to take advantage of this that the other so what that inevitably means is a an evolution towards uniquely human relationships. And what I've been thinking about recently is we are flagging up in terms of a timestamp we're all going across to Paris for the Scotland, Ireland Rugby World Cup pool match, which would be a fantastic absolute shambles. It will be far easier to stick, sit at home and put it on your TV and put your feet up and you're gonna have no hassles and no problems. And no sort of three argues trying to get into the stadium and god knows what else is going on. But we don't want to do that because we are sentient beings, and we enjoy the uniquely human experience. And this is the point technology exists for us to do this, to consider it's just about consuming content is to watch the rugby match, and get excited and all the rest of it throughout it. But we are choosing to have a human experience. And I think that's going to be repeated in a lot of sectors around the world, and particularly financial planning. People will want to deal with people. And we'll have all the robots and all the technology to do all that other grunt work that no one actually enjoys doing. Nobody enjoys inputting data to voice or whatever. It's not a positive experience. We enjoy being naturally human human with other humans and chewing the fat talking about life talking about family, talking about future, and what I think is just too good to answer George's question. I think I live in a bubble. I think speaking to you guys and the financial planners that I hang out with and going to humans under management and go into progressive planners and other conferences like that. It gives you a false sense of well, all advisors are human focus advisors, but I'm not convinced they are, I think there's a significant part of the advice community that are really good at 10 years of technical information and knowing the pension rules and knowing how to run a spreadsheet, you know how to do a forecast. And I'm afraid they've got a short shelf life, unless they're able to migrate towards the kind of right brain relationship focused financial planner, they're probably going to be out of a job than a few years. And this entire new kind of, you know, we've been talking about it for years, but the uniquely human focused financial planner, their time is coming. And there'll be no no other game in town. So continue learning about behavioral stuff, continue learning about how it is to show up in the world as a human being to build relationships, to build rapport, to have good quality conversations, that in my opinion, is a direction of travel is going to happen faster than we ever think. That's my point.
Nick Lincoln:Yeah, great stuff. And think, you know, as a great man once said, as more information, there's more data out there, people can do more of this stuff if they want to. I'm not sure that many people even if they can just speak to a microphone and say, if I take a year off, does that affect my plan? A lot of sway. People won't even want to do that, because it's just not in their in their purview. It just doesn't interest them. Wisdom is sold separately. So much knowledge, so much data, wisdom is sold separately, and wisdom is sold by an empathetic behavioral investment counselor, I would suggest and George actually who posed the question, he he's an example of the change that we're seeing, really, in terms of content creation. I think for me, that's the big I know, we talked about content creation since forever. But it really is now I think, the epoch of this new, there's new dawn and George is a very good example. He puts out these very nice YouTube videos that are overproduced, they're not you know, he's watched some American ones and they have they're coming in with a camera coming out with the camera, they're shooting swooshes and everything else. But it's just nicely nicely recorded. George speaking to the camera, giving content away ideas around money and financial planning is a big change. You know, and it's this this thing about showing your work. And I think that's going to become more and more important because that makes you human. It humanizes you shows you have a character and again separates you from the data. You know, there's all the information I have all the knowledge there's all the numbers, there's all the info but here's me as a human being here's how I can help you. Do you think we can bond? Do you think we can bond? So that's what I would say on that. I think we're given that dog with thrashing Jensen's, we're at almost 75 minutes in to the show. So I think we should move on without any further hesitation to culture corner. Okay, it'll Natori dumb money.
Alan Smith:dumb money, just started the cinemas. I think it just came up last weekend. And I took myself down there by the way, quick aside the everyman cinema. Very nice. There's a few of them around. There's one near me in Baker Street. You sit in a nice sofa, the deliver food and drink to your seat. Good or you pay you pay a premium, but it's a it's a first class experience. Now they're excited. They they the baseline of oddities of watching a film, but they actually experienced sorry, Nick, you said,
Nick Lincoln:they plumb a catheter in and they say hey, do you have to move for three hours just sitting exactly. It's
Alan Smith:it's, it's wonderful. So I went and I took my boy my teenager along to see dumb money, this new film has just come out. And it's really entertaining. And one of the reasons is entertaining is because this is a true story. And of course, facts are stranger than fiction, and it's very recent. This is just a whole series of things that went on, really from January 2021 She's obviously pretty recent in the memory. And because you're kind of, you know, us, we're kind of in the game somewhat, we're not in this kind of craziness that was going on in the US. But you certainly know a lot of the players involved in it and the name names and they have, you know, the, the cutter with actual footage of what was going on at the time. So you've got the guy from this hedge fund called Melvin capital. You've got Ken Griffin, at a citadel hedge fund, and he's sort of up to his eyeballs. And all this kind of nonsense, you've got this app that was founded called Robin Hood, and which you could just buy and sell stock on you. And so talk about gamified you can buy this stuff. And behind it all was just social media business platform, which I don't really know much about, called Reddit. And read, it's got all these so called sub Reddits, and a little communities. And they all kind of egg each other on there's one guy in particular, it was a kind of mild mannered guy who worked I think he worked as a financial advisor up in Boston, and it was just in his spare time to sort of buy stock and he would post on it and, and the whole thing or about that, it's not giving the game away, because as well as well, sort of knowing what went on. But you got behind an unloved stock called GameStop, which is a kind of video shop, you know, sort of video game shop, you know, you could go into their stores and buy video games, and it was very unloved. So being shorted to hell by all these hedge funds. They bought it, it went up nearly 2,000% In the course of a month, it made instant millionaires, multimillionaires, this whole thing about tech on Wall Street, it was sort of democratizing investment, blah, blah, blah, the I'll leave the rest, but it's really well made, actually, it's a couple of hours long, very entertaining. And as I say, if you kind of knew knew what was going on roughly at the time, you can cast your mind back and you think what was going on, we sort of collectively all lost our minds, or certainly a lot of people who participated in this this nonsense, let relating it back to what I mentioned before about, you know, you know, esoteric investments are just a crazy investment strategy, pile all your life savings. And of course, then the taken the boring money on margins, the boring four and 10 times their actual underlying investment. And that was obviously fueling the growth in it as well. So the whole world have certainly parts of the United States where it's collectively insane for a period of time, and no doubt that will happen again. Maybe it's happening already without us even knowing very entertaining or recommend going along and watching it.
Nick Lincoln:So I guess that was at the time of the lockdowns wasn't happy, we just had a lot of time on their hands and then just just just we're staring at screens all day and the devil makes work for idle hands, but just a
Alan Smith:lot dance. It was the app that came along a lot of them got these What do you call it, the US government paid out just give them a payment to give them like $1,600 or something STEMI payments or call it you know, to stimulate the economy. And they took this money measure gets $1,600 and then putting it on margin and Robin Hood and borrowing 10 acts against it. And then there was various other ways that they were doing Contracts for Difference and a lot of really complex investment strategies. But of course, they made overnight millionaires amongst some of them and of course, then the post that on ready and the average person working in a kind of low paid job thing. This is my this is my key out of this steady job. This is my as the solution. So it was just collective madness. And it shows that the markets can move quite quickly if 1000s of people get behind them. It does actually show the impact of social media can have if you get a community a bunch of people who all believe in something, but yeah, it was it was a perfect storm of craziness. Yes, I
Nick Lincoln:mean, there's a microcosm of that story that kind of madness of crowds thing is that is the thing you talked about in the last episode. I think it was Alan, you know this this crypto split off currency thing that took over the village of Winchmore hill because the Publican had made money on it and this to his pub pile in is just wow human nature a failed investor okay great stuff. And that's that cinemas only I think that's not on. You can't find that on your screen at home. Presently. Mr. Hart Nick Murray books you have a new year Sean's
Andy Hart:I'll get on to the Nick boy books just done a similar thing to Allah mentioned panorama. BBC covered it the downfall of the crypto King. This is the SAM bank when fried story about FTX goes into a lot of detail about it. Again, it's on a similar vein to dumb money. You know, billions have been wiped out across the world. I think they had 100 million customers over 9 million customers over 100 countries whatever. Check it out. So yeah, the downfall of the crypto King BBC panorama, check it out. The next mention is Nick Murray books get sort of the recurring theme on this podcast. This one sort of slipped through the net through through the net, but it's called simple wealth books dot code at UK. Go on there immediately as you hear me say this and buy all the books you can. I'm pretty sure if we get a good shout out to this the books will sell out. I don't know who's behind it. But anyway, they've got the books on there for reasonable prices. When I say reasonable prices you're looking at and be like 80 quid for a book. I'm not paying that. No, no, that's quite cheap. 70 pounds 80 pounds I got if you're just gonna buy one buy around the year. A 80 pound it'd be the best 80 pounds you ever spend.
Alan Smith:What's your I had a look at that like 7080 pounds what's wrong with a books which you mentioned before because the second hand they ended like five
Andy Hart:$6 own I don't think
Nick Lincoln:the older one has the ones in the 1990s and early noughties on they're
Andy Hart:getting it in around the year for 80 quid is an absolute bargain and there is a link in the so called shownotes. But yeah, it's called if you just type it in that simple wealth books dot code at UK Knock yourself out of
Carl Widger:the old ones because they're all the same anyway.
Unknown:Okay acronym
Andy Hart:Murray books.
Nick Lincoln:Somebody linked them call another high performance podcast, David Smith.
Carl Widger:Yeah, I I know I felt bad. I'm gonna I'm gonna mention the high performance podcast again. I'm not on our payroll. But you know what I think is okay, I just absolutely love this one. Now, Nick, this was a live podcast that was done at Fern cotton's happy festival. I bought you a ticket for next year. I think you absolutely love it. So anyway, the high performance
Alan Smith:can you imagine Victor Meldrew? angry with everyone.
Carl Widger:Happy festival my arse. Anyway, the two guys did the high performance podcasts with a guy called David Smith who I'd never heard of before. And look, I want regale the story to you know, but it's an incredible story. So well told. It's emotional and it will make you feel lucky and grateful for what you have in your life. Definitely, definitely. Please, everyone listen to that podcast.
Nick Lincoln:Okay, I'm gonna do that, Carl. Thank you for that. Appreciate it. I think I think that at two minutes in. We're coming to the end of this episode. So that will be a wrap. Thank you dear Trappist. For your precious time and your input into this show. Remember, this is your show. It's as much your show as it is as it is shaped by you. The questions are fired in by you the feedback comes from you and we love that please do leave a six out of five star review on iTunes and leave your real name and firm name if you want to just to engender more of a sense of community. Do like and subscribe to our YouTube channel please and do subscribe to our podcast as well. Don't just look out for the latest episode randomly if you subscribe, it'll be on your phone in the early hours every other Friday morning and without without that
Alan Smith:Thursday, Thursday
Nick Lincoln:morning. Right the early hours of Thursday morning. Thank you Alan so that is that the OS and take care of their folks and speak to you two weeks. Bye. Bye bye