Between Three Advisors - A Conversation with Pomarium

In this episode of The Money Script Podcast, host Yohance Harrison teams up with Erik Sartin and Brad Sparks for a dynamic "Between Three Advisors" discussion. They explore the world of values-based investing, the emotional connection between money and personal goals, and the innovative tools available to align portfolios with individual values. From personal investment stories to the challenges of creating portfolios that reflect clients' beliefs, this episode is packed with insights for advisors and investors alike. Tune in to learn how aligning investments with your principles can lead to both financial success and personal satisfaction.

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Transcript

Brad Sparks 0:00

So we transitioned our planning into being more values based. Like,

Brad Sparks 0:06

how do you start to relate to your money differently? What are the assets that you can own that can really be a fit for you? And sure our job will be in the background to make sure it all works long term as your planner, but really it's like, let's get you into this process. Let's get some buy in. We want our clients to be proud of their money and their financial situation and take ownership of it.

Seth Harrison 0:35

You are tuned in to the Money Script podcast. Today we will share strategies to help you grow your financial literacy and improve your money Script. I'll be back with some important announcements. Until then, enjoy the show.

Yohance Harrison 0:56

Welcome back to the Money Script Podcast. It's your host, Johans Harrison. I am here today with one of my favorite segments. This is what we like to call between three advisors. Yeah, normally it's two, but I. It's three of us. There's three. For those of you that are watching on YouTube, I decided to have a little fun with our little threesome here. So if I make it like this, then we got kind of like this little reverse Oreo thing going. But I won't make you have to think about that any longer than you just had to. So I'm here joined by Erik and Brad. We met at. Do we meet at Nitrogen?

Brad Sparks 1:28

No, I met the Altruist conference.

Yohance Harrison 1:29

Altruist conference. That's what it was. Altruist. Yes, we met at Altruist conference. I have alters T shirt as well. Just wear it today. And, and they would tell me a little bit about their, their practice, what they're doing. They've got a unique approach to asset management that we'll talk more about. But most of you as listeners, you. You know who I am because this isn't your first episode, but if it is, I'm a financial advisor. I'm CEO and founder of Money Script Wealth Management where I help people bring alignment between their values, their goals and their financial behaviors. And really, it's just all about helping them make better decisions with their money. This podcast is brought to you today by Financial Literacy. That's what this is all about. Helping you become a little bit more financially literate. And hopefully if you listen to this, you will go out and, you know, do some more

Yohance Harrison 2:18

investigation into your own finances and how you're making your financial decisions and maybe, just maybe you reach out to a professional for some help. So without any further ado, let's dive in. Erik, Brad, tell us or tell the listeners, whoever wants to Go first. How did you get into financial services?

Brad Sparks 2:35

Go for it, Erik.

Erik Sartin 2:37

Yeah, so I had the luxury of growing up around the financial services business. So my first time I was in a financial services meeting, I was with my dad at a wheel. I was a wee little guy, 6 years old. He would take me around and go on appointments and I would, I was, now that I have kids, I know I was probably not keeping my mom from having to deal with me, so. But yeah, I would go with him and hang out and listen to him talk about things. And so I graduated from school, did. Worked for a company that did commercial insurance and retirement plans, 401ks for small businesses. Eventually

Erik Sartin 3:19

transitioned over to doing financial planning. And it was really because I loved working with people, helping people achieve what they want, understand what they care about, and put together a plan that's going to achieve that.

Yohance Harrison 3:31

Beautiful. Beautiful. Yeah, I used to drag my son onto those appointments as well. He could still do a pretty mean tax triangle every now and then if he tries. He usually gets the things out of order, but he can, he, he got some of the concepts down. Brad, how about you?

Brad Sparks 3:47

Yeah, I came from a different, completely different angle. I got, I studied to be a scientist, got my master's in geophysics. And then as I was writing my thesis, I was like, I don't want to be following code books all day for the rest of my life. So I started looking into other things, teaching being one of them, running my own environmental consulting business being another, and then doing financial planning because I had known a bunch of Northwestern Mutual agents who told me that I should join their practice. So I was like, okay, I, I looked into all those things. I had a background. My mom is, or was she retired, an executive at State Farm. So I grew up being around finance. But when I, when I started to really seriously consider the Northwestern Mutual or State Farm agent route, I was friends with Erik. And that's when Erik was like, hey.

Yohance Harrison 4:39

Erik's been shaking his head the whole time.

Brad Sparks 4:41

He's like, you need to know some things about this.

Erik Sartin 4:44

I, I tried to talk him out of going into the business, and when I couldn't talk him out of going into the business, I said, well, you should at least join our firm because I think we do a good job.

Yohance Harrison 4:55

There you go. And, and don't get us wrong, Brad. There is nothing wrong with being an agent for Northwestern Mutual or for State Farm, especially not for your mother. But there's something right about being a full service financial advisor. We'll put it to you that way.

Brad Sparks 5:12

Yeah, I wanted to. That's, like, why teaching. Like, I was experiencing how, like, I was around all these smart people in my programs, and they, like, were making really bad decisions about money, and it was kind of affecting their lives. And then these questions, and I was like, I just want to help people, like, teach them. And so when, like, you're right, there's nothing wrong with being those agents, but the incentive there was was to provide a. Like, a product and not to teach, per se.

Yohance Harrison 5:38

So, yeah, I. I can't tell you how many poorly funded whole life universal life policies I come across. And I'm just like, did your agent ask you any questions about your financial life, or did they just say, do you want some insurance? And again, insurance serves a purpose. It's just. I. I don't. I. I hate the concept of a whole life policy or universal life policy or variable universal life policy being the Swiss army knife of financial planning. So there's. Actually, we're gonna have to cut to it. We're gonna do something fun here. So I want you to cut to right now. The walk of Flock of Flame, where he's talking about life insurance. So for those of you that are into. Well, here, run the tape.

Speaker 5 6:24

Oh, it's habits. I just pay attention to habits. And one day I had a friend of mine was like, yo, man, I went to school for being a financial historian.

Brad Sparks 6:33

I'm like, what is that?

Speaker 5 6:34

Yeah, I never heard of that one, right? I'm like, you know, I'm asking. I'm like, bro, I don't know what that is. What is that? He's like, bro, we study rich people's spending habits. I was like, oh, snap.

Yohance Harrison 6:45

I blew your mind. I became that. I just stopped following what people do.

Erik Sartin 6:46

What?

Speaker 5 6:50

I'm like, oh, I wanna win, bro. I gotta win. I'm telling y'all right now, anything I do not to look over my shoulder, I'm down with it. It's easy. Once I, you know, once I learned the credit game, it was over. Game was over. But I know I had all the millions, and I didn't even have a credit card. The dumbest. I was like, the dumbest person ever. I used to spend money on everything, man. Please. Yeah, please. I'm. I'm going to open UP insurance, put 2, 3 million of my insurance and borrow from that and put it back in. I never lose my money. Ever. Anybody get money? I'll give you a promissory note because you will promise to pay this back. I'm gonna bring you to court.

Yohance Harrison 7:24

Okay? So what you heard him talking about was using life insurance and p and being able to bank with his life insurance. But people misunderstood part of what he said. So he said, I, I went out and put 2 to 3, got 2 to 3 million of insurance. What he did not do was go buy a two or $3 million whole life policy and start funding it with $200

Yohance Harrison 7:48

a month. No, he probably took two or $3 million, put it into a whole life policy, and it probably got him five or six million dollars worth of life insurance. And then, yes, at some point in time, he could probably utilize that cash value to be able to leverage it to borrow for other things. And it might make sense, but he put 2 to 3 million dollars in the policy. We come across people that are like, oh, I want to buy a two million dollar life policy and I'm going to bank on myself in 10 years. How much you willing to contribute? 200amonth. We ain't gonna be banking on much. The cost of insurance is going to be 150. And I meet people all the time like, oh, well, I got this life policy, it's worth 2 million. No, the death benefit is worth 2 million. What is worth to you in cash value is 17.

Brad Sparks 8:32

When you're 121, it'll be worth 2 million.

Yohance Harrison 8:34

Exactly, exactly. So, all right, again, I told you all this was between three advisors. We're gonna, we're, we're gonna keep it 100 for y'all. So. All right, so, so you guys are, are rias like, like myself? Is that right? Is that same concept there? Okay, awesome. And where are you, where are you located?

Brad Sparks 8:53

Fort Collins, Colorado.

Yohance Harrison 8:55

Okay, so right up the road. Erik, you in the same place?

Erik Sartin 8:58

Yep, we are.

Yohance Harrison 8:59

Y'all actually in this. You're actually in the room next door, right? Okay. Okay, that's what I figured. All right, all right. So I figured that. Okay, awesome. Good stuff, good stuff. I, I want to, just for our listeners today, I want to talk about just the world of investing because I know the two of you are very passionate about values investing and I just want to, like, could we start with each just telling our stories of our first investment portfolios? What were some of the investments we chose and why?

Erik Sartin 9:02

Yep, we're awesome.

Erik Sartin 9:31

So I've got a interesting and unfortunate story around this. So I told you my dad was a financial advisor. And so as I was growing up, he was putting money into mutual funds. And this was the late 90s, so I had some MFS Tech mutual fund, I'm sure. And I remember it getting up to be worth almost $5,000. And then I remember it being worth, you know, $1500 or $1700 or something like that. So that was the tech bubble. And so I have, like, a very formative memory of that. And then also right after that happened, I. I worked all summer, and there was this company called Apple that had these imacs that I thought were pretty cool. So I literally took all of my lawn mowing money, twelve hundred dollars or fourteen hundred dollars, opened a Scottrade account when I was seventeen. I don't even think I was old enough to open a. It wasn't an UDMA. And bought 100 shares of Apple.

Yohance Harrison 10:34

Wow.

Erik Sartin 10:36

Yep. Was. Was all in 100 into Apple stock. And I owned it for almost a year. Nope, not quite.

Yohance Harrison 10:44

And not long enough.

Yohance Harrison 10:49

I was waiting for it. I was like. He was like, and I'm actually a multi millionaire right now. Why am I even on this podcast? I'm gonna go do something else.

Erik Sartin 10:57

So my, My. I was going to college and my dad said, hey, I need some computers. Why don't you build me a couple computers and I'll rent them from you for a hundred bucks a month? And I was like, okay, it'll cost a thousand bucks to build the computers. He'll pay me 100 bucks a month. I'll get paid back in a year. This is great. Sold my Apple stock, bought two computers, and I stopped keeping track when it would have been worth over $500,000. But.

Yohance Harrison 11:23

Oh, man, that means you stopped keeping track of, like a decade ago.

Erik Sartin 11:26

Yeah, basically, man.

Erik Sartin 11:31

So that's my note. That's my unfortunate investment. Investment.

Yohance Harrison 11:35

I feel like I need to pour myself a drink now, huh?

Erik Sartin 11:38

I think so. It's a good time.

Yohance Harrison 11:39

Wow. A good time for that. All right, well, Brad, follow that.

Brad Sparks 11:44

Yeah, that's. Mine is not that interesting. I. I got a job shortly after college, and because my mom was a State Farm agent, knew that I needed to buy car insurance because we just bought a car. And the guy was like, hey, have you thought about investing? And I was like, I mean, I know what it is, but I haven't done it yet because I don't have any money. And he's like, okay, great. Why don't we open a Roth IRA and invest in State Farm mutual funds? And so I bought State Farm mutual funds. And then now State Farm doesn't offer mutual funds anymore because of all the.

Yohance Harrison 12:13

Regulations, but okay, at least you started a Roth IRA early. So mine started in the days of also in the late 90s, which I hear a common theme here, tech bubble. So late 90s, I'm working at nations bank, soon to be bank of AmErika. I just didn't know it was going to happen at the time. And I used, as a teller, I used to refer business to the broker at the time. And you know, I'd see people's accounts like, hey, you got this money only earning, only earning 7% in the money market account. Why earn 7 when you can earn 70 from whatever mutual fund? I was really saying like that because I'd be against the regulations, but I was telling people, hey, go talk to the broker. And so after months and months of referring millions of dollars to the broker, one day I just said, well, wait, I got a T shirt for the amount of referrals that I sent to you. What did you get? And he said, I thought you'd never ask. And he showed me his paycheck. And I was like, oh, I'm on the wrong side of the bank. He said, yes, you are. So he was the one that showed me how to open up my first investment account. And you know, he said, why don't you buy some nations bank stock? I was like, why not? I should do that. And then he referred me to the broker training program. He's like, come on over to the dark side. I said, yeah, I'd love to do that. And that was as nations bank was turning into bank of AmErika. And when that happened, it was a pretty good day for my stock portfolio, but not a good day for my job. So they, they decided that they were going to shut down the, the Series 7 training group that I was in. Funny thing though, they, they forgot to lay us off, but they laid off the, our boss, the proctor that was there because we'd basically show up from 8 to 5 and study and learn about the business while studying. And that was kind of our day to day. And I'd only been in the program like two months when they shut it down, so I didn't even have a test date yet. Yeah. So we show up for work. We're just kind of doing our normal thing. We think maybe he's out sick or something, so we'll just do our normal thing. And then one day, like the third day I believe we go out to lunch. You know, we all go, it's downtown Charlotte, so we go to the local eateries, whatever, and we all come back and the security is like waiting for us. It's like, we can't let you guys in. I'm like, what did we do. It's like, none of you work here anymore. And he just starts taking our badges from us. Like, what. What does this mean? There I was without a job. Like, okay. And then you know what I did? I went and applied at Northwest Mutual. They wouldn't hire me. I applied it. What's the. What were the name of Salt? Not Solomon Smith Barney. Who were there before that.

Yohance Harrison 14:48

They're Solomon Brothers. They applied there. They said no because I was a young black kid with no fan. They would ask me in the interview. So who do you know that has money? You

Yohance Harrison 15:01

like, don't you guys have the money? Why do I need money? Because I didn't know. Because I was in a bank where the clients just kind of showed up. I didn't know that in these other worlds, I had to go out and get the clients. I was like, yeah, I don't know. Anybody have money. I'm like, I'm 20 years old. So anyways. But then I found someplace. So let's go back to this Apple thing. So have you all heard the news that Warren Buffett or, well, Berkshire Hathaway is d leveraging their portfolio as amount of that they have in Apple. However, they have like a 600 return or something ridiculous like that.

Brad Sparks 15:35

Yep.

Erik Sartin 15:35

Did you hear Warren Buffett's comments in the annual meeting a couple weeks about Apple?

Yohance Harrison 15:40

About that I thought I might have read. Remind me. I'm sure I glanced over them. What do you say?

Erik Sartin 15:45

So. So he basically insinuated somebody asked him about this. I said, what about Apple? I heard that you, you know, Ted and Tom or somebody sold 100 million shares or something like that. And he reiterated that Apple is an important company and that he believes in it and it's going to be core to Berkshire's holdings. And then he went on to basically say that the way that the government's headed, he sees that tax rates are going up. And he said, I think everybody's going to be happy that we sold some stock and only paid 21% income tax on it.

Yohance Harrison 16:17

Interesting. I did not hear that. Okay.

Erik Sartin 16:19

It is. It is not what I expected, but that's what he insinuated. It was a tax play.

Yohance Harrison 16:26

It's a tax play. Well, also, I think. I think it was close to over half their portfolio or something like that had grown to be. And he doesn't like having that much into one company. He said that in several of his books about, you know, once something becomes a certain size, you just have to know when to sell. And. And if you're Going to sell. He says his favorite whole period is forever or when he's made money. It's like, so made some money. Let's. Let's get out of here. So. Yeah, yeah. Bank of AmErika then. Nations Bank. So my bank of AmErika stock is what kept food on the table during my displacement because we were considered displaced. We weren't laid off. There was no. We just had to get an unemployment line. There was no, there was no severance. No nothing, really. Yeah, yeah, it was. Yeah, that's. That's the big banks for you. So. All right, well, let's. Let's talk value investing. So how did you. Or how did. Did your firm become passionate about values based investing? Well, actually start. What is values based investing? Let's start there.

Erik Sartin 17:12

That's unfortunate.

Brad Sparks 17:31

Yeah. I think it's the way we would define it is aligning your money with the things that are important to you, even. And maybe even in the absence of financial metrics. I think financial metrics are important, but it's like, what are the things that are important to you that are not financial that you want to be invested in? That's how we would define it. Or how I would. At least.

Erik Sartin 17:52

Yeah.

Erik Sartin 17:54

Yeah. I think the only thing that I would add to that is to say that to me, value investing is all about having integrity with what you believe with your money as well as everything else in life.

Yohance Harrison 18:10

So what we're not talking about is growth stock versus value stock. We're talking about internal values. As an individual, what do you value? So I, I have something to share on that. When I. The first portfolio I ever designed when, because I worked at a company that wasn't allowed. We weren't allowed to buy individual stocks until like 2006 or seven. So I've been an advisor like five or six years only having mutual funds like that MFS Tech Fund. I bought it when. After the crash.

Yohance Harrison 18:42

But. But when we were finally able to buy stocks, I was really excited to go build a stock portfolio for myself. And I really didn't know where to start. And I decided to start with basically my. Not only my values, but also could. I think values can be represented by your receipts, meaning where do you already spend your money? So I built my first portfolio around companies that I already did business with. And my whole idea was if the, if the product is good enough to go into my body or go on my body or be in my house, then it's got to be good enough for me to invest in the stock. Or I have to question, why am I eating this product. So my. The first stocks I bought were Kimberly Clark. I had a kid, we bought Pampers. So, like, huh. Well, I buy a lot of those. Might as well get that. And then I kind of thought about. I was like, well, there's also toilet paper and tissues and feminine hygiene products. I was like, oh, yeah, I think they're gonna be around a while. So I bought Kimberly Clark. So that was one of the first ones. I bought Clorox because I use bleach when I clean my clothes and all this other stuff. I was like, ah, that's a good one. I purchased. I purchased Ford. Another story about that later.

Erik Sartin 19:57

Did you drive a Ford?

Yohance Harrison 19:58

I didn't, but my grandfather worked for Ford for 50 years and it made him a millionaire. So I kind of thought, I can do that too. But the difference is he bought it 50 years ago and I bought it in 2006.

Yohance Harrison 20:13

I bought Apple because I had an imac. And the first computer I ever use or remember using was an Apple. I was at a school that. One of those schools that got an Apple computer. And you need to be in line to use the Apple computer. So I bought Apple. What else was in my portfolio?

Yohance Harrison 20:33

Oh, I remember

Yohance Harrison 20:36

I had these DVDs that would show up at my doorstep every few days, two or three at a time. I'd watch them, send them back, and I just love that process. And I was like, oh, I wonder if this company's publicly traded. It was like, oh, look, they are Netflix. I'll get some of that too. So I had about 10 stock, but they were all. Any stock that I purchased. It had to be a company that I booked that I either was doing business with on a normal basis or truly believed in. But when it came, when it was other stuff, like, oh, you want to buy some? I don't know, name whatever stock of the day back then, or the oil and gas stocks like Exxon, all that stuff. I wasn't interested in them because I just got gas wherever was local and cheapest. So I wasn't someone that wanted to buy. And it wasn't because I didn't, because I was green or, you know, or, you know, oh, they're bad for the environment. It was like, no, I just. I don't really care about the oil company. So I'm just going to invest in the companies that I truly care about. And it turns out that as an investment thesis, other than Ford, that served me very well. And the truth is, it was Netflix that did all the serving. Yeah. So that. That was Fun. And I. I held Netflix for a long time. That was a. That was a fun ride. I did eventually sell it all in, like, 2015. But I. I had a good time at Netflix.

Erik Sartin 21:55

They just stopped the DVD service.

Yohance Harrison 21:58

Yeah. So. So, funny thing, I remember that day, that announcement, that quarterly earnings. I remember reading Rich Hastings comments that he was going to split the company in two, and. And he was going to start transferring investment to digital streaming and stop investing in DVDs. And the stock plummeted because everyone said that he was an idiot. And I was thinking. I was like, no, I think he's onto something. I'm gonna buy some more of this. One of the best decisions I ever made. But I remember. I remember when I was like, you know what? I'm. I'm going to stop ordering the DVDs. I'm gonna stop. I'm just gonna do this streaming thing. And before I knew it, I. My son teased me all the time. I don't even own any DVDs anymore. My whole collection is gone. But my son has reminded me something. But now I own nothing because everything's in digital form. I don't own that. I'm borrowing it from Apple. I'm borrowing it from Netflix. I don't own a collection of film anymore. I was like, okay, I guess you're right. So, anyways, let's talk back to. Back to value investing. So how. How have the two of you been able to introduce this as an opportunity for clients to get on board with aligning their values and their investment decisions?

Brad Sparks 23:19

Yeah, I think what happened was, like, we were running an efficient practice, and we were under the same umbrella kind of organization, but we were colleagues, and we had offices right next to each other, and so we would talk about things all the time, and our businesses were going well, but there was just this, like, kind of sensation or experience that, like, our clients, who we really liked and cherished, like, were just coming to us because it was the thing to do. It was like. It was like your dentist visit, right? Like, you go once or twice a year, you check it off the list. You know, you look at some charts and you feel good. And yet Erik and I are like, hey, money is really emotional. Like, there's a lot of power behind our money and what we do with it, and. And even to some degree, the control it can have in our lives if we're not careful or if we don't, you know, kind of talk about it. And so we wanted to be able to level up our offering. And we were experiencing all sorts of things in the world. You know, this is like around 2016. And so, like, people were just more cognizant about their values and what they stood for or didn't want to stand for. So we transitioned our planning into being more values based. Like, you know, how do you. How do you start to relate to your money differently? Like, what are the assets that you can own that can, you know, really be a fit for you? And sure, like, our job will be on the, in the background to make sure it all works long term as your planner, but really it's like, let's get you into this process. Like, let's get some buy in. Like, we want our clients to be proud of their money and their financial situation, to take ownership of it. So we did that and then it got to the investment conversation, inevitably, because investments are a part of financial plan. And it was like, here's your, you know, genErik 8020 ETFs, ETF portfolio. And the holdings are like the MSCI eafe, you know, index fund. And our clients were like, just glazed eyes. Like, here's the dentist experience again. Right. And so we're like, we can do better here. Like, we want our clients to feel proud about their investments. Like, we've already shared stories that are really impactful in our lives about how investing can kind of shape our futures and our experiences. We want our clients to be proud of the things that they own, the things that they're invested in. And that was when we were like, we got to do better again. So we looked at a lot of the services out there, and we just couldn't find something that could really build a portfolio for all of our clients on an automated basis at any account level that would really be personalized to the things they cared about and not kind of say, not kind of like force values upon them, but let them, like, lead the conversation. And so that's. That's kind of what led to the inception of the tool that we built outside of, like, kind of inside of our planning practice that we've now separated outside of it. It's kind of the inception story.

Yohance Harrison 26:05

So how do you match this values investing with the. We spoke about Warren Buffett earlier where Warren Buffett says, you know, the average person does a horrible job of stock picking

Yohance Harrison 26:21

and they should just go buy, you know, a spider index spy. Excuse me, the S P index fund. So how do you. How do you fit those two mantras together and still deliver a great experience for the client?

Erik Sartin 26:37

Yeah, I'll take that. So if you think about it when you buy the s and P500 or an index fund, or frankly if you invest in any large cap mutual fund, you're getting a conglomerate of a whole bunch of different companies. And I would argue that you do need a number of companies to be diversified, but you don't need 500. And so if you were to look at that portfolio and look at the list of 500 companies, and if you were informed and understood how, how those companies handle different social issues and different environmental issues, different issues of shareholder governance, you know, how they handle, how they integrate into their communities, you might find that there are a lot of those companies that you really don't jive with what they're doing. And you could exclude those and build a portfolio out of the remaining companies and still do just as good of job, maybe even better.

Yohance Harrison 27:34

But is this similar to, is this similar then to direct indexing?

Erik Sartin 27:40

I would say that what, what we are doing is, is different than direct indexing because direct indexing starts with what's the whole market? Let's build a portfolio of the whole market that represents the whole market. And that's the objective where we're saying what is it that somebody really cares about, what's important to them, what are the things that they want to support? And then also let's remove the things that they exclude or that they don't want to support. Okay, let's build a portfolio that works, that achieves, that's diversified, that meets all the objectives that an investment manager has. Let's build that portfolio out of that group of companies. And so it's a little bit different orientation. It's much more oriented around what is the actual portfolio, you know, client one.

Yohance Harrison 28:28

So is it possible then for a client to, to potentially be under diversified, if not educated? I mean, talk, talk to us about that.

Erik Sartin 28:39

Yeah, I think that, you know that, that we designed this as a tool for advisors because it's important to have a client to have a relationship with a fiduciary advisor who's looking out for that client's best interest. You know, we're building the portfolios in such a way that we're going to meet those diversification minimums, that we're going to have a portfolio that works and accomplishes everything that an advisor wants as a fiduciary. But yes, somebody could be under diversified. If you had five stocks, especially if they were in the same industry, you're not going to be diversified.

Yohance Harrison 29:13

Okay, so to be clear then this is an advisor tool

Yohance Harrison 29:21

because clients, let's keep it Honest. You guys are going to mess it up. Clients, you just will because you buy. You have too many biases that are getting in the way. And yeah, yeah, yeah.

Brad Sparks 29:29

Yeah.

Brad Sparks 29:33

It is an advisor tool I think like there's applications where, where you could use it outside advisor. Like the way we built it now is like we really want, we want it to be an experience where the advisor can co create a portfolio with the client. Client. So when we onboard an advisor into the tool they get to say like hey what, what are my allocations across different risk levels? Like what is that for me as an advisor? Like what's my investment philosophy there? What are my preferred holdings on like small cap or emerging markets or like fixed income. And like you get to put those preferences in whether it's like an ETF or a mutual fund or you have like a, you know, a preferred asset manager. And then are there like any factor like tilts that you want to, that you want to check and then our, our tool builds the infrastructure so that all of that kind of total portfolio offering is constructed specifically for that advisor. And then they invite the client in to say like what are your values? And then the companies that we have data on that we can actually make an informed decision on like hey this is a good fit for you based on your values. Like we can add those in as like the US large cap stocks and then eventually as we get more data we'll do it for international and fixed income as well. But how we're thinking about it is like let's get this tool that the advisor can say like hey, this delivers real value because it's my investment philosophy that's unique to me and it's my clients values that's unique to them. And let's like let's build that portfolio on a one to one basis for every one of our clients. That's how we're thinking about it.

Yohance Harrison 31:02

Got it, got it, got it. So we have a lot of different listeners for the show. Advisors I know, hey all you advisors out there, hey for those of you that, that also agree that we are not in competition with each other. Our competition is all the things that our clients waste their money on. And then of course procrastination, that is our biggest competition and there's so many households go around so we will all be just fine. So thank you advisors for tuning in to the show. So I want to speak directly to the advisors right now that are listening in and don't tune out prospects and clients will come back to you. But for the advisors that want to learn more about Palmerium.

Yohance Harrison 31:43

How can they learn? Where can they get started? Do you have a trial or, or some, I'm sure you have some videos or something that they can learn more about it.

Brad Sparks 31:51

Yeah, that's what our, our take on this is like, hey, we built this for our practice out of our need. Like we hope that people can just test it out too. Like, so we're trying to do it very low key, get people onboarded, like, make it as little friction as possible. Because we understand that advisors have a lot of technical tools that they need to like worry about how to integrate into a workflow.

Yohance Harrison 32:10

Yeah. You know, like cameras into your podcast. Yeah, things like that. I get it. Exactly. Yeah.

Brad Sparks 32:16

So what we're trying to do right now, like we're about to launch our beta for a small number of firms where we can get product feedback, like early, early adopters that get really excited about it. We'll have a full release after that, probably three to six months, like quarter, quarter, three, quarter, four this year. But if you're interested in testing out the beta just to like be like, hey, this kind of sounds like a cool idea, I'd like to try it out, like low key, put it in front of a client or two. The best way to do that would be to go to our website, which is get Pomarium.com and just click the button, contact us or to send Erik and I an email which is just Brad atget or Erik.com.

Yohance Harrison 32:53

Great, we'll put that in the show notes. So what is your message then to clients and prospective clients who want to engage their advisor in a conversation of. Of. I don't want the check the box dental exam when it comes to my portfolio. How, how should they. What's a good way for them to approach that conversation with their advisor?

Erik Sartin 33:16

I think unfortunately there's a.

Erik Sartin 33:23

When you're speaking to an advisor, you're speaking to somebody that's never had the tools to easily personalized investment portfolio, especially with individual stocks in their entire career. The technology has simply not been there. It's been very difficult. And our mission is to give people an investment portfolio that they love, that they look at and they say, yeah, I like these, I like these companies. That's what we want. I think that that's going to help people be successful in the long run. You know, it stinks losing money in a market downturn. It especially sucks whenever you've got companies that you don't love in your investment portfolio. And I assure you, if you're holding an index fund you're holding companies that you don't love. So like, at least ride through the down times with companies that you believe in and are willing to get behind. So I think speaking up and just telling an advisor, like, hey, this is important to me. I would love the possibility of having a portfolio that aligns with my values and just see what they say.

Brad Sparks 34:29

And I would add to that. Johannes. And you resonate with this. And we, like, these are some of the things we bonded over at the altruist conferences. Is it like you have the best interests of your clients in mind and like you're putting their values forefront? Right? Like, and I think, I actually think a lot of advisors are like that, but they don't have the ability to actually know how to execute that in like a modern or in a way that resonates. And so what ends up happening is you kind of get this experience where clients or prospects talk to somebody and they kind of get put through this process that just feels stale and, and not like it doesn't resonate. And then there's this. And then that gets attached to this stigma of advisors that's like, oh, they don't care about people. They just want to golf or they just want to do these things. And I think actually like, and this has been really helpful for me to learn as I've gotten more in the industry and gone to like ultras conferences and talked. It's like, actually advisors, a lot of advisors out there do care about their, about the people they're working with. And, and it's just like, they might not have the tools to like, best deliver that. So I think like Erik said, like, just ask like, say like, hey, I really care about this. And the advisor might be like, I don't do that. And it's like, this is really hard to do sometimes for some people, but just have the gumption be like, why not? Like, there might be tools out there. Can we look, you know, like, I want to work with you and I trust you want to work with me. Like, let's, let's do this together to get better.

Erik Sartin 35:56

Yeah. Yeah. I think that, I think that all change happens because people ask and speak up. And one of the big impetuses behind Palmarium is giving every investor a voice and letting you know you're not directly letting companies know that you don't want to invest in them because of their human rights policy. But if that's important to you and that's important to enough people and they're actually changing what they're Investing in. Based on that, companies are going to figure that out. And so, like, we also believe that there's an important element of social change that we can drive by using our, like, using our capital actively.

Yohance Harrison 36:41

Yeah, the meme stocks taught us that. The meme stock starts. We, we. If you haven't seen the movie Dumb Money, I think it's called to go watch Dumb Money, you won't be able to own it. You just have to rent it from one of those places. Or, I mean, you go get the DVD if you want to, but I don't even have a DVD player anymore. But the point is, is that we have learned that in numbers, that we as consumers, as lay investors, we don't have to be activists. We can actually make changes at a corporate level. Yeah. So. So I, I believe a lot in what you all are doing and I appreciate you, of course, for coming on to the Money Strip podcast. And I have to say this. It's be on the closeout, but not everyone listens past the when the music starts. We talked about stocks. We were not recommending that you buy those stocks. We were just talking about. We're just having a conversation. So don't go and buy Apple because Erik bought Apple and you're trying to relive his dream. Don't do that. Okay? Go talk to an advisor, look at your own situation and do what's in your best interest based on your values and your goals, etc. That said, I do have to say, because you saw something earlier about that emotional tie to companies, I have a company that has been just languishing in my portfolio.

Yohance Harrison 38:03

I had the foresight

Yohance Harrison 38:06

in 2000 and I want to say it was 19. You can check me on this. But the small company had an IPO. I think it was 20, 19, might have been 18. And I said, huh? I think that company represents the future. Because I thought about it, I said, who is going to make a conversion to this technology and say, I'm gonna go back to the old way of doing things. And that company is DocuSign. I was like, docusign. That's. They got it. I mean, it was them. Adobe had a sign, and there's one other sign, but DocuSign. I was like, it's Docusign. It's like, it's a. It becomes a verb and a noun at the same time. They're the, you know, And I say what? I said, what company's gonna say, yeah, we're not gonna do that Docusign anymore. Let's print paper.

Brad Sparks 38:53

Okay?

Yohance Harrison 38:54

And I loaded up on DocuSign. And then the pandemic hit. And my DocuSign shares went sky high. And I was like, I did it.

Erik Sartin 39:00

Yeah.

Yohance Harrison 39:08

But then the pandemic ended in my DocuSign shares are right back where they started, the IPO.

Brad Sparks 39:15

Yeah.

Yohance Harrison 39:16

And I kept buying all the way up.

Brad Sparks 39:22

So.

Yohance Harrison 39:23

But it's one of those companies where I will, I, I use DocuSign every day. I, I can't see in here. I'm like, no, I, I still believe in them. I, it doesn't hurt as bad that I've lost money because I don't see that I've lost because I didn't buy DocuSign for what it was going to be able to do in five years. I purchased DocuSign for what it was going to be able to do in 15 or 20 years. But because of that values based relationship I have and that affinity I have for the company, like, yeah, it's the worst performer in my portfolio, but who cares?

Erik Sartin 39:46

Yeah.

Brad Sparks 39:57

Yeah. Yeah, who cares?

Erik Sartin 39:59

Yeah. And I'll, and I'll just add on to like, you know, I enjoy buying and selling individual stocks every now and then because it's a way that I entertain myself. Like, I like the engagement. I'm in the industry all the time and like a bulk of my retirement assets are not in a whole bunch of individual.

Yohance Harrison 40:18

Oh yeah, bulk of my retirement's in ETFs and some mutual funds.

Erik Sartin 40:21

Yeah, exactly. And I feel like that one of the, one of the things that we see, or I see and as Palmirium as we see is that the technology is getting to where we don't. We can basically replace and replicate what, what ETFs on mutual funds are doing. We can avoid the fees of the ETF and mutual fund companies and we can apply that layer of personalization to it. And I think that we fast forward five, ten years from now, most people are going to have portfolios that are going to have 50, 100 different stocks on the stock side, you know, and probably individual bonds as well. And it's more efficient, it's more personalized, it allows people to have greater transparency. It aligns better from a fiduciary perspective. And I think like that's where I see it being headed.

Yohance Harrison 41:14

And they can probably save some money on taxes. And with that, we want to thank you all for tuning in to the MONEY Script podcast. And this was our edition of Between Three Advisors. We're just doing some water cooler talk, you know, finding ways that we can sharpen each other's swords and just get better. And as always, if you liked what you heard today, tell us by just clicking that like button or thumbs up or whatever it is that shows us that you thought this was pretty cool. But more importantly, this was all about financial literacy. This is Podcasts are free. I. I will never put a paywall in front of my podcast. If I'm forced to put a paywall in front of my podcast, I'm out of the podcasting game. This is here for you so that you can get some financial literacy without any barriers to entry other than, I guess, having access to Wi fi or paying your cell phone bill. So with that, please share this with someone. If you know someone that's an investor wants to learn more more about investing. We talked about a lot of things in this podcast that can give someone that can plant some seeds that they can then fertilize and help grow into fruitful trees and plants in the future. So share Tell a friend to tell a friend to tell a friend and tune in to the Money Script podcast soon because we got more episodes. I'm back, y'all. Actually, I am taking a week off for the graduation. That's next week, so there won't be an episode. Well, actually I record two today, so you'll get back to back episodes, but there might not be one the following week. We'll see. But tune in, there'll be more where that came from and I'm gonna go try to figure out what was going on with my. You probably noticed I'm at a different camera angle. For those of you on YouTube, something weird just happened with my camera all of a sudden. I don't know. It's weird. I'm gonna go figure it out. Thank you, Erik. Thank you, Brad. We'll see you all next time.

Brad Sparks 42:54

Thanks, Josh.

Erik Sartin 42:55

Thanks Jones.

Seth Harrison 43:09

I'm back. Wasn't that a great show? I hope you learned something. I know I did. Now, before you go trying anything you heard today, remember it is not intended to be specific tax or legal advice. If you need that, go see a CPA or an attorney. If you would like any complimentary consultation with a knowledgeable advisor, visit moneyscript.com and schedule 15 minute consultation. Want Johans to come speak at your next event? Go to the MoneyScript website for that too. Of course, if you're watching on YouTube, make sure to like, comment, subscribe and click the bell for notifications. MoneyScript Wealth Management is a registered financial advisory service in multiple states. Want to learn more? Get the full disclosure on our website moneyscript.

Yohance Harrison 43:50

Com.