Choosing the Right Financial Advisor: Retirement, Social Security, and Your Family’s Future
On this week’s Money Matters, Scott and Pat dive deep into what truly makes a great financial advisor—and why empathy and guidance matter as much as investment strategies. They share real-life stories that highlight how a trusted financial advisor can help families navigate some of life’s toughest moments: illness, unexpected retirement, losing a spouse, and planning for Social Security. From a caller facing a terminal cancer diagnosis to another couple debating whether to pay off their mortgage early, Scott and Pat explore the practical—and emotional—side of retirement and estate planning. Listeners will learn why selecting the right financial advisor isn’t just about numbers, but about having a partner who understands the human side of money.
Join Money Matters: Get your most pressing financial questions answered by Allworth's co-founders Scott Hanson and Pat McClain live on-air! Call 833-99-WORTH. Or ask a question by clicking here. You can also be on the air by emailing Scott and Pat at questions@moneymatters.com.
Automated Voice: Would you like an opinion on a financial matter you're dealing with? Whether it's about retirement, investments, taxes, or 401(k)s, Scott Hanson and Pat McClain would like to help you by answering your call. To join Allworth's "Money Matters", call now at 833-99-WORTH, that's 833-99-W-O-R-T-H.
Scott: Welcome to Allworth's "Money Matters", Scott Hanson.
Pat: Pat McClain. Thanks for joining us.
Scott: Yeah, glad you are with us as we talk about financial matters. Both myself and my co-hosts, were both financial advisors. We used to say, for a long time, we'd spend our weekdays meeting with people like yourself, broadcast this on the weekends. But truth be told, after 35 years of being financial advisors, we're not necessarily doing this five days a week, Monday through Friday with clients.
Pat: Yes. I still have clients to interact with. Enjoyed that part of the business?
Scott: I tell you, Pat, and we'll take some calls here soon, but the longer I'm in this profession, a couple things, one, I really see the value in what we do. I talked to a bunch of... We had, it was like, I don't know, a dozen or so of our associate advisors. So, here at Allworth, sometimes we'll hire somebody from, maybe they were trained at another large firm, after a year or two out of college, we'll hire them. Or we hire new college grads, and it's a five-year program that they come through. They have to get their certified financial planner designation, and then there are these associate advisors.
Pat: And they get a mentor, and there's a whole process.
Scott: Yeah, yeah, yeah. It's a career path, just like other companies do, like real companies. But I was talking to these young group of people.
Pat: Recently?
Scott: Yeah, like, two weeks ago. It was great.
Pat: Well, thanks for doing that. I'm glad they didn't call me.
Scott: You would have scared them out of the business.
Pat: You know what? Wait, wait, I have to come and talk to them?
Scott: But it's one of those moments when you really kind of reflect on what it is we do. And one of the questions someone asked is like, "What makes a great advisor?" And without skipping a beat, I said, "Empathy." I said, "You truly need to care about these people. You can't just fake it. You really need to care about people. And if you don't really care about people, go do something different. Go work back office stuff or something. But don't be an advisor, because I think a great advisor really cares about people." And the value of being an advisor is not necessarily the financial planning, although it's super important, it's not always necessarily the asset allocation, although that's super important...
Pat: Super important.
Scott: ...it's the guidance when life happens. Whether it's external, the financial markets are going crazy and people want to do things with their portfolio, they're going to be detrimental.
Pat: The death of a child, death of a spouse...
Scott: Seriou illness.
Pat: ...late marriage, divorce, unemployment.
Scott: Financial setback, layoff.
Pat: Forced retirement, issues with children, issues with parents. Yes. And to compound things, if that's happening in the middle of a downturn in the market...
Scott: It's even worse.
Pat: ...it magnifies it.
Scott: Yeah, I remember, Pat, a number of years ago, the client I worked with.
Pat: Wait, Scott, before you move on, and what was the response from the...like, three of them left?
Scott: Three of the people got up and left the room.
Pat: No, no.
Scott: They're like, "I have no emotional intelligence whatsoever." No, these were all people... Well, you know, that's interesting, because we do hire people to be financial advisors, and not all of them end up being financial advisors.
Pat: You can normally tell. If they don't have an emotional intelligence.
Scott: Look, we've all had gone to doctors that have bad bedside banners. I remember years ago, I went to the... I won't tell you the specialist in case he listen to the show. But I thought, "Am I in Candid Camera?" I mean, he was so odd and I didn't connect with him. But supposedly, he was really good at what he did, so I kind of put up...
Pat: I'm going to lead on that before you get into your story. I read a book 12 years ago. I don't know how I came across it. But it was a book, but it was written around this study that had to do with how patients viewed their doctor's empathy. And the more empathetic the patient viewed the doctor as, the better the outcomes of whatever it was.
Scott: I would imagine that.
Pat: Right? And so they...
Scott: Because belief is a huge part of your healing.
Pat: Well, and the more you believe in the person, the more you're likely...
Scott: You're going to follow.
Pat: ...to follow the course, right?
Scott: It's the same exact thing with the financial advisor.
Pat: That's right. If someone doesn't believe you're emotionally... And it's hard not to be emotionally invested. Well, most of your clients, it's hard not to be emotionally invested. Some of them-...
Scott: If you like people.
Pat: Okay, yeah.
Scott: So, you have to be a people kind of... You have to be the type of person...
Pat: Which is why I started out really, really good in this business, and got progressively worse. As I got older, I liked people less and less.
Scott: But I mean, it's like...
Pat: I'm joking.
Scott: ...if a new client shows up and they're at point A, and you believe that the right thing is to get them to point Z, you can't just say, "You're an idiot for being at point A, we're moving you to point Z," because they'll say, "Sayonara," they're going to go work with some... It's this, you've got to build that trust, build that relationship. Maybe you get them to point L or M or N, and it takes you four years to get to point Z. It's that... And it's an interesting...
Pat: But I don't think that's how clients view it. That's not how clients view it.
Scott: I know that's not how clients view it. But a good advisor engages with that client and helps them to get to where they need to be, what's really in their best interest, not just what the clients want to be.
Pat: That's correct.
Scott: But we were talking about different things in life. I remember years ago, I had a client. She'd been a client for like 20 years. Her husband had retired a few years prior. She had a great, little business making good money. And financially, she was bam-bab. Probably, she was about ready for retirement. But she didn't want to retire, she was enjoying her job. But suddenly, her husband came down with serious cancer, terminal cancer. She came in, she got less than 12 months to live. And she was always one that's a bit nervous about the markets. Always one of the first ones to call when the market's down 5% or 10%.
And so, we're having this conversation, she asked about the markets, and said, "Why don't we just go to cash right now?" She's like, "What do you mean?" I said, "With all the stress you've got in your life, who knows what your retirement is? It's not the retirement you've been thinking in your mind and planning for the last decade. Your husband's going to be passing away. You've got enough stress in your life. Whether the market's up 20% or down 10% the next 12 months, but the long-term is not going to make any difference in your portfolio. It's not going to have any impact on your life."
Pat: True.
Scott: So, we went to cash. Because they had plenty of assets. She had enough assets. Went to cash. Husband passed. And then over time, we came up with a strategy to get her back fully invested. She ended up remarrying. She's got another life ahead of her. And got grandkids. Her retirement...
Pat: That's emotional intelligence.
Scott: But to your point of, when life happens, those are the times when we may need to make adjustments to our financial plan.
Pat: Okay, you were going to talk about this doctor specialist.
Scott: I did already. I just thought I was on Candid Camera. He was so odd. And I went back to my primary physician like, "What in the world?" She said, "Yeah, he didn't have very good bedside manners, but he's the best surgeon."
Pat: Oh, that's all you got? I thought I was waiting for a big story, other than this guy who just had no bedside manner.
Scott: No, there's no good story there.
Pat: I'm sorry.
Scott: Although he was so odd. And literally, I'm like, "Where's the camera?" You can't know it could be this weird. How do you even have any employees? He's got a little practice, a surgeon of sorts.
Pat: Well, did he have a costume on when you went to visit him? What was he dressed like? He had, like...
Scott: He had this scythe soap thing hanging.
Pat: He was dressed like Darth Vader, "Come into my office, Mr. Hanson."
Scott: He wasn't that weird.
Pat: That's funny.
Scott: Anyway.
Pat: All right, let's go to the calls.
Scott: Yeah, no one wants to hear about these stories.
Pat: Well, we don't know. I wanted to hear. But by the way, getting a good advisor.
Scott: And look, it is accepted. It's funny. I've been doing this 35 years ago. When you called yourself a financial advisor 35 years ago, people would say, so you sell insurance, right?
Pat: Or your stockbroker.
Scott: Or your stockbroker, right?
Pat: You sell product.
Scott: Yes, yes. It wasn't as well respected as it is today. The problem is that it's not recognized as CPAs or...
Pat: Well, the CFP is much more widely recognized than it used to be.
Scott: Yeah. And to the CFP's credit, Certified Financial Planning Board of Standards or whatever it is, to their credit, they've helped and have increased the ethical standards. Like, disclosing if you're going to get a commission, that sort of thing. Of course, they can disclose on page 8, way in the bottom that nobody ever sees.
Pat: Yeah, a little footnote.
Scott: Yeah. Anyway. But there's still a lot of bad actors, Pat, that's for sure.
Pat: If you wanted to join the show, how would you do that, Scott?
Scott: Send us an email, is the best way to do it, questions@moneymatters.com, questions@moneymatters.com. We'll schedule time. Or you can call 833-99-WORTH. We're talking with Alan. Alan, you're with Allworth's "Money Matters".
Alan: Thank you, gentlemen, for taking my call.
Scott: Yes, sir.
Alan: I was listening to your broadcast. And I hope you have a little empathy for me because I have a situation that's very similar to what you guys were talking about.
Scott: Oh, all right. Well, good.
Alan: Okay. So, let me give you a little background information. I'm 66 years old. Married. My wife is 62. Two kids. Both, one just about ready to leave the house. The other one got long gone. And from a financial standpoint, from an income standpoint, I have a pension of $102,000 a year. And the only other income coming in is my wife. She took Social Security using her benefits. So, she gets about $1,000 a month from the Social Security benefits. So, that's pretty much the inflows. For as asset...
Pat: Wait, Alan. And are you receiving Social Security?
Alan: No, I was planning on deferring it until 70.
Pat: Okay. You are eligible, though?
Alan: Well, my full retirement age is 66 in 10 months.
Pat: But you've paid into it.
Scott: You weren't at school... Well, it doesn't matter now because of the windfall. I mean, it's just...
Pat: Assuming you have 40 quarters. But you're eligible for Social Security.
Alan: Yeah, I'm eligible, but I purposely deferred. So, as far as investable assets, I have about $2.3 million, of which $1.3 million is tax deferred, $325,000 is brokerage, $120,000 is cash, and $532,000 is in the Roth, Roth IRA. So, those are my investable assets.
Scott: Wow. I couldn't design a better tax allocation, so to speak. When you look at your savings, 55% roughly is in tax deferred. You've got a big chunk in Roth. You've got some brokerage. You've got some cash. It puts you in a really good position for retirement income planning.
Pat: Yeah, for distribution, yes.
Scott: Really good position.
Pat: Absolutely.
Alan: Right. So, exactly, I retired in 62, so the last couple of years, I have been doing some hefty Roth conversions.
Scott: Very good.
Alan: Okay. So, my goal is to...
Scott: You want a job?
Alan: Excuse me?
Scott: Excuse me.
Alan: You know, I very much considered becoming a CFP because I'm an accountant by trade.
Pat: Oh, okay.
Scott: Oh, okay.
Alan: Anyway, so my question or situation is simply this, beginning of this year, I got a diagnosis of cancer. And so, my question really revolves around, how does my retirement planning change, given my time horizon has dramatically changed? The cancer I have is not curable. It can be treated. And there are a small number of people who go into remission and are actually cured. But the odds are against me. I'm not going to... The life expectancy tables will not work for me anymore from that way.
Pat: Alan, what was the benefit that you selected for your pension in terms of a joint survivor?
Alan: Yeah, so my wife's going to get 50% of my pension.
Pat: Okay, so she'll get $51,000 a year. Is that correct?
Alan: Today's dollars, yes.
Pat: Okay, thank you.
Alan: Yeah, and she'll get my Social Security, which, let's see, at 66 in 10 months, it would be $38.26 per my last statement.
Scott: Why don't you start your Social Security today?
Pat: Why are you waiting?
Alan: Well, I was just diagnosed in January. So, the original plan was to take it at 70, then after that.
Pat: It doesn't matter. So, not to be rude, but your question to us was, what changes? And one of the things that changes is start your Social Security right now.
Scott: Yeah, because essentially, whether you take it early or defer, if you have an exactly normal life expectancy, the number's a wash. Actually, it's a wash. But if something happens and suddenly your life expectancy might be shorter than the average, then you're better off taking it as soon as you can.
Pat: So, that was one of your answers to the question, what changes? That's one.
Scott: That's an easy one.
Pat: What kind of debt do you have?
Alan: Well, I have two homes, and I have a mortgage of $290,000.
Pat: And the interest rate is?
Alan: The house was purchased within the last 18 months, so the interest is $6.5.
Scott: Is this a vacation home or rental?
Alan: Well, it's kind of turned out to be a vacation home. I mean, the plan is to sell the home that we're in currently, and then just to have one home. So, we were never planning on having two homes, but we're in the process of selling one of them.
Scott: And where are you moving? Out of your neighborhood? Two different...?
Alan: Yeah, we're moving about two hours away.
Pat: Okay, and is there a social network there for your wife in that particular area?
Alan: Well, we kind of do 50% of the time in one house, 50% in the other. A lot of times, we have to come to one house simply because of the doctors, the health care.
Scott: Alan, Alan, is there...?
Pat: Where do the kids live?
Scott: One's about to be launched back at home.
Alan: One's about to launch, and the other one has got her own place.
Scott: And is that near your primary home?
Alan: Yeah, I mean, I've actually tried to convince my daughter to actually buy the house.
Pat: Okay, so but where is your daughter? So, here's what would scare me in your situation... And these are not easy conversations at all.
Scott: No, no.
Pat: So, the studies show us that in a single person, especially a widow, is...
Scott: Yeah, so we're going to plan worst case scenario, right?
Pat: ...that something happens to Alan, and it happens sooner rather than later. The studies show that the number one desire, especially for a widow, is that to age in place, right? And aging in place means that there is not a disruption in their social circle where they retired or where they lived. And let me give you an example. My parents moved when... I grew up in a family of five children in Northern California. My parents moved into a new house. And my mother would get in a car and drive...
Scott: To the grocery store.
Pat: ...13 miles across town to the grocery store.
Scott: To see the checkers that she was used to seeing for 30 years or whatever.
Pat: How do you know this story?
Scott: I don't. Just because I've...
Pat: And I asked her, I said, "Why? The same stores down the street. It's the same brand. They have the same things." And she said to me, "It's not the same people. I like the people at the store I've been going to for 20 years." And so, she goes out of her way to do that. And so, you can afford two homes. That is not an issue. You can absolutely afford two homes. But the issue is, where are those homes? Because if you're no longer in the picture of the social circle, just significantly shrank by, not 50%, probably by 80% to 90%. And so, a move at this time is the one thing that I would caution you. Unless she has a social circle...
Scott: That's bigger.
Pat: Or, at least, the same size in the new area.
Alan: Yeah, it's a timing issue, gentlemen, because when I purchased that second home, there was no diagnosis at that point.
Pat: I understand that. So, what's the timing?
Alan: So, it kind of happened. Yeah, timing.
Scott: Why do you...? Just keep both homes for now?
Alan: Well, we can. And it's not out of the question. I don't like paying maintenance, taxes, and insurance on two homes. But if I have to, I have to. So, that's...
Scott: But you know what? So, you add the homes, you're $3.5 million. You can't take a dime with you. No, in all seriousness, I know this sucks. It's interesting. We started the show with the same kind of situation. But you had a certain plan. You saved your whole life. And suddenly you're like 66. Like, God, what the heck? This has certainly changed things. But it's changed things. And so, now, if you're called for help. The most important thing is setting it up so that your wife is in a good position should you die.
Pat: If you were sitting in my office with me and you said, "Well, we're going to move to this new home, I would call you after the appointment in private and implore you to not do that."
Scott: Not to.
Pat: Because all of a sudden, your wife is in an area... Unless she has a social circle there. But...
Alan: She does not. She does not. We have a very small circle of friends in the area that we're currently in. So, I mean, it's going to be transition for her no matter what, for sure. Understand.
Pat: I understand. But the quality of the relationships is actually more important than the number.
Scott: That's more important than the quantity. That's right.
Pat: Than the number. And look, we used to do this whole presentation called the Art of Retirement that actually talked about the four aspects of a successful retirement. And the social circle was a large part of it. And then when Scott and I owned this reverse mortgage company, we did a lot of studies on... We'd engaged outside firms to try to figure out.
Scott: And the last thing people would want to do is leave their home.
Pat: It's an aged home. So, I would implore you to do one of two things.
Scott: Keep both homes.
Pat: Keep both homes or sell the vacation home. The one you just bought.
Alan: Yeah, I think I have a third option, buying something with no maintenance, like a condo or an apartment, and selling both homes. Keeping it around the same area.
Pat: Thank you. Thank you. Thank you. Thank you. Thank you.
Alan: One other question I have, guys... So, thanks for the Social Security tip. I will go ahead and apply for that. But in regards to my tax deferred money, you guys say, "Oh, you've got a great mix." I would really like to reduce that tax deferred in accelerated basis simply because my wife, you know, you heard the widow tax trap. She'll be in a single tax paying situation, where the tax income...
Scott: Yeah, but her income's down $50,000.
Alan: Well, she'll still be in a 22% bracket, I mean, with Social Security.
Pat: Okay, so what's your thought? To do more in Roth conversions?
Alan: Right. Currently, right now, I'm filling up the 22% bracket, and I'm touching the lower end of the 24. Because I have IRMAA considerations as well, so I have to be careful not to invest.
Pat: It's a push. Whether you do the Roth conversions at this stage or she takes the distribution...
Scott: You know what I think is more important than that? Here's my guess. So, I met my wife in a finance class, right? Even back then, it was a very small percentage of women, as it still is today in finance for whatever reason. My wife has a degree in...
Pat: She had all these men to choose from, and she took you.
Scott: I know. I got it figured out. There was some competition. I'm not exactly tall, dark, and handsome either, so... But we've been married 33 years. She pays no attention to the finances. And I try to involve her like, "Hey, here's where our stuff is." And she's like, "Eh, just, man, you do something." She doesn't worry about it. And odds are, I'm going to predecease. That's just how it works most of the time. And so, she knows that should something happen to me, call Pat. Pat can figure it out. And we're at Allworth, and someone will be there. And she trusts, she knows a lot of people. Alan, my guess is, your wife has very little involvement in your assets, your strategies you're doing right now, your investments. Should you pass, she is going to be...
Pat: Oh, yeah, you need to hire a financial advisor.
Scott: Now.
Pat: Do you have a financial advisor?
Alan: So, I have one of those hybrid robo advisors from Vanguard.
Pat: That's not it. That's not it.
Alan: Yeah, I know, I know, I know.
Scott: So, just talk of the show, we were talking about a good advisor, empathy, guidance. You called us for advice. My advice is to find an advisor that your wife really connects with and trusts. Maybe it's a male. Maybe it's a female. But someone that she can trust so that, should something happen to you, she can follow that person's guidance 100%.
Alan: Right. And I think you hit the nail right in the head. I'm trying to get these Roth conversions done before something else happens.
Scott: Yeah, but it's a push.
Pat: It's a rounding.
Scott: No, but I'm telling you, Alan.
Alan: Well, I don't consider it a push because that Roth IRA, most of it's probably going to go to my kids. So, to me, it's the legacy issue as well.
Scott: No, I... Okay, all right. But, okay. It depends on what marginal tax bracket your kids are in.
Pat: Right. You might want to have a portion of your tax deferred go directly to your kids when you pass.
Alan: Well, one is high income a dentist, and the other one is getting up there.
Scott: Okay. Well, then in that case, a Roth would make sense. But that is it. Out of the list of things file for Social Security tomorrow, it's a no brainer.
Pat: What's your number one?
Scott: What's my number one?
Pat: Yeah, into...
Scott: Hire a financial advisor.
Pat: A hundred percent.
Scott: Look, I can't tell you how many times. So, I'm still a practicing advisor, but I haven't brought a new client on in years. But I can't tell you the number of times, at least, two dozen times, where someone has come into my office who has been diagnosed with what they believe to be a terminal illness and hired me for the first time, never, ever having hired an advisor before.
Pat: Absolutely.
Scott: And just saying, "When I'm no longer here, can you please take care of son?"
Pat: And I've had people not even terminally ill. They're just getting older.
Scott: That's right.
Pat: Like, I'm 70 now....
Alan: So, would a fee-based advisor be as fine?
Pat: Yeah.
Alan: I really don't want... I mean, the amount of capital gains I would...
Pat: Oh, no.
Scott: No, no, no. A good advisor is not going to move your assets just to move your assets.
Pat: No, no, they wouldn't.
Scott: They have a fiduciary responsibility to act in your best interest.
Pat: Yeah, they absolutely should not be remodeling a portfolio, especially at this stage of the game.
Scott: Correct.
Pat: And what they should do is, after the fact, actually then, make the portfolio super tax efficient. But, yes, you want a fee based advisor.
Alan: Okay. All right, gentlemen.
Scott: And good for you. And please involve your wife in this, please, please, please.
Alan: No, no, believe me, I am. In fact, just trying to get her to learn Quicken. It's a challenge.
Pat: Oh, yeah. That would be my...
Scott: That would be a challenge for me. I could do it.
Pat: I don't like... My wife as an accountant, and she...
Scott: How about if you had to learn to take over Quicken?
Pat: Oh, there's no way, there's none.
Scott: And we're financial advisors. Like, could you imagine certain temperaments?
Pat: Oh, that would be awful. I'd have actually marry an accountant.
Scott: You need to learn Quicken.
Pat: My wife died, I'd be, like, on whatever the app saying, what do you look for in another person?
Scott: Good bookkeeping skills. Hey, Alan, we hope you have a nice, long life. And I'm glad you called. I think this is prudent.
Alan: Thank you, gentlemen. I appreciate your advice.
Pat: Alan, call any time, any time.
Scott: Yeah, I appreciate the call. You know, Pat, it was reminds me, I had a client. He was probably a client for 15 years. And he would wouldn't bring his wife in. And every time he'd come in, I'd say, I'll call him Steve, "Steve, where's Judy?" "Well, she's in..." And like, "You need to bring Judy in." Well, one day he comes in with Judy. And I'm thinking, Steve seems a little off today. And Judy calls me after the appointment, says he's got Parkinson's. He passes two years later. Judy comes in after he passed with her sister. Sister never met me. Judy barely knows me, knows that Steve liked me. But Judy doesn't. Judy is...
Pat: But the sister... Judy's world just fell apart. Her husband is gone.
Scott: And the sister may not know anything about financial planning, but knows more than. Her sister says, "Well, what I'm telling her, she needs to get a rental house for the tax deduction." And I'm, "What?" I said, "Rental? Why in the world does she need a rental house?" Like, her finances are in good shape. Her husband left her in fine shape. Like, you want to start managing a rental house? For what?
Pat: Maybe there's a tax deduction, maybe not.
Scott: Who cares?
Pat: At age, what, 70?
Scott: Correct. And they left the meeting. And I thought...
Pat: You failed them.
Scott: That's exactly what I thought.
Pat: You failed them, Scott.
Scott: That's exactly what I thought.
Pat: Because...
Scott: I should have said, "I'm not going to work with you, unless you bring your spouse in."
Pat: Yeah, you failed them. How does it feel?
Scott: I don't really feel I failed them. I mean, just...
Pat: Well, you tried.
Scott: I probably should have tried.
Pat: You might have tried harder.
Scott: I would have tried harder today. I probably would have... I would insist today. What's the point, otherwise? Odds are you're going to pre... You know, 9 out of 10 husbands go before their wives.
Pat: Did they buy rental, and she took up the cello?
Scott: No.
Pat: At the age of 70 something.
Scott: At the age of 70.
Pat: It's not the time to introduce new things.
Scott: Not new investment, rental property?
Pat: That is, absolutely, yeah. I can't imagine. In fact, I tell clients exactly the opposite.
Scott: And look, if that call, that last call resonated with you...
Pat: Then hire an advisor.
Scott: And you're getting up an age? I told a...
Pat: What's the goal here?
Scott: Well, that's... I told...
Pat: What is the goal? You can't take a dollar of this with you.
Scott: I had a client that owned four houses, four houses, yeah, all of them that he lived in. And he would complain to me about them. And I said, you know...
Pat: What do you mean, he all lived in?
Scott: He would spend time in each one of the houses.
Pat: Four?
Scott: Four.
Pat: How to make your life complicated.
Scott: That's what I said to him. And then he would complain to me. And he had plenty of money. And I said, you know, "You don't own those houses." He said, "What do you mean? I own them." I said, "No, no, two of those houses, they own you."
Scott: There was an article in "The Wall Street Journal" years ago. This wealthy couple owned six homes. And the wife spent her full-time job as managing the homes. And the article was about this. And you can tell from the woman being interviewed that she thought that this was gonna be this wonderful piece on her. And I read it as the exact opposite.
Pat: What a nightmare.
Pat: Like, this is where you wanna invest your life, in this? This is your legacy?
Scott: They're not so wealthy that they don't have an estate manager, right? The super wealthy have someone that... Doesn't mean that they're not involved. It means that they have someone that actually manages the day-to-day.
Pat: The super wealthy. Yeah, but I don't get it. I don't know why. But it's hard. Look, you've been doing stuff on your own your whole life. Maybe you're quite frugal. Maybe you do your plumbing and everything. Like, you're quite frugal. And maybe you're good. Maybe it's worked out for you. But if you've got a spouse and you think the spouse is going to be here beyond you, you really need to think about setting things up. It's good to leave an inheritance to a spouse, but it'd be even better if you can leave an inheritance with actually someone to manage it.
Scott: Yes, exactly. Anyway, let's continue on. We're talking with Nicole. Nicole, you're with Allworth's "Money Matters".
Nicole: Hey, good morning, guys. Thanks for taking my call. I'm glad to be talking to some financial advisors.
Scott: Oh, good.
Nicole: I'm looking for financial advice.
Pat: All right.
Scott: All right, well, let's see how we do.
Nicole: All right. So, I have a question about paying off my mortgage early. My husband's here with me also. He's the one who turned me on to you guys. So, he's very involved in our finances and I'm kind of the secondary to that. But my question is about paying off my mortgage or mortgage early.
So, I'm 47, he's 50. And we plan to retire early, about seven and a half years from now. So, I'll be 55 and he'll be 58. Right now, we don't have any debt other than our mortgage. We don't have a car payments. We don't own a credit card. We have no student loans. So, our plan is that we'd like to retire with no actual debt.
Scott: Yep, love that.
Nicole: Yeah, so we'd like to focus on traveling. We're actually calling from San Diego right now. We're in our trailer.
Scott: Oh, very nice.
Pat: Oh, cool.
Nicole: Yeah, so we'd just like to spend more time traveling. So, right now, our mortgage...
Pat: And no kids at home?
Nicole: No kids at home. No, they're both...
Pat: College?
Nicole: ...self-sufficient adults.
Pat: Okay, good for you.
Nicole: Paying their own way. Yeah, so...
Pat: Self-feeders.
Nicole: Yes, yes, it's so lovely. It's so lovely. I was raised in a very blue collar household, and luckily, was fortunate enough to make my way now into the white collar job.
Pat: There we go. What is the value of the home that this mortgage is on?
Nicole: So, right now, the current value, the market value right now is $738,000, and we owe $487,000.
Pat: And what's the interest rate?
Nicole: 3.125.
Pat: And tell us about the rest of the financial situation. Will you receive a pension when you retire?
Nicole: Yeah, so, my husband works for the state. He'll have a pension. He will have... What is this pension about? About $10,000 a month when he retires. And I have right now, my 401(k) is at $430,000. I plan to take Social Security at 62. And my pension, I don't have exact numbers, but I think it's in around....
Man: I don't know.
Nicole: Oh, I could cash it out for about $500,000.
Pat: You work for the government?
Nicole: My husband does, I do not. I work for an insurance company.
Scott: And what's your family pay right now, between the two of, your wages?
Nicole: Right now, we're at about $302,000 a year.
Pat: And what's the total value of all the 401(k)s and 457s, 403(b)s in the family? What's the total value of those between you and your spouse?
Nicole: Right now, $545,000.
Pat: You guys need to save more money if you wanna do this plan.
Scott: Unless your income is much higher than it was five years ago and you just finished getting the kids through school and suddenly you've got way more cash than you've ever had.
Nicole: We do have way more cash than we've ever had...
Scott: How much cash do you have?
Nicole: ...because we don't have other debt. So, right now, we have an emergency savings account with $25,000 in it. We also have been saving toward paying off the mortgage early in a money market account because the interest rate was higher.
Pat: Yeah, that makes sense.
Pat: How much do you have there?
Nicole: Yeah, so well, we had $46,000, and we have some in a T-bill that's about to mature at the end of the month. But interest rates are kind of going down on the market.
Pat: Okay, so how much do you have in this T-bill?
Nicole: $30,000.
Pat: And you have $30,000 and $46,000 in a money market?
Nicole: No, total.
Pat: That's total, okay.
Nicole: It's total.
Pat: Okay, all right. Well, we don't know whether interest rates are gonna go down or up. I don't know that. You need to save more money if you're gonna retire in seven years.
Scott: And I would use...
Nicole: I'm sorry, I was just gonna say, we also are maximizing our benefits as far as cash out. So, we've both been saving a number of PTO hours. And he can cash out up to 2,000 hours, so that's a big chunk of change when we retire, too.
Scott: That's right, yeah.
Pat: You need to save more money if you wanna retire in seven years.
Scott: And I like the idea. What I would do is plan. So, you had seven years, seven and a half years. How much do I need to put aside? I'm making the mortgage payments. What's the balance gonna be seven and a half years? How much do I need to be putting aside in savings so that I got a chunk of cash to pay that off?
Pat: Well, actually, we have time. This is a podcast. Let's...
Scott: Well, that's the first step.
Pat: Let's do it right now.
Scott: No, I'm not doing that. But I think what's important is to really run a financial plan. You've got $300,000 coming in. Where's it all going?
Pat: Scott, you don't wanna go through it right now?
Scott: No, I'm not gonna do that math.
Pat: You just don't wanna...
Scott: You can go online. They're simple. You can do it. Those are simple calculations.
Pat: Okay, all you do is you take your income...
Scott: But what's more important?
Pat: ...minus your Social Security, minus your contributions to your 401(k)s, minus your mortgage, if you're saving up enough mortgage, which will tell you what you're living on right now. And then you plan to that. You plan, I'm gonna take a four or 5% distribution added in your Social Security and figure out. It's just a quick financial plan that tells you... We're not guessing here. But I can tell you, I've been doing this long enough, that if you stay the current course, you're not gonna retire in seven years.
Scott: Well, they might. And then...
Nicole: Yeah, so I've run numbers of what we're gonna pay towards the mortgage in our normal monthly payments, and then what balance will be left, is around $400,000. So...
Scott: So, how much is your mortgage payment excluding taxes and insurance?
Nicole: $2,800, I believe. And we pay almost $3,500 a month.
Scott: Okay, so it's $30,000 a year. It's 10% of your income. I shouldn't say it's a rounding there, but it... So, the question I think we have is, like, you're making $300,000 a year. You're living on... This is your lifestyle. And you're gonna go... It seems like maybe you got a lot of money at 55 with $100,000 pension, $120,000. But it's a fraction of where you're at today.
Man: We're saving every month.
Nicole: Yeah, we saved about $3,000 a month towards.
Pat: But the idea, the answer to the question is, I like what you're doing by putting the money aside to pay down the mortgage, right? I like that idea. The assumption is you're gonna stay in the same house once you retire, is that...?
Nicole: Yes.
Pat: Okay, so I like the idea of putting it aside. I wouldn't mess with treasury bills as much as I would just buy...
Scott: Got a high-yield money market account.
Pat: Yeah, or buy BIL, which is just a short-term treasury. Yeah, just something along those.
Scott: These are a high-yield money...
Pat: High-yield money market.
Scott: High-yield on savings.
Pat: You're fine. I like the idea of that. You should be both maximizing your 401(k)s.
Nicole: We are.
Pat: Okay, yep.
Scott: But I like the idea of that. And by the way, we don't know whether interest rates are gonna go down or not down. We know that if Donald Trump gets to handpick the Fed chair, and then fires everyone else on the Fed board, that the chances of them going down are probably...
Pat: Yeah, Scott, interest rates are gonna be beautiful. You'll never see anything like it. Incredible.
Scott: Look, I'd really recommend you guys do a full financial plan. Here's where you are today. Here's where you're gonna be in seven and a half years. Here's the steps that you need to be doing to see that, to make retirement a reality. And I appreciate the call. I think the concern, Pat, is, and we've seen it, the 50s is still pretty early to retire, people retire early. Some people are good financially. They live somewhat frugally and can make a go of it.
Pat: Yeah, but...
Scott: But we've also seen people where they start living, doing all this stuff, travel, and then their net worth's declining, and you have the conversation like, "Look, you're gonna be broke at 73."
Pat: Yeah. And he's retiring at 57 and her at 55. That $100,000 pension certainly helps, but we actually don't know if that's a joint survivor or if that's a full survivor. My guess is it's top line.
Scott: That's right, so you have to take a reduction on that.
Pat: Which you take a reduction on that, which probably puts it closer to $83,000 or $84,000. Then you add in Social Security, which is a long way away. Then, fortunately, he works for the state, and I assume, since they called from California, works for the state of California, which he gets health insurance for both he and his spouse, but I don't know. Yeah, just pay a couple grand, get the financial plan done, and burst your bubble or inflate it. That's what it's gonna do.
Scott: Yeah, it... Yeah, I think we've seen... I remember years ago. And when you work for a company or the government where you've got a pension, it's an interesting place, because we've certainly... And, Pat, we've counseled people that are in their 50s, not loving their employment, and helping them to get something different, sometimes even at less pay, pushing out their retirement date, somewhere they got some flexibility so they can go visit the grandkids or whatever, right? Whatever help them figure out the lifestyle they want, their life. And when you work for an entity that has a pension... Like I remember a guy I used to ride bikes with, he said, "Seven years. Got seven years."
Pat: Oh, what miserable... He was leaving his job.
Scott: And he was locked. He was locked. He was locked because he had to get to the pension.
Pat: He was locked?
Scott: Yes.
Pat: I remember, I had another friend of mine, he asked me to run some numbers. He worked for a school district. He was burnt out, wanted to do something different. Yeah, working with junior hires would burn me out as well, right? He's just like me. And the problem was he had to stick around till whatever the age was, he was 55. Forget exactly, the planning we did. But he said, if I left now, what would this mean?
Scott: Hundreds of thousands of dollars.
Pat: Correct. I ran the numbers. I came up with a net present value. I like, whatever the number was, "Here's how much money you are leaving on the table if you leave right now."
Scott: Hundreds of thousands, is my guess.
Pat: Hundreds of thousands.
Scott: I had a relative that worked, and he said, "I can't do this anymore." I said, "Look, you got three years to go hide. Just go to work every day and hide from people." It's interesting. That is the downside with pensions. And pensions, companies started offering pensions in large form during World War II, as that's when employee benefits became a big thing.
Pat: Including employer healthcare at the end of World War II.
Scott: Because you weren't allowed to lure someone away at a higher wage.
Pat: Yeah, the wage freezes, which is an unintended consequence of government involvement.
Scott: Correct. Imagine that.
Pat: When government starts monkeying with the free markets. They didn't say you couldn't give them a pension and/or health insurance, they just said you couldn't pay them anymore.
Scott: Yeah. And they're good and bad. If you love your job, they're fantastic.
Pat: They're great.
Scott: If you don't love what you're doing, it's a...
Pat: They're handcuffs.
Scott: They're handcuffs, and maybe for many, many years.
Pat: And they're golden handcuffs.
Scott: You know, it's interesting, but talking about government getting involved in the unintended consequences. And I look at... We try not to be very political here. And I look at the administration's investment in Intel, and I think this is not a healthy move. This leads down a very dangerous path. I am a firm believer in free markets. Look, I think we need regulations, we need to know what the rules are, we need to make sure that people are honest. But there's something beautiful about the free markets because money gets allocated to where it produces the most.
Pat: Do you think that the government might steer contracts to Intel because they own part of it now?
Scott: A company that has eroded wealth, shareholder value...
Pat: Shareholder value.
Scott: ...50% over the last 25 years, that's the company we're getting behind?
Pat: That's the one we're betting on. That's the one we're betting on. Yep. Unintended consequences, we have no idea where this is gonna go.
Scott: I mean, during like the financial crisis, there was bailing out the banks, there was a lot of talk about that. Is this healthy or not healthy?
Pat: Automotive companies, is it healthy or not healthy? But there was an exit there. I don't know if there's an exit on Intel, right? When they went into these...
Scott: That's right.
Pat: ...there was a thought out strategy as, this is what the plan is. We don't plan to own part of General Motors and/or Bank of America or Wells Fargo.
Scott: That's right. And they got repaid.
Pat: And they did get repaid.
Scott: We got repaid, I should say. We're in.
Pat: Yes, all of us.
Scott: That's right. With less debt that we are encumbered with. It just seems...
Pat: Dangerous. I don't see how that's healthy for...
Scott: Hey, wanna let them know we've got a webinar.
Pat: Do we?
Scott: Yes. Webinar, it is wealth strategies for the modern investor. I am doing the webinar with Victoria Bogner, our head of wealth planning.
Pat: Well, thank you for doing this, Scott.
Scott: You've heard Victoria. And during this... It's really designed for those with $5 million or more, was what this particular one is. But some of the things we're gonna be looking into is limiting your downside risk with buffered ETFs. We'll talk about those. How to access some private markets for enhanced diversification. Using some option overlays to reshape our returns and navigating new tax laws with coordinated, forward-thinking tactics. So, those are the things that we're covering. Really designed for someone with $5 million or more in assets. Wednesday, September 17th at 10 a.m., Pacific. Thursday, September 18th at noon, Pacific. Saturday, September 20th at 9 a.m., Pacific. We'll touch on all those. And you need to register at allworthfinancial.com/workshops. It's gonna be a good one. Anyway, it's been great being with you. This has been Scott Hanson and Pat McClain of Allworth's "Money Matters".
Automated Voice: This program has been brought to you by Allworth Financial, a registered investment advisory firm. Any ideas presented during this program are not intended to provide specific financial advice. You should consult your own financial advisor, tax consultant, or a state-planning attorney to conduct your own due diligence.
Scott: Welcome to Allworth's "Money Matters", Scott Hanson.
Pat: Pat McClain. Thanks for joining us.
Scott: Yeah, glad you are with us as we talk about financial matters. Both myself and my co-hosts, were both financial advisors. We used to say, for a long time, we'd spend our weekdays meeting with people like yourself, broadcast this on the weekends. But truth be told, after 35 years of being financial advisors, we're not necessarily doing this five days a week, Monday through Friday with clients.
Pat: Yes. I still have clients to interact with. Enjoyed that part of the business?
Scott: I tell you, Pat, and we'll take some calls here soon, but the longer I'm in this profession, a couple things, one, I really see the value in what we do. I talked to a bunch of... We had, it was like, I don't know, a dozen or so of our associate advisors. So, here at Allworth, sometimes we'll hire somebody from, maybe they were trained at another large firm, after a year or two out of college, we'll hire them. Or we hire new college grads, and it's a five-year program that they come through. They have to get their certified financial planner designation, and then there are these associate advisors.
Pat: And they get a mentor, and there's a whole process.
Scott: Yeah, yeah, yeah. It's a career path, just like other companies do, like real companies. But I was talking to these young group of people.
Pat: Recently?
Scott: Yeah, like, two weeks ago. It was great.
Pat: Well, thanks for doing that. I'm glad they didn't call me.
Scott: You would have scared them out of the business.
Pat: You know what? Wait, wait, I have to come and talk to them?
Scott: But it's one of those moments when you really kind of reflect on what it is we do. And one of the questions someone asked is like, "What makes a great advisor?" And without skipping a beat, I said, "Empathy." I said, "You truly need to care about these people. You can't just fake it. You really need to care about people. And if you don't really care about people, go do something different. Go work back office stuff or something. But don't be an advisor, because I think a great advisor really cares about people." And the value of being an advisor is not necessarily the financial planning, although it's super important, it's not always necessarily the asset allocation, although that's super important...
Pat: Super important.
Scott: ...it's the guidance when life happens. Whether it's external, the financial markets are going crazy and people want to do things with their portfolio, they're going to be detrimental.
Pat: The death of a child, death of a spouse...
Scott: Seriou illness.
Pat: ...late marriage, divorce, unemployment.
Scott: Financial setback, layoff.
Pat: Forced retirement, issues with children, issues with parents. Yes. And to compound things, if that's happening in the middle of a downturn in the market...
Scott: It's even worse.
Pat: ...it magnifies it.
Scott: Yeah, I remember, Pat, a number of years ago, the client I worked with.
Pat: Wait, Scott, before you move on, and what was the response from the...like, three of them left?
Scott: Three of the people got up and left the room.
Pat: No, no.
Scott: They're like, "I have no emotional intelligence whatsoever." No, these were all people... Well, you know, that's interesting, because we do hire people to be financial advisors, and not all of them end up being financial advisors.
Pat: You can normally tell. If they don't have an emotional intelligence.
Scott: Look, we've all had gone to doctors that have bad bedside banners. I remember years ago, I went to the... I won't tell you the specialist in case he listen to the show. But I thought, "Am I in Candid Camera?" I mean, he was so odd and I didn't connect with him. But supposedly, he was really good at what he did, so I kind of put up...
Pat: I'm going to lead on that before you get into your story. I read a book 12 years ago. I don't know how I came across it. But it was a book, but it was written around this study that had to do with how patients viewed their doctor's empathy. And the more empathetic the patient viewed the doctor as, the better the outcomes of whatever it was.
Scott: I would imagine that.
Pat: Right? And so they...
Scott: Because belief is a huge part of your healing.
Pat: Well, and the more you believe in the person, the more you're likely...
Scott: You're going to follow.
Pat: ...to follow the course, right?
Scott: It's the same exact thing with the financial advisor.
Pat: That's right. If someone doesn't believe you're emotionally... And it's hard not to be emotionally invested. Well, most of your clients, it's hard not to be emotionally invested. Some of them-...
Scott: If you like people.
Pat: Okay, yeah.
Scott: So, you have to be a people kind of... You have to be the type of person...
Pat: Which is why I started out really, really good in this business, and got progressively worse. As I got older, I liked people less and less.
Scott: But I mean, it's like...
Pat: I'm joking.
Scott: ...if a new client shows up and they're at point A, and you believe that the right thing is to get them to point Z, you can't just say, "You're an idiot for being at point A, we're moving you to point Z," because they'll say, "Sayonara," they're going to go work with some... It's this, you've got to build that trust, build that relationship. Maybe you get them to point L or M or N, and it takes you four years to get to point Z. It's that... And it's an interesting...
Pat: But I don't think that's how clients view it. That's not how clients view it.
Scott: I know that's not how clients view it. But a good advisor engages with that client and helps them to get to where they need to be, what's really in their best interest, not just what the clients want to be.
Pat: That's correct.
Scott: But we were talking about different things in life. I remember years ago, I had a client. She'd been a client for like 20 years. Her husband had retired a few years prior. She had a great, little business making good money. And financially, she was bam-bab. Probably, she was about ready for retirement. But she didn't want to retire, she was enjoying her job. But suddenly, her husband came down with serious cancer, terminal cancer. She came in, she got less than 12 months to live. And she was always one that's a bit nervous about the markets. Always one of the first ones to call when the market's down 5% or 10%.
And so, we're having this conversation, she asked about the markets, and said, "Why don't we just go to cash right now?" She's like, "What do you mean?" I said, "With all the stress you've got in your life, who knows what your retirement is? It's not the retirement you've been thinking in your mind and planning for the last decade. Your husband's going to be passing away. You've got enough stress in your life. Whether the market's up 20% or down 10% the next 12 months, but the long-term is not going to make any difference in your portfolio. It's not going to have any impact on your life."
Pat: True.
Scott: So, we went to cash. Because they had plenty of assets. She had enough assets. Went to cash. Husband passed. And then over time, we came up with a strategy to get her back fully invested. She ended up remarrying. She's got another life ahead of her. And got grandkids. Her retirement...
Pat: That's emotional intelligence.
Scott: But to your point of, when life happens, those are the times when we may need to make adjustments to our financial plan.
Pat: Okay, you were going to talk about this doctor specialist.
Scott: I did already. I just thought I was on Candid Camera. He was so odd. And I went back to my primary physician like, "What in the world?" She said, "Yeah, he didn't have very good bedside manners, but he's the best surgeon."
Pat: Oh, that's all you got? I thought I was waiting for a big story, other than this guy who just had no bedside manner.
Scott: No, there's no good story there.
Pat: I'm sorry.
Scott: Although he was so odd. And literally, I'm like, "Where's the camera?" You can't know it could be this weird. How do you even have any employees? He's got a little practice, a surgeon of sorts.
Pat: Well, did he have a costume on when you went to visit him? What was he dressed like? He had, like...
Scott: He had this scythe soap thing hanging.
Pat: He was dressed like Darth Vader, "Come into my office, Mr. Hanson."
Scott: He wasn't that weird.
Pat: That's funny.
Scott: Anyway.
Pat: All right, let's go to the calls.
Scott: Yeah, no one wants to hear about these stories.
Pat: Well, we don't know. I wanted to hear. But by the way, getting a good advisor.
Scott: And look, it is accepted. It's funny. I've been doing this 35 years ago. When you called yourself a financial advisor 35 years ago, people would say, so you sell insurance, right?
Pat: Or your stockbroker.
Scott: Or your stockbroker, right?
Pat: You sell product.
Scott: Yes, yes. It wasn't as well respected as it is today. The problem is that it's not recognized as CPAs or...
Pat: Well, the CFP is much more widely recognized than it used to be.
Scott: Yeah. And to the CFP's credit, Certified Financial Planning Board of Standards or whatever it is, to their credit, they've helped and have increased the ethical standards. Like, disclosing if you're going to get a commission, that sort of thing. Of course, they can disclose on page 8, way in the bottom that nobody ever sees.
Pat: Yeah, a little footnote.
Scott: Yeah. Anyway. But there's still a lot of bad actors, Pat, that's for sure.
Pat: If you wanted to join the show, how would you do that, Scott?
Scott: Send us an email, is the best way to do it, questions@moneymatters.com, questions@moneymatters.com. We'll schedule time. Or you can call 833-99-WORTH. We're talking with Alan. Alan, you're with Allworth's "Money Matters".
Alan: Thank you, gentlemen, for taking my call.
Scott: Yes, sir.
Alan: I was listening to your broadcast. And I hope you have a little empathy for me because I have a situation that's very similar to what you guys were talking about.
Scott: Oh, all right. Well, good.
Alan: Okay. So, let me give you a little background information. I'm 66 years old. Married. My wife is 62. Two kids. Both, one just about ready to leave the house. The other one got long gone. And from a financial standpoint, from an income standpoint, I have a pension of $102,000 a year. And the only other income coming in is my wife. She took Social Security using her benefits. So, she gets about $1,000 a month from the Social Security benefits. So, that's pretty much the inflows. For as asset...
Pat: Wait, Alan. And are you receiving Social Security?
Alan: No, I was planning on deferring it until 70.
Pat: Okay. You are eligible, though?
Alan: Well, my full retirement age is 66 in 10 months.
Pat: But you've paid into it.
Scott: You weren't at school... Well, it doesn't matter now because of the windfall. I mean, it's just...
Pat: Assuming you have 40 quarters. But you're eligible for Social Security.
Alan: Yeah, I'm eligible, but I purposely deferred. So, as far as investable assets, I have about $2.3 million, of which $1.3 million is tax deferred, $325,000 is brokerage, $120,000 is cash, and $532,000 is in the Roth, Roth IRA. So, those are my investable assets.
Scott: Wow. I couldn't design a better tax allocation, so to speak. When you look at your savings, 55% roughly is in tax deferred. You've got a big chunk in Roth. You've got some brokerage. You've got some cash. It puts you in a really good position for retirement income planning.
Pat: Yeah, for distribution, yes.
Scott: Really good position.
Pat: Absolutely.
Alan: Right. So, exactly, I retired in 62, so the last couple of years, I have been doing some hefty Roth conversions.
Scott: Very good.
Alan: Okay. So, my goal is to...
Scott: You want a job?
Alan: Excuse me?
Scott: Excuse me.
Alan: You know, I very much considered becoming a CFP because I'm an accountant by trade.
Pat: Oh, okay.
Scott: Oh, okay.
Alan: Anyway, so my question or situation is simply this, beginning of this year, I got a diagnosis of cancer. And so, my question really revolves around, how does my retirement planning change, given my time horizon has dramatically changed? The cancer I have is not curable. It can be treated. And there are a small number of people who go into remission and are actually cured. But the odds are against me. I'm not going to... The life expectancy tables will not work for me anymore from that way.
Pat: Alan, what was the benefit that you selected for your pension in terms of a joint survivor?
Alan: Yeah, so my wife's going to get 50% of my pension.
Pat: Okay, so she'll get $51,000 a year. Is that correct?
Alan: Today's dollars, yes.
Pat: Okay, thank you.
Alan: Yeah, and she'll get my Social Security, which, let's see, at 66 in 10 months, it would be $38.26 per my last statement.
Scott: Why don't you start your Social Security today?
Pat: Why are you waiting?
Alan: Well, I was just diagnosed in January. So, the original plan was to take it at 70, then after that.
Pat: It doesn't matter. So, not to be rude, but your question to us was, what changes? And one of the things that changes is start your Social Security right now.
Scott: Yeah, because essentially, whether you take it early or defer, if you have an exactly normal life expectancy, the number's a wash. Actually, it's a wash. But if something happens and suddenly your life expectancy might be shorter than the average, then you're better off taking it as soon as you can.
Pat: So, that was one of your answers to the question, what changes? That's one.
Scott: That's an easy one.
Pat: What kind of debt do you have?
Alan: Well, I have two homes, and I have a mortgage of $290,000.
Pat: And the interest rate is?
Alan: The house was purchased within the last 18 months, so the interest is $6.5.
Scott: Is this a vacation home or rental?
Alan: Well, it's kind of turned out to be a vacation home. I mean, the plan is to sell the home that we're in currently, and then just to have one home. So, we were never planning on having two homes, but we're in the process of selling one of them.
Scott: And where are you moving? Out of your neighborhood? Two different...?
Alan: Yeah, we're moving about two hours away.
Pat: Okay, and is there a social network there for your wife in that particular area?
Alan: Well, we kind of do 50% of the time in one house, 50% in the other. A lot of times, we have to come to one house simply because of the doctors, the health care.
Scott: Alan, Alan, is there...?
Pat: Where do the kids live?
Scott: One's about to be launched back at home.
Alan: One's about to launch, and the other one has got her own place.
Scott: And is that near your primary home?
Alan: Yeah, I mean, I've actually tried to convince my daughter to actually buy the house.
Pat: Okay, so but where is your daughter? So, here's what would scare me in your situation... And these are not easy conversations at all.
Scott: No, no.
Pat: So, the studies show us that in a single person, especially a widow, is...
Scott: Yeah, so we're going to plan worst case scenario, right?
Pat: ...that something happens to Alan, and it happens sooner rather than later. The studies show that the number one desire, especially for a widow, is that to age in place, right? And aging in place means that there is not a disruption in their social circle where they retired or where they lived. And let me give you an example. My parents moved when... I grew up in a family of five children in Northern California. My parents moved into a new house. And my mother would get in a car and drive...
Scott: To the grocery store.
Pat: ...13 miles across town to the grocery store.
Scott: To see the checkers that she was used to seeing for 30 years or whatever.
Pat: How do you know this story?
Scott: I don't. Just because I've...
Pat: And I asked her, I said, "Why? The same stores down the street. It's the same brand. They have the same things." And she said to me, "It's not the same people. I like the people at the store I've been going to for 20 years." And so, she goes out of her way to do that. And so, you can afford two homes. That is not an issue. You can absolutely afford two homes. But the issue is, where are those homes? Because if you're no longer in the picture of the social circle, just significantly shrank by, not 50%, probably by 80% to 90%. And so, a move at this time is the one thing that I would caution you. Unless she has a social circle...
Scott: That's bigger.
Pat: Or, at least, the same size in the new area.
Alan: Yeah, it's a timing issue, gentlemen, because when I purchased that second home, there was no diagnosis at that point.
Pat: I understand that. So, what's the timing?
Alan: So, it kind of happened. Yeah, timing.
Scott: Why do you...? Just keep both homes for now?
Alan: Well, we can. And it's not out of the question. I don't like paying maintenance, taxes, and insurance on two homes. But if I have to, I have to. So, that's...
Scott: But you know what? So, you add the homes, you're $3.5 million. You can't take a dime with you. No, in all seriousness, I know this sucks. It's interesting. We started the show with the same kind of situation. But you had a certain plan. You saved your whole life. And suddenly you're like 66. Like, God, what the heck? This has certainly changed things. But it's changed things. And so, now, if you're called for help. The most important thing is setting it up so that your wife is in a good position should you die.
Pat: If you were sitting in my office with me and you said, "Well, we're going to move to this new home, I would call you after the appointment in private and implore you to not do that."
Scott: Not to.
Pat: Because all of a sudden, your wife is in an area... Unless she has a social circle there. But...
Alan: She does not. She does not. We have a very small circle of friends in the area that we're currently in. So, I mean, it's going to be transition for her no matter what, for sure. Understand.
Pat: I understand. But the quality of the relationships is actually more important than the number.
Scott: That's more important than the quantity. That's right.
Pat: Than the number. And look, we used to do this whole presentation called the Art of Retirement that actually talked about the four aspects of a successful retirement. And the social circle was a large part of it. And then when Scott and I owned this reverse mortgage company, we did a lot of studies on... We'd engaged outside firms to try to figure out.
Scott: And the last thing people would want to do is leave their home.
Pat: It's an aged home. So, I would implore you to do one of two things.
Scott: Keep both homes.
Pat: Keep both homes or sell the vacation home. The one you just bought.
Alan: Yeah, I think I have a third option, buying something with no maintenance, like a condo or an apartment, and selling both homes. Keeping it around the same area.
Pat: Thank you. Thank you. Thank you. Thank you. Thank you.
Alan: One other question I have, guys... So, thanks for the Social Security tip. I will go ahead and apply for that. But in regards to my tax deferred money, you guys say, "Oh, you've got a great mix." I would really like to reduce that tax deferred in accelerated basis simply because my wife, you know, you heard the widow tax trap. She'll be in a single tax paying situation, where the tax income...
Scott: Yeah, but her income's down $50,000.
Alan: Well, she'll still be in a 22% bracket, I mean, with Social Security.
Pat: Okay, so what's your thought? To do more in Roth conversions?
Alan: Right. Currently, right now, I'm filling up the 22% bracket, and I'm touching the lower end of the 24. Because I have IRMAA considerations as well, so I have to be careful not to invest.
Pat: It's a push. Whether you do the Roth conversions at this stage or she takes the distribution...
Scott: You know what I think is more important than that? Here's my guess. So, I met my wife in a finance class, right? Even back then, it was a very small percentage of women, as it still is today in finance for whatever reason. My wife has a degree in...
Pat: She had all these men to choose from, and she took you.
Scott: I know. I got it figured out. There was some competition. I'm not exactly tall, dark, and handsome either, so... But we've been married 33 years. She pays no attention to the finances. And I try to involve her like, "Hey, here's where our stuff is." And she's like, "Eh, just, man, you do something." She doesn't worry about it. And odds are, I'm going to predecease. That's just how it works most of the time. And so, she knows that should something happen to me, call Pat. Pat can figure it out. And we're at Allworth, and someone will be there. And she trusts, she knows a lot of people. Alan, my guess is, your wife has very little involvement in your assets, your strategies you're doing right now, your investments. Should you pass, she is going to be...
Pat: Oh, yeah, you need to hire a financial advisor.
Scott: Now.
Pat: Do you have a financial advisor?
Alan: So, I have one of those hybrid robo advisors from Vanguard.
Pat: That's not it. That's not it.
Alan: Yeah, I know, I know, I know.
Scott: So, just talk of the show, we were talking about a good advisor, empathy, guidance. You called us for advice. My advice is to find an advisor that your wife really connects with and trusts. Maybe it's a male. Maybe it's a female. But someone that she can trust so that, should something happen to you, she can follow that person's guidance 100%.
Alan: Right. And I think you hit the nail right in the head. I'm trying to get these Roth conversions done before something else happens.
Scott: Yeah, but it's a push.
Pat: It's a rounding.
Scott: No, but I'm telling you, Alan.
Alan: Well, I don't consider it a push because that Roth IRA, most of it's probably going to go to my kids. So, to me, it's the legacy issue as well.
Scott: No, I... Okay, all right. But, okay. It depends on what marginal tax bracket your kids are in.
Pat: Right. You might want to have a portion of your tax deferred go directly to your kids when you pass.
Alan: Well, one is high income a dentist, and the other one is getting up there.
Scott: Okay. Well, then in that case, a Roth would make sense. But that is it. Out of the list of things file for Social Security tomorrow, it's a no brainer.
Pat: What's your number one?
Scott: What's my number one?
Pat: Yeah, into...
Scott: Hire a financial advisor.
Pat: A hundred percent.
Scott: Look, I can't tell you how many times. So, I'm still a practicing advisor, but I haven't brought a new client on in years. But I can't tell you the number of times, at least, two dozen times, where someone has come into my office who has been diagnosed with what they believe to be a terminal illness and hired me for the first time, never, ever having hired an advisor before.
Pat: Absolutely.
Scott: And just saying, "When I'm no longer here, can you please take care of son?"
Pat: And I've had people not even terminally ill. They're just getting older.
Scott: That's right.
Pat: Like, I'm 70 now....
Alan: So, would a fee-based advisor be as fine?
Pat: Yeah.
Alan: I really don't want... I mean, the amount of capital gains I would...
Pat: Oh, no.
Scott: No, no, no. A good advisor is not going to move your assets just to move your assets.
Pat: No, no, they wouldn't.
Scott: They have a fiduciary responsibility to act in your best interest.
Pat: Yeah, they absolutely should not be remodeling a portfolio, especially at this stage of the game.
Scott: Correct.
Pat: And what they should do is, after the fact, actually then, make the portfolio super tax efficient. But, yes, you want a fee based advisor.
Alan: Okay. All right, gentlemen.
Scott: And good for you. And please involve your wife in this, please, please, please.
Alan: No, no, believe me, I am. In fact, just trying to get her to learn Quicken. It's a challenge.
Pat: Oh, yeah. That would be my...
Scott: That would be a challenge for me. I could do it.
Pat: I don't like... My wife as an accountant, and she...
Scott: How about if you had to learn to take over Quicken?
Pat: Oh, there's no way, there's none.
Scott: And we're financial advisors. Like, could you imagine certain temperaments?
Pat: Oh, that would be awful. I'd have actually marry an accountant.
Scott: You need to learn Quicken.
Pat: My wife died, I'd be, like, on whatever the app saying, what do you look for in another person?
Scott: Good bookkeeping skills. Hey, Alan, we hope you have a nice, long life. And I'm glad you called. I think this is prudent.
Alan: Thank you, gentlemen. I appreciate your advice.
Pat: Alan, call any time, any time.
Scott: Yeah, I appreciate the call. You know, Pat, it was reminds me, I had a client. He was probably a client for 15 years. And he would wouldn't bring his wife in. And every time he'd come in, I'd say, I'll call him Steve, "Steve, where's Judy?" "Well, she's in..." And like, "You need to bring Judy in." Well, one day he comes in with Judy. And I'm thinking, Steve seems a little off today. And Judy calls me after the appointment, says he's got Parkinson's. He passes two years later. Judy comes in after he passed with her sister. Sister never met me. Judy barely knows me, knows that Steve liked me. But Judy doesn't. Judy is...
Pat: But the sister... Judy's world just fell apart. Her husband is gone.
Scott: And the sister may not know anything about financial planning, but knows more than. Her sister says, "Well, what I'm telling her, she needs to get a rental house for the tax deduction." And I'm, "What?" I said, "Rental? Why in the world does she need a rental house?" Like, her finances are in good shape. Her husband left her in fine shape. Like, you want to start managing a rental house? For what?
Pat: Maybe there's a tax deduction, maybe not.
Scott: Who cares?
Pat: At age, what, 70?
Scott: Correct. And they left the meeting. And I thought...
Pat: You failed them.
Scott: That's exactly what I thought.
Pat: You failed them, Scott.
Scott: That's exactly what I thought.
Pat: Because...
Scott: I should have said, "I'm not going to work with you, unless you bring your spouse in."
Pat: Yeah, you failed them. How does it feel?
Scott: I don't really feel I failed them. I mean, just...
Pat: Well, you tried.
Scott: I probably should have tried.
Pat: You might have tried harder.
Scott: I would have tried harder today. I probably would have... I would insist today. What's the point, otherwise? Odds are you're going to pre... You know, 9 out of 10 husbands go before their wives.
Pat: Did they buy rental, and she took up the cello?
Scott: No.
Pat: At the age of 70 something.
Scott: At the age of 70.
Pat: It's not the time to introduce new things.
Scott: Not new investment, rental property?
Pat: That is, absolutely, yeah. I can't imagine. In fact, I tell clients exactly the opposite.
Scott: And look, if that call, that last call resonated with you...
Pat: Then hire an advisor.
Scott: And you're getting up an age? I told a...
Pat: What's the goal here?
Scott: Well, that's... I told...
Pat: What is the goal? You can't take a dollar of this with you.
Scott: I had a client that owned four houses, four houses, yeah, all of them that he lived in. And he would complain to me about them. And I said, you know...
Pat: What do you mean, he all lived in?
Scott: He would spend time in each one of the houses.
Pat: Four?
Scott: Four.
Pat: How to make your life complicated.
Scott: That's what I said to him. And then he would complain to me. And he had plenty of money. And I said, you know, "You don't own those houses." He said, "What do you mean? I own them." I said, "No, no, two of those houses, they own you."
Scott: There was an article in "The Wall Street Journal" years ago. This wealthy couple owned six homes. And the wife spent her full-time job as managing the homes. And the article was about this. And you can tell from the woman being interviewed that she thought that this was gonna be this wonderful piece on her. And I read it as the exact opposite.
Pat: What a nightmare.
Pat: Like, this is where you wanna invest your life, in this? This is your legacy?
Scott: They're not so wealthy that they don't have an estate manager, right? The super wealthy have someone that... Doesn't mean that they're not involved. It means that they have someone that actually manages the day-to-day.
Pat: The super wealthy. Yeah, but I don't get it. I don't know why. But it's hard. Look, you've been doing stuff on your own your whole life. Maybe you're quite frugal. Maybe you do your plumbing and everything. Like, you're quite frugal. And maybe you're good. Maybe it's worked out for you. But if you've got a spouse and you think the spouse is going to be here beyond you, you really need to think about setting things up. It's good to leave an inheritance to a spouse, but it'd be even better if you can leave an inheritance with actually someone to manage it.
Scott: Yes, exactly. Anyway, let's continue on. We're talking with Nicole. Nicole, you're with Allworth's "Money Matters".
Nicole: Hey, good morning, guys. Thanks for taking my call. I'm glad to be talking to some financial advisors.
Scott: Oh, good.
Nicole: I'm looking for financial advice.
Pat: All right.
Scott: All right, well, let's see how we do.
Nicole: All right. So, I have a question about paying off my mortgage early. My husband's here with me also. He's the one who turned me on to you guys. So, he's very involved in our finances and I'm kind of the secondary to that. But my question is about paying off my mortgage or mortgage early.
So, I'm 47, he's 50. And we plan to retire early, about seven and a half years from now. So, I'll be 55 and he'll be 58. Right now, we don't have any debt other than our mortgage. We don't have a car payments. We don't own a credit card. We have no student loans. So, our plan is that we'd like to retire with no actual debt.
Scott: Yep, love that.
Nicole: Yeah, so we'd like to focus on traveling. We're actually calling from San Diego right now. We're in our trailer.
Scott: Oh, very nice.
Pat: Oh, cool.
Nicole: Yeah, so we'd just like to spend more time traveling. So, right now, our mortgage...
Pat: And no kids at home?
Nicole: No kids at home. No, they're both...
Pat: College?
Nicole: ...self-sufficient adults.
Pat: Okay, good for you.
Nicole: Paying their own way. Yeah, so...
Pat: Self-feeders.
Nicole: Yes, yes, it's so lovely. It's so lovely. I was raised in a very blue collar household, and luckily, was fortunate enough to make my way now into the white collar job.
Pat: There we go. What is the value of the home that this mortgage is on?
Nicole: So, right now, the current value, the market value right now is $738,000, and we owe $487,000.
Pat: And what's the interest rate?
Nicole: 3.125.
Pat: And tell us about the rest of the financial situation. Will you receive a pension when you retire?
Nicole: Yeah, so, my husband works for the state. He'll have a pension. He will have... What is this pension about? About $10,000 a month when he retires. And I have right now, my 401(k) is at $430,000. I plan to take Social Security at 62. And my pension, I don't have exact numbers, but I think it's in around....
Man: I don't know.
Nicole: Oh, I could cash it out for about $500,000.
Pat: You work for the government?
Nicole: My husband does, I do not. I work for an insurance company.
Scott: And what's your family pay right now, between the two of, your wages?
Nicole: Right now, we're at about $302,000 a year.
Pat: And what's the total value of all the 401(k)s and 457s, 403(b)s in the family? What's the total value of those between you and your spouse?
Nicole: Right now, $545,000.
Pat: You guys need to save more money if you wanna do this plan.
Scott: Unless your income is much higher than it was five years ago and you just finished getting the kids through school and suddenly you've got way more cash than you've ever had.
Nicole: We do have way more cash than we've ever had...
Scott: How much cash do you have?
Nicole: ...because we don't have other debt. So, right now, we have an emergency savings account with $25,000 in it. We also have been saving toward paying off the mortgage early in a money market account because the interest rate was higher.
Pat: Yeah, that makes sense.
Pat: How much do you have there?
Nicole: Yeah, so well, we had $46,000, and we have some in a T-bill that's about to mature at the end of the month. But interest rates are kind of going down on the market.
Pat: Okay, so how much do you have in this T-bill?
Nicole: $30,000.
Pat: And you have $30,000 and $46,000 in a money market?
Nicole: No, total.
Pat: That's total, okay.
Nicole: It's total.
Pat: Okay, all right. Well, we don't know whether interest rates are gonna go down or up. I don't know that. You need to save more money if you're gonna retire in seven years.
Scott: And I would use...
Nicole: I'm sorry, I was just gonna say, we also are maximizing our benefits as far as cash out. So, we've both been saving a number of PTO hours. And he can cash out up to 2,000 hours, so that's a big chunk of change when we retire, too.
Scott: That's right, yeah.
Pat: You need to save more money if you wanna retire in seven years.
Scott: And I like the idea. What I would do is plan. So, you had seven years, seven and a half years. How much do I need to put aside? I'm making the mortgage payments. What's the balance gonna be seven and a half years? How much do I need to be putting aside in savings so that I got a chunk of cash to pay that off?
Pat: Well, actually, we have time. This is a podcast. Let's...
Scott: Well, that's the first step.
Pat: Let's do it right now.
Scott: No, I'm not doing that. But I think what's important is to really run a financial plan. You've got $300,000 coming in. Where's it all going?
Pat: Scott, you don't wanna go through it right now?
Scott: No, I'm not gonna do that math.
Pat: You just don't wanna...
Scott: You can go online. They're simple. You can do it. Those are simple calculations.
Pat: Okay, all you do is you take your income...
Scott: But what's more important?
Pat: ...minus your Social Security, minus your contributions to your 401(k)s, minus your mortgage, if you're saving up enough mortgage, which will tell you what you're living on right now. And then you plan to that. You plan, I'm gonna take a four or 5% distribution added in your Social Security and figure out. It's just a quick financial plan that tells you... We're not guessing here. But I can tell you, I've been doing this long enough, that if you stay the current course, you're not gonna retire in seven years.
Scott: Well, they might. And then...
Nicole: Yeah, so I've run numbers of what we're gonna pay towards the mortgage in our normal monthly payments, and then what balance will be left, is around $400,000. So...
Scott: So, how much is your mortgage payment excluding taxes and insurance?
Nicole: $2,800, I believe. And we pay almost $3,500 a month.
Scott: Okay, so it's $30,000 a year. It's 10% of your income. I shouldn't say it's a rounding there, but it... So, the question I think we have is, like, you're making $300,000 a year. You're living on... This is your lifestyle. And you're gonna go... It seems like maybe you got a lot of money at 55 with $100,000 pension, $120,000. But it's a fraction of where you're at today.
Man: We're saving every month.
Nicole: Yeah, we saved about $3,000 a month towards.
Pat: But the idea, the answer to the question is, I like what you're doing by putting the money aside to pay down the mortgage, right? I like that idea. The assumption is you're gonna stay in the same house once you retire, is that...?
Nicole: Yes.
Pat: Okay, so I like the idea of putting it aside. I wouldn't mess with treasury bills as much as I would just buy...
Scott: Got a high-yield money market account.
Pat: Yeah, or buy BIL, which is just a short-term treasury. Yeah, just something along those.
Scott: These are a high-yield money...
Pat: High-yield money market.
Scott: High-yield on savings.
Pat: You're fine. I like the idea of that. You should be both maximizing your 401(k)s.
Nicole: We are.
Pat: Okay, yep.
Scott: But I like the idea of that. And by the way, we don't know whether interest rates are gonna go down or not down. We know that if Donald Trump gets to handpick the Fed chair, and then fires everyone else on the Fed board, that the chances of them going down are probably...
Pat: Yeah, Scott, interest rates are gonna be beautiful. You'll never see anything like it. Incredible.
Scott: Look, I'd really recommend you guys do a full financial plan. Here's where you are today. Here's where you're gonna be in seven and a half years. Here's the steps that you need to be doing to see that, to make retirement a reality. And I appreciate the call. I think the concern, Pat, is, and we've seen it, the 50s is still pretty early to retire, people retire early. Some people are good financially. They live somewhat frugally and can make a go of it.
Pat: Yeah, but...
Scott: But we've also seen people where they start living, doing all this stuff, travel, and then their net worth's declining, and you have the conversation like, "Look, you're gonna be broke at 73."
Pat: Yeah. And he's retiring at 57 and her at 55. That $100,000 pension certainly helps, but we actually don't know if that's a joint survivor or if that's a full survivor. My guess is it's top line.
Scott: That's right, so you have to take a reduction on that.
Pat: Which you take a reduction on that, which probably puts it closer to $83,000 or $84,000. Then you add in Social Security, which is a long way away. Then, fortunately, he works for the state, and I assume, since they called from California, works for the state of California, which he gets health insurance for both he and his spouse, but I don't know. Yeah, just pay a couple grand, get the financial plan done, and burst your bubble or inflate it. That's what it's gonna do.
Scott: Yeah, it... Yeah, I think we've seen... I remember years ago. And when you work for a company or the government where you've got a pension, it's an interesting place, because we've certainly... And, Pat, we've counseled people that are in their 50s, not loving their employment, and helping them to get something different, sometimes even at less pay, pushing out their retirement date, somewhere they got some flexibility so they can go visit the grandkids or whatever, right? Whatever help them figure out the lifestyle they want, their life. And when you work for an entity that has a pension... Like I remember a guy I used to ride bikes with, he said, "Seven years. Got seven years."
Pat: Oh, what miserable... He was leaving his job.
Scott: And he was locked. He was locked. He was locked because he had to get to the pension.
Pat: He was locked?
Scott: Yes.
Pat: I remember, I had another friend of mine, he asked me to run some numbers. He worked for a school district. He was burnt out, wanted to do something different. Yeah, working with junior hires would burn me out as well, right? He's just like me. And the problem was he had to stick around till whatever the age was, he was 55. Forget exactly, the planning we did. But he said, if I left now, what would this mean?
Scott: Hundreds of thousands of dollars.
Pat: Correct. I ran the numbers. I came up with a net present value. I like, whatever the number was, "Here's how much money you are leaving on the table if you leave right now."
Scott: Hundreds of thousands, is my guess.
Pat: Hundreds of thousands.
Scott: I had a relative that worked, and he said, "I can't do this anymore." I said, "Look, you got three years to go hide. Just go to work every day and hide from people." It's interesting. That is the downside with pensions. And pensions, companies started offering pensions in large form during World War II, as that's when employee benefits became a big thing.
Pat: Including employer healthcare at the end of World War II.
Scott: Because you weren't allowed to lure someone away at a higher wage.
Pat: Yeah, the wage freezes, which is an unintended consequence of government involvement.
Scott: Correct. Imagine that.
Pat: When government starts monkeying with the free markets. They didn't say you couldn't give them a pension and/or health insurance, they just said you couldn't pay them anymore.
Scott: Yeah. And they're good and bad. If you love your job, they're fantastic.
Pat: They're great.
Scott: If you don't love what you're doing, it's a...
Pat: They're handcuffs.
Scott: They're handcuffs, and maybe for many, many years.
Pat: And they're golden handcuffs.
Scott: You know, it's interesting, but talking about government getting involved in the unintended consequences. And I look at... We try not to be very political here. And I look at the administration's investment in Intel, and I think this is not a healthy move. This leads down a very dangerous path. I am a firm believer in free markets. Look, I think we need regulations, we need to know what the rules are, we need to make sure that people are honest. But there's something beautiful about the free markets because money gets allocated to where it produces the most.
Pat: Do you think that the government might steer contracts to Intel because they own part of it now?
Scott: A company that has eroded wealth, shareholder value...
Pat: Shareholder value.
Scott: ...50% over the last 25 years, that's the company we're getting behind?
Pat: That's the one we're betting on. That's the one we're betting on. Yep. Unintended consequences, we have no idea where this is gonna go.
Scott: I mean, during like the financial crisis, there was bailing out the banks, there was a lot of talk about that. Is this healthy or not healthy?
Pat: Automotive companies, is it healthy or not healthy? But there was an exit there. I don't know if there's an exit on Intel, right? When they went into these...
Scott: That's right.
Pat: ...there was a thought out strategy as, this is what the plan is. We don't plan to own part of General Motors and/or Bank of America or Wells Fargo.
Scott: That's right. And they got repaid.
Pat: And they did get repaid.
Scott: We got repaid, I should say. We're in.
Pat: Yes, all of us.
Scott: That's right. With less debt that we are encumbered with. It just seems...
Pat: Dangerous. I don't see how that's healthy for...
Scott: Hey, wanna let them know we've got a webinar.
Pat: Do we?
Scott: Yes. Webinar, it is wealth strategies for the modern investor. I am doing the webinar with Victoria Bogner, our head of wealth planning.
Pat: Well, thank you for doing this, Scott.
Scott: You've heard Victoria. And during this... It's really designed for those with $5 million or more, was what this particular one is. But some of the things we're gonna be looking into is limiting your downside risk with buffered ETFs. We'll talk about those. How to access some private markets for enhanced diversification. Using some option overlays to reshape our returns and navigating new tax laws with coordinated, forward-thinking tactics. So, those are the things that we're covering. Really designed for someone with $5 million or more in assets. Wednesday, September 17th at 10 a.m., Pacific. Thursday, September 18th at noon, Pacific. Saturday, September 20th at 9 a.m., Pacific. We'll touch on all those. And you need to register at allworthfinancial.com/workshops. It's gonna be a good one. Anyway, it's been great being with you. This has been Scott Hanson and Pat McClain of Allworth's "Money Matters".
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