Capitalist Investor

Checking, Double Checking, and Optimizing Your Retirement Plan, Ep. 262

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In the latest episode of the Capitalist Investor, hosts Derek, Tony, and Luke dive deep into crucial strategies for optimizing your financial health. If you missed it, here are the top five hot topics that were discussed:

1. The Necessity of a Second Opinion
One of the major topics brought up in this episode is the value of seeking a second opinion on your financial plans. In a world overflowing with information and differing perspectives, having an additional expert eye can help ensure you're on the right track. Whether you're already working with an advisor or managing your own investments, a second opinion can offer new insights and safety nets for your financial future.

2. Advisors: What Should They Be Doing for You?
Tony underscored the responsibilities of an ideal financial advisor. It’s not just about taking on a new client for the sake of business; your financial advisor should be transparent, highlighting both the good and the bad in your financial plan. An annual plan refresh was discussed as an indispensable tool for ensuring that your strategies remain aligned with your evolving financial goals.

3. Comprehensive Financial Planning
Derek and Tony highlighted the importance of looking at the bigger picture: investments, taxes, healthcare, income, and estate planning. Merely focusing on investment returns isn’t enough. An effective advisor is someone who ensures that all these pillars of financial planning are not only addressed but also meticulously coordinated to optimize your financial health.

4. Natural Talent vs. Hard Work
Luke made an interesting comparison between financial advising and sports. The hosts noted that, like in sports, hard work can often outdo natural talent. The podcast emphasized that a diligent, hard-working advisor can offer significant long-term benefits. It's not always about outperforming the market but about consistently working hard to win the financial 'war' over time.

5. Blind Spots and Tax Strategies
Finally, the hosts discussed how critical it is for financial advisors to identify and cover their clients' blind spots. Tax strategies, in particular, were highlighted as an area often overlooked by individuals but can have a significant impact on your finances. Unlike investment returns, which are easy to track, the benefits of a good tax strategy show up in unexpected savings and increased financial security.

The Capitalist Investor podcast continues to provide invaluable insights into the world of financial planning. This episode is a reminder that navigating the complexities of finance requires constant vigilance, multiple perspectives, and a holistic approach to planning. Tune in next time for more expert advice from Derek, Tony, and Luke!

For more in-depth discussions and personal finance tips, make sure to subscribe to the Capitalist Investor podcast and stay informed about the best strategies to improve your financial health.

Hello and welcome to this episode of the Capitalist Investor. As always, you have me, Diamond Hands D. We got the whole crew here. Cool hand Luke, Tony the tiger. What's going on, guys? Same, same stuff, man. I'm trying to live the dream. It's not working out. That's big energy, guys. I appreciate that. I am here to bring in the energy. Love it. Well, if you can't bring the energy to the planning corner, you're probably dead. Do we need to restart the show? No, we're going. Going through. If you're watching YouTube, I am smiling. One take every time. I have a client and he listens, you know, you know who you are. I can't say your name, but every time he emails me, he's like, Luke, I hope you're smiling. That's his front line every time. And how it makes me crack up. I'm like, yeah, I can't promise I am today, but I try. Well, you know, this is, you know, frankly, one of the, I think the most important things to talk about because, you know, obviously, you know, we've been, we've been doing this for a while, and you get, you talk to all different kinds of people who have all different types of, you know, opinions and, you know, thoughts on how everything works. What I'm always surprised about is some people, you know, definitely not everybody, but there always seems to be almost a little bit of a reluctance to get a second opinion on your situation. And I think just the idea of a second opinion for anything in life is usually a good idea when you're talking about your finances, your retirement plan, your investments, when you go out there on the Internet and you start searching for things, you're going to get a filtered explanation on whatever you're looking for. So just having someone else look over your situation, look over your investments with their eyes to kind of give a different take on what's going on. With. Your finances and with your investments. So with that, why don't you print that? All right, so here's the. So I've had people come in for, you know, second opinions and things like that, and what should be happening is a, you know, obviously somebody's like, oh, I want a second opinion. I'm not sure if my advisor is doing well. Right. You know, and I would, I would venture to say most advisors start salivating like, oh, this is my opportunity to bring out a new client. Right. But I know I've always sat down with somebody who's in that situation, and I tell them upfront because of the person I am in the fiduciary responsibility is like, hey, I'm gonna point out the good and the bad, and if the good outweighs the bad, I'm still gonna point out the bad. If there is any, I don't know, you know? And that's where, you know, doing your due diligence, making sure. But at the end of the day, it's. It is a good way to. To see and make sure everything's coordinated and optimized. It's kind of why we do a plan refresh. You know, it's always just checking and double checking and triple checking, like our work, you know, when I sit down and I do a refresh of a financial plan, it's like, okay, what did we do last year, and what can we be doing this year that might have changed? It's always like, what is your advisor doing for you, and how are they doing it right? And that's why we always do our plan refresh. It's a big process, and it's an important process that we've implemented. But at the end of the day, it's like, even if you're a DIY person, you know, it's like, I always use the analogy, if my faucet starts leaking, I'm like, kitchen, guess what, man? I'm turning off the water. I'm calling a plumber, because if I grab a wrench, there's probably going to be a foot of water in my basement. Yep. It's just, so what do you really want to do if you retire and you can, and you want to say, like, you know what? I'm going to hang up my. My CPA hat or my attorney hat or my plumber hat or whatever your. Whatever your occupation is, and saying, I'm a financial advisor today, right? Like, you got zero days of experience, you know, and that is where sometimes the irreversible financial mistakes come into play. So even if you do a lot of stuff on your own, it's still okay to get a double check to see what you're doing, how you're doing it, and how can you optimize it? Well, people that are coming on that aren't clients yet, I always encourage them. If they're even somewhat hesitant, I'm like, go get a second opinion. Go shop around. Go figure out who is going to be the fighter in your corner that you want to fight for you every single day. Go shop around to find somebody you 100% trust and value, because this is your hard earned nest egg. You got to find somebody that you trust and that you, like, you share and share similar values in a lot. Of ways, you have to like them, too. Yep. Enjoy their time because they're in charge of an important part of your life. Yes. Yeah. And that's. That's what I usually, um, you know, have conversations about. Like, hopefully, you only make this decision once. Right? So hopefully, you make a good decision the first time around. And, you know, kind of to that point, there is a natural. And I've talked about this before, there's kind of a natural. When you talk about retirement planning and investments, there's just a natural kind of lean towards talking about investments and investment returns. What we've been talking about for months now in the planning corner is, yes, investments are important. The right types of investments and the right tax locations, all that stuff is extremely important. But the overall financial plan is what's going to tie it together for you and give you that confidence to live the life and the retirement that you want. Right. And think about when you think about even prior to retirement, at any point when you're looking at your financial planning focus, it should be investments, taxes, health care, income, estate planning, Social Security. When do I turn that on? How do I optimize that? You start thinking about all of those pillars, investments. Well, we have cfas. You know what? Good luck competing with those guys. I understand a lot about those guys are a different breed, different level of sophistication, taxes. Are you CPA? Do you want to be a. Do you want us to be a CFA CPA, a CFP, certified financial planner, or a JD? Because there's estate planning, too. Gotta get those documents done. Like, what hat do you want to wear? All four of those hats. Are you going to be an expert on each one of those categories? I'm going to go back to this. I don't know if this is the perfect analogy or metaphor, but I go back to what everyone always said in sports growing up. It's like, hard work beats organic talent any day of the week, just natural talent. If you're a hard worker, you'll always win over that person that has natural talent that isn't a hard worker. One thing I always go back to with that is, you know, I know we're in here day in, day out. Like, you know, most of us are not working 40 hours weeks. It's 50, 60 plus hour weeks that we're all working here. We're not on the golf course Monday through Friday. There might be one time during the summer we might get out there, but we're not, you know, not the typical advisor, just not, not working five days a week in the office, 50, 60 hours a week. So the, the thing I go back to there is a lot of people think that you should be outperforming every single day. You should be. It's all of the investments, kind of like Derek was saying. And the fact of the matter is, over a long time period, even if you underperform one year, the hard work is always going to win in the end, over a longer duration time period. Of course, you're not going to win every single battle, but you're going to win the war. That's kind of what I go back to when it comes to that same philosophy. When it comes to managing money or financial advisor, I think we're pretty talented. I think we have talented team. But of course, there's, there's very, very intelligent people around the world and there's always going to be, you know, some people that are, do better than others during the year. But I think that philosophy is really important when you're finding that guy again in the boxing corner to fight for you every day. Yep. I think that's probably one of the, you know, if I could give people one, one piece of advice if they're out there looking for an advisor, do not just base it on past performance, because that's where people usually want to start. And frankly, it's easily manipulated. You can make 100 different portfolios, and then when someone asks for past performance, you just give them the best one that performed the best for that time period. And like we've talked about many times before, it's not all about rate of return, especially in retirement. It's about controlling risk and controlling volatility over a long period of time. And that's really going to make a difference over, you know, outperformance over a short period of time or even tax strategies. Oh, yeah, they don't. A tax strategy does not show up at the bottom of your Schwab or fidelity statement. It shows up at the bottom of your checking account. Because if you don't implement the right tax strategy, guess what? The IR's does not call you or send you a letter saying, hey, you messed this up. Why don't you go file an amendment, redo this, and we'll send you some money because you messed it up. No, it doesn't happen. Right. You need to be, you know, for thinking on that and be able to identify the opportunities. So. For sure. And, you know, I'll wrap it up here with this excuse me. We have a note written down here. Blind spot like that is, that's what an advisor should be doing for you, is monitoring those blind spots. You know, thinking about stuff that you're may not, might not be on your radar, but it's on their radar to make sure you're protected from, whether it be the downturn in the market or whether it be taxes, whether it be income planning, whatever that is, making sure all of your bases are covered. Always important to get that second opinion. If you're looking for a second opinion, obviously shoot us an email info. Or if you're looking for topics you'd like us to talk about, or even guest spots. We had a guest spot the other week, so if you're interested in that, let us know. And thanks for listening to this episode, and we'll talk to you next week. Sadeena. Sadeena.