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The Smart Take:
In this episode, hear Tyler Emrick, CFA®, CFP®, talk through what it means to be wealthy and how your own perception of personal wealth can be a powerful force that leads you astray or opens your eyes to better outcomes and, ultimately, a happier retirement.
Here are some of the assumptions we will discuss in this episode:
- What does it mean to be wealthy? (2:06)
- Your perception of wealth impacts your financial planning and your habits. (8:37)
- A comment that really stuck with Tyler recently. (12:53)
- How should you manage your wealth in retirement? (17:49)
- Thinking about how spending will impact your life. (19:54)
- Think in times and not years. (25:05)
- Be deliberate about your decisions and your approach to wealth management. (30:16)
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The Hosts:
Kevin Kroskey, CFP®, MBA – About – Contact
Tyler Emrick, CFA®, CFP® – About – Contact
Walter Storholt:
On this episode of Retire Smarter, hear Tyler Emrick Certified Financial Planner talk through what it means to be wealthy and how your own perception of personal wealth can be a powerful force that leads you astray or opens your eyes to better outcomes and ultimately, a happier retirement. Stay tuned. It’s time for Retire Smarter. Well, thanks for joining us once again on Retire Smarter, Walter Storholt here with you alongside Tyler Emrick. And Tyler, I’m excited for today’s show as we’re going to talk about your wealth, your retirement, how can you do it better? But before we dive into all of that, what’s going on in your world, my friend?
Tyler Emrick:
I’m doing all right, Walt. Nothing too exciting. I’m just coming off a pretty nice and productive weekend. Actually, our household was under the weather most of last week.
Walter Storholt:
Oh, no.
Tyler Emrick:
So yeah, recovering from that. But yeah, I think we’re on the right path going forward. And I think, as I mentioned to you as we were kind of coming on the show earlier today, that we went through a pretty decent sized drought for a few weeks here, and we finally got some rain, which is a welcome addition here in Northeast Ohio.
Walter Storholt:
Nice. Yeah, folks behind the scenes, it was another great thing that we’re together today able to do this show Tyler, because last week you were under the weather and sick, so we pushed recording back a little bit, and then today I’m trying to get to the recording and I had to navigate through some floodwaters, find my way back to the studio. I went out for some lunch and then everything flooded while I was at lunch and came back and said, I’m not going to be able to make it. But the show went on, thankfully, and we were able to connect. So glad to have you with us again and to dive into our topic today.
So yeah, a little bit different angle on I think this whole planning conversation today, and look at how can we just get better wealth retirement, our planning process. I would imagine this is a goal that a lot of people, if we’re not talking all the technicals, Tyler, if somebody just comes in and they’re like, ah, I just want to do better with everything that I’m doing. That seems like a natural place to start for a lot of people.
Tyler Emrick:
It is. Right. Well, and I think as we kind of dive into the show today, it’s probably important for us to maybe even just peel back the onion a little bit on what does it mean to be wealthy? I mean, it’s a very relative term. I mean, relative to maybe where you live, relative to your peers, maybe relative to your own personal goals and aspirations. So we all have our own definition of wealth and what it means to be wealthy, and I think that has a large impact or can have an impact on your financial planning and your outcomes and how you handle your finances. And there’s a number of terms that we can look at to help quantify wealth. A couple that I have on for today was really looking at it from an income perspective, because that’s very easy for us to look at.
We can really look at clear hard data on all right, hey, let’s break out the US household population and break it down from an income standpoint and see where you fall. And when you look back through those numbers, the median household income in the US is roughly around 70K per year. And if you kind of zero in on households of married couples, that number does jump up to just over a hundred K per year. And I wouldn’t consider the median household income wealthy, but as we start maybe jumping up and going up that scale a little bit and maybe zero in on the 90th percentile or the top 10% of household incomes, the number does jump up a bit. It’s a little over 200,000. And Walt, I’m curious, when I say, hey, if you make 200K a year, you’re in the top 10% of household incomes in the US, does that feel about right to you?
Walter Storholt:
I would suppose so, yeah. I mean, it’s still hard in today’s inflation world to wrap your brain around what’s wealthy and what’s not when you see the price of a gallon of milk. But yeah, I think most people would probably say that that feels like you’re on your way to wealth.
Tyler Emrick:
Yes, absolutely. And like you said and I think like I mentioned earlier, I’m sure a lot of it depends on your location and where you’re at here in the good old US.
Walter Storholt:
We’ve all seen those stories of somebody in California barely making ends meet on six figure salaries because of the cost of living of where they are.
Tyler Emrick:
Yeah. It’s amazing how it’s not only to that area of the US anymore. I mean, you could probably throw Arizona in there, Texas, Northeast up in New York and down south in Florida too. I mean, all these areas are pretty well sought after and seems like the cost of living and housing prices in particular and things like that have skyrocketed over the last few years. No doubt about it.
Walter Storholt:
That’s a great point. Is that 90th percentile, just out of curiosity, you mentioned household income, so that would be married homes, married households included in that figure?
Tyler Emrick:
All households. Yeah. Married households and not, so just a pure aggregate of all households in the US over 200K, top 10%. And if we zero in on it a little bit more and said, hey, what’s the top 1%? That’s a household that has a little over 570K of annual income coming in per year. And obviously you’re looking at just income. That’s I think one dynamic or one piece of the pie. But of course, assets and investments and savings and things like that aren’t factored in. We’re just looking at it from a pure income standpoint. I think another way that I’ve seen it framed, which I’m going to bring up here because I thought it was quite interesting, is some individuals at their work might use Slack, which is a communication tool, or office communication tool. When the founder of Slack, his name’s Stewart Butterfield, he actually had a unique way to look at and try to quantify, all right, hey, what does it mean to be wealthy?
And he broke it down into three levels. And he’s like, hey, level one of wealth means you no longer are stressed about debt. So A, you’re not worried about paying off a credit card from month in to month out. Your mortgage isn’t a huge piece of the income pie that’s coming in on a month in and month out basis. So that’s level one of wealth. As you move up the scale and go to level two of wealth, he’s like, hey, this person does not care what items cost at a restaurant. So the amount they spend on a meal is not impacted by their finances at all. And this one, I chuckled on it a little bit because I have a brother, a younger brother, and in my household when we were growing up, one of the big things on birthdays Walt was, hey, you got a dinner at your choice.
Walter Storholt:
Yeah, your favorite place, right?
Tyler Emrick:
You got it. And inherently growing up, we were of modest means. So our creme de la creme place to go was Red Lobster.
Walter Storholt:
Nice.
Tyler Emrick:
And so my brother always chose-
Walter Storholt:
The cheddar biscuits, man, you can’t-
Tyler Emrick:
Cheddar biscuits. Yes. In my brother’s case, and this would tick my parents off so much, but every time, he was one of those individuals that when he opened the menu, he didn’t care if it had market price next to it, that is what he was ordering. So it’s like lobster or crab legs I felt like was his growing up and he would never finish the plate. So I don’t think my parents mind actually paying it once per year for him, but the fact that he hardly ever finished it and actually ate it, it just pushed their buttons so much.
Walter Storholt:
Oh, I’m sure. You just brought back a great memory. That place for me was IHOP and instead of dinner… Well, we did dinner some years, but I remember a couple of specific IHOP breakfasts and it was like, my parents must have been in heaven. And I’m like, I just want the pancakes.
Tyler Emrick:
Pancakes. Yeah. That’s hilarious. Yeah, my choice, since you said IHOP I don’t feel as bad, my choice was always Long John Silvers, which I think is probably the worst out of all of these.
Walter Storholt:
I don’t know. That’s definitely a battle for the bottom right there.
Tyler Emrick:
That’s dad. Yeah. So I wasn’t even going to bring it up, but since you said IHOP, I’m saying Long John Silvers. All right? Please don’t hold it against me any of the listeners.
Walter Storholt:
Oh, Long John Silvers.
Tyler Emrick:
And I wouldn’t even get fish. I would get their chicken strips.
Walter Storholt:
Oh, even worse.
Tyler Emrick:
Something about that battered chicken. But Stewart Butterfield, right? Hey, level one of wealth, no longer stressed about debt. Level two, you can get anything at the restaurant, even market price-
Walter Storholt:
Anything at Long John Silvers you want.
Tyler Emrick:
Yes. Anything at Long John you want. And then he had this final level, which was level three where he said, all right, hey, if you’ve achieved the pinnacle, you’re an individual who does not care what vacations cost, right? Doesn’t matter. Whatever it is, if you want to go, you’re going. And that’s how he kind of wrapped his arms around, all right, what does it mean to be wealthy and what does it mean to him? And I think that that is an important concept to kind of grasp is like, well, hey, of course there’s no single definition of what it means to be wealthy, but your perceived wealth and where you fit on that spectrum absolutely has an impact on your financial planning and your habits and what you do with your own personal finances.
So for example, over the last couple months, I had an individual that came in and sat with me. And this individual by all accounts is in that top 90th percentile of income, would be considered wealthy by most standards if you were to ask. And he kind of slides over a statement when we’re sitting there during the meeting and I’m like, “Okay, hey, what’s this?” And he’s like, “Okay, that’s one of my accounts.” And I’m looking at it just trying to gauge, all right, what am I looking at here? What are the balances and such? And I kind of get at it and it’s a balance. And I’m like, “Okay, what are you looking at here? What are we trying to talk about?” And he kind of looks back and says, “Well, hey, the account was worth a couple hundred thousand dollars at the time,” actually a little bit more, the dollar amount is not extremely important, but it was a good sum of money by all standards.
And I kind of looked at the balance. I was like, “Okay, well what happened?” Because the balance was down about 90% from that, and he’s like, “Well, I picked two bad stocks,” and my mouth kind of dropped. And I was like, “Wait, you mean to tell me that over the last couple years you’ve lost a couple hundred thousand dollars on just two stocks?” And he’s like, “Yeah, I did. It was my trading account, my hobby account.” And by no means in his circumstance was this going to have any impact other than losing the funds. But his retirement goals are spending, I mean, this is a high income earner that we’re talking about here, but that thought process and that neglect and him treating that amount of money as just a, hey, I don’t want to say it was gambling or play money, but really didn’t put himself in a good situation even though he could afford that loss, his perception and I feel like the neglect on that type of account put him in a bad situation.
Walter Storholt:
Wow.
Tyler Emrick:
Yeah. And I can think about it from the other standpoint too. I think about my parents, for example. I mean, my mom was a machine shop foreman and my dad was a bus mechanic. I remember when I first got into financial planning and I wanted to sit down, I was like, hey, mom, dad, let’s sit down. I’ll take a look at your finances and we’ll do all these great things and do it. And my mom’s like, “What do we need financial planning for? We don’t have any money.” And they went through the exercise, not with me, but with other financial planners over the years. And I think it quickly became realized to them that, hey, yeah, that just means they have less room for air because they didn’t accumulate the amount of wealth that maybe she perceived to be as wealthy.
I think they had a good nest egg and certainly had enough to get to retirement and accomplish a lot of good things that they wanted to, but they didn’t perceive themselves as being wealthy. So they’re like, well, why do I need a financial advisor? Or why do I need to talk about finances because I don’t have any complexity? But yet they didn’t think about, well, hey, what about refinancing my house to a lower mortgage rate? How should I be saving in my retirement account? Are my investments diversified? And all these little things that greatly impact their finances, they just didn’t really care to go down that path and try to figure those things out because hey, they didn’t really think that it was really something that they needed. So you can kind of see how both end of the spectrums, whether you perceive yourself as wealthy or not, can certainly lead to some of these outcomes that might not be in your best interest kind of going forward.
Walter Storholt:
So that’s why it’s important to have your definition of wealth for you, your specific definition of it, because then you can measure the planning that you do and how the needle can get moved based on that planning. For the first guy in that story, wealth to him and the planning that then takes place will look different than it would for your parents. But the plan and the way that it can help somebody is still impactful.
Tyler Emrick:
It would.
Walter Storholt:
So that’s really interesting.
Tyler Emrick:
I agree a hundred percent. Well, and I think about it too, hearing your comments say that, I think back a few weeks ago, we were sitting down with some very, very close friends and a comment was made. We got on the topic of finance as we tend to do with this couple, and we were talking about finance, and he had made a comment and said, “Well, we’re really good about making money, but we’re not great at managing our wealth,” and on its face value, not that big a deal. But that comment really stuck with me. And the reason why it did is I looked at this individual and as I know them very well, I know they are extremely competent and knowledgeable in areas of investing and tax, general financial planning principles. I mean by all intensive accounts, it didn’t even cross my mind that this individual wouldn’t feel they could manage their wealth because they had all the knowledge and tools to be able to do it efficiently and effectively and be perfectly fine.
It kind of sat with me so much that a couple weeks later when we were talking, I kind of brought it back up and I was like, “Hey, what did you mean by you guys are good at making money but not great at managing wealth?” And side note, I knew they were good at making money. They’re in the top 1% by those definitions that we had talked about. So they were doing very well for themselves. But really I was like, “Well, what do you mean by not great at managing your wealth?” And his answer surprised me. And it really talked about how, hey, I really feel like we need someone to put these decisions and financial pieces together because they had very intensive accounts, a pretty complex financial life. I mean, they had children, they’re both working, doing a lot of gifting, they had some tax considerations to be thinking about. I mean, they do quite a bit of things so I understand that hey, they do have some complexity here.
And his argument was, “We have this complexity and it’s hard to really boil down decisions to the nuts and bolts to make effective decisions. How does this affect that?” And he brought up the decision like a couple years… Or not a couple years ago, about a year ago they were considering buying a house and it just kind of fell by the wayside. And he’s like, “Looking back on it, our family’s grown. We need a house. We’re outgrowing the house that we’re in. It was the first house that we purchased. We want to be in a better school district,” and all these things. And he’s like, “I kind of chalked up that decision on buying a house to interest rates are high, housing market’s high. Yeah, I’m not going to do it.”
But yet looking back, if he would’ve really got down to the nuts and bolts of the decision and how maybe stretching or even if he overpaid for a house, okay, if you’re going to be in it for the next 30 years, is that really an impact and something they’re willing to be comfortable with that, hey, I overpaid for the house, but I just found my house for the next 30 years type decision. And he made a couple other comments about just timing and how busy they are and that, okay, hey, I focus on investments because that’s what I enjoy and I look at it, but all these other things around tax and making decisions to move the family forward to where we’re trying to go kind of get lost by the wayside because those aren’t decisions and things that he necessarily enjoys planning around. So it was really eye-opening for me.
And as I thought back to some of the families that I’d worked over the years and I was like, well, okay, that’s why a lot of individuals work with financial planners. It’s our job in it’s most basic sense as a financial planner is to give clear, concise, actual advice to help make informed decisions. And to maybe even take it one step further, once we give you those tools to be able to make a decision that’s best for you and your family, all right, hey, how can we make the implementation as easy as possible? All right, hey, in their circumstance, I wanted to buy that house. All right, now how do I find a realtor? Where’s a mortgage broker? How do I decide how much to put down payment on a house? Do I go with an adjustable rate, a fixed rate? There are a multitude of decision points that go into something like that.
And having someone that can not only help you wrap your arms around making the decision, but once you do, all right, hey, here’s what you need. Go here. This is where we can get X, Y, Z. This is the type of mortgage you want to target, whatever. That’s very, very valuable to someone that might know how to make the decision but doesn’t necessarily have the time to go in and wrap their arms around making the best decision for them and hold them accountable to actually do it. So I thought it was quite fascinating, maybe a little bit different than our conversation around, all right, hey, how is your perceived perception of wealth? But I thought it was a good little segue that we could kind of sneak in here that I think would resonate with a lot of the listeners.
Walter Storholt:
Yeah, I think it would big time. I mean, just look at all those different perspectives. I don’t have enough to worry about planning or this part of my plan and of my finances isn’t important enough to warrant planning. I can afford to lose it, so therefore it doesn’t need a plan. And then your friends think in their perspective, they’re good at all of those little things individually. It’s just seeing the full picture that their perspective was like, oh yeah, we’re not very good at this. So you have a lot of people that are like, I’m not very good, or this needs to improve, yet kind of almost don’t view themselves as, I don’t want to say worthy because that sounds a bit too severe, but I’ll say it, worthy of the plan and the time and the attention and you illustrate no matter what your situation is, that that planning can really help people figure out their perspective, first of all, and then get a plan that’s appropriate for it.
Tyler Emrick:
Absolutely. And even still, I mean, I think most of our listeners are probably on the doorstep to retirement or in retirement. So that perception of wealth kind of trickles down into, all right, hey, I’ve built wealth, maybe I’ve done some financial planning to get me to a point where I can retire and live a happy, healthy retirement. Hey, that’s great, but now what? How do I start using that wealth and managing that wealth for better outcomes for me and my family? Because as you think about just individuals in retirement, I mean, there are a lot of things coming at you on where you can spend your money and what you can use your money on. I mean, an infinite number of choices that are out there. And as I look at financial planning in our profession, in the industry, we joke around a lot that, hey, we’re psychologists and we have a lot of those conversations.
I think there’s some truth to that. I mean, I think when I look back on my personal development and the things that I focus my time on to get better as a financial planner, I mean, there’s been a number of hours spent on, for example, spending and how to manage your wealth in a clear and efficient manner. And a lot of that data that’s out there on retiree spending, it’s very robust, but a lot of it really tends to skew towards the fact that when we look at retiree spending and where they get the most enjoyment out of spending their money, there’s a lot of heavyweight put on that, hey, experiences are where a lot of retirees get their most joy and it’s a really good place to be spending your money as you think about retirement. And two weeks ago, I actually had an article that came across my desk that the headline caught me because it reflected the fact that, hey, let’s not lose sight of or discount the happiness boosting potential of actually buying and purchasing material things as well.
I mean, not every family or individual fits in this box that says, all right, hey, experiences are where I should be spending my money in retirement. But looking at that data and trying to understand it and how it applies to you, I think thinking through where you want to spend your money, whether it is experiences or material things, I don’t think that’s as important as, hey, how is this going to impact your life and what enjoyment are you going to get out of it? As I think about this time of year, summertime, we have a lot of families that are coming in for their yearly progress meetings. And progress meetings for us, what they’re doing is they’re coming in and we’re spending the bulk of our meetings talking about their financial plan, their goals, how has things changed from last year to this year? Are we moving in the right direction? And what type of expenses and spending and goals are we trying to accomplish over the next year? And have we positioned your assets in a way that is going to get you there efficiently and effectively?
So a lot of these conversations are about spending and where individuals and families want to be putting their resources. And just last week we were sitting down with a family where we were going through the plan results and talking about the update and that year to year progression. And by all accounts, their financial plan looked great. Well, I mean, the tank of plans, they’re not going to run out of money. There is no way. And the husband actually even made a comment. He’s like, “Well, hey, it looks like the kids are going to inherit a decent amount of money.” And I kind of chuckled, but it actually triggered me a little bit. And what I mean by triggered is earlier on in the conversation when we were just getting caught up, they had mentioned to me that their son was actually looking to move back into the area. And if any listeners are out there where they have children that are in another state, I mean, you hear, I might be able to get one of the kids back closer. I mean, that’s a big deal, right?
Walter Storholt:
They’re all in typically, right? Yeah.
Tyler Emrick:
Yes. And throw grandkids into the mix, I mean, they were very, very hopeful and it seemed like he was going to be the case and he’s set on moving back, which I think is great for them. But they were talking about how he was looking for houses and a house came up in their neighborhood that was actually close in proximity to them. It would be good school district. It kind of really checked a lot of the boxes, but it was outside of his budget, his family’s budget. As I think about his chosen profession and kind of his background, I mean, he has a wonderful career, but it wasn’t a career that was going to afford him a really high income or be something to where they’re going to be able to create a lot of wealth and build through their income.
And I’m sitting here walking with this family who actually had accumulated enough wealth and had been fortunate enough to be in a situation where they did have high incomes and did the right things and saved, and I kind of sat back and I was looking, I saying, “Well, hey, didn’t you say that your son was looking for houses and one came up and it was a little outside of their budget?” I was like, “You thought about just helping them buy the house?” And he kind of sat back and it took them a second and they were just digesting. And I could clearly tell that they didn’t really think about it that way. And as we start thinking about going back to perceived wealth, this was a family that did not perceive themselves as being wealthy. By all accounts they were, but they didn’t perceive themselves as being wealthy. And that possibility of being able to spend on a material thing like a house, which all the studies show, all right, hey, you want to buy experiences or you want to do these types of things.
But for them, I look at that being able to help their son get into a close proximity to them, be in the good school district, set themselves up in a situation where there would be a lot of enjoyment and family time that come out of that, I think looking at those purchases and where they’re spending money, there’s a lot of value add that’s in there. And my job as a financial advisor is to really geek out on all the things on how you can get it done, right? I mean, then when they gave me the okay, I was like, oh, well, hey, we can gift a highly appreciative stock, or hey, we could do a family loan, or hey, there’s all these cool things we can do to be able to get it in a tax efficient way or in a way that benefits both families.
But at the end of the day, thinking through spending, that’s why I think these progress meetings and spending time on your financial plan and updates are so vital and so important is because decisions like that that you might not think is possible if you don’t get into the weeds and you have a set time to discuss and talk through them, they might not have ever thought about like, oh, well, hey, are we going to get this house? Maybe we help them. They didn’t end up getting that house, by the way. But I think their whole mindset on the transition and the move has changed significantly from that conversation, which I think is going to give them better outcomes in the long run.
Walter Storholt:
It’s really cool to see how that comes together, Tyler. Yeah, go ahead.
Tyler Emrick:
Oh, it is. Well, we had an advisor that was in the office. The way he always explained it, he’s like, hey, you would always rather give with a warm hand than a cold hand. And I was like, oh, I guess it kind of makes sense. That’s all right, but that’s the way he described it.
Walter Storholt:
Yeah, it’s a little odd. Yeah.
Tyler Emrick:
You give with the warm hand [inaudible 00:24:51] the cold hand. I was like, I don’t know. But hey, if that’s how it resonates with you and some people get a kick out of it, but that’s how he explained it. But it all [inaudible 00:24:58]. It’s using your wealth in a way that benefits you, your family, and promotes good life experiences. And that kind of, as we segue and thinking about finishing up and wrapping up here and my last point on the podcast, I think it’s a nice segue.
One of my families is an individual that I’ve worked with for a while now. He had sent over a link to me to a YouTube video that I kind of wanted to share. I can’t share the video, but the concept I wanted to talk about because I think it’s very prudent. And the title of the video, or not the title specifically, the way I think about it is it’s think in times, not years. All right?
Walter Storholt:
Times? Think in times not years.
Tyler Emrick:
Think in times, not years. So what does that mean? And maybe even another way to think about is think in number of times, not years. So it’s real easy to get caught up in, hey, what’s the latest news cycle? What’s going on in the world? I mean, we’ve got a lot of things thrown at us on a day in and day out basis to where I think it’s really hard to lose sight of ultimately what’s important to you in life.
Walter Storholt:
Really? I thought it’s been kind of a slow news year this time.
Tyler Emrick:
It’s been wild. I used to, in 2020, I was like, hey, this has been a crazy year. I’d say that all the time. And then 2021, hey, this has been a crazy year. And in 2022, historically bad bond market, this has been a crazy year. I can’t say that anymore, but-
Walter Storholt:
Because they’re all going to be crazy. Yeah.
Tyler Emrick:
It is, right? A lot that’s going on and it’s not going to change. But I think retirees thinking in a perspective or thinking in terms of number of times or think in times and not years is extremely important. So what do I mean by that? But the video had a nice visual on it where it kind of broke down. And basically what happens is, the way I want you to think about it, so take your average 60-year-old. So if you’re 60 years old, typical life expectancy, let’s say you’re going to live until… Or your life expectancy is until age 90. So that means you’ve got 30 years left. So about two thirds of your life’s behind you, not necessarily abundance of time that’s left. And I’m not saying that negatively. I’m really wanting to say that because I want to drive home the importance of using the time you have left well.
So in this scenario, you’re 60 years old, life expectancy’s another 30 years, you’ve got about another 30 years left. So instead of thinking about that in 30 years, think about that in number of times left. So you can think of it and say, well, okay, I got about 30 more Christmases left. All right, hey, I take a trip to Florida one time per year and I always swim in the ocean. I’ve done it my entire life. Okay, well, you’re probably not going to be able to travel those last 10 years of retirement let’s say. Maybe you’re able to go maybe another 20 more trips. So that means that you’re going to swim in the ocean 20 more times likely before you pass. And this whole concept and the way that they illustrated in the video, it’s like literally you’re just taking it out and writing a slash on each things that you kind of have left and the typical things that you do per year and then thinking of it in terms like, wow, this is about how many more times I’m going to be able to experience that.
And the one that kind of hit home for me was, I mean, I got two little girls at home, so the comment of the presenter was, during the first 18 years of a child’s life, they will have spent about 90% of the time they will spend with you during that first 18 years. Because at 18 they move out of the house, you’re seeing them less frequently. You think about even if you have one of your children that moves out of state and you get to see them a couple times per year. Okay, well, you might only get to see your child 60 more times, 40 more times and actually going out and seeing them. So I think it did a great job and I love how it illustrated the point to say, hey, time is precious. Where you spend your money is even more precious. And understanding that I think lead you to better outcomes to spend your money and your wealth on the resources that you want to and the places that you want to that are going to make that time as most beneficial as possible.
Walter Storholt:
Well, I’m thoroughly depressed. I’m sitting here as you’re talking about all that time going through, I’ve only got this many times left with that?
Tyler Emrick:
Right? I mean-
Walter Storholt:
But that’s how eye-opening it is, and I’m 35, and so I’m sitting here going, oh my gosh. Well, you’re kind of right, I’ve only got this many more times to do this. And if we do go on a vacation, maybe we’ve only got this many vacations left in us, or whatever the case may be.
Tyler Emrick:
[inaudible 00:29:19] talking about it. Yeah.
Walter Storholt:
Well, I’ve got some aging grandparents and luckily got to see both sets of grandparents just two weeks ago and was kind of doing some of that same number in my head of we could literally be down to zero. I mean, this could be the last one. Or okay, I can make it back for Christmas and then there’s that one. But boy, even if they exceed kind of current life expectancies, we might be down to three or four. And I’m hoping it’s many more than that. But that’s the reality that you start to get hit with and you’re broadening that out even further to just all of your life experiences thinking of them in the number of times. That’s really effective.
Tyler Emrick:
Oh, absolutely. Yeah, one of the things that they brought up was books. If you’re an avid book reader and say you read 10 books a year, your life expectancy is 30 years, and how many more books are you going to be able to read? Make sure you pick your titles appropriately.
Walter Storholt:
Right.
Tyler Emrick:
Right?
Walter Storholt:
Do I want to spend my time appropriately on the books? Yeah.
Tyler Emrick:
It does. Yeah. So I think it’s just frame of mind, whether it’s your perceived level of wealth and how you treat your money, or hey, where do you want to perceive are the best use case of that money, being very deliberate about it and making sure that you’re trying to take a holistic approach to those decisions I think is extremely, extremely important. And as I kind of think about a couple closing thoughts here, it’s like, hey, don’t let your own personal perception of Wealth lead to those negative outcomes and get to a point of clarity and confidence with your own personal wealth and financial planning to allow you to focus on and spend your wealth on what really matters to you. And I think that’ll give you the power to make those better decisions.
Walter Storholt:
Well, Tyler, I really appreciate you bringing this topic up, going into depth with it on the show today, because I’m going to be honest with you, when I saw the headline and the description, I was kind of like, okay, this will be a nice, light, fluffy episode, but you’ve given so much to think about. And we went kind of deep in these conversations today that yeah, I think my perspective on some things may change and just seeing how important it is to really… Well, I guess this is what it comes down to. It seems like you and Kevin and the True Wealth team really inspire all of your clients wherever they are on that spectrum of planning, where they are on the wealth spectrum that you kind of laid out for us that Stewart Butterfield kind of had, and then percentiles. Wherever they are, it seems like the one constant is you’re always encouraging your clients and the people you interact with to just be more intentional with their dollars, more intentional with their thinking behind how they spend your money.
I think that’s really influential when someone’s getting ready to retire because you spend your whole life working and accumulating, you’re kind of just pummeling money as best as you can maybe into those accounts and planning for that future. But rarely do you actually get to do a lot of planning for that future. And it’s sometimes mindless how money just goes right into a 401K or automatically into an IRA. You almost lose some of that intentional purpose for those dollars down the line, and that’s what then has to get all defined when you guys start working. So that just kind of strikes me, just you want people to be really intentional about their decisions.
Tyler Emrick:
I think it’s a wonderful way to put it. I wouldn’t say prior to me getting in the industry, and this is my chosen profession, but my personality lends itself to be kind of more happy-go-lucky, right? Internal optimist, try to be. But you mentioning and bringing up the term intentional, I think from my own personal life and where my family’s going and things like that, over the years, I’ve become much, much more intentional with what we’re doing, not only with finances, but experiences and the way we try to raise our kids and all that other good stuff. So I think it stems out into anything that you do in your life. But yeah, that’s a good way to put it, intentional.
Walter Storholt:
Great sentiments today, Tyler. Thanks again for sharing that. And I mentioned to you, if you’re listening to the podcast today and you’re enjoying what you’re hearing and you want to get some more of it but maybe in a little bit different format, I would definitely encourage you to sign up for the e-newsletter that Tyler and Kevin and the True Wealth team put together. It’s a biweekly newsletter that goes out, keeps you up to date with what’s happening in the financial world, things that you should be thinking about if you are just thinking more intentionally, since that’s our sort of word for the day to kind of end things here, Tyler, if you’re thinking more intentionally about your finances, it could be a great additional resource for you to add to your email list. I know we all get a lot of emails. I can promise you there’s a lot of good value in these emails that come from the True Wealth team.
So if you want to sign up for that, we’re going to have a link in the description of today’s show that’ll take you to the podcast landing page on the site, and you’ll see in the sidebar where you can put in your name and your email and subscribe to that newsletter. So it’s pretty easy to do. It’s on truewealthdesign.com. And again, we’ll link to that in the description of today’s show. That’s where you can also go to set up a visit with a member of the True Wealth team. If you want to have a 15-minute conversation, just go to truewealthdesign.com and click that are we right for you button and you can schedule a discovery call with Tyler, Kevin and True Wealth Design. Tyler, thanks for all the help on the show today. Enjoyed this one with you, my friend, and we’ll look forward to chatting with you again in a few weeks.
Tyler Emrick:
Sounds good. See you then.
Walter Storholt:
Very good. That’s Tyler Emrick. I’m Walter Storholt. We’ll see you next time on Retire Smarter. Information provided is for informational purposes only and does not constitute investment, tax or legal advice. Information is obtained from sources that are deemed to be reliable, but their accurateness and completeness cannot be guaranteed. All performance reference is historical and not an indication of future results. Benchmark indices are hypothetical and do not include any investment fees.
