David Blanchett: Retirement Income Investing in a Low Yield World (TAM Classic)

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welcome to fund with annuities where

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it welcome to fun with annuities I'm

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400 informative um YouTube videos I

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think we're going to contact Guinness

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and say hey we we have set the record

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because you know how many videos can you

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do on the annuities I'm going to test

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that theory listen today's guest is a

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superstar straight up let me tell you a

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little bit about him and hang in there

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with me because you need to know who's

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on who who you're going to be listening

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to today his name is David Blanchett

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he's the managing director and head of

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Retirement Research for PG imdc

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Solutions they're they're a global

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Investment Management business part of

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um credential Financial but his role

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primarily is is developing research and

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and and Innovations and solutions to

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help people improve their retirement

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income and a retirement income and

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retirement outcomes so he's focused on

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the investors now prior to uh joining

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that firm he was head of Retirement

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Research for morning starless you

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probably remember him for Morning Star

1:49
and before that he was the director of

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Consulting and investment research for

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the retirement plan Consulting Group at

1:55
unified Trust Company now he's published

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hundreds and hundreds and hundreds of of

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of uh articles all over the place you

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know just everywhere um he's his

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research has received rewards uh Awards

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rewards Awards everything I mean people

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follow David and what David is thinking

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he's currently the adjunct an Adjunct

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professor of wealth management at the

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American College of financial services

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and research fellow at the alliance for

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Lifetime income he holds his bachelor's

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degree in finance and economics from the

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University of Kentucky go Wildcats

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master's degree in financial services is

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from the American College of financial

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services go retirement incomers a

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master's degree in Business

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Administration from the University of

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Chicago Booth School of Business go

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smart people and a doctorate in personal

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financial planning prog uh from the tech

2:44
from Texas Tech University go Red

2:46
Raiders from my good friends Harold Dy

2:48
and DEA Catz who run that program there

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he has he has a beautiful wife and four

2:52
beautiful kids and he enjoys running and

2:55
rooting for the Kentucky wildcast but I

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don't think at the same time but enough

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of those impossible to achieve accolades

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you know this is the way I look at it

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when I'm because David's here I'm so

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happy he is if you want to talk about

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football and quarterbacking you talk to

3:08
Tom Brady if you want to talk about

3:09
shooting a basketball you talk to Steph

3:11
Curry if you want to talk about playing

3:12
a guitar you talk to Eric Clapton if you

3:14
want to talk about songwriting you talk

3:16
to Bob Dylan if you want to talk about

3:17
college basketball recruiting you talk

3:19
to John caliper but if you want to talk

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about retirement money and the

3:23
markets you talk to David Blanchett

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David Blanchett welcome to fun with

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annuities great to be here now so you

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missed the University of Chicago is the

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Maroons I like gohost smart people I

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thought that I thought that was really

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good you that was good that was good

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that was good but there the

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Maroons maroon David let's just start

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right there I don't know that's their

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mascot that's all I got for

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you that's like um my daughter went to

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NYU please people don't hold that

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against me um she got out of the house

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it was great it was an expensive way to

3:54
get out of the house but they're like

3:55
the purple or something I mean they're

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like something that makes no sense I

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mean think their their best athletic

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team was ping pong um not kidding so

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let's jump in you wrote an article

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recently I read it and I immediately

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contacted you and the title of the

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article was retirement income investing

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in a low yield World talk about hitting

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the button and hitting the topic that

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everybody's talking about can we jump

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into that and start off with investors

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are not always rational right David yeah

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I mean so almost all my research right

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is focused on this idea that people do

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um the decision that they should that

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emotions don't come into play but we all

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know that that's not reality right I

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think that it's always in more to kind

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of work from a framework of you know

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what should people do if they're kind of

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you know utility maximizing robots but

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nobody is and you've got to kind of okay

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ask yourself this question how do you

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how do you maybe adjust a strategy to

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reflect the unique goals of investors

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and one of the most kind of personal

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goals for a lot of folks is retirement

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and people have very different

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perspectives on how to accomplish that

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goal and I think that that you know now

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more than ever given where where bond

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yields are um it makes things really

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tough and so I think that you know

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investors advisors everyone has to ask

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this question how do I help people

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accomplish the goal that they want to

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accomplish that's a big question though

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you know because everybody's goals are

5:13
customizable everybody's trying to

5:15
achieve different things um one example

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that you listed was something called

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irrational

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preference um for income can you kind of

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dig into that a little bit I thought

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that was an interesting way to put it

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yeah I'm not I'm not trying to like hate

5:29
on people but um so in theory right in

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theory what you should what you should

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be indifferent between is spending down

5:37
your portfolio and living off of income

5:39
right so let's say you could buy buy two

5:41
companies one goes up 5% every year like

5:45
clockwork one has a 5% dividend okay in

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theory an individual should be

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indifferent between buying the company

5:52
that goes up 5% a year and selling 5% or

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buying the one that has the 5% dividend

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right that's not how people actually are

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right people don't like the the the act

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of selling down their Capital their

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balance whatever you want to call it so

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people have a have a strong preference

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um at least most people do a lot of

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retirees do to to not deplete their

6:14
their their portfolio they want to live

6:16
off of the income and again like what

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you should be you shouldn't care you

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should say well I can just as easily

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spend on my portfolio people don't want

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to do that and so if you change the

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perspective from okay I you know I'm

6:26
going to focus on depleting my portfolio

6:28
if I have to versus want to live off of

6:30
income it can kind of change your

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perspective on like what is the

6:34
efficient portfolio how do you build

6:36
portfolios especially today given where

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yields

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are but the but the low yield

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environment perceived low yield this

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might be the new normal nobody knows um

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is driving people crazy because they're

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they're they're wanting that Jimmy

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Carter type yield that doesn't exist and

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that's kind of where the bad sales

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practices especially in the annuity

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industry start taking place where people

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are selling hypotheticals and

6:59
theoretical and back tested junk um and

7:02
at the end of the day you're buying

7:03
you're buying a contract um overall

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you're just looking at markets and and

7:08
things like that but do you have a good

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or bad feeling toward maybe putting in

7:15
an income floor using lifetime income

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annuities using the transfer risk taking

7:19
that longevity risk off the table and

7:22
using the mortality credits that are in

7:23
place right now that I think are a

7:25
bargain yeah so I mean I think that I

7:27
think that that you know today's

7:30
environment is somewhat unprecedented

7:32
right I mean the average yield on 10e

7:35
government bonds has been about 5% we at

7:37
about one and a half percent today so um

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that affects every single investor out

7:43
there it affects um mom and pop it it

7:46
affects financial advisers it affects

7:47
mutual fund managers it affects pensions

7:49
and so we're all kind of playing in a

7:51
space right now where um it's really

7:53
hard to expect historical average

7:57
returns and you made a great point about

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I you know I I worry about a lot of

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advisers a lot of you know projections

8:03
if they rely on historical because you

8:05
cannot buy Bond you cannot buy a 10e

8:07
Government Bond today Ying 5% one and a

8:09
half percent right and so then given

8:12
where we are it kind of begs the

8:13
question again like what is the optimal

8:16
strategy and so like you mentioned you

8:17
know one example of that and so you know

8:19
when you get your retirement you know

8:20
every American for the most part has

8:22
some kind of guaranteed income Social

8:23
Security bu right um excellent base to

8:26
kind of cover your non-discretionary

8:27
expenses okay the question that every

8:30
household has to ask beyond that is does

8:32
that cover enough of my need money the

8:35
money that I know that I need to have

8:37
guaranteed for as long as I live and the

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if the answer there is no I think that's

8:41
where you have to ask this question okay

8:42
where else can I get it right one way to

8:44
get it is delay claiming Social Security

8:45
haven't claimed yet another way that I

8:47
think is actually increasingly

8:48
attractive right now and you alluded to

8:49
this is is buying some kind of annuity

8:52
or product that provides lifetime income

8:53
now there's all kinds of fun new flavors

8:56
there's a new product in Canada

8:58
introduced like a tonen few months ago

9:00
that's mosha that's that's mosha

9:01
molesky's baby right there right yeah

9:03
and I don't wantan to you know I I don't

9:05
want to you know spend too much time on

9:06
like is there one kind that's better

9:08
than other is I think that that you know

9:10
that too many people in retirement

9:12
aren't asking these questions and and

9:14
you know it's somewhat counterintuitive

9:15
but the lower that interest rates are

9:18
the more there's benefits to longevity

9:20
pooling right so when you buy these

9:22
products that have a group of people

9:23
that you know that say hey it's like any

9:25
it's like a public pension you know some

9:27
folks might lose money some folks might

9:29
make money but you know every investor

9:31
today has to earn Le less off of their

9:33
Investments but the benefit of longevity

9:35
pooling hasn't gone away and so for

9:37
those folks that are really worried

9:38
about do I have enough money to provide

9:41
income and retirement these products

9:43
make a lot of sense and like here's the

9:44
thing like if interest rates were like

9:46
8% and inflation was 2% you don't have

9:50
to worry about depleting your portfolio

9:51
if you can earn 6% guaranteed you can't

9:53
do that right now in real terms you're

9:55
going to be just fine but that's not

9:57
today right today is you're going to

9:58
earn a negative yield on on government

10:00
bonds real yield and what that suggests

10:02
to me is that if you want to make sure

10:04
that you're going to be okay in 20 or 30

10:06
years you need to think about right now

10:08
how you should reposition your portfolio

10:09
to help accomplish

10:11
that does it keep you up at night when

10:14
you you I mean under the the fact that

10:16
we live in a pension world and I think a

10:20
lot of what's happening right now with

10:21
people like you that are trying to

10:22
advise consumers in a factual way non-

10:25
salesy way because you don't sell

10:27
anything you are a researcher you are a

10:29
smart guy in the

10:30
room the fact that companies don't offer

10:33
those type of defined benefit plans that

10:36
has to be the biggest problem right now

10:38
facing the Baby Boomers coming out

10:40
because they have to convert what they

10:43
have into an income type stream whether

10:45
they're just peeling off money from a

10:47
growth portfolio but at the end of the

10:49
day and I hate this word we we use it

10:51
called decumulation it's just horrific

10:54
um what do you say to the person out

10:56
there the majority of the people out

10:57
there that don't have that pension and

10:58
the only annuity they own is social

11:02
security yeah you know I I've heard of

11:04
defined management plans before like I

11:05
haven't actually seen one out in the

11:06
wild yet myself maybe maybe I will one

11:08
of these days I hear they're out there

11:10
some people have them you know I just I

11:11
can't wait to experience my own at some

11:12
point but like like Define benefit plans

11:17
you know are are are one of the best

11:19
ways for individuals if you stay with an

11:22
employer for 30 or 40 years to fund

11:24
their retirement right the movement away

11:27
from Define benefit plans radically

11:29
changes the way that American households

11:31
have to plan for retirement right I mean

11:33
a Define iFit plan you have

11:35
institutional fiduciaries professional

11:37
money managers actuaries all these smart

11:39
people figuring this stuff out and you

11:42
you're pulling the risk together okay

11:44
we're moving you know significantly away

11:46
from that approach to one where every

11:47
single person is responsible for all

11:50
their all their stuff and to me like

11:51
that's that's terrifying right because I

11:53
mean this is this is not easy stuff it

11:56
requires lots of lots of good decisions

11:58
for a very long time time Horizon you

12:00
don't know what the how long you're

12:01
going to live how much you're going to

12:02
need to spend on stuff what the return

12:04
of the market to be it creates it

12:05
creates uncertainty and panic and that's

12:07
not how retirement should be right it is

12:09
like both of my parents are are retired

12:10
teachers they have you know almost all

12:12
their income in via public pension you

12:15
know like that is that's that's an the

12:17
ultimate easy button right having to

12:19
figure out how much you can take from a

12:21
portfolio every month every quarter

12:22
every year with all this uncertainty

12:24
that is like the opposite of the easy

12:26
button and you can get someone to help

12:27
you you can pay a financial advisor I'm

12:29
a big believer in that to help you

12:30
figure out what all those things are but

12:31
it doesn't alleviate the stress right we

12:33
saw this back in 2020 um you know I

12:35
always make the joke I I love a good

12:37
market downturn so I can study investor

12:40
behaviors and see what we did wrong and

12:41
so the good news is we had one [ __ ]

12:44
like a true researcher exactly the bad

12:46
news didn't last very long one thing

12:48
that that is that that fascinates me

12:50
about about people and investors and we

12:52
I actually saw this in 08 and we so it

12:54
again in 2020 sure is that is that you

12:56
would think that the older someone gets

12:58
the better investor they become the less

13:01
irrational they are about reacting to

13:03
downturns but it's the exact opposite

13:05
and so if you look at trading behaviors

13:07
in 2020 it wasn't those those those you

13:10
know all these young kids that are on

13:12
the news that were selling out of stocks

13:13
they actually lean into stocks okay like

13:15
they got more aggressive as the markets

13:17
went down it's it's it is it is without

13:20
a doubt you can it's a it's a it's

13:21
called a monotonic relationship it was

13:23
just perfect and that the older you got

13:26
the higher the probability of you making

13:27
a trade the more the port fol you trade

13:30
moving to a conservative investment so

13:31
they are like the worst Market timers

13:33
and so what's happening I think is that

13:35
retirement becomes more Salient the

13:37
closer you are to it right your 401k

13:40
goes down and you're like 35 years old

13:41
you don't care what is retirement right

13:43
but if you're 55 years old and you see

13:46
the market dropping 10% 20% and you're

13:49
55 you are you have a very real reaction

13:52
to what that means for you in terms of

13:53
oh my God I'm not able to do this in

13:54
retirement I've got to get up so what

13:56
what you see happening is those

13:57
individuals that that that can't afford

14:00
to make a mistake are those that make

14:01
them and so I think that we have a

14:03
situation now where you've got you know

14:05
each individual responsible for these

14:07
decisions and you might have an advisor

14:08
but a lot of advisers got fired in 2008

14:11
2009 yeah right and so I think I think

14:13
for me like the best thing you can do is

14:15
is create is create easy buttons and a

14:18
way to enjoy retirement where you're not

14:20
stressed out all the time if the market

14:21
goes down 5% 8% 9%

14:25
so what's your take on and and for the

14:28
uh the senior citizens out there that uh

14:31
don't be offended by this because we're

14:32
all getting there do you think that what

14:35
you just described also has to do with

14:38
cognitive decline that we all have as we

14:41
get old I mean you're young I'm old

14:43
other people listen to this they in

14:45
their you know 50s 60s 70s 80s

14:47
90s does that irrational

14:50
um decision making does that also play

14:53
into cognitive ability decline has that

14:56
been studied it has and so you know what

14:58
what what you see is people don't

15:01
perceive their their investment Acumen

15:04
ever trowing off we think that we're

15:05
just like solidly bit end the problem is

15:07
is to your point that older ages we'll

15:10
just say like 70 75 plus is where

15:12
there's have to be a noticeable Gap in

15:14
actual abilities and perceived abilities

15:17
like it's really important because even

15:18
if you if you have cognitive decline but

15:20
you know you do you could Institute

15:22
safeguards you can say hey you know what

15:23
I'm on a downhill slope here I have to

15:25
make a change the problem is is is if

15:27
there's a gap and you're perceived an

15:29
ual abilities and and that's what tends

15:31
to happen as we age and you know there's

15:34
there's obvious kind of additional

15:36
implications there so like as you age

15:38
you know you're going to have you know

15:39
you're going to be more susceptible to

15:40
making poor decisions you can't get the

15:42
money back and so like again like that's

15:44
where if you you have something that's

15:45
locked in to provide income for life you

15:47
don't have to worry about it but if you

15:49
don't have that there is the there is

15:51
the chance you can you know make a poor

15:52
decision you can get prayed on by a some

15:55
kind of fraudulent scam um a lot of bad

15:57
things can happen what's interesting

15:59
about where we're headed with this

16:01
conversation is it falls into it's

16:04
almost like saying you're overweight or

16:06
you are you know when you start talking

16:08
to people about cognitive decline or

16:10
planning for that eventuality which is

16:12
going to happen one of one out of one of

16:14
us is going to have that um when you

16:18
talk to the industry advisers Masters of

16:20
the Universe are you are you advising

16:24
them to at least Broach that subject

16:25
with people because that's a tough one I

16:26
do it all the time because I'm bulling a

16:29
china shop I have no problem talking to

16:30
people at anything and my clients are

16:32
like nodding their head as just but I do

16:34
think that um having some type of

16:36
guaranteed income or uh as some in the

16:39
industry call it protected income it

16:42
does put in that income floor and that

16:45
peace of mind that when things happen in

16:47
the future things are taken care of do

16:49
you see a shift with that with the

16:51
demographic tial wave of 10,000 Baby

16:52
Boomers hitting 65 every day do you see

16:55
that kind of happening and maybe that's

16:57
an angle for um a lifetime income

17:00
products to to be

17:02
positioned yes so I don't I don't know

17:04
that my what I perceive is

17:06
representative of the entire Market but

17:08
I I do believe that there is a a a

17:10
rising interest among advisers among the

17:12
public in products that provide

17:16
protected or guaranteed income there's

17:17
lots of products that do it in different

17:19
ways but you know to your point a lot of

17:22
advisers I think will will will will say

17:25
to clients hey like I'm your I'm your

17:28
I'm your to ensure that nothing bad

17:30
happens right wrong answer there's but

17:33
there's a lot there's a lot of things

17:34
wrong with that like that's how people

17:36
get money stolen yeah um the client can

17:38
fire you and hire a really bad advisor

17:40
instead and so I think that you know

17:42
delegation is is important it's good to

17:44
have that trusted advisor but it's also

17:46
good to have you know safeguards in

17:48
place to Ure that nothing truly bad can

17:50
happen and the more of your money that

17:52
is protected or guaranteed you know like

17:55
like you it's this range of outcomes and

17:58
you know you know we every day I see a

18:00
story about some adviser who sold some

18:02
Ponzi scheme that you know wiped out

18:04
people's savings okay right like that is

18:06
that is not going to happen if you have

18:08
money in a guaranteed or protected

18:10
product you've got you've got income for

18:12
life and so I think that you know the

18:13
key is is finding that balance and just

18:15
and just ensuring that no matter what

18:17
happens with respect to the markets that

18:19
you've got what you need taken care of

18:21
do these Market at the time of this

18:23
taping do these market valuations and

18:25
where we're at is it making your stomach

18:27
a little queasy are you I mean I've been

18:30
czy for a while now I mean I just I

18:32
don't get it I mean you know I don't

18:33
know what there's lots of metrics that

18:35
you can use like the the cape ratio it's

18:37
the the Schiller PE and others I mean

18:39
sure pretty much you know I mean I the

18:41
only okay what scares me we've had like

18:43
a like a market that's gone straight up

18:45
for like 15 years or however long 14 I

18:47
don't know what it is okay like that

18:48
doesn't happen no right you know I I

18:50
mean don't get me wrong I would love it

18:52
if the markets went up 15% every year

18:54
forever that would to me would be you

18:56
know that that you know that would be

18:57
spectacular amazing use all the nice

19:00
words you can we haven't had that right

19:02
and there's like no point in history

19:04
that markets just keep going up Forever

19:06
Without a correction right usually the

19:08
longer it goes up the longer then it

19:10
eventually goes down and so you know

19:11
someone can say well we had a correction

19:12
in 2020 well we really didn't right

19:14
we're already well past that point and

19:16
so like for me I I am genuinely

19:19
concerned um increasingly I feel like

19:21
that we're due for some kind of

19:22
Correction I don't know when that's

19:24
going to happen what it looks like but

19:26
um the markets have done awfully well

19:27
for a long time it just is it doesn't

19:29
feel sustainable yeah when I read that

19:32
people are buying I'm nothing against

19:33
cryptocurrency people I mean nothing but

19:35
when I read that people are leveraging

19:37
crypto to buy crypto you know the old

19:39
kudin in me that's been here for 30

19:41
years is like o you know that kind of

19:44
DOT type play um you know comes comes to

19:48
the Forefront the other thing I read and

19:49
I don't know if this is true maybe you

19:50
have a a better clarification on this is

19:52
over 90% of crypto is is purchased by

19:55
what we consider young people you know

19:57
not not the old heads in the room

19:59
that's that's a little interesting as

20:01
well because all of those people have

20:03
never seen Market

20:05
downturns yeah I have I have I have

20:07
mixed to negative feelings on crypto um

20:10
just from the perspective of an

20:11
investment right you know sure it has

20:13
like a potential public use you know

20:15
sure I don't want to you know

20:18
blockchain's real let's we can all just

20:19
say blockchain technolog is real but I

20:21
don't know I don't know how to quantify

20:23
like how much doge is worth or Bitcoin

20:25
or any of those what is their value I I

20:27
don't know that's why I feel like you

20:29
can buy them but like it's it's

20:31
effectively specula I mean people you

20:33
know I talked to a lot of my friends

20:34
I've read I've researched this for

20:36
hundreds of hours and I'm like I'm like

20:38
I highly doubt that your research is

20:40
unbiased and represent of like a

20:42
collective view of the thoughts on what

20:43
crypto could be you know it's like it's

20:45
like the rabbit holes people get on

20:46
online anyways and so you know I would

20:49
say that you know like in terms of like

20:50
a contagion effect for the markets I'm

20:52
less about crypto because I don't know

20:54
how you know the market cap isn't

20:56
necessarily High Enough um it's younger

20:59
people so I think I think there's

21:00
there's there's risks there in terms of

21:02
obvious loss of capital but I don't know

21:04
that that's enough to kind of like you

21:06
know destroy the market or have the big

21:08
downturn but it could be one Domino of

21:10
of five that happened at the same time

21:11
like you know I think the fun thing with

21:13
with Market crashes is they always seem

21:15
so easy to kind of predict after the

21:17
fact but it's it's looking forward that

21:18
makes it really hard so I think at some

21:20
point we will have this negative shock

21:23
the question just is what are the thing

21:25
or things that that cause it to happen I

21:27
like how you started that sentence the

21:28
fun thing with Market crashes I mean you

21:31
know got look at the right side okay

21:33
yeah is you get to see your neighbor

21:34
walk out in the front lawn and throw up

21:36
uh and you've never seen that before in

21:38
your article on retirement income

21:40
investing in a lowy year world and by

21:41
the way we're going to have a page for

21:44
um for David on the site with a link to

21:47
this so don't worry about it we'll have

21:49
that for you there was um a survey from

21:52
from probably the most um probably the

21:54
most energetic group of people ever on

21:56
the planet the societ Society of actuar

21:59
that was pretty interesting can you go

22:01
into kind of the percentages of the

22:03
senior citizens that plan to spend down

22:05
their wealth I found this fascinating

22:07
and disturbing at the same time yes so I

22:09
I forget that the numbers on top of my

22:11
head but I think one thing that that if

22:12
you look at it and and they do that

22:15
survey every every few years and let me

22:17
read it for you no let me just read from

22:19
your articles because it's straight only

22:21
17% of pre-retirees plan to spend down

22:24
their wealth in retirement while 32%

22:26
plan to withdraw only earning and try to

22:29
leave the principal intact that sounds

22:31
like a dream world right now it is well

22:34
and so like I think that like if if if

22:36
we were at a place where bonds we owning

22:37
four or five perc doable right I think

22:40
that I think that that's a realistic

22:41
goal possibly at that point but it's

22:43
just not today and so I think that that

22:45
that a lot of people are going to have

22:46
to kind of recalibrate their

22:47
expectations the longer we stay in this

22:49
environment and so that wasn't

22:50
necessarily you know I think that was

22:52
like a 2019 survey it wasn't incredibly

22:55
unrealistic then but it definitely is

22:57
right now and so I think that the longer

22:59
we have this persist the more that

23:02
people have to kind of you know really

23:04
understand to the extent they can live

23:05
off the income and I think that again it

23:07
gets back to the earlier idea that

23:08
people don't I mean when you don't know

23:10
how long you're going to live you know

23:12
it just creates all this uncertainty

23:14
because as soon as you deplete your

23:15
savings you can't replenish that I mean

23:17
like your the the job possibilities when

23:19
you're 80 years old are not that

23:21
enticing these days that could change in

23:23
the future but unless you want to kind

23:24
of be a Walmart reader it ain't going to

23:27
happen right and so you know when you

23:29
stop working you've got what you've got

23:31
now maybe you'll get an inheritance

23:32
things like that can happen but I I I

23:34
understand that very real fear that if

23:36
you spend that money down it's gone

23:37
forever therefore you don't want to do

23:39
it the problem the the obvious problem

23:41
is you save that money to enjoy your

23:42
retirement right and so if you if you

23:45
want to maximize your your life

23:47
satisfaction you you need to find a way

23:49
that you're comfortable behaviorally

23:51
accessing your funds and that to me is

23:53
this whole you know new thing I looked

23:55
at it's like this idea of a license to

23:57
spend and that's what protected slash

23:59
guaranteed income does it gives you a

24:01
license to spend you don't have to worry

24:03
anymore about you know I've got save if

24:05
I'm live to 105 because that's taken

24:07
care of and so I think in the past i'

24:09
I've focused a lot on maybe even too

24:11
much on the academic benefits behind you

24:15
know moving into protected income

24:16
categories I think the biggest benefit

24:18
are actually behavioral it's allowing

24:19
someone to understand hey I save this to

24:22
enjoy my retirement I can spend it if I

24:24
know that I have income as long as I'm

24:26
going to be allowed and it's to me it's

24:27
all messaging and it's all it's all

24:29
marketing and obviously I'm sitting here

24:31
wearing all kinds of standy NY main gear

24:33
so I'm into that kind of thing but you

24:35
know people have fire fire insurance and

24:37
home insurance and flood insurance and

24:38
car insurance but somehow we have not

24:40
sold income insurance or retirement

24:43
income Insurance because it's it falls

24:45
under the same categories it's there

24:47
when you need it you know if you need it

24:49
but you probably are going to need it

24:51
going into retirement because of just

24:54
kind of where where we're at and the

24:55
interesting part is and you're probably

24:57
seeing the same thing

24:58
the promises that I heard from people

25:00
after the 2008 debacle those people have

25:03
forgotten that well Stan I'm never going

25:05
to have that's never going to happen to

25:06
me again I'm never going to let that

25:07
happen to me again but boy the greed

25:09
Factor does take over when you see at

25:11
this point people throwing darts at

25:13
things and it's going up um I mean it's

25:15
it's tough from an inflation

25:19
standpoint I know that's I I'd like to

25:21
get your your take on if you believe

25:23
it's transitory or not and then from

25:25
there what your advice is to people on

25:29
how to address it because there's no

25:31
perfect answer just bad sales pitches

25:33
yeah I mean I think the the inflation

25:35
question is a difficult one I mean I'm

25:37
I'm only 40 so I haven't experienced you

25:39
know the the good old days of of you

25:42
know 10 plus percent inflation um I I

25:46
don't think we're g to get back to that

25:48
um I I do think it could be an issue I

25:50
mean I I see it every time we go the

25:52
grocery store right you see you see it

25:54
everywhere today so I think that you

25:56
know um it makes sense that it it could

25:59
be very real at least in the near future

26:01
you know but it does create interesting

26:02
challenges for retirees I think one

26:04
really important point to make is that

26:06
retiree spending does not increase every

26:09
year by inflation right you know how

26:11
much spending evolves in retirement

26:13
depends a lot based upon for example um

26:17
each each retire you know if you go to

26:19
group you're spending into once in needs

26:21
or essential non-essential discretionary

26:24
whatever you want to do it you know and

26:26
what you what you tend to see is that is

26:27
that you know if inflation goes up say

26:29
3% a year spending normal goes about

26:32
about 1% for for the average retire now

26:34
it actually goes up even less than that

26:35
if you're if you're spending a lot

26:36
because more of your spending tends to

26:38
be on discretionary items when it comes

26:40
to like retirement income strategies um

26:44
I'm a little bit less worried about

26:45
inflation because you have the explicit

26:47
inflation um income guarantee from

26:50
Social Security but I do think it's

26:52
important to layer on top of that you

26:53
know other benefits that possibly could

26:54
have you know a fixed Cola or cost of an

26:57
adjustment or other investment

26:58
strategies like like tips or real estate

27:00
that provide a a a perfect or quasi

27:02
perfect inflation hedge but I'm probably

27:05
less concerned about inflation than

27:06
maybe other retirement academics because

27:08
you know I I just don't see that that

27:10
that that historical pattern where

27:12
retirees actually increase their

27:14
spending based upon you know oh CPI was

27:17
up two and a half percent last year I'm

27:18
going to spend two and a half% more year

27:19
that just doesn't

27:20
happen and I blame the media like I

27:23
blame the media for a lot of things they

27:24
just take inflation and they just it's

27:26
it's a driveby and they just kind of

27:27
shoot it out there they really don't

27:28
know what they're talking about and then

27:30
it scares the heck out of people and

27:31
then everyone tries to find you know the

27:33
product to address inflation and there's

27:35
nothing out there that exist in a

27:36
perfect world to perfectly address it

27:38
one of the things I want to talk to you

27:39
about as well was something that came

27:41
out in the Journal of wealth management

27:43
there was some research done um and you

27:46
you know kind of went in and explored

27:48
specifically um the optimal equity

27:51
allocations for income focused investors

27:53
can you dig into kind of what that is

27:55
and put it in English for us peons out

27:57
here to understand what you were doing

27:59
and thinking yeah so we we had talked

28:01
about this actually um at the beginning

28:02
of the podcast and this this idea of

28:04
like how do you invest when you have low

28:08
yields if you're focused on income right

28:11
and so um I I I I will not get all weird

28:14
mathy or I'll try not you I promise but

28:16
when we think about about risk normally

28:18
it's it's like the volatility of an

28:20
investment so it goes up five% it goes

28:23
down 10% all that okay so like

28:25
government bonds are an interesting

28:28
vehicle to assess from a risk

28:29
perspective because like long government

28:31
bonds that have say a 20 plus year

28:33
maturity are actually pretty risky right

28:36
so there's like a rule of thumb that you

28:37
can use for duration so duration kind of

28:39
like maturity how many years the

28:41
payments are going to last just kind

28:42
cash flows so you know there's this rule

28:44
where you know like if if if interest

28:46
rates go up 2% and you have a a bond

28:49
fund that as a 15-year duration it would

28:52
go down

28:53
30% right so there's a lot of a lot of

28:56
potential loss there for that that bond

28:58
fund however if you're GNA hold that

29:01
bond fund until maturity you wouldn't

29:04
realize that loss right so if I buy a

29:07
Government Bond it's yielding 2% and I'm

29:10
GNA hold that thing for 10 years then

29:13
then then the kind of the the definition

29:15
of volatility changes right you know if

29:17
I want to get 2% a year of income I'm

29:19
going to hold that thing no matter what

29:21
well I I shouldn't use the fact that it

29:23
could drop in value I should focus on

29:26
how does it do in terms of creating

29:28
sustainable income and for that it is

29:30
like perfect it is it is often described

29:33
as the risk-free asset for investors

29:36
well if you take that perspective on a

29:38
portfolio if you ask this question well

29:40
I am focused not on the variation in the

29:44
in the and the volatility of the

29:45
investment I'm focused on income I want

29:48
income stability right so for a stock

29:51
portfolio that's dividends you're going

29:52
to say I'm not worried about you know

29:54
whether it goes up and down I want

29:55
consistent dividend income if it's from

29:57
a b portfolio it's it's the yield and so

30:00
if you take that perspective that more

30:02
behavioral perspective it actually does

30:04
make equities look quite a bit more

30:05
attractive today simply because you know

30:08
the dividend yield on the sp500 actually

30:11
exceeds the the yield on tene bonds

30:13
today it's not to say that that that

30:15
that equities are by any means a bargain

30:17
or a good deal but if you're focused on

30:19
income historical evidence does suggest

30:22
that that it actually might make sense

30:24
to own some equities just based upon

30:26
relative yields

30:30
it's yeah it's it's it's kind of a weird

30:33
environment that we're in including I

30:35
wanted to get to kind of the political

30:36
Silly Season that's always occurring in

30:39
DC and I'm assuming when you're doing

30:41
your research there's probably two parts

30:43
to it there's the actual math and the

30:44
research and doing that but but I'm

30:46
assuming you have to factor in DC and

30:50
what's coming out of DC not only from

30:52
the standpoint of actual law but

30:54
proposed law as well when talking about

30:58
people's retirement especially I feel I

31:00
feel for people that are right at the

31:02
retirement uh you know they're getting

31:04
ready to cross the tape and and go into

31:06
retirement and now we have all this

31:07
nonsense that's going on in DC from the

31:09
standpoint of Taxation they're floating

31:11
ideas about interrupting Roth rules and

31:14
all kinds of things can you weigh in a

31:16
little bit I know you're not not you're

31:17
not political like me I you're just not

31:19
I know that reading your stuff but can

31:21
you weigh in on what's Happening and

31:23
what you think people should be

31:24
preparing for yes so I mean you know my

31:27
my Focus has been on

31:30
DC I've worked in the DC business now

31:32
for about 20 years and I think why

31:35
that's so important is people do not for

31:38
Americans do not save outside of defined

31:39
contribution plans the only reason

31:41
there's any money in IRAs is because

31:42
people roll money from a DC plan to an

31:44
IRA now I hope that that changes right

31:46
but DC is the preeminent way that that

31:49
Americans save for retirement now DC for

31:52
people out there in English is 401K 401K

31:54
403b it's it's it's that type of plan

31:57
that you are employer sponsor type plan

32:00
where you're putting money in and

32:01
they're matching whatever that's what

32:02
that's what DC means right A Defined

32:05
contribution plan and so you know I'm

32:07
I'm you know people get all bit out of

32:09
shape like sure they could cover more

32:10
people they aren't perfect but like you

32:12
know those that have them and use them

32:13
well it's been a it's been an effective

32:15
way to save for retirement right um you

32:18
know there have been positive changes to

32:21
how we operate Define contribution plans

32:23
in the US we have you know these these

32:25
things called default Investments or

32:27
Target funds you might get automatically

32:29
enrolled all good things there is you

32:31
know um you know there's obvious there's

32:34
there's there's there's budget

32:35
shortfalls and a in a place that they

32:37
they always threaten to fix it is by

32:39
overhauling or removing certain benefits

32:43
that we've had in the 401K structure for

32:45
a long time um you know I I hate to

32:49
speculate on on legislation as it's

32:51
working way through the because it just

32:52
changes but you know I I want I want to

32:55
see us do more as a country to open

32:57
these programs up and provide more

32:59
incentives versus the opposite and I I

33:02
worry that that we're we are moving in

33:04
the wrong direction with with some of

33:05
these proposals just because they are

33:07
looking for ways to close shortfalls in

33:10
budgets and that is a very appetizing

33:12
way to do it especially based upon the

33:14
way for example the monies are scored

33:16
during the budgetary process well and

33:18
also too things like trying to Tex

33:20
unrealized gains and things like that

33:22
that just are head scratchers to people

33:24
that are thinking pragmatically and

33:25
rationally even though I was watching a

33:27
a news program this morning and one of

33:28
the the hosts was like this is a

33:30
no-brainer this makes total sense to tax

33:32
unrealized gains and I'm going really

33:35
what disy savings it sure does but ites

33:37
I mean what it's interesting what's

33:40
happening out there if you're following

33:41
the Elon Musk person that that started

33:44
Tesla he's got a conundrum on his hands

33:46
of probably a 15 or 20 billion dollar

33:48
tax bill depending on what's going to

33:49
happen if you don't know what I'm

33:51
talking about you know pull that up I

33:53
was talk talking to Jason fitner the

33:55
other day and I was you know I know that

33:57
you you both work for the alliance for

33:59
Lifetime income and trying to get the

34:01
messaging out Etc and I'll ask you the

34:04
same question I ask him do you think the

34:07
annuity industry as a whole has kind of

34:09
dropped the ball on the Monopoly that

34:10
they have for Lifetime income because

34:13
when people hear the word annuity they

34:14
vomit I call annuity the curse word in

34:16
the financial industry which leads to

34:17
the question hey Stan why did you name

34:20
yourself Stan the annuity man I believe

34:22
in these products I believe in the

34:23
transfer risk nature of them and I think

34:25
a monopoly is good when the product is

34:27
good um how can how can the messaging be

34:31
better to the public out there when

34:32
every single person already owns Social

34:34
Security which is the best inflation

34:36
annuity on the planet what's your what's

34:38
your take on that as a smart guy in the

34:40
room I mean there there have been dat

34:42
line specials against annuities right

34:44
you know Chris Hanson pops out and says

34:46
hello like bad things are about to

34:47
happen I don't think it was actually

34:48
Chris Hansen but I think I think I think

34:51
you know is an industry we're moving

34:53
forward right I think the problem is is

34:55
that is that you often get judged by

34:59
the worst within your ranks yeah there's

35:01
bad apples in every industry for sure

35:03
yes and and I I would even go as far to

35:05
say that maybe there's more bad apples

35:07
in this world versus other Financial

35:10
products because there isn't the need to

35:11
be a fiducia right a lot of people out

35:13
there are selling product they make a

35:15
commission and they're done they have no

35:18
you know they're not really looking out

35:19
for the best interests of their clients

35:22
correct and so like that's one way to

35:23
address it I don't know that I think

35:25
that that's the best way I think the one

35:27
thing that has gotten me excited is that

35:30
is that more advisers are looking into

35:32
these products and you I I get so tired

35:36
of advisors saying that they hate

35:39
annuities and you know and anyone

35:41
listening might even know what I'm

35:43
there's and it's the dumbest statement

35:44
of all time it's like saying I hate all

35:46
restaurants it's right and that's my

35:48
point it's so like I'm like I'm like you

35:49
know advisers I know and I will often

35:51
engage them on LinkedIn and they they

35:52
never have an original thing to say

35:54
because you know like they're like they

35:55
always say the same thing they say like

35:56
oh I've seen so many crappy products and

35:59
I'm like listen like do you buy crappy

36:01
mutual funds for your client's portfolio

36:03
you know there's crappy funds out there

36:05
but you know what you can do because you

36:06
have human capital specifically in

36:08
helping clients accomplish their

36:09
financial goals so what you're good at

36:11
is helping select products that help

36:13
them do those things and so when it

36:15
comes to Investments you can pick a

36:17
portfolio of the best mutual funds or

36:19
ETFs around right of course I can okay

36:22
well let's just acknowledge that there's

36:24
a spectrum of quality of annuities out

36:26
there too you tell me there not a single

36:28
one that that that can't help your

36:30
clients that's when they stop they're

36:32
like well you know like you know I'm

36:34
just like like really like if you have a

36:37
100 clients that are retirees sure maybe

36:40
only 20 of them need one I'm just going

36:41
to pick a really low number sure but for

36:43
that 20 it is like a rock solid option

36:46
that you should be considering but

36:47
you're not and so I think I think we I

36:50
we I'd like to think that there are more

36:52
advisers that are realizing that that

36:53
like you know being aware of at least

36:55
certain strategies the ones that best in

36:57
your store whether it's a dsba I don't I

36:59
don't know that I have a strong

37:00
preference on the product type as long

37:02
as it's a quality product it it comes

37:03
down to what you know I always ask

37:05
people two questions what do you want

37:06
the money to contractually do and when

37:08
do you want those contractual guarantees

37:10
to start from there then we go to the

37:12
product that's going to provide the

37:13
highest contractual guarantee and you go

37:14
to my site and run the quote yourself

37:16
the point is I think the industry that

37:19
the alliance for a lifetime income I'd

37:20
rather instead of sponsoring the stones

37:22
and I love Mick and the stones I've

37:23
partied with them in Bahamas many a time

37:26
um not I'd rather that money be spent

37:29
bring everyone in and let's let's have

37:30
it out and let's get one message let's

37:33
all have one message and let's go

37:34
forward and let's get in front of this

37:36
demographic tidal wave now the

37:37
interesting part is even if they don't

37:39
do that the annuity industry is going to

37:41
benefit because there's a demographic

37:43
tidal wave and they're all looking for

37:44
guarantees but the educa the the time

37:46
for education is certainly now that's

37:48
the reason I have 400 plus videos and do

37:50
20 a month and do my podcast and written

37:52
seven books on educating the public that

37:55
yes you might think it's a curse word

37:57
but it's not and and I'll one last thing

38:00
and I want you to comment on this you

38:01
know Banks and Brokers firms will bring

38:03
me in undercover and have me speak to

38:05
their gr their Masters of the Universe

38:07
people that are managing a lot of money

38:08
and I'll say this if you have the income

38:10
floor in place because I used to work

38:12
for Morgan Stanley Dean wood or pay

38:14
Weber UBS I did that I was on that side

38:16
of the table if you have the income

38:17
floor in place and it's contractual

38:19
you're a better investor or you're a

38:21
better adviser and there's no disputing

38:23
that do you think that's true

38:25
undoubtedly I mean I think that it it

38:27
Chang changes your client conversation

38:30
right I mean advisers know that they

38:33
don't usually have all the assets

38:34
especially that people have tons of

38:35
money and so I think that when you

38:37
evolve your conversation from I'm GNA

38:39
create Alpha and I mean Alpha is not an

38:43
easy thing to do to I'm helping you

38:44
accomplish your financial goals and

38:46
ensuring that you have income for life

38:49
that to me just is a better story it it

38:51
is a it is it is a marketable story and

38:53
you're actually helping the client do

38:55
what they're effectively paying you to

38:57
do but in a different way I mean a lot

38:58
of advisors grew up building portfolios

39:01
this idea of planning is a new thing

39:04
well in most advisers always say I've

39:06
have cowboy boots older than they are

39:07
because they've never seen a down market

39:09
and they just think it's always going to

39:10
go up there will be a reckoning you and

39:12
I both know that we don't know how long

39:13
it's going to last but um you know it

39:16
will happen I wanted to ask you without

39:18
you giving away the intellectual

39:19
property uh pie here and you know the

39:23
the head the main company that you work

39:25
for is credential and and I know that

39:27
you're doing you know research and and

39:30
trying to create solutions for good

39:32
retirement

39:33
outcomes what's surprised you in the

39:36
past few years of what you've found or

39:38
have you been surprised as you're going

39:41
down a path and looking at Blue Water

39:43
strategies that's never been looked at

39:47
before I think the the most interesting

39:50
place for the future and I'm not the

39:53
only person that's kind of well aware of

39:55
this is is is making 401K plans

39:59
retirement income Vehicles today 401ks

40:03
get you to retirement I'd like to see

40:05
the future is them getting people

40:07
through retirement um it's not to

40:09
suggest that individuals can't or

40:11
shouldn't roll out to an advisor but a

40:13
401k it's it's has an Institutional

40:16
fiduciary it has you know professional

40:18
money management you can get economies

40:20
of scale it's not a f benefit plan but

40:22
you can get it pretty close if you start

40:24
layering in you know guaranteed income

40:27
prot ected strategies advisors advice

40:30
and you know where I get excited is is

40:33
just for kind of for Mass America I know

40:35
that people that have lots of money will

40:37
always want to go work an advisor but

40:39
the idea of an Institutional fiduciary

40:42
available to everyone having lowcost

40:45
high quality options with some kind of

40:47
guaranteed to protective strategy that

40:49
to me is a is a better A Better Way

40:52
Forward than hey why don't you save some

40:54
money in this in this DC 401k plan and

40:56
then when you're done later figure it

40:59
out on your own yeah the current process

41:01
is you this is a good and bad example is

41:05
you accumulate in the 401K you retire

41:07
you you roll that money over to to an

41:10
IRA and then you go to a bad chicken

41:12
dinner seminar or very expensive Stak

41:13
dinner seminar and some idiot without

41:17
license license or proper license or to

41:19
talk about it sells 100% of your

41:21
portfolio into an annuity which is the

41:23
reason the annuity industry has a bad

41:25
reputation um unfortunately that's

41:27
what's happening I hope that what you're

41:29
proposing happens at a faster scale my

41:32
only question is because annuity

41:34
products are commodity products and they

41:36
change every seven to 10 days like a

41:37
gallon of milk from a quotation

41:38
standpoint the fiduciary part I'm

41:41
scratching my head a little bit on if

41:43
you are a company a and you're offering

41:45
income Solutions inside your defined

41:47
contribution plan whatever that is and

41:50
you have three choices are you being a

41:51
fiduciary I'm not sure about that well

41:55
so the decision to offer the product is

41:58
a fiduciary Choice that's made by the

41:59
plan sponsor you can hire a consultant

42:02
or delegate that via what's called a 330

42:04
Arrangement sure you can also hire

42:06
someone to advise on whether you should

42:08
own the product or not given your facts

42:09
and circumstances so I mean I see I mean

42:12
there's all these different ways that

42:14
that that employers or PL moners can

42:15
Delegate for you Share responsibility I

42:17
see most of them going down that path if

42:19
I'm a I mean if I'm a if I'm a company I

42:22
want to offer a 401k I don't want to

42:24
have all this liability for it so I

42:25
think you can I think what we'll see is

42:26
more entities come in that they can hire

42:29
to do and provide solutions for

42:31
participants that that reduces or

42:33
eliminates the the DU shary risk for the

42:36
employer as Wayne gresy says you skate

42:39
to where the Puck's going to be not

42:40
behind the puck for you where's the puck

42:44
headed other than what you just told us

42:46
on the 401K side where do you think um

42:50
you know with this demographic title way

42:52
where what advice do you have for people

42:54
here because they're they're thirsty for

42:56
it that's the reason this podcast is

42:57
growing by Leaps and Bounds they know

42:59
it's not salesy they know I'm bringing

43:00
on the smartest people in the country to

43:02
talk about it you're talking to

43:04
thousands and thousands of listeners and

43:06
viewers right now they all have

43:08
different viewpoints but in the current

43:10
environment that we're in both market

43:12
and political and Global for that matter

43:15
um this is a tough one but kind of can

43:18
you can you give a broad view to make

43:20
people give people places to go to to

43:23
think about it read about obviously

43:24
we'll have your stuff I know I asked you

43:26
a big question but can you help with

43:27
people because that's in essence why

43:28
they tuned in they want to hear that

43:31
yeah I mean I don't I don't have I mean

43:33
I don't know that I have a great answer

43:34
I think that that you know to me one of

43:37
the most important things for people is

43:38
to get personalized advice or guidance

43:41
from a fiduciary I think that for most

43:44
Americans that's not necessarily

43:45
economically viable I think that it

43:47
would cost too much and you'll end up in

43:49
something that you don't need or want I

43:51
think that you know um education is

43:54
critical I think that more and more

43:56
advisers are moving away from being

43:58
portfolio Pros to being you know

44:00
holistic planners but you know uh I wish

44:04
I had a better single site to send

44:06
someone to but but I think I think

44:08
trying to educate yourself is the key

44:10
and then and then bringing someone in

44:12
that you think can complement that that

44:13
is a professional fiduciary that you

44:15
know has access to you know a whole

44:18
Suite of products and solutions not just

44:20
ETFs or mutual funds is a the best path

44:23
forward 20 years from now you'll be the

44:25
right oldold age of 60 correct that is

44:28
correct where are you going to be what

44:30
are you going to be doing what's the

44:32
future for you I think I'll still be

44:34
doing this I mean I I don't I don't ever

44:36
I am not one to to Dole I I don't I

44:39
don't think I'll I don't think I I you

44:40
know it's ironic that I'm the the head

44:42
of Retirement Research and I don't think

44:43
I'll ever retire and I think I I want

44:45
Financial Independence I want to have

44:46
freedom to do whatever I want but I

44:48
really enjoy my job um I've been

44:51
interested in this in this industry

44:52
since I was in high school um I love

44:55
what I do so I think I'll I'll be doing

44:57
something like this uh as long as I

44:59
possibly can go back to what you just

45:00
said to high school when did when did

45:02
this when did the passion when did the

45:04
fork in the road road moment happen when

45:07
did you pick up the fork I mean I was I

45:10
had like a I convinced some buddies of

45:11
mine to give me money to invest in a

45:13
stock portfolio in high school I was

45:14
like reading Forbes I was I was doing

45:16
internships at at brokerage companies I

45:18
had like 10 internships in in college at

45:21
the Board of Trade at at uh two

45:24
accounting firms at every other I mean I

45:26
just I the you know the thing that's

45:29
changed is you know I when I first got

45:31
in the business I was more geared

45:32
towards doing like individual personal

45:34
financial planning so work with

45:36
individuals you know now I would say I'm

45:38
more like institutional developing

45:39
Solutions but it's all it's all the same

45:41
right it's all trying to help people

45:43
achieve better Financial outcomes and so

45:45
I think that to me has always been a a

45:47
goal of mine and I'm just I'm still

45:48
doing it just in a different way right

45:50
now were you ever in the retail side

45:52
client okay you did that for a while and

45:54
then what was the Epiphany for you to go

45:57
from there to the research side was it

45:59
just the accumulation of

46:01
degrees so I actually I actually passed

46:04
the cfp the clu and chfc when I was 21 I

46:07
was like a CFA at 24 I had msfs at 22 um

46:11
I think so I was I was I had an

46:13
internship selling life insurance at 19

46:15
and um that was interesting right you

46:17
know I did that for three years and um

46:20
you know they they tell you to do things

46:22
and you know you don't always ask the

46:24
question like is that truly in the

46:25
client's best interest and I think that

46:27
you know if you want to find the right

46:29
answer you can but a lot of my

46:31
colleagues didn't necessarily want to

46:33
educate themselves on what to do and so

46:35
you know I was like I want to make sure

46:36
that I'm actually helping people that

46:38
count on me that I'm giving them good

46:40
advice and I I was like I needed to

46:42
learn this myself and so I just started

46:44
radically taking you know more and more

46:47
classes and tests and I've you know I

46:48
had like eight or nine I mean I have two

46:50
master's degree as a PhD and I had like

46:52
nine designations at one point in time

46:54
so I'm a I'm a big geek but like I think

46:56
it was all geared towards being able to

46:59
when I when I when I tell someone that I

47:01
think this is the right thing to do it's

47:02
because I've spent the time to learn it

47:04
and you know I I might get back into

47:06
working with individuals again at some

47:08
point um I really like the more kind of

47:10
institutional Focus now but I think that

47:12
for me education's been the key because

47:14
I you know yes I I I obviously listen to

47:16
others and take their opinion but I I've

47:18
got enough of a background now that I

47:20
can kind of call things as I see it as

47:21
well well the reason I asked that is as

47:23
I read your stuff I can tell you you've

47:24
been in the game um youve you've

47:27
actually been on the other side of the

47:28
table because you can read that into

47:30
there's some people out there that have

47:31
never either sold or been on the retail

47:33
side I think it's important for you to

47:35
be there just because you understand

47:36
people and the fact that they don't know

47:38
what they don't know and then your

47:39
research then is geared toward filling

47:42
in that Gap because you're not assuming

47:44
that everyone has a a foundational

47:46
knowledge of these products Etc I mean I

47:49
I run into that every day in the annuity

47:51
world where I'm just on the fixed

47:52
annuity side and just selling

47:54
contractual guarantees you know people

47:56
just don't know about them it's been

47:58
such a poorly uh educated um you know

48:02
thing that's that I mean the industry

48:04
has just done a poor job by the way uh

48:06
you went to Texas Tech University and

48:08
what people don't probably should know

48:09
about Texas Tech and I went and spoke

48:11
there a couple times is one of the few

48:13
if only University that has a financial

48:16
planning degree and if you ever ask well

48:19
who was David Blanchett before David

48:22
Blanchett His Name Was Harold

48:24
ainy and uh he started all that

48:27
and with his partner DEA cats they um

48:30
they started that can you comment a

48:31
little bit about the Texas Tech program

48:33
because I don't even think people

48:34
understand that that's even out there

48:36
and available but I think it's important

48:38
to know that even some of the

48:39
universities are starting to address

48:40
this from an accreditation standpoint

48:43
sure so I mean for lack of a better term

48:45
Texas Tech is like the Harvard of

48:47
personal financial planning like it is

48:49
the largest leic Texas Texas love Texas

48:53
now so lots of lots of lots of schools

48:56
have

48:57
more and more schools offer

48:58
undergraduate degrees in personal

49:00
financial planning right it is it is the

49:02
largest without a doubt school that

49:03
offers Advanced curriculum so Masters

49:06
and especially PhD you know they've been

49:08
going now for for 25 plus years and they

49:10
I mean you know I would guess that

49:12
almost everyone that's leading a program

49:13
in the country now came out of Texas

49:15
Tech and so you know there's a group of

49:17
folks you know mentioned um you know

49:18
Harold and Dean and others that kind of

49:20
you know created this program and you

49:22
know when I was after I finished my NBA

49:24
you know I was doing research and I

49:25
wanted to I I wanted to get a more you

49:27
know background in you know what people

49:30
do that you reachers they get a PhD and

49:31
that was just a great opportunity so um

49:33
I'm a big fan of Texas Tech uh LC is an

49:36
interesting City but uh yeah it is it's

49:38
a phenomenal program um and individuals

49:40
that are listening that you know want to

49:42
pursue this as a career I would I would

49:44
you know definitely recommend not only

49:45
Texas Tech but only any school that

49:47
offers a personal final planning degree

49:49
want to learn more about this um

49:50
especially in college interesting David

49:53
I hope to have you on again as the time

49:55
has flown any last and final words for

49:57
the I always do this with my my

49:59
celebrity guests any last words for the

50:01
listeners and viewers before we close

50:02
this thing up I I think we're good I

50:05
think you covered it you really did now

50:07
who who have we been listening to smart

50:09
guy in the room David Blanchett he's uh

50:11
I'll have all his stuff on my site he'll

50:13
have his own page you can replay the um

50:16
you know the podcast on all major

50:18
platforms and on the YouTube channel if

50:19
you want to see how young he actually is

50:22
but I appreciate you joining us and I

50:23
will see you next week on fun with

50:26
annuities

50:32
[Music]