Paul Merriman: Supercharge Your Retirement and Shut Out the Noise

0:04
welcome to

0:05
fun with annuities with your host me

0:07
stan

0:08
the annuity man america's annuity agent

0:11
can annuities be fun

0:12
can contractual guarantees be fun

0:14
absolutely they can find out the brutal

0:17
facts about annuities

0:19
with no sales pitches or high pressure

0:21
nonsense

0:22
just the brutal and factual annuity

0:25
truth which is all you need to hear

0:27
let's have some fun with annuities and

0:29
let's have that fun

0:30
start right now

0:33
[Music]

0:39
welcome to fun with annuities the number

0:41
one annuity podcast

0:42
on the planet we're saying here is live

0:44
in the reality

0:46
not the dream so we only look at

0:47
contractual realities

0:49
i'm very excited today to have a great

0:52
friend and guest on

0:53
his name is paul merriman he's done so

0:55
much that i've literally got to read

0:58
just a portion of his bio and how he's

1:01
laughing

1:02
but um i'm just fortunate to to know him

1:05
we've been

1:06
you know we communicate back and forth

1:08
when it comes to annuities and things

1:09
like that but on this podcast we're

1:11
going to talk a

1:12
lot not not that much about annuities

1:14
we'll cover a little bit

1:15
but i want paul to tell you about what

1:17
he does etc now a little bit about him

1:19
and i'm going to read some look down a

1:20
little bit here so

1:21
my apologies and by the way welcome to

1:23
all the podcast

1:24
listeners that are listening in the car

1:26
in the treadmill wherever you are and

1:27
all the major platforms

1:28
but as you know we also have a fun with

1:30
annuities youtube channel

1:32
that we film this so if you want to

1:33
watch paul and i interact on the split

1:35
screen and you can see us and

1:37
and all our beauty and glamour you can

1:40
do that as well

1:41
and i do encourage you to do that in

1:43
addition i have a standing nude man

1:45
youtube video channel

1:46
as well if you want to you know see the

1:48
400 videos on prod on products and

1:50
things like that

1:51
now paul he currently is the president

1:54
of

1:54
the merriman wealth uh the merriman

1:57
financial education

1:58
foundation now and that is is what it

2:02
sounds like i mean he is

2:03
educating people and that's what i like

2:04
about him he's all about the facts just

2:06
like i am brutal facts the truth he

2:08
leads with the facts and the truth

2:10
there's no reason for sales pitches or

2:12
anything like that he wants you to be

2:13
informed so you can make a

2:14
good decision on your terms in your time

2:16
frame you know in 1983 he founded

2:19
merriman wealth management and he sold

2:21
that firm in 2012.

2:23
um from there he did not stop

2:26
following markets and and giving advice

2:29
from the standpoint of a 30 000 foot

2:30
view and also in the weeds helping

2:33
consumers understand markets understand

2:35
financial products and understand

2:37
retirement

2:38
from a very straightforward approach

2:41
he's written a ton of books and a ton of

2:43
articles

2:44
he has a brand new book out right now

2:48
and i'll i'll have him tell you about

2:50
that um

2:52
because it's it's a good one i was on a

2:54
plane recently i was flipping through it

2:55
and there's just so much in i was right

2:57
now i'm like that would take the whole

2:58
podcast so without further ado

3:00
i'd like to welcome paul merriman paul

3:03
thank you

3:04
so much for joining us on fun with

3:05
annuities hey stan it is absolutely

3:08
great

3:08
fun to be here with you this is a

3:11
pleasure

3:12
that's that's that's fantastic let's

3:14
start off with your book to start off

3:15
with the new book tell people the title

3:16
where they can get it and then give them

3:18
the brief overview of why you wrote it

3:20
and why you think it would help people

3:22
to read it

3:23
well the title it it says it all we're

3:26
talking millions

3:27
that's the title everybody it's the word

3:30
millions

3:31
and the subtitle is 12

3:34
simple ways to supercharge

3:37
your retirement and that it is

3:41
about basically for the first time

3:43
investor but i think a lot of folks that

3:46
that are interested in the process of

3:49
investing will enjoy it

3:51
but the bottom line is i want to get a

3:53
hold of first-time investors in their

3:55
20s in their 30s

3:58
make sure they make the decisions that

4:00
are in their best interest

4:02
only them not wall street not their

4:05
neighbor

4:05
but for them and so each one of these 12

4:09
ways or steps or choices or

4:13
decisions literally should add

4:16
an another another million dollars to

4:19
your bottom line

4:20
not only in retirement but what you

4:23
leave

4:24
for your children and your charities it

4:28
pretty much says it all i mean that is

4:30
you need to you need we're going to

4:31
circle back and go through some of the

4:33
steps later

4:34
but what i wanted to jump into right now

4:36
and and people watching uh

4:37
watching this and listening to this on

4:39
the on the podcast platforms

4:41
we're in the the biggest raging bull

4:43
market of all time and we have we have

4:45
products that are

4:46
entering the space that no one's ever

4:47
seen before which is cryptocurrencies

4:49
and things like that

4:50
we're at very interesting interest rate

4:53
environments some people call it low

4:55
some people call it high depending on

4:56
what view you're taking

4:58
but i would really like your and and

5:00
before we even go in this let's do a

5:01
disclaimer paul

5:02
this is not advice do not accept this as

5:04
advice this is paul and i having a

5:06
conversation

5:07
about marcus that i hope that you can

5:10
glean some very good information

5:11
from but if you ever want to talk to

5:13
either of us you know we're going to

5:14
have paul's

5:15
uh contact information on our website so

5:18
if you want to talk to him and sign up

5:19
for his stuff and read his stuff

5:21
i would encourage you to do that but

5:22
with that being laid out and people

5:24
understanding that this isn't advice

5:26
this is just your brain tell us about

5:28
current markets and what you're really

5:30
thinking right here

5:32
well it would be a little flip to say

5:35
i'm not

5:36
thinking but in at some level

5:41
to be a successful long-term investor

5:44
you have to shut out all the noise

5:48
and years ago i wrote a book entitled

5:51
101

5:52
investment decisions guaranteed to

5:54
change your financial

5:56
future and every one of those

5:59
forks in the road has something to do

6:02
with the

6:03
something that will be will change will

6:05
change your financial future

6:08
so many people are sitting on the

6:09
sidelines right now wanting to go into

6:11
the market

6:12
writing i get it every day and email how

6:14
do

6:15
i get into this market well

6:19
before you decide you want to get into

6:21
this market i

6:22
i would like to know if i were your

6:24
advisor and i'm not

6:26
what is your you're trying to achieve

6:28
what's this money for how much risk are

6:30
you willing to take what rate of return

6:31
do you need

6:33
tell me about your background have you

6:35
in the future

6:36
felt this way took the big dive and then

6:40
only found out that it was

6:41
bad timing and then i'll ask you well

6:44
are you a market timer oh no

6:46
no i'm not a market timer you'll say uh

6:49
but in fact you act like a market timer

6:52
and so i want you if you're going to be

6:54
a serious investor

6:56
for a lifetime i'm not interested in the

6:59
next week or month or year

7:01
i want you to figure out are you a

7:02
market timer

7:04
or are you a buy and holder and if you

7:07
can't deal with the information

7:11
but you that's that's around us like

7:13
stan says a lot of crazy stuff

7:16
going on right now really but there's

7:17
always a lot of crazy stuff going on

7:20
i've been

7:21
around this about 55 years and i don't

7:24
see anything different today than i saw

7:26
55 years ago i that that may not sound

7:30
like i have a good memory but it's the

7:33
same

7:33
noise do your dollar cost average in

7:37
do you lump somehow do you get right in

7:39
there right now

7:41
dive in with all your money for a lot of

7:44
people the answer is regardless

7:46
of what the information is dollar cost

7:49
average go in a little bit at a time

7:52
over a relatively short period of time

7:54
there's all these simple decisions that

7:56
really don't have to

7:58
do with the information it has to do

8:01
with

8:01
you and who you're going to be because

8:04
your success

8:05
is in the end going to be about you

8:09
i agree with that and i think

8:11
instinctually people

8:13
feel like they should be a market timer

8:15
like they should be able to time it

8:17
and as i tell people in the annuity side

8:18
as well you can't time that that's a

8:20
contract you don't time contracts

8:22
you don't time life expectancy um but in

8:26
the markets

8:26
uh in the in the world that we're in and

8:29
i've been in

8:30
a long time not as much many years as

8:32
you but i've been three decades

8:34
and i always tell people we see

8:35
movements in the stock market

8:38
in a day that we used to see in a year

8:40
okay but that still doesn't change the

8:42
way that you approach

8:44
you know choosing your investments and

8:45
your goals do you agree with that

8:48
you know i i i do and and

8:52
most people stand don't have a very good

8:54
sense of the past i

8:56
i like your opening where i don't

8:58
remember exactly what you said

9:01
but you talked about the contract about

9:03
the reality

9:05
yeah there is no reality in this process

9:08
because we can look to the past which

9:11
we do and and that's what we're about is

9:14
looking to the past and trying to

9:16
understand investing from the past

9:18
because we can't know the future

9:21
so all that stuff in the past you could

9:24
say well

9:25
what happened back in 1929 to 1938

9:28
what does that have to do with today it

9:31
has a lot to do with today

9:33
because the same thing happened only it

9:36
was worse

9:36
from 2000 through 2009 i mean literally

9:40
the returns were worse in that decade

9:43
than that earlier 10-year period

9:46
and so the the the problem is there's

9:49
always the good news

9:51
there's always a bad news i could make

9:54
the list of why i think the market's

9:55
going up

9:56
i could make the list as to why i think

9:58
the market's going down

10:00
and the minute you start picking one of

10:02
those lists to make your decisions

10:04
i think you're right stan that is a

10:06
market timing decision

10:08
right it is now in the world that we're

10:11
in now which is

10:12
i call it blue water blue water means we

10:14
haven't seen it before

10:16
you know we're sailing the ship and the

10:17
blue waters ahead of us we haven't seen

10:18
it we haven't seen

10:19
the trillions of dollars of money that's

10:21
being printed we haven't seen the global

10:23
nature of everything being somewhat

10:25
interconnected between all markets

10:27
we haven't seen a lot of that we

10:29
certainly haven't seen covid

10:31
in our lifetimes or anything like that

10:33
that type of an event

10:36
what do you tell people right now during

10:38
this and i know you've laid the good

10:40
foundation of you can't time it but what

10:41
are you telling people as they're

10:43
as they're fearful of markets at their

10:45
all-time high

10:46
the printing of money and giving it away

10:49
in the in the spiraling debt

10:51
how do you address that well it's it

10:54
it doesn't seem right to say that that's

10:56
all noise

10:58
but you talked a few minutes ago about

11:01
this wonderful amazing market that we've

11:04
been in

11:05
well 75 to 99.

11:09
the compound rate of return of the s p

11:12
500 was 17.2 percent

11:15
you're right and and on top of that from

11:17
1995 to 1999

11:20
the s p this is why people started to

11:23
believe in

11:24
indexing and by the way back then

11:26
indexing was the s p

11:28
500 in people's minds right it

11:30
compounded over 28

11:33
a year and at the end of that five-year

11:36
period

11:37
people surveyed believed that for the

11:39
next

11:40
decade that the market was likely

11:43
to compound at 20 to 30 percent

11:46
a year so

11:49
the biggest enemy and that i think every

11:51
professional believes this the biggest

11:53
enemy that we have is

11:55
what we believe and how we respond to

11:58
the biases we have we think that

12:00
what's happened recently has way more

12:03
importance than what happened before

12:06
and you bring up cryptocurrency that is

12:09
not part of

12:10
my life because it's not the kind of

12:12
thing that sits inside

12:14
of a of an index fund but i can tell you

12:17
this

12:18
i was on top of gamestop i was in

12:20
gamestop at

12:22
under 10 with both feet you want to know

12:25
where i got out i got out at

12:27
over 300. okay nice

12:30
now let me tell you what happened what

12:33
happened was

12:34
i owned an index fund a small cap index

12:38
fund

12:39
which i happen to believe should be part

12:41
of a long-term portfolio

12:44
it purchased gamestop it had no idea

12:47
what it was getting

12:48
into but they also had disciplines

12:52
about what to do how to sell something

12:55
and they sold it at a huge huge profit

12:58
for their

12:59
for their shareholders had nothing to do

13:03
with the story the short sellers the the

13:06
retail investors clamoring to get in and

13:08
make some fast money

13:10
every time i think about making fast

13:13
money i

13:13
also think remember list a and list b

13:16
there's the good news

13:17
but the bad news is losing fast money

13:21
and i know somebody so near and dear to

13:24
my heart of

13:25
all things she called me and said dad

13:28
i've made oh i'm giving her away crying

13:31
out loud

13:32
i'm i just made my first investment now

13:36
she has investments but they're all

13:38
index funds

13:39
oh now she's going to learn how to do it

13:41
on her own

13:43
son of a gun it turns out that she was

13:45
in

13:46
gamestop at 300 but she was buying

13:50
and then she had the audacity after all

13:53
that i've taught her

13:54
to say well it's only a thousand dollars

13:57
dad okay

13:58
that's the point at which i want to know

14:00
what will that thousand dollars be worth

14:02
when you're 65 or 70

14:04
and you want to do something special

14:06
that that thousand dollars might have

14:08
paid for

14:08
right you know it's the thought process

14:12
the emotions that are involved in this

14:14
in this and wall street just there we're

14:17
like in the puppets they're up there

14:19
moving the strings making us

14:20
jump we got to get out of the way

14:24
of the puppeteer we have got to do

14:27
what's in our best interest and you show

14:30
me

14:31
one piece of evidence that

14:34
taking great risk is likely to be in

14:38
your best interest

14:40
and you're going to say well look at

14:41
amazon look at google look at look at

14:44
any of these stocks that have or

14:46
gamestop look at that i mean that was

14:48
a crummy company that went wild but the

14:51
fact is

14:52
people win lotteries i'm happy when they

14:56
win lots of stories and those kinds of

14:59
things

14:59
generally tend to be random events

15:03
and the people who participate in them

15:05
think

15:06
what's wrong with the rest of the people

15:08
are they stupid

15:09
don't they see the reality well there is

15:13
no reality they are the stories you just

15:16
mentioned the things to be concerned

15:18
about

15:19
and saying that well this has never

15:21
happened before

15:22
that was true at every point of

15:25
investment history

15:27
it hadn't happened before and things are

15:30
going to happen going forward that we

15:32
can't predict or see um and you just

15:35
you know i think what you're saying and

15:37
i like this and i think our listeners

15:39
and and viewers need to listen closely

15:42
stay the course stay in your lane you

15:44
know always tell people i want you to be

15:46
a 10-year overnight sensation

15:48
i want people to think about that for a

15:50
second um it takes time

15:52
and investing as you're saying and your

15:54
approach for

15:55
50 plus years has been it takes time and

15:59
you have to do your research and your

16:00
work

16:01
investing is hard work would you say

16:03
that's true no

16:05
no no i wouldn't wow explain that

16:09
i think investing is dirt simple

16:12
all right explain that that's fantastic

16:14
well okay i got an idea read the book

16:17
no i understand i flipped through it no

16:19
you're right but i flipped through it no

16:21
let me let me tell you why i say it's

16:22
easy

16:24
there are a series of decisions that you

16:26
must make

16:28
and i i gave people 101. it's a free

16:31
book it's on my website

16:33
and and and many of those had little

16:36
impact on a portfolio it might mean

16:39
you'd make an extra thousand

16:40
well would you bend over and pick up a

16:42
thousand dollars off the ground

16:44
if it was lying there yes you probably

16:46
would yeah

16:47
so if you look at each fork in the road

16:52
and you do it in an objective

16:54
probabilistic

16:55
basis rather than an emotional hoping

16:59
for the best want to get rich soon

17:01
right there is the save versus spend

17:04
decision

17:05
and we all know we all know what the

17:07
outcome of that is if we don't save

17:09
we're going nowhere in terms of our

17:11
long-term investments

17:13
and a lot of people something like 25 in

17:15
a survey said the only way they're going

17:17
to be financially

17:19
independent is to win a lottery and

17:22
unfortunately that actually is true of

17:24
way too many people

17:26
it is true but we understand it's easy

17:29
gotta save how much we can debate but

17:31
got to save

17:33
and then you got to make the decision

17:34
okay what are you going to save your

17:36
money in

17:36
and some more forks in the road pop up

17:39
like

17:39
stocks versus bonds well that

17:42
just that one decision stan now i'm not

17:46
kidding when i say this and i do my best

17:48
to prove this at least in terms of

17:52
compounding over time i mean i i assume

17:54
you live to be old in order to do this

17:57
but it's a 10 million dollar decision

18:01
for a relatively small investor

18:04
stocks versus bonds wow and yet

18:08
those bonds are so unbelievably

18:11
important

18:12
to the people who think that investing

18:15
is nothing but a gamble it's

18:17
you might as well go to las vegas you'll

18:19
hear people say that one of the many

18:20
myths of the investment process

18:23
but the fact is yeah i believe in 100

18:26
stocks i believe there are some people

18:28
who could be a hundred percent in stocks

18:30
equities their entire life right till

18:32
the day

18:33
they die because about seven percent of

18:36
investors who are surveyed are

18:38
doing that so it's not like it's

18:41
completely illogical and i'm working on

18:43
an article

18:44
right now on that topic but

18:47
if you don't have the risk tolerance if

18:50
you're not willing to lose half your

18:52
money sixty percent of your money

18:54
you should not be all in a diversified

18:57
equity portfolio

18:59
right if you're not willing to lose 100

19:01
of your money you shouldn't be

19:02
in one company i i i'm from the

19:06
northwest part of the country where wamu

19:10
their line was the friend of the family

19:13
well they weren't a very good friend of

19:14
the family that owned their stock

19:16
because they went out of business

19:18
totally and i know

19:20
people who had virtually all of their

19:22
portfolio

19:23
in their 401k plan in that stock

19:27
but even a diversified portfolio is

19:29
going to lose 50 to 60 percent of the

19:32
time

19:33
warren buffett says that's what you got

19:35
to be willing to accept

19:36
right well if you're not if you're not

19:38
you've got to make the decision

19:40
how much do i need in fixed income in

19:43
the

19:44
in the break i mean there's the gas

19:45
that's the stocks there's the break

19:47
that's the

19:48
that's that's going to be the bonds and

19:50
a lot of people

19:52
cannot take the risk of having over half

19:54
of their money

19:56
in equities because they don't want to

19:58
lose half even the idea of losing 25

20:02
is pretty scary yes it makes their

20:05
stomach hurt would you consider yourself

20:07
a

20:08
if you could answer neither or some or

20:10
either

20:11
fundamental type investor when you look

20:14
at

20:15
a markets investing or do you look at

20:17
technical or do you look at both

20:20
tell me what you mean by fundamental

20:22
stan well

20:23
when i when i was first that's that's a

20:25
good question when i was um

20:26
was first trained at dean witter a long

20:28
long time ago in the world trade 2

20:29
center

20:30
in new york city you know fundamentals

20:33
were looking at the company looking at

20:34
the price to earnings ratio looking at

20:36
what they made looking at who was

20:38
running the company looking at the fun

20:40
the actual fundamentals where they're in

20:42
a lot of cases today

20:43
you have traders that don't even know

20:45
the companies they're trading you know

20:46
fundamentals was actually

20:48
understanding what the company did they

20:50
sold widgets

20:51
they were based in wisconsin et cetera

20:53
et cetera that was fundamental and then

20:55
the technical for just a 30 000 foot

20:57
view where the

20:58
the candlestick people and the people

21:00
today just watching screens and charts

21:01
and graphs

21:03
do you look at either or both or none or

21:06
what what's your approach

21:07
well stan in in what i preach

21:10
yeah which uh my mother always said i

21:13
probably would have made more money as a

21:15
preacher but um

21:18
but the bottom line is i

21:21
don't care a wit at all

21:24
a wit about any analysis of any company

21:28
my wife and i

21:30
we have almost 15 000 companies

21:34
in our portfolio when that gamestop

21:38
story came out and i found out my

21:40
daughter had purchased some

21:43
i had to find out do i own it that's

21:45
when i did the research

21:47
about a company i wanted to see if the

21:50
index by the way

21:51
you got in and if you were at

21:52
dimensional funds or you were at

21:54
vanguard you probably had it if you were

21:56
in

21:56
any index i don't have the ability to

22:01
analyze those things

22:02
and i have no reason to trust the people

22:05
that do and let me tell you why i feel

22:06
this way stan i was

22:08
a broker for about two and a half three

22:11
years back

22:12
in the 1960s and um

22:16
i've studied the output of

22:19
the analysts who work and are paid a lot

22:21
of money

22:22
right and in many cases these people are

22:24
really in a way

22:26
glorified sales people because the key

22:29
as you remember

22:30
is it isn't really the information about

22:33
that company

22:34
it's not the stake it's the sizzle what

22:37
can we say about that company that'll

22:39
get

22:40
people to want to buy that company and

22:41
oh by the way we're going to be

22:43
underwriting this

22:44
you know the company and we got to

22:46
create this story

22:47
along with the numbers they always make

22:50
it work

22:51
every stock has a reason to buy and

22:53
everyone has a reason to sell

22:55
if not there would not be a trade and so

22:58
my question is

23:00
do i trust wall street

23:04
do i trust main street our neighbor our

23:07
friend

23:09
do i trust university street the

23:12
academic community

23:13
and let me tell you about the

23:15
fundamentals they believe in because

23:17
that's why i wanted to make sure i was

23:19
going to answer the right question

23:22
do i trust fundamentals i would say i

23:25
trust the fundamental

23:27
90 plus year result of academic studies

23:32
that conclude there are asset classes

23:35
that make more than other

23:37
asset classes and you and i would have

23:40
no problem

23:41
understanding the idea that penny stocks

23:44
as a group

23:46
is not something that people are likely

23:48
to do well with

23:49
but there's a lot of evidence that the s

23:52
p

23:52
500 will in fact produce

23:56
a good return in fact i think john will

23:59
john bogle would say a good enough

24:02
return

24:03
because if you look at every 40-year

24:05
period since 1928

24:08
the worst 40-year period was a compound

24:11
rate of return of

24:12
8.9 turned out that was during a period

24:16
of time that inflation was relatively

24:18
low

24:19
so it was not a bad return the best was

24:23
a period

24:24
40 years that compounded at 12.5

24:28
so that's the best and the worst that's

24:30
a fairly narrow range

24:32
and by the way that 12.5 came during a

24:35
period of time

24:37
that inflation was relatively high so

24:40
it wasn't what you're thinking in terms

24:42
of how much money you'd have at the end

24:44
of that 40 because when you inflation

24:46
adjusted

24:47
you weren't that much different from

24:48
what you would have gotten if you've

24:50
gotten 8.9

24:51
something people totally overwhelmed i

24:53
can't say totally overlooked

24:55
but it's the biggest enemy we have other

24:57
than ourselves

24:58
inflation because it is a guaranteed

25:01
bear market as far as i'm concerned

25:04
whereas when the s p 500 goes down

25:07
30 or 40 or 50 percent yeah that's a

25:10
bear market

25:11
and it hurts but it has always come back

25:15
tell me how the people who 50 years ago

25:19
had a dollar that is now worth about 12

25:21
cents

25:22
tell me how they're gonna get that back

25:25
right

25:25
of course that tends to point to the

25:27
stock market

25:28
to have done that for them we don't know

25:31
if it'll happen next time

25:33
that's the that's the problem we have

25:35
versus the work that you do

25:38
where you're telling people i and i'm

25:41
guessing this but most people who

25:43
believe what you believe will say

25:46
i only deal with the industry

25:49
part of the industry insurance industry

25:51
where they guarantee

25:52
something that that's what i'm hiring

25:54
them to do

25:56
well we can't guarantee anything

25:59
we can't even guarantee that we can't

26:01
even come close to guaranteeing

26:03
that we think the market's going to do a

26:05
certain thing over the next year

26:07
what we should then follow that with is

26:10
but there's a very good chance that it

26:13
will go down

26:14
30 percent i challenged a guy recently i

26:18
called him on the phone he was

26:19
on a national uh interview

26:23
and somebody asked what he thought that

26:26
the

26:26
the crypto could the bitcoin would be

26:30
a year from now he said a hundred and

26:32
fifty thousand

26:34
thousand dollars i i had to call him

26:38
and and he comes out of the academic

26:42
community see

26:43
i mean that come out of a broker's mouth

26:45
i said well that makes sense

26:47
but out of an academic and i said what

26:50
are

26:50
how did you justify that comment because

26:52
people are going to listen to you

26:55
right and say oh and by the way

26:58
he mentioned that he put money in it he

27:02
recently bought it he said okay so i

27:04
wanted to know how much

27:06
turned out he bought a little tiny bit

27:10
so so the implication of 150 000 and i

27:14
just bought it

27:15
whoa you mean like you're selling it to

27:17
your mom yeah i'm putting my mom in it

27:19
you remember brokers used to use

27:21
those kind of lines they still they

27:23
still do but unfortunately

27:24
i'm sure they do i asked him about the

27:27
150

27:28
000 and he said they didn't

27:32
give me the time to give the rest of the

27:36
story

27:37
what i wanted to say was it will be

27:39
between a hundred and fifty thousand

27:42
and twenty five thousand correct to

27:44
which i wanted to say

27:46
how could you justify 25 000 but i

27:49
didn't have the guts

27:50
because i was already picking on him but

27:52
but the bottom line

27:54
is the stories that we hear

27:57
if we allow those stories to drive us

28:00
they're driving us more than likely in a

28:02
way and this is important because now

28:05
sex becomes part of this

28:07
this process now i know this is i got to

28:09
bring it out

28:10
trying to attract viewers i just want to

28:12
talk about sex

28:14
okay let's talk about and the more sex

28:16
food

28:17
and money are not intellectual decisions

28:22
they are emotional decisions and if you

28:26
will

28:26
just read one of my favorite books of

28:30
all times your money and your brain

28:33
by jason zweig and what you will

28:37
understand

28:38
is yes not only is your neighbor a

28:40
little crazy about their financial

28:42
decisions

28:43
but look at your own and when i say

28:46
crazy

28:47
you'll find they are not intellectual

28:50
decisions

28:51
what we're trying to do is bring people

28:53
down

28:54
don't do this based on your feelings if

28:56
you invest based on your feelings

28:59
then how are you going to sell well

29:01
guess what you're going to sell based on

29:03
your feelings

29:04
oh my god martha if we lose any more

29:07
money

29:08
we're not going to be able to retire we

29:10
got to get rid of that dog

29:12
right those are the which is why so many

29:15
people need an advisor

29:17
because they can't deal with all these

29:20
on their own

29:22
i have no idea what your question was

29:24
but no that was no that was fantastic

29:25
and

29:26
what i was going to interject i'm

29:27
listening to you you just can't hide

29:29
passion

29:30
i know people on the that are listening

29:32
and viewing this they're like man he is

29:33
passionate about

29:34
yes he is he is passionate which leads

29:36
me to a question i didn't have on my

29:37
list which is

29:39
who is your mentor like how did you get

29:42
into this and how did you

29:44
how did this become the passion because

29:46
no one wakes up in the morning and go

29:47
you know what i want to be either stand

29:49
the annuity man or i want to be

29:50
paul merriman and and look at markets go

29:53
back in time a little bit because i'd

29:55
like to know that story i'm sure our

29:56
listeners and viewers would as well

29:58
you know my my mentors and i must have a

30:01
thousand of them and i really

30:03
mean that my mother was

30:06
a mentor and he she mentored me

30:10
by teaching me and i really mean this be

30:13
nice to everybody you meet in your life

30:16
well and try it if you want to be a

30:18
success

30:20
just try to figure out how you can help

30:22
a person

30:23
and you will be a success

30:26
my stepfather who i absolutely hated

30:30
was a mentor okay he made me afraid to

30:33
even

30:33
come into the room he was in because

30:37
he was physically and he was verbally

30:40
and he was emotionally abusive

30:42
he really wished i didn't exist i was

30:44
screwing up things with my mother i'm

30:46
sure

30:48
but i learned from him i learned

30:52
how to survive with that guy by figuring

30:55
out

30:55
what's on his mind what can i do to make

31:00
him happy wow but then

31:04
i met people along the way who taught me

31:08
how to help people invest and i learned

31:11
some things for example

31:12
ed put his arm around my shoulder when i

31:15
went into the brokerage business and he

31:17
said paul

31:20
you got to understand this business this

31:22
business

31:23
is not about making money for people

31:27
i was 22 i thought wow

31:30
how can that be that's why i came into

31:32
the business

31:33
right he said no it's about creating

31:36
loyalty

31:37
it should be as difficult to fire us as

31:40
it would be to kick a child

31:42
out of a home and i learned

31:46
i mean that i cannot forget that

31:48
conversation

31:49
and that's one of the reasons i left the

31:51
business after less than three years

31:54
because it was not built to help

31:57
people in fact i was taught you've got

32:00
to make a lot of money during the bull

32:02
markets when things are up and they're

32:04
crazy you got to keep selling because

32:06
that's when people want to buy

32:09
so then i got out of the industry and i

32:12
met

32:13
other mentors along the way that changed

32:15
my life but at age 40

32:18
i cashed in what i had been doing and i

32:21
started my investment advisory firm it

32:23
was not

32:24
originally merriman wealth management by

32:26
the way stan

32:28
because my minimum size account was two

32:30
thousand dollars

32:31
i hear you that did not qualify i hear

32:34
it as well

32:35
but but i was just having a good time

32:37
because theoretically i was a member of

32:39
the

32:40
fire group i just didn't realize i was

32:43
an early retiree because i'm a

32:45
workaholic so

32:46
even when i'm playing i do it like a

32:49
workaholic

32:50
right but i learned from people what is

32:53
in fact

32:54
in their best interest and when i sold

32:56
my well

32:57
let me just do one more thing and this

32:59
is not a sales pitch

33:00
when i built my business and i know

33:03
other people who have built it the same

33:05
way

33:05
since i did this and they have been very

33:08
successful

33:10
i had classes it's like what you're

33:13
doing

33:14
i i can't believe the education that

33:16
you're giving people

33:18
on your website yeah and i direct

33:21
people to you all the time i said go

33:23
look

33:24
at the youtube pieces go he'll send you

33:27
a free library of books on annuities

33:31
that's true

33:31
and i have never had one of those people

33:34
come back to me and say a salesman

33:36
called

33:37
never and this is what this is what i

33:40
did

33:41
and so i would teach three and six hour

33:43
classes

33:44
and show people how to do it all on

33:47
their

33:47
own wow and then guess what

33:51
some people won't and so they knew what

33:55
i believed

33:56
and a lot of them hired us to do it for

33:58
them

33:59
so when i retired and this is partly my

34:02
wife's doing actually

34:04
because i was looking what am i going to

34:06
do next

34:07
and uh within weeks i was writing the

34:09
column for market watch

34:11
within months i was underwriting a

34:13
course at western washington university

34:16
up in bellingham washington where i

34:18
graduated

34:19
and then because of a mentor a guy named

34:23
tom [ __ ]

34:24
tom helped me learn how to do podcasts

34:28
and he actually helped us have a radio

34:30
show

34:32
locally in seattle when we had our firm

34:34
a great an

34:35
amazing mentor and a very dear friend in

34:39
fact

34:39
most of my mentors with the exception of

34:42
my stepfather

34:43
have become really good friends over my

34:47
life

34:48
so i built the business based on helping

34:51
others and when you're if you're a brain

34:54
surgeon you don't have to be that way i

34:56
mean you

34:57
you just do your work right uh but i

35:00
suspect

35:00
i suspect they're trying to do their

35:02
best work too helping others

35:04
but you know something when you're in

35:06
the world of sales

35:08
there's a fork in the road you can help

35:11
others in a fair way

35:13
and do okay uh and i'm going to tell you

35:16
one of my mentors in just one second

35:18
about that

35:20
or you can do it in a way that you rape

35:21
and pillage

35:23
and you end up with all the goodies i

35:26
spent 90 minutes

35:28
with john bogle back in 19 2017

35:33
and one of the things that came out of

35:35
that conversation

35:37
his absolute commitment to the small

35:40
investor the reason he didn't want to do

35:44
some of the things that i believe

35:46
that he should do in terms of educating

35:50
his investors is he was afraid they

35:53
wouldn't do it

35:54
and that if they didn't do it it would

35:56
hurt them rather than help them

35:58
and uh and he also uh and he

36:02
literally wiggled his finger at me you

36:04
know kind of one of these

36:06
he said you're making things too complex

36:08
if you want to help people you've got to

36:10
simplify it

36:12
and we've done that we have developed

36:14
portfolios that used to take 13

36:17
funds and now it takes four funds or

36:20
even

36:21
better yet two funds and

36:24
one of my mentors works with me chris

36:26
patterson

36:28
uh he's our director of research

36:31
he's been an amazing mentor to me so

36:35
uh you never know and that started by

36:37
the way with a little email he sent to

36:40
me asking if i could use some help

36:42
little did he know he was going to end

36:44
up helping me be

36:46
a lot better at what i think we're doing

36:48
so there you go so when the merriam and

36:50
people we're going to give the you go

36:52
ahead and give the site to the people

36:53
we're going to put it on on my website

36:55
as well what's the website they can go

36:56
to to look at what you do

36:59
paulmerman.com and the merriman

37:01
financial education foundation

37:03
and the and paul merriman.com when

37:05
people go there

37:07
what what type of services do you offer

37:09
what can they look for

37:11
well the commitment in our mission is to

37:14
helping people

37:15
at all stages of life

37:18
and i consider birth

37:21
to 21 as one of those stages okay

37:25
so you're going to find articles

37:28
podcasts books

37:32
uh and and and

37:35
by the way recommendations to other

37:38
people i think you can trust

37:40
in these arenas sure uh trying to help

37:43
people do the right thing and i'm not

37:45
talking just about

37:47
here's what a mutual fund is

37:50
i'm talking about not only suggesting

37:53
that you probably based on this table

37:56
because i got we have over 160 tables

37:59
that we have that investors can use i'm

38:02
i'm trying to help the do-it-yourselfer

38:04
got it and you're not really i mean

38:07
you're trying

38:09
to be the intermediary between somebody

38:11
who normally has no idea what they need

38:14
and then you're going to put them

38:15
together with a product that's right for

38:17
their needs

38:18
i'm trying to leave a message in the

38:20
mind of these people

38:22
that when i am 77 stan i haven't got

38:26
long and when i die i'm expecting

38:30
because i'm covering all stages we have

38:32
laid the grain

38:33
the groundwork it's basic it'll change

38:36
which is why

38:38
i'm leaving money to support the

38:40
foundation after i

38:41
die i wanted to go on and keep doing

38:44
this work but the bottom line

38:46
is to educate educate educate

38:49
and then to motivate to action which

38:52
means

38:53
we actually have to be able to give

38:57
them the actual mutual funds are etfs to

39:01
invest so we have

39:02
portfolios at vanguard at fidelity at

39:06
schwab

39:07
nice we have the best in class chris

39:10
patterson's put this together

39:12
the best in class recommendations with

39:14
etfs people love etfs

39:16
what etfs he's done the homework

39:20
by the way totally totally volunteer

39:23
does not get paid one penny for the

39:26
hundreds of

39:27
hours that he puts in every year that's

39:30
fantastic

39:31
and you know we're trying to do

39:32
something similar you know i do think

39:34
the annuity industry is eventually going

39:35
to go to a direct consumer platform we

39:37
are as close as you can get because you

39:39
can go to our site and

39:40
run quotes on your own and no one's

39:41
going to call you and we treat you like

39:43
i love that

39:44
you can get rates and all that stuff um

39:46
but what i'd like to do in the kind of

39:47
the final segment of this podcast which

39:49
has been fantastic and by the way for

39:50
the people that are watching this on the

39:52
uh

39:52
on the fun with annuities youtube

39:54
channel you can see that the

39:56
sunshine in the state of washington oh

39:58
my god this is or

39:59
this yeah this is no it's oregon now

40:01
you're an organ that's right um

40:02
earhart oregon and there's a special sun

40:05
comes to

40:05
gear right so somebody get up and pull

40:08
the shade down

40:09
but if you're focused and stand it no i

40:11
think that's no i think i think we take

40:13
the sun no we take this and i just want

40:14
to let

40:15
my viewers know that that's not some

40:16
weird lighting thing we're doing with

40:18
paul it's just that i have just become

40:19
abandoned i can see it right now

40:21
that's the pure that's the pure uh

40:23
sunshine let's go through a couple of

40:26
of the items and the topics in your new

40:28
book

40:29
um maybe choose one or two that you

40:31
think they're all important but maybe

40:33
choose one or two

40:34
and let's talk about those so i'll i'll

40:36
let you choose which one or two that you

40:38
want to talk about

40:39
thank you thank you that is a blessing

40:43
at the the book is kind of two parts the

40:46
first part is about

40:47
the 12 major major huge decisions

40:52
the last half of the book is about what

40:55
is

40:56
the best general investment product that

41:00
has

41:00
ever been invented it's not the mutual

41:03
fund

41:04
it's it it isn't uh

41:07
it isn't even index funds it's the

41:10
target day fund

41:12
because the target date fund what does

41:14
it do that's so special

41:17
it allows a person who absolutely has

41:20
no interest in doing anything about

41:23
their investments

41:25
but is scared to death of going to wall

41:27
street

41:28
scared to death they're going in the

41:29
stock market on their own

41:32
but they want the money in the hands of

41:34
somebody that's truly going to act

41:35
in their best interest and boy a target

41:39
date

41:40
at a fund at vanguard you can then there

41:43
are others by the way

41:44
that are very good as well but you can

41:46
put your money

41:47
in the target 2065 because that's when

41:50
you think you're going to retire

41:52
all right they're going to do everything

41:55
an old-fashioned pension fund manager

41:57
would do

41:58
they would be changing your portfolio

42:00
from mostly equities

42:02
to mostly bonds as you age and you reach

42:05
retirement

42:06
they know that you're young and you're

42:09
in these

42:10
great working years where you're worth a

42:13
lot to

42:13
others because you're a worker bee and

42:16
they also know that late

42:18
in your life you're not worth so much to

42:20
others

42:21
and you've got to be able to take care

42:22
of them and make the payroll for

42:24
yourself

42:26
so you literally with one investment and

42:30
one decision

42:31
out of all of them could latch on to a

42:35
strategy and the management

42:36
at a very very very low expense

42:40
expenses are important to your bottom

42:42
line

42:43
and be there until you're 91

42:46
but that's not the end of that part of

42:48
the of the book

42:50
then we show you this is the second

42:53
thing that i i think is really important

42:56
and that is not

42:57
equities i mean that's huge i already

42:59
mentioned that

43:00
but what equities well the target date

43:03
fund has

43:04
almost all the equities that you

43:06
probably need

43:08
except for one combination

43:12
small companies and value companies

43:15
and so we do our best to give you an

43:17
education how if you

43:18
just put in 10 instead of putting all

43:22
your money in that target date fund

43:24
inside your 401k if you have a small

43:26
cap value fund access in that 401k

43:31
great put 10 percent there 90

43:34
in the uh in the target date fund just

43:36
do that every month

43:38
for the rest of your life until you

43:39
retire

43:41
at that point you might want to take out

43:43
the small cap value because it could be

43:45
a very

43:46
very big part of your portfolio

43:49
and so we give you the evidence

43:53
and what would that lead to what do we

43:54
know from the past

43:56
it looks like it would add about 30

43:59
percent

44:00
on average to what you would have

44:01
otherwise had

44:03
when you retire well you may not think

44:05
that's a big deal

44:06
but if instead of a million have a

44:08
million three and you haven't taken

44:10
outrageous risk to get it

44:12
particularly when you start what does

44:15
that mean well if you're living on

44:18
four percent a year instead of forty

44:21
thousand dollars

44:22
sounds to me like you're making fifty

44:24
two thousand dollars

44:26
is that a life changer well it is if

44:29
what happens is

44:30
it keeps going up over time both of them

44:33
going up

44:34
but the one that's got the better rate

44:36
of return is likely to give you more

44:39
income in retirement and leave more to

44:41
your kids

44:43
literally for every half a percent and

44:45
this is an important

44:47
fact in the book if you just do the

44:51
computation

44:52
every half a percent more that you

44:55
make on your investments ads

44:59
between a million and a million and a

45:01
half dollars

45:02
over your lifetime even if you're only

45:05
putting away

45:06
five thousand dollars a year over 40

45:09
years well most of you are going to put

45:11
away a lot more than that

45:13
sure interesting where do people buy

45:16
this book

45:17
where they get it well they can get it

45:20
at amazon

45:21
and if they want to know how others feel

45:24
i hope you will take the time

45:26
to read what others say about it and a

45:28
lot of those people are college kids and

45:30
young

45:31
young adults and that's that this book

45:33
is really built for the 20s and the 30s

45:36
maybe even the 40s

45:39
the title is a killer i love it what's

45:41
the title

45:43
uh we're talking millions we're talking

45:46
12

45:46
simple ways to supercharge

45:50
your retirement and

45:53
give me number one let's do number one

45:55
and number 12.

45:56
what's number one well number one is the

45:59
save got to save

46:01
uh and and and saving is difficult for

46:04
people

46:05
but warren buffett i think he's got a

46:06
great answer

46:08
don't say what's left over after

46:10
spending spend what's left over after

46:13
saving every

46:14
study concludes that people who just

46:17
simply say

46:18
take it get it out of my life this is

46:20
like a 401k

46:22
where it's automatically taken you never

46:24
see it that's the way a pension fund was

46:27
built money that just was

46:28
automatically take taken out of your

46:31
income

46:32
they could have given that money to you

46:33
didn't have a choice they just did it

46:35
because they wanted to be parental and

46:38
take care of you make sure you had money

46:40
because most people we know this most

46:43
people will not put the money aside

46:46
well probably because they think they

46:47
can't afford it

46:49
but it only takes pennies one dollar

46:52
a day stan one dollar a day for a

46:54
newborn child

46:56
through 65 millions

47:00
millions can be as much as 4 million if

47:04
you happen to put that money

47:05
historically in small cap value

47:07
one dollar a day all right we're not

47:10
going to give away all of this because

47:12
we want people to go and get the book

47:13
because it's worth it

47:15
every single penny what's number 12

47:17
target date fund

47:19
target date fund yeah the other the

47:22
other ones in the middle

47:23
you're going to have to get the book but

47:25
what i do encourage everyone to do

47:27
is go to paul's site and again we're

47:29
going to have that on our

47:30
on our website this is not this is not

47:33
paul's last appearance on

47:35
the annuity man podcast fun with

47:37
annuities because

47:38
as you as you notice we really didn't

47:40
talk about annuities now you know

47:42
the way that paul and i probably agree

47:44
upon annuities is

47:46
is as part of the income floor that

47:48
guaranteed income that you want to hit

47:49
your bank account every single month

47:52
you know it it does make you a better

47:53
investor in my opinion if you have that

47:55
already

47:56
you know at least a portion of it in

47:58
place because everyone already owns the

47:59
best

48:00
inflation annuity on the planet and

48:01
that's called social security so people

48:03
can't

48:04
hate all annuities and then say yeah

48:06
where's my social security payment but

48:08
um this has been fantastic and i think i

48:10
add something

48:11
yeah if you got time i mean yeah

48:13
absolutely if it's going to

48:15
stop no wait no we've got we've got

48:16
something let me tell you why

48:18
i refer people to you and i

48:21
and i tell them where else they can go

48:23
check on stuff on the internet

48:25
but i have not found anybody yet who

48:27
educates people the way that you do but

48:29
here

48:29
is where you come up so often

48:33
i find a lot of people

48:36
do not have the desire

48:39
or really the wherewithal to take any

48:42
risk

48:42
with their portfolio they should not

48:44
take any risk

48:47
and i also know in all of those

48:50
workshops that i did

48:52
back back in the 80s and the 90s

48:55
i would ask how many of you have a

48:57
pension

48:58
and a whole bunch of arms would go up

49:02
and they did it with gusto i mean they

49:04
were happy to say

49:06
i have a pension and and then i would

49:10
ask

49:11
for how many of you is that pension

49:14
the greatest financial luxury in your

49:17
life

49:18
almost every handstand meant

49:21
up because they could guarantee that

49:24
monthly

49:25
income and then when i'm talking

49:28
and they never questioned that the

49:29
pension was a good thing to do now some

49:31
of them thought all right

49:32
i could just get my hands on that money

49:34
i could double it every year

49:35
in the stock market but for most people

49:38
just to take the pension was the right

49:40
thing to do

49:42
today we don't have those pensions but

49:44
uh when i am talking with somebody and i

49:46
don't give investment advice

49:47
individually

49:48
so i don't want to sound like i'm

49:49
holding myself out to people but right

49:52
when i'm talking to somebody let's say a

49:53
friend and they tell me

49:56
that that they don't really have enough

49:59
to make it

50:00
i say have you considered an annuity

50:05
a single premium immediate annuity and

50:08
they say we

50:08
that's an insurance product right oh no

50:11
i don't want any insurance products

50:13
in my portfolio the fact is

50:17
a pension is an insurance product

50:20
correct and that

50:21
so here's the thing that is so wonderful

50:24
is that you can buy the pension you

50:27
don't have to depend if you did

50:29
saved all your own money in a 401k

50:32
and then you wanted to guarantee a

50:34
stream of the same thing

50:36
a pension would give you that's what you

50:39
can do

50:40
you can buy it the problem is

50:43
and where i'm i'm so leery

50:46
is where they buy it because i

50:50
i mean you mentored me on this stan i

50:52
mean i want to give you credit as a

50:54
mentor

50:55
you showed me the range of payouts

50:59
that people would get from a whole bunch

51:01
of well-known companies

51:04
sure some are not so well known because

51:06
they're sure they're not

51:07
generally on tv to see but

51:10
what their payouts would be and in one

51:13
case and i'm not saying that this is

51:15
what they're paying today but it was

51:16
what they were paying

51:17
then sure there was about

51:21
two 300 difference a month a month

51:24
between new york life paying less than

51:27
one that

51:28
that was the same quality company

51:31
and you had to explain to me i had no

51:34
idea

51:34
i was asking you is that a rip-off of

51:37
some sort

51:37
and then you explain to me how these

51:40
insurance companies work

51:42
and why there are these big differences

51:44
in their commodity products and that's

51:45
the reason that

51:46
we're very proud of the platform we put

51:47
together which is a non-bias toward any

51:50
carrier we represent them all you quote

51:51
all these companies for the highest

51:52
contractual guarantee

51:54
um and in quotes change like a gallon of

51:56
milk every seven to ten days so you

51:58
can't fall in love with the name you got

51:59
to fall in love with the number but

52:00
um but i really appreciate that and you

52:02
know i've learned a ton on this

52:04
this podcast i do recommend people going

52:07
to paul's site paul will be back with us

52:10
but it has been an absolute pleasure i

52:12
appreciate you getting up early in the

52:13
beautiful oregon sunlight

52:15
oh yeah joining us um but that i think

52:18
we've

52:19
maxed out the time i mean i uh he you

52:21
know i told you i've got to make one

52:22
more offer stan

52:23
i'm sorry i oh please one more

52:27
if somebody cannot afford my book

52:31
i want them to email paul paulmerman.com

52:36
and i will send them a free pdf

52:41
and i'll also do that for a student

52:44
or i'll do that for a teacher there you

52:46
go

52:47
actually i'd like to do it for every

52:48
person on earth but that's not going to

52:50
work

52:52
yeah b be honorable with paul's offer

52:54
but he is uh he is he's just a gracious

52:56
man in a general

52:57
and generally just uh you know he's just

52:59
such a a good person

53:01
and in the financial services world

53:03
that's tough to say a lot of times

53:05
because you know we've been in it a long

53:06
time

53:07
but there are some good people that's

53:09
the reason he's on this podcast i want

53:10
you to if you didn't know about them all

53:12
most of you probably heard of paul but

53:14
if you haven't heard of paul

53:16
please go to his site please you know

53:18
look at his information

53:19
and follow his his it's not investment

53:23
advice but his

53:23
overall views of how markets work and

53:26
you know his staff doing the research it

53:28
is worth

53:29
it's worth you going to a site but with

53:31
that i think we got to close it out i

53:32
really

53:33
appreciate you being with us paul and i

53:34
appreciate all you listeners and viewers

53:36
and i'll see you next week on

53:38
fun with annuities

53:46
thanks for listening to fun with

53:47
annuities please hit the subscribe

53:49
button and make sure to go to my site

53:52
at the annuityman.com where you can run

53:54
your own

53:55
spea dia and culat quotes and see a live

53:58
feed of the best

53:59
mica fix rates in the country and even

54:02
get

54:02
indexed and income rider quotes as well

54:05
you can also

54:06
sign up for my six annuity owner's

54:08
manual books and i'll ship them for

54:10
free and under no obligation i also

54:13
encourage you to schedule a one-on-one

54:15
call with me

54:16
stan the annuity man so we can have a

54:18
full discussion

54:19
of your specific situation it will be

54:22
the best

54:22
brutally factual and truthful advice you

54:25
will ever get and that's one guarantee

54:28
you should definitely take advantage of

54:30
so join me next time for the number one

54:32
annuity podcast on the planet fun

54:35
with annuities

54:39
[Music]