Episode 85
Markets, Retirement Tax Strategies and Plan First Wealth Updates: Our Latest Take
A big milestone for Plan First Wealth, a market that refuses to stay down, and a topic we get asked about every single week.
In this episode of From the Trenches, Richard Taylor and James Boyle share a major announcement for the business, along with a few updates behind the scenes as the firm continues to grow. They then turn to markets.
Despite constant headlines and uncertainty, equities have shown serious resilience. What is driving that, and what should long term investors focus on?
Roths are back on the agenda too. It is one of the most talked about strategies for a reason, but there is a specific window and a few details that many people miss.
There is also a broader conversation around expats and cross border planning, including a noticeable shift in where people want to live and why.
To close things out, Richard and James introduce a new segment, sharing some of the most interesting things they have been reading, watching, and listening to lately. As always, this is a behind-the-scenes look at building a cross-border financial planning firm while helping expats make smarter decisions with their money.
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Expat Wealth is supported by Plan First Wealth. Plan First Wealth is a Registered Investment Advisor serving fellow expatriates and immigrants living across the US on matters such as retirement planning, investment management, tax planning and non-US asset management.
Expat Wealth is affiliated with Plan First Wealth LLC, an SEC registered investment advisor. The views and opinions expressed in this program are those of the speakers and do not necessarily reflect the views or positions of Plan First Wealth.
Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Plan First Wealth does not provide any tax and/or legal advice and strongly recommends that listeners seek their own advice in these areas.
ABOUT RICHARD:
Richard Taylor is a British expat, dual citizen (UK & US). Originally from Bolton, he now lives in Greenwich, CT, where Plan First Wealth has its head office.
As the firm’s leader, Richard launched Taylor & Taylor, now Plan First Wealth, and continues to fuel the firm’s growth. Richard is a Chartered Financial Planner (UK – CII) in addition to holding the IMC (CFA UK) and Series 65 (US – FINRA).
Connect with Richard on LinkedIn
TRANSCRIPT:
James Boyle:
[00:00:00 – 00:00:26]
And you remember the conversations we were having last April, right? There’s, you know, you hear us say this all the time, too. There’s always reasons to be pessimistic and valid reasons, right? We’re not saying those are unfounded, but the reality is to reap the benefits, as we’ve seen, as our clients see, as the markets have seen, you have to stick with it. You have to hold out that optimism, that hope, and it’s unbelievable in the rewards.
Richard Taylor:
[00:00:26 – 00:00:49]
Do not leave this country without taking some very good tax advice and structuring yourself accordingly, because you can save yourself tens, hundreds of thousands and God knows how much agony and heartache. The long arm of the US Tax system is terrifying. It’s brutal, it’s horrible. I hate it. But it is what it is. Don’t move abroad without tax advice. So that’s for anyone who that might be relevant for.
James Boyle:
[00:00:49 – 00:01:15]
Check it out if I can be so bold to pick some common threads from them. And these are things that we hammer on about. So it’s validating, right? Because we hear the same advice from all these professionals in all different walks of life and different specialties. Don’t put this off, right? This, these topics, these problems, these issues that crop up are enormously complex. The more time you have on your side, the better off you’ll be. That is across the board.
Richard Taylor:
[00:01:17 – 00:02:29]
Welcome to Expat Wealth, a Plan first wealth podcast dedicated to helping ambitious expatriates in America and Americans overseas thrive. I’m your host Richard Taylor and Plan first wealth is the business I founded and run today and we work with a successful expatriates, immigrants and internationally minded Americans to make the most of their opportunity and avoid the expat landmines. First, a quick disclaimer. While Plan First Wealth LLC is an SEC registered investment advisor, the views and opinions expressed in this program are those of the speakers and do not necessarily reflect the views and positions of Plan First Wealth. Information presented is for educational purposes only. Now, if you aren’t already receiving our emails, please go to our website, www.planfirstwealth.com and sign up there. It’s free and you’ll be notified every time we drop a new episode and so much more. Okay, let’s get back to this week’s show. Welcome to another from the trenches. This is the show from Expat wealth where myself and my colleague James Boyle bring you behind the scenes of Plan first wealth as we build this business, work with our clients and navigate life in general. Which is. I’m getting close to end of the school year here, James getting harder and harder.
James Boyle:
[00:02:30 – 00:02:33]
Is this the final push before summer?
Richard Taylor:
[00:02:33 – 00:02:50]
I think I’m just getting older as well. Everything stays the same. It’s just I’m getting older and therefore it’s getting harder. No, this is. We’ve got eight weeks left and then school breaks up and it’s like a vacation for us as well. It’s great. No commute in the morning, kids get picked up for camp. Dad gets to play a bit of golf. Great fun.
James Boyle:
[00:02:51 – 00:03:00]
Do the kids get this rush of energy these last few weeks? Because I can remember as the summer holidays were coming up, it was. It was exciting times.
Richard Taylor:
[00:03:00 – 00:03:35]
I don’t know if they had rush of energy, mate. My kids get rush of energy first thing in the morning and last thing at night and it’s just. And just terrorizes as we’re trying to get them out of the house and. And later on into bed. Right. So I say, well, actually we just what we’re going to cover today. So I actually give people a preview. We don’t normally do this. We just normally plow straight into it. So we’re going to start with a couple of company announcements, then we’re going to just reflect on the news with a. With a look towards markets and stuff as it pertains to us and our clients over the last month since we last chatted. We will then do a little technical corner. We’re going to look at Roths again because everyone wants to talk about Roths all the time.
James Boyle:
[00:03:36 – 00:03:37]
All the time.
Richard Taylor:
[00:03:38 – 00:04:05]
We’ll review the last couple of podcast episodes I’ve done and then we’re going to add a new feature. Since we last met, James and I have traded articles, we’ve been reading and we’re going to just talk about some interesting stuff that we’ve read in the last month and maybe reflect on that and see. And see if that throws up anything interesting. So company announcements. I am very excited and pleased to announce that James is now a partner in Plan First Wealth.
James Boyle:
[00:04:06 – 00:04:11]
Very, very excited as well on. On this side. It was. It was a special moment, I think.
Richard Taylor:
[00:04:11 – 00:04:24]
Yeah, yeah. It. We’ve been talking about it for a while. There’s. Hey. The legal process is as fun as it always is. I’m glad I’m not a lawyer, mate. I couldn’t stand looking at documents all the time. Makes my head hurt.
James Boyle:
[00:04:24 – 00:04:26]
I can’t imagine. Yeah, yeah. It’s like reading a different language.
Richard Taylor:
[00:04:26 – 00:04:39]
Totally. But it done is signed, sealed, delivered. James is a partner. James is my partner in Plan First wealth it’s official. Welcome aboard. Super excited to have you.
James Boyle:
[00:04:39 – 00:04:57]
Appreciate it. We have a bright future. I think both of us share the confident belief that this space is only going to continue to grow. Every week we get more and more questions, inquiries, interest. The audience for the podcast continues to grow. So I’m really excited to be part of the journey.
Richard Taylor:
[00:04:57 – 00:05:05]
Yeah, I mean I’m excited to have you as well. So great. So now I can go someone to share all the, all the difficult questions with all the decision making process.
James Boyle:
[00:05:05 – 00:05:06]
Absolutely.
Richard Taylor:
[00:05:06 – 00:05:42]
So that’s the big news. We also have on the back of a new website which I think we mentioned last time we met on this podcast and if anyone hasn’t checked that out, please go check out www.planfirstwealth.com. We also have a new app. Now this is only relevant for clients and also this is only relevant for clients. We’ve got US portfolios currently, which is most of our clients. But if you go into the app store and search for plan first wealth, you should see an app with our log logo pop up and people can now access all their information for their us stuff via this app. So that’s awesome. Exciting development. New website, new app, new partner. Off we go.
James Boyle:
[00:05:42 – 00:05:50]
Part of, part of what we want to do is make things as accessible and transparent as possible. An app is the perfect way to do that. So we’re excited to get it launched.
Richard Taylor:
[00:05:50 – 00:06:06]
And if any clients listening, wondering why we haven’t announced. Yes, we’ve mentioned this on here first but we’ll be sending out an announcement beforehand and also all of you already have access to this platform already, just in a different place form. Okay. So news got top out of round, haven’t we?
James Boyle:
[00:06:07 – 00:06:35]
There’s one more announcement we should say. The team has grown so not only have I signed on as partner, but we’ve introduced Connie as a client service associate working mostly with my clients. You’ll see his name on emails and things like that. Really happy to have him on board. He has a background in financial services, actually worked for a, for an Australian financial planning firm. So we’re keeping the cross border theme running. Really happy to have Connie.
Richard Taylor:
[00:06:35 – 00:06:57]
I think we did mention that last time but always good to mention it again. And also he’s working with you but he’s turned out to be much more than a client servicing associate. Right into loads of stuff and it’s just great to have another person on board, another perspective, someone coming from with fresh ideas and you forget that sometimes. So yeah, welcome. Kanye Iran.
James Boyle:
[00:06:57 – 00:07:01]
It’s still going on when will it end?
Richard Taylor:
[00:07:01 – 00:07:31]
Last time we met it was the early stages of the war. Market was in free fall. Since we met, I’ve been away on spring break. I went to Mexico for a week. While I was away in Mexico, this seaside ceasefire was announced and boy, oh boy, did the market rocket back. Holy heck, it went up. Normally they say the market goes, it goes up by the stairs and down by the escalator or elevator, up by the stairs, down by the elevator. This time it went down by the stairs, up by the elevator when it.
James Boyle:
[00:07:31 – 00:07:50]
Shot up, which is a pattern we’ve seen these last couple. If you think back to April, we don’t want to read into the tea leaves too much, but this idea of V shaped recovery and that becoming more commonplace with more information and more data and more speed, we certainly see that bear out the last couple wobbles of the market.
Richard Taylor:
[00:07:50 – 00:08:58]
The market, this market is remarkably resilient. And I think, I believe it comes down to the fundamentals, which is profits, or as it could like to say here, earnings. And the fact of the matter is we all, I think, I think people forget this. Simply put, stocks are a derivative of their earnings, their profits. Now on a long term basis, that’s absolutely true. On a short term basis it fluctuates wildly based on news and current affairs and people’s perceptions of all these things. And that’s what everyone focuses on. But ultimately, stocks are a function of profits. And profits, ladies and gentlemen, are crushing it. Or I should say, companies are crushing it. And we get totally wrapped up in what’s happening right now and the mayhem that surrounds this administration and everything that goes with it. And for good reason. But we need to just remember, stocks are a function of profits. Companies in the US are crushing it. Et voila.
James Boyle:
[00:08:58 – 00:09:58]
It’s one of those things where you’re almost waiting for the other shoe to drop. And that’s a very normal sort of human response. This can’t keep going on. But the reality is, like you say, earnings continue to crush it. I was taking a look at Josh Brown or the group over at Ritholtz. We always like to read their content. It’s the six consecutive earnings seasons of double digit profit growth. Revenues higher across all 11 sectors. I saw a report from American Express as cardholders under 45 spending more than ever. The reality is data is looking good so far. New unemployment claims remain relatively low. Just sort of eye watering numbers. There’s another one here. 12 Month forward, profits are $600 billion higher than they were just four months ago. That’s a 12% increase. Largest upward revision outside of a recession recovery. Like you say, these companies are printing money. Hand over.
Richard Taylor:
[00:09:59 – 00:11:29]
This is what you’re buying into, folks. You’re buying into human ingenuity, human striving. Corporate excellence is not perfect. Obviously there are excesses and issues with the system. But, but you are buying into this, particularly in America, this like drive and excellence and we need to keep sight of that. It’s funny you mentioned Josh Brown because I also want to quote him. He, he framed. I love this framing and I think we do this intuitively, but I think most people don’t. And that’s rather than asking what can go wrong, ask yourself what can go right? Because people who listen to podcast will have heard me say a million times, bears sound smart, Bulls make you money. In other words, bears people who are negative, people who are pessimistic about the future of the economy, in the market, they sound smart. There’s always reasons to be. There’s always issues, there’s always concerns, there’s always worries. There’s always risks and threats. Bears sound smart. Bulls make you money because bulls people are optimistic. People who invest for the long term and stay invested, they make you money because despite all these threats, risks, worries, etc. The history has shown time and time again, investing sticking with it is a way to make money. And bears sound smart, bulls make you money. Ask yourself what can go right? And we, I think that is, that’s what we’re seeing.
James Boyle:
[00:11:30 – 00:11:40]
We’re seeing it. Yeah. If you have a plan, you can stay the course and reap the benefits of this kind of enormous growth in the markets. I mean, we see it again and again and again.
Richard Taylor:
[00:11:41 – 00:11:48]
It’s validating, but also the resilience is market. Can you believe the tariff thing was a year ago? A year.
James Boyle:
[00:11:48 – 00:11:52]
Think about all that’s happened in between then and now.
Richard Taylor:
[00:11:52 – 00:11:54]
It’s the longest year of my life, I swear.
James Boyle:
[00:11:54 – 00:12:21]
And you remember the conversations we were having last April, right? You hear us say this all the time too. There’s always reasons to be pessimistic and valid reasons. We’re not saying those are unfounded, but the reality is to reap the benefits as we’ve seen, as our clients see, as the markets have seen. You have to stick with it. You have to hold out that optimism, that hope. And it’s unbelievable, the rewards.
Richard Taylor:
[00:12:21 – 00:12:28]
It was life changing stuff like $1 million. Do you know what $1 million compounding at 10% is over 30 years.
James Boyle:
[00:12:28 – 00:12:29]
How much?
Richard Taylor:
[00:12:29 – 00:13:37]
17 And a half million. And this is why I don’t understand like really active management of like trying to like. Because the US stock market has, I think it’s delivered more than 10 over the long, long term. So to turn one million seventy and a half million dollars all you have to do really is, is buying the US market and, and leave it. I, I’m not, I’m not advocating for that because I think there is, there is more to it. I’m dumbing it down to make a point but broadly you want to own the market and own it for as low cost as possible and you can turn 1 million to 17 and a half if you do active management where you’re trying to second guess and move in and out of equities and bonds and large cap, small cap value, all this stuff. Right. Individual stocks even. What’s your best case? If I can do Nothing and turn 1,000,017 and a half why would I go to all this effort to try and turn 1 million into what over that timeframe where the flip side starts to get it wrong and we both believe most people will over time, professionals, let alone regular folk, you could turn it into a lot, lot less. So I just, I just don’t get it frankly.
James Boyle:
[00:13:38 – 00:14:26]
Yeah, and it’s not to say we’re, we’re completely you know anti any kind of active management for in portfolios and in fact we utilize those for some client portfolios. But you make a very good point there where I think investors tend to overestimate their own risk tolerance. And also at the same token it’s very easy to increase your risk by trying to get cheeky by trying to make these moves and time the market and be active or day trade however you want to call it. And when it goes wrong it becomes very clear that actually the risk profile was not connected to the portfolio as I was managing it, as that investor was managing it. And that can have really serious downstream effects making mistakes that again can derail Planet would have worked otherwise.
Richard Taylor:
[00:14:26 – 00:14:30]
It’s astounding the numbers anything else rather than on news?
James Boyle:
[00:14:31 – 00:15:07]
Nope. Probably worth mentioning. We’re recording this Wednesday April 29th. Today is a big day for earnings. We’re talking about earnings I think five of the mag seven are going to report. Alphabet, Amazon, Meta, Microsoft. Obviously a huge part of the story is the AI spending still holding up. Certainly we’ve seen Capex continue to grow the last few quarters is ad revenue holding up all these kind of things that are crucial to these businesses model we’ll see the party will end at some point but right now things Seem really confident and feel good.
Richard Taylor:
[00:15:13 – 00:15:35]
Right. Should we do a bit on Roths? We mentioned this in our last call, but you said you wouldn’t. Last time we met, we talked about Roth. So if people want to go back and listen to Last from the Trenches, James and I did. We do talk about Roths and how we incorporate this, but we’re going to revisit it. Partly because we didn’t cover some of the stuff and partly because we just. Every call people are talking to, asking us about Roths.
James Boyle:
[00:15:35 – 00:15:35]
Right.
Richard Taylor:
[00:15:35 – 00:15:58]
So. And with good reason. Roths are the best, I think the best US account for good reason. Right. They, you put money into it, it grows tax free and you take money out tax free. There’s no required minimum distributions and there’s no, as far as I’m aware, there’s no, there’s no limits what you can have in there. There’s limits to what you can put in there, you know, contribute. But there’s no, there’s no ceiling on how much money you can have in a Roth. So great account.
James Boyle:
[00:15:59 – 00:16:04]
It’s something that, like you say, we hear about every week, every day almost, we get questions about Roth. Right.
Richard Taylor:
[00:16:04 – 00:16:27]
So I think, James, that’s partly because financial advisors talk about it so much, because it’s just an easy thing to talk about. So everyone who’s in the content game is out there talking about Roths because they’re so attractive and it’s such a, on some levels, an easy win. And then that perpetuates more people hearing about it, which perpetuates more people talking to us about it and then perpetuates us doing more content about it. It’s a vicious circle.
James Boyle:
[00:16:28 – 00:19:49]
It’s a vicious raw circle. We’ll keep it high level today and we’ll only touch on again the things we didn’t cover last time. So just a very brief sort of primer. If you’re listening to this, every episode is someone’s first episode, right? So a Roth account is funded with post tax dollars. It grows tax free and then you can take withdrawals, you can take distributions completely tax free as well. So it’s almost in some ways the opposite of what you might call a traditional account. Right. A pre tax account. What that does, that whole structure then creates tremendous opportunity for some creative strategies. The one that we probably get asked about the most, other than just sort of what is a Roth and how should I be using it? And implementing it is what’s called a Roth conversion strategy. Very briefly, you may be heading into retirement with a good Amount of assets of funds in traditional accounts. Right. In these pre tax accounts, those are going to be taxable upon distribution in retirement as ordinary income. What you can do, and this is particularly powerful in certain circumstances which I’ll outline, is you can convert some or all of those traditional funds at your discretion into Roth accounts. So you pay the tax up front upon conversion, but now you have this bucket that’s growing as a Roth. Right. Completely tax free and tax free upon distribution. What is the best use case for this and the one we see and implement very often? I had a call earlier this week where we built a plan around this. Let’s say you’re stepping away from earned income at. We’ll use round numbers. Age 60, right. Your income now is going to be artificially low. Right? Your, your marginal rate, tax rate is going to be very low because you don’t have that paycheck coming in. You may have guaranteed sources of income that will tick on in the future. Right. Maybe you’re eligible for US Social Security, UK state pension, private pension in the uk, whatever it may be, right. Which is going to push your marginal rate up at some future date. You have this bridge, this transition period where you can convert dollars from a traditional account into a Roth account at very low marginal tax brackets. You lock in that very low rate. Now you have these dollars growing again, Roth completely tax free and then distributed tax free. That is a very high level summary. Right, Takeaway for anyone listening. If you’re not incorporating this into the plan, you should be. That’s kind of 0.11 a, right? If this is not being implemented or discussed with you or part of your plan, if you’re managing it on your own, it should be. It is a tremendously powerful Strategy. Also, no RMDs apply to Roth accounts. So if you’re not familiar with what an RMD is required minimum distribution for traditional accounts, right. Your old school 401 IRA. When you turn a certain age, right now it’s 73, you are forced to distribute a portion of those accounts and then therefore you’ll pay ordinary tax on it. RMDs are not subject to or, excuse me, Roth IRAs are not subject to RMDs. So I’m not going to go into the details of a whole other RMD planning, but that’s also part of the appeal. Now that was a lot of talking. Let me pause there and let you chime in. Richard, anything to add on to that before we get into laddering?
Richard Taylor:
[00:19:49 – 00:20:45]
No, nothing to add on. Just to highlight so we’re about to do a webinar after this and one of the points we’re going to talk about is there’s like sequencing, having a strategy for withdrawing income and this is part of that strategy. Even so, you might not even need the income, but, but as part of the overall retirement strategy and where you’re taking income and when you’re taking income from these different tax advantageous accounts, Roth conversions and laddering should absolutely be a part of that conversation. That having an effective strategy to draw down your assets can save you tens, I don’t know, maybe depending on your values, hundreds of thousands in tax over a lifetime. You know, letting tax advantageous accounts roll up, but not, but, but also being mindful of the required minimum distributions, getting as much money as you can into Roths at a lower tax rate. Yeah, these things have a real meaningful difference.
James Boyle:
[00:20:45 – 00:20:53]
Absolutely. It’s, it’s very easy to overlook too, I should say. Right. Without good advice in place, it’s, it’s easy to bypass these things.
Richard Taylor:
[00:20:53 – 00:20:58]
Don’t you, don’t you find, don’t you find that our client bank is, we, a lot of our clients are retiring.
James Boyle:
[00:20:58 – 00:20:59]
Yep, absolutely.
Richard Taylor:
[00:21:00 – 00:21:25]
And the, this, the transition just on from our planning perspective, not, not even like the emotional, and it is an emotional transition, it’s a mindset transition. But the, the amount of work going from accumulation to decumulation, the hopes you have to jump through, the amount of thinking the different strategies are different. Yeah, there’s a lot. There’s a lot.
James Boyle:
[00:21:25 – 00:21:35]
And it’s kind of, if I could be so bold, it’s, it’s the fun stuff. Right. It’s when we get to be a bit more creative, we can really start to get hands on and what can we be doing to save the client money?
Richard Taylor:
[00:21:35 – 00:21:35]
Right.
James Boyle:
[00:21:35 – 00:21:43]
That’s the ultimate goal is more dollars in their pocket. Yeah, absolutely. There’s this sort of flurry of activity when you’re getting ready for retirement.
Richard Taylor:
[00:21:43 – 00:22:36]
You know, as you’re building up to retirement. It’s kind of like our job is like get well, you know, bottom line is to say am I on track? Am I on track? Am I going to be okay? Can I live the life I want to live without fearing that money? Am I on track? If not, how do I get on track? There’s an like organizational stuff. This might, I wonder if this surprises people. We’ll often take people on and, and one, we’ll put them into our software and they have this lawn like list of assets in, in the balance sheet and a big project of ours is to condense that as much as possible. We met the long term client recently in retirement and they’ve got like the dream balance sheet for us. It’s like four or five accounts. We know exactly what everything’s doing, what they do, we do. It’s all consolidated. It’s dead simple. It’s significant, some of money, but we’ve simplified the whole thing so it’s kind of so nerdy, but beautiful in its simplicity.
James Boyle:
[00:22:36 – 00:22:38]
Now I know exactly what you mean.
Richard Taylor:
[00:22:39 – 00:23:51]
But then once you. And there’s huge value in that I think. But then once you transition into retirement, the whole game changes. There’s so much more to think about and there’s also so much more we can do, which is great. I’m excited to announce that Expat wealth has its first sponsor, the Global Financial Planning Institute. The GFPI exists to provide education, community tools, resources and ongoing research for financial planners and other advanced financial professionals working with international and cross border clients in the US and Americans abroad. I’m a GFP Institute fellow and I’ve put all our employees through their GFPI programs when they join us. I’ve met some great people, I’ve learned a ton. It’s a genuine community of internationally minded folk doing their best to serve their clients properly and critically sharing what they know in the oftentimes challenging and ambiguous US cross border environment. And as anyone in this sector will tell you, you’re always learning. So if you work with international clients and or Americans abroad, or if this is an area you’re looking to get into, check out the gfpi@www.you will be glad you did and I hope to see you there soon.
James Boyle:
[00:23:52 – 00:26:09]
I want to touch on one thing because we mentioned this term, but I want to make sure that we cover it. Laddering Roth conversion laddering. So in the US we know in the uk, right. If you’re listening to this as a Brit with UK pensions, age 55, soon to be age 57, you are not touching that money. Right? There’s no access to it. US accounts little bit different, 59.5% and really you can access them. Usually there’s a 10% penalty, right? There’s some exceptions, but by and large before 59.5, 10% penalty, Roth conversion laddering and we’re getting this more and more often now. I would say we get these questions. People want to retire. Certainly people we’re talking with at 50, 52, 55. This is lesser known. There are ways we can be creative to get you access to those funds without Ever paying a cent of that 10% penalty. Roth conversion laddering is one of the more powerful tools. There’s something called a 72T we probably could do, honestly a whole section on this in some future episode. Roth conversion laddering. When you convert that chunk of money from traditional to Roth, it starts a timer, starts a ticker, five years that you can access those conversions, those dollars without penalty. What you can do then, let’s say you’re going to retire at 52, you want to travel, you’re running marathons, whatever it may be. You can start to create a ladder of converted funds. You convert X amount of dollars in year one. Those dollars are available to you in year five or year six. Really right. After five years, year two, you convert again. That creates a ladder available to you in year seven. And you start to stack these on top of each other, knowing that in five years I have access to these funds. I’ve never paid any penalty dollars on them and they can fund my lifestyle. You have to have funding for that bridge period, right. You need the initial five years of funding. So maybe that’s cash, maybe that’s a taxable brokerage account. But once that ladder is in place, you have a. To your point about a detailed income plan, you have an income plan that is going to be providing you what amounts to a paycheck. Right. It’s almost replicating what you had at work. And again, very easy way to bypass that 10% penalty, get access to your funds. And if you’re retiring early, that’s a particularly attractive strategy. Something that isn’t talked about quite as much, but another way that Ross can be utilized.
Richard Taylor:
[00:26:09 – 00:26:22]
Very good, powerful, powerful stuff. Lots to think about. Pay less tax people legally legit. Don’t do anything, don’t sail close to the wind, don’t do anything naughty, but just pay less tax.
James Boyle:
[00:26:22 – 00:26:23]
More money in your pocket.
Richard Taylor:
[00:26:24 – 00:28:02]
Let’s just have a quick recap. So since we met, I’ve obviously met with Brian. My usual chat about everything and nothing in the market. And then we all also. I had 2, 2 ask an expert shows I had. First one I think was Christine Alexis Conception. I think Conception, yeah, I think they. I need to do the Latino flair. She’s a Florida based tax attorney with offices I think in like Paris, Madrid, maybe even Italy. She speaks like four or five languages, maybe even more. She was great. She, she’s really, really active in like tax, international tax compliance and helping Americans move to Europe, which as you know, is red hot right now. So that, that’s obviously relevant for Any American looking abroad, but, but actually a lot of expats, a lot of expats come to America, work here for 20, 30 years, take u. S. Citizenship and then go and retire somewhere else. We’re seeing more and more of this, so it’s relevant for, for Nate, for, you know, American Americans, but also the rest of us, like myself, you might end up. Who might end up going abroad one day. So, you know, and I’ll tell you what, if you’ve, if you’ve come to America, you’ve made it, you’ve made some money, you just be, be careful. Do not leave this country without taking some very good tax advice and structuring yourself accordingly, because you can save yourself tens, hundreds of thousands and God knows how much agony and heartache. The long arm of the US Tax system is terrifying. It’s brutal, it’s horrible, I hate it. But it is what it is. Don’t move abroad without tax advice. So for anyone who that might be relevant for, check it out.
James Boyle:
[00:28:03 – 00:28:47]
The other thing, that again, yes, it was an excellent episode. We’re hearing this more and more. I know we were talking about that last time. I’m seeing cases on the margin, I’d say, where people kind of said, look, we’re not sure, right? We’re still a few years out. We may go back, we may not, we may stay in the US More and more of those, I think, are expressing stronger interest in leaving. And I’ll say this too, even more alarming or it catches my attention. People who are adamant that they wouldn’t leave are now saying, you know what? We’re thinking about it. And those timelines are condensing. They’re saying, well, we thought maybe in five years, maybe in seven years. All of a sudden that’s. We actually started looking at properties or we’re trying to get a feel for where we want to live. That’s a massive shift.
Richard Taylor:
[00:28:47 – 00:30:01]
Well, the other podcast, Sorry, I’m jumping around a little bit because we’re also. This is. This topic’s going to come up, I think, when we do this news review. My other, the other podcast was with David Gauchel and we talked about pre immigration planning, coming to America and all the things you can do to structure yourself correctly and save yourself a whole world of pain. And this is more our bread and butter because our clients are, for the most part expats in America. We’ve built a business. We’re building a business around expats in America. And I think coming to America is such an opportunity. Is America perfect? Obviously not. Right. Is anywhere perfect? But is America perfect? Obviously not. But is there something about this place? Is there something in the water? Yes, there truly is. And the longer I’m here, the more I’m kind of in awe of it, honestly, on some levels. And yet I’m seeing the tide to go, go out. And that is less people are looking to come to America and more Americans are looking to leave America. That really, really worries me and disturbs me.
James Boyle:
[00:30:02 – 00:30:26]
And you can’t really. I know we touched on this last. Hate to be a downer, but you can’t. I don’t see the tide shifting back anytime soon, unfortunately, but which, frankly, makes all these topics more important in my mind. Right. It becomes even more urgent, even more critical that this level of planning, of care is taken for the people who are listening to this, for our audience.
Richard Taylor:
[00:30:26 – 00:30:45]
I think people are exhausted, mate, as well. People who are here are just tired of this. But if you’re going back as an American, you’re not out of it now. It will subside a lot, but just get your ducks in a row so you don’t go out of the frying pan into the fire.
James Boyle:
[00:30:46 – 00:31:44]
Both of those episodes, excellent. Have a lot of really good information. So if any of either of those topics pertain to you, certainly recommend you go back and listen. If I can be so bold to pick some common threads from them. And these are things that we hammer on about. So it’s validating. Right. Because we hear the same advice from all these professionals in all different walks of life and different specialties. Don’t put this off. Right. These topics, these problems, these issues that crop up are enormously complex. The more time you have on your side, the better off you’ll be. That is across the board. Right. So I know we hammer on about that. Having time, we like to say, at least a year out. Right. Planning for a move in either direction, ideally. And it was really gratifying or validating to hear that from. From both Dave and Christine. They were both echoing the same pieces. Because the reality is this is complex work and it takes time. It takes time to reorganize structures.
Richard Taylor:
[00:31:44 – 00:31:46]
And you have other stuff going on.
James Boyle:
[00:31:46 – 00:32:00]
Yes. You have a million other things going on. Yep. So, you know, again, without getting to the details of each of those, that’s a good takeaway. Right. These are complex situations and need to be treated as such. Right.
Richard Taylor:
[00:32:00 – 00:32:26]
Well, so we’re going to do something new here. So since we last got together, James and I have created like a channel in our company chat, and we’ve been dropping in some articles that we’ve come across that we thought were interesting we should share. So I’ll go first. And it’s linked what I just said. It’s an, it’s a, it’s an incredible piece. You know, journalism gets a lot of stick and, you know, journalism is dying, frankly, isn’t it? Let’s be honest. Sadly.
James Boyle:
[00:32:26 – 00:32:27]
Yeah.
Richard Taylor:
[00:32:27 – 00:33:41]
And then sometimes you’ll read a piece of journalism. Guardian has a great read. New York Times has stuff which is what this is. Wall street journals are some great stuff. They’re the ones I mainly read. But there’s loads. New York, there’s all sorts of good stuff. It’s just a, just a deeply researched piece. And they’re going through the as this birthright citizenship issue is coming up with the Supreme Court, the New York Times have delved into the immigration history of all the Supreme Court judges. And it’s just a fascinating look at how these people came to America. Fascinating. It’s called how Immigration Policies Like Birthright Citizenships in Supreme Court Justices History. A Story of Immigration in America. New York Times. Brilliant. Fascinating. And it just blows my mind, the hostility to immigrants in this country. I know that’s just a global the issue. It’s just human nature. But there’s just something about, in America, a country built on recent immigration. This just particularly makes my head hurt a little bit. I don’t fully understand it.
James Boyle:
[00:33:41 – 00:34:13]
You mentioned earlier sort of feeling deeply sad about certain aspects of American life or current American life. And that to me is there’s probably very few better examples of something that. But it’s just depressing, frankly, that people’s worst instincts are amplified. And when it comes to immigration, you talk about all the economic reasons about why we need immigrants and why immigrants help a country thrive.
Richard Taylor:
[00:34:13 – 00:35:08]
Yes. So not only in a country based on immigrants, but I can’t remember, you need a certain birth rate to have enough people in the economy to grow the economy for prosperity to keep increasing. And I think we’re below that. Certainly we are below the birth rate required. And, and, and that’s falling. But that’s been topped up by immigration to this country. But now that birth rate is continuing to fall and they’re trying to cut immigration and kick out all the immigrants. Like, yeah, that is going to end. It will end in disaster. That’ll end in rampant inflation, collapsing, rising inflation and collapsing asset prices. The message needs to get out there that this is truly bad for the country, for the economic prosperity of us and our children. But the message is not getting out there, the counter message that is winning.
James Boyle:
[00:35:09 – 00:36:15]
The demography conversation is always fascinating. I think you read different studies. What they call the replacement rate, I think usually is around 2.1, 2.2, and essentially that means, parents, you need to replace yourself. I mean, it sounds awfully mechanical when you say that, but we’re well below that. And I think the history of the last few decades, certainly in developed countries, is that number falls and falls rapidly and there’s very little you can do. And certainly you could argue that younger generations, with the cost of housing, college, all those things, they’re disincentivized from having kids, certainly from having kids young. The economic outfall of that, the kind of downstream effects of that, to me, are fascinating. They’re grim. There are real policy decisions that can be made to help plug those gaps, so to speak. And to your point, to not only ignore that reality, a reality we’re seeing play out in other countries, Japan’s kind of the most famous example, to not only ignore that, but to actively further that, almost exacerbate the problem is confounding.
Richard Taylor:
[00:36:15 – 00:36:59]
So on that theme and the one I shared with you, this is from the Wall Street Journal. Is moving abroad the way to find your dream job? You know, so we’ve. We’ve mainly focused on when we talk about people going abroad, Americans in their, you know, 50s who have already made it and just want a new adventure, different pace of life, live in Europe. Sounds amazing, right? But there are young Americans leaving to try and find their dream job. And then this. I pulled this quote out of that article. The last. In the last year, more people left the US Than moved in the first half for the first time in nearly a century. Wow. Yeah. According to an estimate by the Brookings Institution, more people left America last year than came here. That’s. That. This is. That’s trouble.
James Boyle:
[00:36:59 – 00:37:07]
Yeah. It echoes the conversations we have. Right. Like we were saying earlier, it’s, it’s. It’s real immigration.
Richard Taylor:
[00:37:07 – 00:37:31]
Immigration crackdown slows US Population growth. Also from the Wall Street Journal, this is happening right now. And then another one. This is from the New York Times. Americans living abroad for lower costs now say returning home is too expensive. So basically, people have moved to Europe, build a life, kind of gone. You know, I want to come home and inverted commerce to America, but I can’t A basic price out of America because America’s very expensive.
James Boyle:
[00:37:32 – 00:37:43]
And that move is big. Right. I mean, we know that, and a lot of our audience will know that, but there are times when it doesn’t Work out the way you anticipated and then. And to be priced out of coming home. That’s tough. That’s tough.
Richard Taylor:
[00:37:49 – 00:38:07]
This is the one I’m worried about is the slowing population kicking out the immigrants, immigration slowing and this having a real impact on the economy. And I think AI is kind of the sticky plaster right now that’s solving everything. But I think that’s a wider. That’s something I worry about.
James Boyle:
[00:38:08 – 00:38:10]
Maybe next time we bring some more positive articles.
Richard Taylor:
[00:38:10 – 00:38:15]
Yes, we’ve got some more in here. But remember folks, what could go right.
James Boyle:
[00:38:17 – 00:38:18]
There you go, there you go.
Richard Taylor:
[00:38:18 – 00:38:26]
We’re not going to need people because we’re going to have robots. So that’s what could go. Right. I guess. Right. Should we do. Pick a mix.
James Boyle:
[00:38:26 – 00:38:29]
Pick a mix. You want to go first?
Richard Taylor:
[00:38:29 – 00:42:07]
Yeah. I’m starting listening to a new podcast. Right. So there’s a podcast called the Best is yet to Come. This and this is, this is a change of tack for me. This is. There’s a guy, I can’t remember his name, he’s 90 something years old and he’s interviewing other 90 year olds, 90 something year olds on what they’re up to. Look, I know they talk about their life. They’re not, they’re not really. They’re focused on the positives of like a life well lived and experiences and changes and. And nearly been his life for a century and what they’re up to nowadays. And this guy was obviously pretty senior in I don’t think the government but in those sort of circles he’s got a fascinating story. He’s Czech originally and escaped from the Nazis. He interviewed last week was with Sir Michael Hesseltine which will mean nothing to you but was a very big figure in British Politics in the 80s. Resigned from Margaret Thatcher’s government, took her on in a leadership race, just lost I think could have made quite a good a Prime minister. Big figure from when I was a very, very young kid. That was super interesting. He’s now in his. I think he’s 93. That was super interesting. And then last night I listened to one, he interviewed a lady whose name again escapes me. She was on. Have you ever heard of the kinder transport? No. So there’s a guy called Sir Nicholas Winton and when the Nazis invaded the Czechoslovakia as it was started rounding up the the Jewish families. Long story short, this British guy went to Prague and somehow organized getting it’s like 680 children out and there’s much more to it. Yeah. On a train, a sealed train or a series of sealed trains has to leave the parents behind but he had to organize families for them to stay within in England. And basically this guy almost single handedly, obviously not single handedly but almost single handedly save the lives of something like 688 or 680small which are like 3, 4, 5, 6 years old and older. Czech Jewish children who came to the UK on the, on the, a series of trains before it got stopped down, before it got shut down. And then these, they’ve all grown up in the UK as survivors. And he interviewed this, he interviewed one of these ladies, these women and she just had like a wonderful life story and you know, very moving, very interesting and a quick story short, sorry, furthering the story. So he, this guy Nicholas Winton never talked about what he’d done. And we used to have this program called this is your life or something like that in the UK and, and in the UK he, he was, he was invited to this program this is your life and they talked. This is 1988 so like 40 odd years after it happened and they filled the audience with survivors and like basically surprised him and he was unknown at this point. Then after that suddenly he was, he was famous, very humble guy. Just a wonderful, very, very sad obviously, but also wonderful story. And I find listening to these people who are, who have been through so much, who lived long meaningful lives, who, who are reflective, I find it very, very interesting and cathartic and I, I, it sounds cliche. The older I get, the more conscious I get about aging and the faster that seem, things seem to go. You’re, you’re nearly 10 years younger than me. I promise you in, in nine years time. You mean my age. Me like thinking ye, right. Like it’s, it’s really speeding up, like become much more aware and listening to these people who are over twice my age. It’s inspiring, it’s interesting and I’m enjoying it.
James Boyle:
[00:42:07 – 00:42:09]
I have to, I have to check that out. What was the name of it again?
Richard Taylor:
[00:42:09 – 00:42:12]
It’s called the best is yet to come.
James Boyle:
[00:42:12 – 00:42:17]
I think I, I’m actually taking a holiday. I’ll be in Prague in a week so I have to check that out.
Richard Taylor:
[00:42:17 – 00:42:18]
Oh yeah, of course you are.
James Boyle:
[00:42:18 – 00:42:18]
Yeah.
Richard Taylor:
[00:42:18 – 00:42:19]
It was just by chance I mentioned.
James Boyle:
[00:42:19 – 00:42:22]
That kinder, kinder transport. Is that what it’s sort of known.
Richard Taylor:
[00:42:22 – 00:42:27]
As that, that the best is yet to come? Yeah. Kindertransport. Yeah.
James Boyle:
[00:42:27 – 00:42:39]
What do I have? Oh actually this was a recommendation from my esteemed co host but I read the book night manager by John Le Carre.
Richard Taylor:
[00:42:40 – 00:42:46]
I also really struggle with that name, you know, I’m not. I’m a shovel. Is it Carre or Lecar? It’s Le Carre. Right. Because it’s got an accent after the.
James Boyle:
[00:42:46 – 00:42:49]
- I think it’s Le Carre and it’s a pen.
Richard Taylor:
[00:42:49 – 00:42:50]
Have you read.
James Boyle:
[00:42:50 – 00:42:50]
I’m sure it’s a real.
Richard Taylor:
[00:42:50 – 00:42:52]
Have you read any of his other books?
James Boyle:
[00:42:52 – 00:42:53]
No.
Richard Taylor:
[00:42:53 – 00:42:53]
Right, well, listen now.
James Boyle:
[00:42:53 – 00:42:55]
So this is not what you’re doing for a.
Richard Taylor:
[00:42:55 – 00:43:28]
Stop what you’re doing. Go, go get a list of his books and try and go through them in order and just enjoy the next year of your life. He is an absolute master, or he was a master. He’s. He’s died, unfortunately. His most famous books involve a spy, a British spy master called Smiley, and a Russian spy called Carla. And there’s this whole series of books. Go through them in order. You’re gonna. I am so jealous of you right now. I wish I had known. Go to them in order. They are. They’re a masterpiece in writing. I. I love them.
James Boyle:
[00:43:28 – 00:43:38]
You know, it’s one of those where you start reading it and you’re struck by, like, oh, yeah, this is a really incredibly written book and really great characters and like, you know, his, his. His legend is well deserved.
Richard Taylor:
[00:43:38 – 00:43:50]
It’s the first. Do you know, when you read a book and like, he never says stuff outright. It’s. Everything is like, he talks around things and I’m not doing it.
James Boyle:
[00:43:50 – 00:43:51]
Takes some getting used to.
Richard Taylor:
[00:43:51 – 00:43:51]
It does.
James Boyle:
[00:43:52 – 00:44:11]
I would say even in Night Manager, there’s a structure where the character is very reflective, speaking about, reflecting on. And he goes back to different periods of his life. And you do have to kind of, you know, initially you’re like, wait a minute, are we in Cairo right now? Are we in Ireland? Are we in Serbia? And, you know, it becomes more comfortable as you read through it. But it’s really fascinating.
Richard Taylor:
[00:44:11 – 00:44:29]
Once I got comfortable with that style and these other books, I completely felt love with it. Pro you. Listen, I’m going to hound you on this now. I’m going to live vicariously through you. Get that list, start reading them and, and tell me how you’re getting on. I think you’re going to. I knowing you and knowing what you read, and I think you’re going to have a wonderful time with this.
James Boyle:
[00:44:29 – 00:44:38]
They are brilliant and they’re great sort of summer books. We’re heading in the summer now. They’re sort of, you know, they’re international adventures and things like that. It’s good.
Richard Taylor:
[00:44:38 – 00:44:53]
Yeah, they’re great. And it’s It’s a different war. You know, it’s the Cold War. I don’t know what the Nightminder is. I can’t remember. But the books I’m talking about with Smiley and Carla, they’re true. 70S, 50s, 60s, 70s, Cold War stuff.
James Boyle:
[00:44:53 – 00:45:00]
Yeah, yeah. Night Manager was like right after the Cold war, I think 91 or something like that was the other one. Spy who Came in from the Cold.
Richard Taylor:
[00:45:00 – 00:45:05]
That’s a spy came Tinker Tail, soldier, spy. These are all. They’re their later books.
James Boyle:
[00:45:05 – 00:45:16]
Go back to the beginning, Go in order, like. Yeah, yeah. Okay. I’ve got. So speaking of plane rides, I’ve got the show now downloaded for, for the plane ride. So I’ll be, I’ll be comparing that to the book. But yeah, it was, it was a really good read.
Richard Taylor:
[00:45:16 – 00:45:26]
Okay, good, good. Right. Okay, well, I’m, I’m excited for you. Cool. Listen, James, have a great trip. Enjoy Germany and Prague. Wider. Czech Republic or just Germany and Prague?
James Boyle:
[00:45:26 – 00:45:31]
Yep. Austria. We’ll spend some time in Prague and Germany. We’re excited.
Richard Taylor:
[00:45:31 – 00:45:33]
Oh, and you get the train into Prague, right?
James Boyle:
[00:45:33 – 00:45:34]
Yes. Yeah.
Richard Taylor:
[00:45:34 – 00:45:58]
So listen to that. Apparently there’s a memorial to the Kindertransport in Prague train station. It sounds very moving. It’s like a wind. It’s like a door with a glass frame and child handprints because these parents were leaving. I mean, it’s harrowing stuff. This is just pure by chance. I completely forgot you went to Prague. Research about this. It’ll mean even more to you, I think.
James Boyle:
[00:45:58 – 00:46:01]
Definitely. Definitely. Absolutely. Good timing.
Richard Taylor:
[00:46:01 – 00:46:01]
Yeah.
James Boyle:
[00:46:02 – 00:46:02]
Okay.
Richard Taylor:
[00:46:02 – 00:46:06]
Right, James, have, have a great time and we will catch up when you are back.
James Boyle:
[00:46:07 – 00:46:08]
Sounds good. Thanks, Richard.
Richard Taylor:
[00:46:08 – 00:47:06]
All right, folks, that’s another episode of Expat wealth under our belts. Thank you for listening. I appreciate it and I appreciate you. If you’re enjoying the show and would like to support the mission which is to help ambitious expats thrive in America and ask you to subscribe to the POD wherever you listen and also consider leaving a rating and review. This stuff really does matter. Please help us get this information to the people who need it. It that is, to your fellow expats. Just a quick reminder that this show is brought to you by Plan First Wealth. We are a US based financial planner and wealth manager and we help successful American and international families living across the US to make the most of their opportunity and ultimately to retire happier. If you’d like to know more about how we might be able to help you, you can find us on our website www.planfirstwealth.com or you can look me up on LinkedIn. Do get in touch. We’d love to hear from you. As always, thank you to the podcast guys for their help producing this episode and the entire show. See you next week.
Production