Welcome the Wobble | From The Trenches with James Boyle (We’re The Brits In America S1:E40)

Market pullbacks are necessary for long-term health. But what’s the best way to deal with them? Discussing it are James Boyle and Richard Taylor, back for another episode of the podcast.

‘I welcome a wobble right now’ says Richard.

Find out why, plus much more, in this week’s From The Trenches. You’ll hear discussion on the dangers of performance chasing, the value of diversification, and the importance of proactive tax planning for expats and immigrants.

We’re the Brits in America 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:

Richard:

[00:00:00 – 00:00:26]

Welcome back to another episode of from the Trenches. This is the show where myself and my colleague James Boyle, we bring you behind the scenes and really what we’re trying to do is give you a sense of what we’re doing here at Plan first wealth, how we’re building this business, both the actual business itself, but also our interactions with our clients and learning as we go ourselves. So without further ado, our first from the trenches of 2025. Hi James.

James:

[00:00:26 – 00:00:27]

Hello Richard.

Richard:

[00:00:27 – 00:00:37]

2025, let’s get into this. So first we start by just talking about what’s going on in the economy, in the investment world and it’s wobbling.

James:

[00:00:38 – 00:00:40]

There has been a wobble, technical term.

Richard:

[00:00:41 – 00:00:44]

I think we’re in the middle of a wobble. I think, I think we’re mid wobble.

James:

[00:00:44 – 00:01:21]

We’re mid wobble. What started this, would you say? It might be worth mentioning that we’re recording this Tuesday, the 14th of January. There was a job report released last Friday that was quite a bit stronger than expectations, which the layman might think perfect. Economy’s humming along, people are working, people are consuming. Well, the market reacted, interest rates rose, stocks fell. You can attribute much of this wobble, I would argue, to traders. Expectations for rate cuts in 2025.

Richard:

[00:01:21 – 00:02:42]

I was going to say, I think we were wobbling before that because Fed Chair Powell came out and said, basically said, guys, don’t get too excited. Fewer rate cuts than you’re expecting and the market kind of lost its mind. But you know what? Good. I know that might sound counterproductive. No, I do not like looking at my firm’s aum, my clients assets and my clients assets, my own assets going down in value. I do not like any of those things. But, but I also know enough to know that the two years of robust returns that we’d had with the economy humming on all cylinders, topped off with a mini little frenzy at the end of the year after the election. Frankly we had to have a wobble because if we don’t have a wobble, we just continue the way we were going, which everyone thinks they want. But the resultant kind of collapse from that would be horrible. We need just to have a, we need to have a breather. We need to stop for a minute and just retrench and, and I don’t know, just, just get our heads back in the game. You can’t, three years of 20 returns is going one way, which for me is a bubble, which for me blows up frankly. So I, I, I, I welcome a wobble right now.

James:

[00:02:43 – 00:03:33]

Yep. I would Agree. It’s an important distinction and a hard point to make. And be understood that not only on some level logically we understand that these kind of pullbacks corrections are healthy. Right. And they’re needed. It’s one thing to understand that logically and rationally, another thing to accept that as the natural cycle of things. And certainly when we’re in a mindset, animal spirits. Right. You hear this term thrown around a lot. I would argue in November, December or very early in December, there was still this sort of speculative trend of tech is always going to go up. We’re going to get a bunch of rate cuts next year that’s only going to bolster these companies bottom lines. We’ll talk about concentration in the market right now, but when those patterns reverse, the comedown can feel painful in the moment. But we know it is just a natural part of the market cycle.

Richard:

[00:03:34 – 00:04:53]

It’s amazing and we’re as guilty of it as everyone because we are human ultimately that you, you look at your statement, you look at your, your asset values and that anchors you. Once it hits a level, even though you know it’s in, it’s invested when it goes up and down and, and long term the trend is overwhelmingly up. You get anchored on, on, on the highest value and it hurts. But that’s kind of what we’re here for, is to give people perspective and, and, and rational kind of shot in the arm when things like this happen. But like I say, we needed it because what we were reading recently, two of the hardest times to be a financial advisor, financial planner are when things are really dark. You know, think global financial crisis, think the depth of COVID All that happened very quickly. And think most recently October 2022 after like 10 months of falling equities, falling fixed income and everyone just wants to bail and we say no, hold tight, this will turn around. And bear in mind at the end of 2022, the whole world, the whole world, myself included, believe we’re going heading for a severe recession. What happened? No recession. Two years, 20% growth. Yeah, we’re up in October 22nd.

James:

[00:04:53 – 00:04:59]

I think I’ve mentioned this last time but thinking about 60 odd percent from those lows of 2022, it’s just incredible.

Richard:

[00:04:59 – 00:05:06]

Do you remember our investment reviews in October 2022, the second half of the year were pretty brutal.

James:

[00:05:06 – 00:05:06]

Oh yeah.

Richard:

[00:05:06 – 00:05:54]

People start to lose faith and we’re there to say keep the faith. And we were rewarded for that. Well, the flip side to that is kind of the frenzy that was the post election before this kind of we had this wobble when everyone just thinks when everything’s working and some things are working very, very well, almost too well, and then everyone wants to pile into that. Everyone forgets that the successful investing is looking where the puck is going or the puck is. Everyone’s looking where the puck is and says, oh, we just want to get into that. When the returns have already been had and everyone forgets the benefits of diversification, which is to protect yourself from the hiccups, because everyone just thinks everything’s working, it will work forever. And we know that’s not the case.

James:

[00:05:54 – 00:06:32]

Performance chasing, you’ll hear that term, that is a guaranteed way to make sure that you’re getting subpar returns, is buying what’s hot or what’s trendy or seeing that the tech companies here at the end of the year, the QS or something trying to pile in when it’s expensive and overvalued. Maybe we don’t know how much longer the trends can go, but that in the long term is not going to work for you. That is the definition of buying high and selling low. Diversification is the exact opposite. Right. It’s a disciplined counter approach to that to make sure you’re not getting caught up in these frenzies and potentially risking, in extreme cases, your retirement.

Richard:

[00:06:33 – 00:07:49]

Somewhere, somewhere in my many files accumulated over my now relatively long career, I’m getting older. It’s hard to disabuse myself of that, that somewhere. I have slides, I think, from Scottish widows that show it’s like a thousand dollars or £1,000, because it’s in the UK, invested every year. If you’d gone into the, the. You invested at the start of the year for the fund that was going to be top the next year. Yeah, impossible to do. But if you had, if you had, if you had like the almanac in Back to the Future too, that could predict the future. If you were able to invest next year’s top performing fund, what would happen to that thousand pounds? And you know, it’s. It’s like crazy money, monopoly money. Not even monopoly money, just crazy money. Flip side to that is, and this is what people can do and do do, if you take a thousand pounds and you had invested it at the end of that calendar year in that year’s top performing fund, what did you do to your thousand pounds? So, so, okay, oh, we’re at the end of 2024. This fund, XYZ, was the top performing fund. I invest it all in XYZ and so on and so forth. And you basically destroy, decimate your thousand. Yeah, complete decimate your thousand.

James:

[00:07:49 – 00:08:04]

Yep. And that’s not what people want to hear, right? People want to hear, oh, you have the answer. You know this fund outperformed this year and that means it’s going to do that next year. Tech was, was huge in 20, 23 and 24, so certainly in 25 it’ll continue. Not the case.

Richard:

[00:08:05 – 00:08:07]

Do you know, do you know where the word decimate comes from?

James:

[00:08:07 – 00:08:10]

It was Roman legions or.

Richard:

[00:08:10 – 00:08:14]

Yes. Have I told you this or is. I feel like pulled down.

James:

[00:08:14 – 00:08:23]

You know what this is? We’re going to credit my encyclopedic knowledge but anything Roman related we can rest assured. Rich, you probably taught me at some point.

Richard:

[00:08:25 – 00:09:02]

Yeah. The old, this is the. One of the ancient, ancient punishments in the Roman legions. This is like crosses. This is, this is Spartacus’s time and earlier was when you were punishing a legion. They had this punishment called decimation. And the. You would pull out lots, there’d be 10 people in a lot and you pull out lots. Whoever got the short, short straw, the other nine had to beat them to death. That’s how that punitive punishment. So it didn’t happen that often. When it did, you’ve decimated one out of 10 and they’d have to be killed by their own fellow soldiers.

James:

[00:09:02 – 00:09:14]

That is a vivid image for your portfolio. Use that for, for your retirement savings. You get an understanding of why we don’t invest our clients monies in that way.

Richard:

[00:09:15 – 00:10:07]

So just to wrap up here, we’re having a wobble. I actually think this is a good. I’m not enjoying it, but I actually think it’s a, it’s a good thing, it’s a positive thing in the grand scheme of things. We’re only two years into this bull market. We do not want it to come to a premature end or go out with a bang. Things did get a bit silly after the election, frankly, and I think it part of it. It’s like gambling people now. I think there’s a whole cohort of new, new entrants to the stock market who have been kind of schooled on Robin Hood and the, you know, the new, the gambling. Who treats stock market investing like gambling. And it’s great that people are more invested and more engaged. But my experience has told me that ends in tears, but also it ends in important lessons being learned.

James:

[00:10:08 – 00:10:59]

There’s something to be said for accessibility which no one can argue. I mean the stock market as a whole or investing is as accessible as it’s ever been right and likely will continue to open up in that way, which is great in a lot of respects. But in other aspects, especially fallout from COVID and that kind of sort of. Again, this idea of speculative trend chasing, I don’t know if we’ve seen yet the impact. It will be years and years that people will be studying this from a behavioral finance perspective of what does that do to markets during corrections, what does that do during downturns? How do those, what you might call retail investors react under changing market circumstances? Everyone feels like an expert when they’re picking stocks a in a massive bull run. If that trend turns around, what happens when.

Richard:

[00:10:59 – 00:11:00]

When it turns around.

James:

[00:11:00 – 00:11:01]

Right, Right. Yep.

Richard:

[00:11:01 – 00:11:48]

It’s a matter of time. And I think they’re getting, I think, I think trends are getting shorter and more aggressive. So I think downturns are quick because just information pattern travels so frequently here, which in a way is good because hopefully it means that the unpleasant down periods will be shorter, but they’ll be sharper. And it also means the recoveries will be sharper as well. And you know that famous old adage about missing the top 10 days in the market or something decimates like 50% of your returns. I completely put those figures out of thin air, but they are, they are very compelling. There are actual stats on this. If you miss out the best days in the market, you again, you destroy your returns. And best days in the markets come after the downturns. And you can’t predict the downturns. They come out of nowhere generally.

James:

[00:11:49 – 00:12:48]

The other thing that we alluded to it a couple times is increasing market concentration. If we look at the S and P shorthand for large US companies. Pulled a couple stats here that I thought were pretty staggering. Number one, there are eight stocks in the US that exceed $1 trillion valuations. Eight. The S&P, the 10 most valuable stocks, account for a third of the index’s total value. So again, 10 out of 500 companies in the S&P account for 1/3 of the total value. Even at the height of the dot com madness in 2000, that number was less than 27%. Now, there will be all kinds of arguments from a macroeconomic perspective about why that is and maybe this can continue. But you talk about sharp downturns. If something affects these Mag 7 stocks or the tech behemoths, you’re going to feel that pain pretty quickly and pretty sharply if sentiment changes. So it’s just something to be prepared for.

Richard:

[00:12:49 – 00:13:25]

Yeah. One of the investments we use, Vaneck Wide Moat Invests in stocks not proportionately to their size. There’s 50 holdings and each one’s like two and a half percent. And that means that when these mega companies kind of drive all the returns, this fund suffers. But conversely, when the, when the flip side comes off and these, these, these mega companies, you know, give up all the returns, this fund does much better. You know, you, whatever you think of the US you’ve got to be pretty much in awe with the companies it creates.

James:

[00:13:26 – 00:13:30]

And the dollar, the dollar has gotten a lot stronger too, even in the last year.

Richard:

[00:13:30 – 00:13:30]

Yeah.

James:

[00:13:30 – 00:13:33]

So, you know, that impacts our clients, certainly.

Richard:

[00:13:33 – 00:13:55]

Uh, indeed. Let’s talk about so our last episode I had a Charlie on the podcast to come and I thought with, with, with the new year with tax time upon us, 2024 returns will be being prepared and being submitted soon. I thought it was a good time to get Ashali on the podcast. It was UK US Cross Border Tax Advisor.

James:

[00:13:55 – 00:14:36]

Excellent episode. I’m allowed to say that because I wasn’t part of it, but it really was good. Those are topics and we’ll, we’ll break them down here that just about everyone we speak with on a daily basis and this is no one’s fault but very often these concepts can be misunderstood or just completely overlooked. Right. Ideas that people just aren’t aware of in the first place they need to be thinking of. So it’s a really good episode. I’ve already sent it out to a few different prospective clients we’ve been meeting with to get an idea of, you know, the things, the landmines that are easy to trip over unfortunately and tax.

Richard:

[00:14:36 – 00:15:38]

Every huge part of that everyone trips over bar bar a few who who do take advice before they arrive here and the lucky ones who their company will often engage in tax preparation for them. Although even those clients one oftentimes the tax preparation doesn’t start until they’ve been here a year and by then some of this is too late for some of this. You know, mistakes have already been made. Pfix haven’t been sold. We’ll have a client well we’ll have a new perspective client say oh my company had named the name Big four accountancy firm do our tax preparation and they think that means everything’s on Ghidorian and hopefully it is. But what they don’t realize is they don’t have the crack US UK Cross border team doing it. They have the kind of the outsource team somewhere else doing it and we’ve seen big problems. Big, big problems. PFIC size problems which tend to be big.

James:

[00:15:39 – 00:16:06]

And it’s, it’s sort of even more insidious than someone just being naive to these things. Right. Because they feel like, and for all intents and purposes they should feel comfortable with, you know, X company, X tax advising company, handling the returns and thinking they’re in good hands and they don’t have to worry about. But very often we see things overlooked or contradictory information or anything that can cause problems down the line.

Richard:

[00:16:07 – 00:16:19]

So it’s just this whole podcast is just a message on informational reporting. Pfix, getting your ducks in a row, avoiding the landmines that we talk about all the time.

James:

[00:16:19 – 00:17:22]

Yeah. Things that we’ve repeated, we don’t need to sort of harp on them. But a lot of misconceptions that we see. A common one, like I have this old pension from the uk, haven’t taken any income, haven’t taken any distributions. I haven’t been reporting it. Or another thing we hear is maybe I’ve been reporting it or doing it on my own, but I’m not sure if I’m doing it correctly. So Ashali walked through a lot of the different forms and things you should be considering. Informational reporting doesn’t necessarily mean that tax is due, but it does mean that if you have ownership of a financial account in a foreign country, pensions included, very often they do need to be reported. Somewhat unique to the U.S. obviously the IRS has idiosyncratic rules. When looked at on the global stage, the takeaway always is to work with a qualified cross border tax advisor to make sure you’re crossing those T’s and dotting the I’s and not missing any of these things that quite frankly are so easy to miss.

Richard:

[00:17:23 – 00:19:40]

Yeah, you know, I’ve just, I’ve literally just before this call I came off a meeting with someone else who is looking, who’s frustrated with the tax advisor because all they do is backward looking stuff. And I actually think most, in my experience, most people will say they have a tax advisor and they don’t realize they have a tax preparer. And if you have, if you’re in the cross border space, you know, if you’re an expat or an immigrant here who’s got international connections and stuff overseas and you don’t have a cross border tax preparer, then that’s probably a problem. People think I have a tax advice but you don’t. You have a tax preparer. And it’s totally different having someone prepare your taxes for, for submission. Who’s looking backwards is one thing but, but that’s backward looking. Whereas a tax advisor, that’s forward looking strategic advice on tax mitigation and compliance, but mainly tax mitigation at that point. And these are two radically different things. And in my experience in America, I think if you’re an expat or an immigrant and you’re doing your own, I think doing your own taxes and acts of madness, frankly, especially for an expat or an immigrant, having a local tax preparer with no cross border experiences is also wildly insufficient. Having a tax preparer is, a cross border tax preparer is great but really, really what the sort of people we work with, what I think they really need is a cross border tax preparer who can also provide some strategic advice in conjunction with us to get and keep you in compliance and minimize taxes. Now yes, that’s obviously going to be more expensive because you’re paying for the backward looking tax preparation and some forward looking strategic advice as well. But the idea is here, one, you’ll head off any problems. But two, good strategic advice could save you a lot of money in tax over in the future, particularly coordinated with your financial advisor. And that’s really going to be something I’m exploring this year is how to get more clients to engage in that and get people saving meaningful amounts of tax over and above what we already do.

James:

[00:19:40 – 00:20:50]

There’s an element too that I know we’ve talked about this sort of time line wise. Once you’re backwards looking, once you’re focused on something that’s already happened, I mean this seems self obvious, right? But oftentimes people don’t appreciate it. Your options at that point are necessarily limited, right? You’re restricted to what you can do now to remedy something that’s already happened. That restriction obviously doesn’t exist if you’re looking forward and there are certain circumstances or situations, scenarios certainly that we’ve navigated through that you have to be forward looking, exit, tax or exiting the U.S. you know, those kind of things. Roth conversion strategies, I mean things that on the surface might sound like well I’ll look at that later or I’ll worry about that when I’m, when I’m making those decisions. With not even that complex, straightforward forward looking planning, your options are way wider, way more further ranging and could potentially like you say, not only save you money but could potentially be adding to your investment portfolio or mitigating what might have otherwise had to be paid if you were only backwards looking.

Richard:

[00:20:51 – 00:21:08]

Exit is a huge one. If you exit the US on a green card without taking prior without doing prior planning, you can create some enormous trouble for yourself. I’m actually recording a podcast with Virginia this Thursday on that very topic. So watch this space.

James:

[00:21:08 – 00:21:09]

Excellent.

Richard:

[00:21:10 – 00:21:18]

Let’s talk about wep A, a win, a, a huge win, a welcome win.

James:

[00:21:18 – 00:21:23]

Unambiguous win, which is rare in this space with all these gray areas. Yes.

Richard:

[00:21:23 – 00:22:19]

And, you know, so just to give everyone an information on what’s going on here, background windfall elimination provision. For those of you who aren’t aware what I’m talking about, essentially a lot of expatriates here and immigrants had their Social Security benefits cut, reduced because they had or were going to receive or were receiving a non US state pension. So for Brits, that would be the state pension. Obviously, every country has its own version and if you’re in receipt of a UK state pension, a lot of people had their Social Security benefits cut and people, no, very few people were aware of this. And it came as a nasty surprise, an unwelcome surprise. And it’s going, it’s been, it’s done, it’s passed both houses, President signed it into law. It’s going and I think it’s going to apply as of January 2024. If I’m right.

James:

[00:22:19 – 00:23:41]

That was, that was, that’s the wording in the document. So, so for anyone curious, and I know we’re going to get a lot of questions on this, was I want to make sure I have the right term here, Social Security Fairness Act. If you log on to SSA.gov, they do have a dedicated now URL and you’ll see it in a bright banner sort of when you log in dedicated to updates for the actual specific implementation of the act itself. So, you know, we’re getting a lot of questions about am I going to get a lump sum? You know, are we looking at back pay here? I think the short answer is we don’t know specifics yet. I agree with you, Rich, that by the wording of the legislation, it looks like that it will have been effectively repealed as of January 24th. So there is this open question of people who had been impacted, will they get some kind of back pay owed to them? We’re certainly going to monitor it and we’ll keep you updated on the podcast as we go here. But like you say this, you know, somewhat ironically, it wasn’t designed to, to capture expats. Right. It wasn’t necessarily written to offset foreign pensions. It really was much more focused on domestic workers who were getting semi quasi government pensions and things like that. But this is a win across the board. I mean, I saw median savings. You know, go ahead.

Richard:

[00:23:41 – 00:23:51]

I think there was a. I think there was a proposed amendment as well to kind of carve expats out of it. People have foreign pensions, but it didn’t pass, so it nearly didn’t happen. We were nearly singled out.

James:

[00:23:51 – 00:24:16]

You know, and this is one of those topics that for years now, we’ve been getting questions. You longer than me, I’m sure about every once in a while a bill would come, come up in the House or something or be presented and say, okay, you know, we’re talking about repealing wep. And for the longest time we just said, look, we can’t speculate. You know, we can. We can only take action if and when something gets implemented and it’s happening. Which is. Which is excellent.

Richard:

[00:24:17 – 00:24:32]

Yeah, really great. Just great news. Yes. We don’t know the details yet, but we know it is happening, folks. WEP is going away, which for expats and immigrants in America who spend a bit of time working outside of America is generally great news.

James:

[00:24:32 – 00:24:45]

Yeah, Take the win. The shortest takeaway is that you will be able to collect your Social Security unreduced now, depending, you know, no matter on what other foreign state pensions you’re collecting, which good news all around.

Richard:

[00:24:46 – 00:25:36]

So I just want to add something to agenda today, which had a conversation yesterday at the gym. I crossfit. Irregularly. Irregularly, because my life is taken up by work and children and being an expat. We have no family help here, it’s just my wife and I, so I don’t go as often as I want to. And I know CrossFit causes some strong feelings in some people. I’m not a disciple, but I do enjoy it because, you know, I have to book myself in and if I have to put myself in, I’m allowed to go. And when I go, I don’t have to think about what I’m going to do. I get told what I’m going to do and I get shouted at to work harder. And I kind of. I’m someone who knows I need these things, these ingredients to achieve any level of successful outcome. So that’s why I do CrossFit.

James:

[00:25:36 – 00:25:40]

Do you call it the gym or the box? Isn’t that CrossFit? You have to.

Richard:

[00:25:40 – 00:28:23]

Right, yes, of course, of course. And there’s this lady there who’s absolutely lovely, a fellow Brit, been here for. For ages, early 70s. She’s absolutely lovely. She’s a wonderful person. And her husband is just retiring, like he’s literally just retired after 40 odd years. Her husband’s American, I think he’s a pharmacist. And she said, she’s, she says you do retirement, right? She starts asking me questions about Medicare and stuff. So I’m gonna send her our Medicare podcast and help us sort that stuff out. But then I’m asking like, she’s, she’s telling me that her husband has left and has rolled his 401k into an IRA. And I’m asking a few questions, not trying to pry or anything, just trying to get an idea of what’s going on here. They’re working with someone essentially they’re not working with anyone. I’ve never worked with anyone. Husband manages his own 401k and an IRA and loves it apparently. You know, she’s all in cash, early 70s. They’re going from like 400 grand a year to 40 grand a year income. Feeling a bit nervous about it? No, no help. And I’m just, yeah, I’m just amazed that Pete. I don’t know how people do that, you know, and imagine embarking like a 30, 40 odd year retirement with no plan, doing it all yourself, not knowing what you don’t know. This lady, lovely, she’s 100 in cash. She’s no idea what her husband’s in, but knows that he loves it. She said something like, oh yeah, I think you get 6% a year. And I mentioned that to my guy at the bank, can I, can I beat that? He said, no way. I’m just like, what? I, I don’t even know why I’m, what I’m doing. I just came away almost shocked like the, and is it just because we do this day in, day out so we see what can happen we, when a retirement goes awry through lack of planning or bad investment choices, or not making no investment choices, whatever the reason may be, because you and I see it day in, day out. What a non strategic plan without, without the benefits of like not even a financial advisor, just someone impartial with some level of expertise. Co piloting with you. We see what we, we see what happens that we’re now, are we over Cautious is the wrong word. You know, like, do we over index how important it is to have a, to have help? But I’m just terrified for these people and I don’t have all the facts. James. Right. But like I don’t know how people, I don’t know how people do it.

James:

[00:28:23 – 00:29:55]

There will be, there will be do it yourself investors who hear us talk and say to a hammer, every problem’s a nail. But here’s one thing that always strikes me and I can’t speak to this couple or the conversation you had. In my experience, certainly the people who approach us or the people we talk to, even if there is some level of diying, I’m going to handle this myself. It’s something I enjoy. The number of those people who are actually confident in their own ability to carry this out or confident in the ability to manage obstacles in the way. And sometimes that means if something were to happen to the person who’s handling the management succession planning for family finances, the number or percentage of those people who are confident in their own ability to do so is vanishingly small. And maybe that’s why sometimes they come to us looking for information or guidance and sometimes we can help and sometimes we can’t. But it always strikes me as shocking to your point, that someone who is not fully confident in their ability to do so goes ahead and charges through and plows ahead anyway, which is more common than you might think. It’s not the case. And I’m sure there are people out there who do it themselves, enjoy it and are very confident. We don’t tend to have those conversations, which makes sense. But there are a lot of people who are sort of doing it on their own and have always done so and figure this will work for retirement too.

Richard:

[00:29:56 – 00:32:53]

Let me give you some context. So there’s an advisor in the uk, an earlier mentor and friend of mine, fantastic advisor, wonderful human, Paul Taylor, great guy. He is of the opinion that a successful client outcome for some clients is taking on someone who doesn’t. Who, who doesn’t diy. But then this isn’t their world. And over a course of 5, 10 years, graduating them out of your proposition, graduating them to a place where they can do this themselves. And I agree and disagree with him. I do agree that there are some people for whom that is appropriate. However, I think for almost everyone, including the, the best and most committed DIYers, there comes a point either at retirement or significantly into retirement where even they would benefit from having a trusted advisor. Not, not it doesn’t have to be a financial planner, but someone with them on this journey. Because there’s a few things. The most obvious one is as we get older, there becomes a legitimate chance for cognitive decline. Literal dementia, but also just cognitive, just general cognitive decline. And that can lead to poor decision making. But really, because what does I say? No Plan B. If you’re working and you make a mistake and that mistake costs you wealth. But be a tax mistake, an investment mistake, whatever it might be, and you’re working, there’s hopefully probably time to an opportunity to recover. Once you’re in retirement, there’s no plan B. You get it wrong. And if you get it seriously wrong, and we’re all capable of getting it wrong, if you’re a human being, you’re very capable of getting it wrong either by making poor decisions or just not knowing what you don’t know. That’s what, that’s actually what we encounter the most here, right? You don’t know what you don’t know in this cross border world. And if you get it wrong in retirement, there’s no plan B, there’s no making it back, there’s no recovering. The stakes are so high and the idea of doing that without someone on your side terrifies me. It terrifies me as someone who knows what he’s doing. Like I won’t go into my retirement without someone on my side because I just value that. And now imagine if it was something I had no clue over really. I had some di, I was a DIY investor. Maybe it’s just my personality, I would just be terrified.

James:

[00:32:55 – 00:33:45]

I tend to agree. If we sort of take a step back and look at this retirement, but potentially a 30 year retirement, you can look at it as a series of decisions, calls you’re going to have to make, right. And probably countless calls, right. And you can be supremely confident that you’re going to be right and right and right and right and right until you’re not. And the unfortunate thing is in the industry we’re in and the work we do, all it takes is one misstep. Right to your point, with no plan B behind you, that all of those right decisions come to nothing. Because at the end, whatever it may be, you sold out at the wrong time. Or like you said, you declined to the point where you weren’t able to make sound decisions. It can happen to anyone. And not having someone in your corner, I agree, is certainly not the approach I would take.

Richard:

[00:33:46 – 00:34:11]

Just imagine. So imagine not having that person who can hopefully help you avert his assets. Imagine doing without a plan. Imagine doing with no, with no, no, no financial plan, no investment plan, no income plan. Imagine having all the assets in cat. Your assets, your wife’s asset in cash. We’ve got work to do, Jamie. We’ve got work to do still.

James:

[00:34:11 – 00:35:03]

We’re here for any of those. Anyone listening, that sounds like you. And, and just one other point there. It usually in My experience, it tends to be one person in the partner who handles everything, which, as you know, is. Is a recipe for disaster because sadly we sometimes then get the case where the remaining. If something does happen or if, you know, it doesn’t have to be death, but could be separation or cognitive decline, someone is there in the unfortunate position of having to pick up the pieces and say, I haven’t paid attention to this for 40 years, plus, I am completely in the woods right now and I need help. Now, sometimes we can help, sometimes we can’t. But yeah, it’s not good when that entire burden rests on. On one person that if something goes wrong.

Richard:

[00:35:03 – 00:35:16]

No. So, okay, so, yeah, we’ve got work to do, got people to help. We’re here just trying to share the podcast. Yeah. Right. So should we do. Should we wrap up here with pick and mix.

James:

[00:35:16 – 00:35:19]

Pick a mix. Let’s do it. 20, 25.

Richard:

[00:35:19 – 00:35:20]

You go first.

James:

[00:35:20 – 00:35:38]

Oh, I had a. I have a good one. I don’t want to oversell it now, but I was excited yesterday saying, oh, I got something top of mind. So I think I’m late coming to this, but it is relevant for our audience, I think a show on Apple TV called Slow Horses. Have you heard of this?

Richard:

[00:35:38 – 00:35:40]

Oh, yes, I’ve watched. I’m fully caught.

James:

[00:35:40 – 00:35:51]

Okay. No horse. We just finished season one. It is. For anyone not watching. I’m late. It’s had to be around for a few years now. Right.

Richard:

[00:35:51 – 00:35:54]

Yeah. Because I think it’s three or four seasons. I think it’s four seasons.

James:

[00:35:54 – 00:36:00]

Okay. We just finished one and I think they. They turned them around pretty rapidly. I just saw that they’re.

Richard:

[00:36:00 – 00:36:00]

Yeah.

James:

[00:36:01 – 00:36:02]

Renewed for another couple.

Richard:

[00:36:02 – 00:36:10]

And, you know, it’s a British series, so It’s. There’s not 35 episodes in each series, like six or seven, which is good. You know, frankly, it’s good.

James:

[00:36:10 – 00:36:43]

The British series have that down. I think the. We just finished season one, which I think it was six episodes and it’s taught, well paced, you don’t get bored. The characters are unbelievable. For anyone listening who hasn’t. Who hasn’t seen it or heard of it, it’s a. I think it’s based on a book series called Slough House. And I was looking at. The author’s name is Mick Herron, a show starring Gary Oldman, I guess you’d say, is the sort of lead and he is head of a spy group of ragtag sort of rejects in MI5.

Richard:

[00:36:43 – 00:36:44]

A reject part of MI5.

James:

[00:36:44 – 00:37:04]

Yes. Yeah. And he leads this sort of colorful cast of Characters. It’s the type of show that you watch an episode and a half and you’re like, I’m fully into this, I’m committed. Gary Oldman is putting on a master class, very funny to extremely funny show. So that would be my pick of it.

Richard:

[00:37:04 – 00:37:06]

You know the main guy, the young guy.

James:

[00:37:06 – 00:37:07]

Yeah, yeah.

Richard:

[00:37:07 – 00:37:09]

If you heard him talk in real life, he’s Scottish.

James:

[00:37:10 – 00:37:10]

Really?

Richard:

[00:37:10 – 00:37:12]

He’s got a thick Scottish accent. Yeah. And he’s like, wait, what?

James:

[00:37:13 – 00:37:22]

And what is he? So I always joke that I’m bad at the regionalisms. What, what would you call his accent in the show London?

Richard:

[00:37:22 – 00:37:33]

Like, I don’t know what. Just regular, kind of like Home Counties. Posh. Not too posh, but like, you know, well spoken British one that wouldn’t sort.

James:

[00:37:33 – 00:37:34]

Of stand out, I guess.

Richard:

[00:37:34 – 00:37:55]

Yeah, no, but, but, but you, but you plague it as like a night, you know, like a. It’s not like a regional northern accent like some people say I have. Right, right. It’s southern and not. But, but not, you know, nice. Not too, not too regional. But yeah, you hear him talk, talk for the Scottish brogue, it’s.

James:

[00:37:55 – 00:38:02]

Listen, Gary Oldman too. He’s like a chameleon, right? I mean he could just disappear into these roles. He’s just. Oh, he’s one of the best.

Richard:

[00:38:02 – 00:39:21]

He’s a top actress. Yeah, I, I’m coming to the. I’m still reading the Power Broker. I know I ever have his books, but that’s. Life is very small right now. People need to understand. Podcasts and books is all I really have. It’s a massacre. It’s a hell of a book. It is a. It is a. I don’t even know what the word is. It is a master class in one man’s genius. The danger of where genius meets arrogance and power. Robert Moses was undoubtedly a genius. I’m one of the most clever, intelligent, able people on the planet and hard working. But he, he was supremely arrogant. And then when he, when he secured power for himself, he misused it. It wasn’t open and New York is paying for it to this day. I learned so much about New York history and the regional history, Long island history. It’s fascinating stuff. And a lot of the mass transit problems that we have today are thanks to Robert Moses. It really is a staggeringly good book. It makes me want to go and read this guy’s other books on Lyndon Johnson, but the in depth reporting is staggering.

James:

[00:39:21 – 00:39:46]

Do you get the sense that I don’t know if I can ask this without having read it. But that he would have wound up with that kind of obsessive grasping for power. What I’m asking is chicken or the egg. Was his sort of personality always going to wind up in that place or do you think having reached that level, it corrupts that?

Richard:

[00:39:46 – 00:40:29]

Yeah, he went for that. Yeah, he went for it. Because you start, you’d like, he’s doing so much good stuff. You know, maybe this is just. Maybe this is just a. The price of. No, you can’t build stuff in a major city and it’s suburbs without. Yeah, what is the phrase? You can’t make an omelet without breaking a few eggs. And at first you’re thinking that, but then it just. It just morphs into something way more sinister and destructive and dogmatic. And ultimately that’s where it kind of cements. Like I say, New York. New York paid for that and New York is paying for it.

James:

[00:40:30 – 00:40:47]

Yeah. I have to check this out. One of the things that you do next time we’re in the city, you know when you can start looking at things and pointing to things and say, oh, I remember reading about that in the book. And this is what that comes from that, that kind of connection to the real world is you’re only going to.

Richard:

[00:40:47 – 00:40:50]

New York once a year now. It’s so unbearably expensive.

James:

[00:40:50 – 00:41:02]

It really is. I was shocked. I think we mentioned it last time, but I Thinking of New York, you know, 2017 prices. Last time I was living there and things have gotten more expensive.

Richard:

[00:41:02 – 00:41:07]

It is unbelievably expensive. I can’t. I still haven’t got my head around it.

James:

[00:41:07 – 00:41:07]

Yeah.

Richard:

[00:41:08 – 00:41:09]

But we had a great time.

James:

[00:41:09 – 00:41:11]

We did, we did.

Richard:

[00:41:11 – 00:41:14]

Yeah. Good talking with you, mate. See you soon.

James:

[00:41:14 – 00:41:15]

See you soon. Thanks, everyone.