Category Archives: Coach’s Corner

Click here to learn what Microspending is and what we think about it.

Click here to listen to the full Untucked Episode 87. You can also listen on Apple, Spotify or Google podcasts.

Untucked Episode 87 Microspending

Meghan Tait: [00:00:00] Today we’re going to talk about an article called The Avocado Toast Effect of Spending is Totally Overblown. This was in Men’s Health and written by Chris Browning. We’ve discussed this topic a bit before but wanted to revisit it. There are many talking heads who believe your Starbucks habit will prohibit you from being able to save for larger expenses, be it your first home, retirement, etc.

And that you should in fact avoid all of those costs. Chris, however, takes a different angle by actually advocating for what he describes as small, intentional purchases that are good for us on multiple levels. Social example, social interaction or breaking up our routines, um, or just treating ourselves, for example.

Yeah,

Jeff Mastronardo: I kind of struggle with kind of where I shake out on this. Like obviously if you’re making 25, 30 grand a year and you’re spending 8 a day on a Starbucks coffee. Like the numbers [00:01:00] don’t make sense, like you’re just, that’s, that’s a part of your budget that probably shouldn’t be there. But if someone, if you can afford a Starbucks coffee and you’re saving a few bucks each year into your IRA, like, I agree.

Yeah, go get yourself a Starbucks. And these people that want you to analyze your spending and just do absolutely everything correct to help you amass the most amount of wealth by the time you’re this arbitrary age of 65, I think is stupid. Like there has to be it’s like we talk about all the time like Where’s the balance, right?

I’ve said for years, and I have no idea if I’m on track for it, like, I’d rather have, like, accumulate 3 million dollars by the time I’m 65 and have lived a lifestyle than accumulate 6 million dollars by the time I’m 65 or 5 million dollars or 4 million dollars and have, like, really just watched every single

Mike Traynor: penny.

Yeah, again, I feel like we’ve talked about [00:02:00] this before, but I’m annoyed by these articles because they seem to… Overemphasize these little decisions that are nowhere near as important as making the right big decisions when it comes to like Overspending on your first house, for example, or we’re buying a car.

That’s 15, 000 too expensive that compared to what you should or what stuff like that like this is just trivial and you know, Dave Ramsey’s and people like that and Susie Orman’s out there that Talk ad nauseam about this issue and it’s just not on the of the top ten like financial decisions It’s not one of them in my opinion

Jeff Mastronardo: throughout.

It’s a pretty interesting take. Yeah, I agree a hundred percent with that

Meghan Tait: Yeah, the the decisions that matter are not Those your lunch with your girlfriends once in the right Or, like, and, and, and Chris’s point is, there’s other positive [00:03:00] impacts that those types of things have that matter too. And, when you’re talking to, when the Dave Ramseys and Susie Ormans of the world are talking to the masses, they’re not specifically understanding anybody’s individual circumstance.

So it’s like, yeah, you shouldn’t spend any extra dollar. Like, If the lunch or the latte or, you know, like is important for your general happiness, like, yeah, do it. I mean, again, I think in the context of like, it’s not the most expensive or consequential decision of your life.

Jeff Mastronardo: But what about those tiny decisions that over a month add up to a big, you know, a kind of.

A balance sheet moving decision.

Meghan Tait: I think that’s when yeah, then the ship has to be righted, but I guess I’m maybe specifically talking about like singular or like two or three decisions right [00:04:00] not Not decisions that end up moving the needle right because it feels like those are the things that people stress about I mean we talk with people a lot about their cash flow and it’s like where do you think?

You can pick up a couple of bucks and the first place everybody assumes is like going out to eat or take out. It’s like, okay, there are certain people. Yeah, who like you can look at their DoorDash history and it’s like whoa They spend 350 a month on takeout like that is a place where we could start but then for the for the couple or the person who you know enjoys dinner out with friends twice a month to the tune of 200 bucks like I just don’t know if that, if the impact of that financially is going to outweigh the emotional impact of not doing it.

Does that make sense?

Mike Traynor: Yeah, and I have two things to say, two more things. One, in the article they use the example of four Starbucks a week would [00:05:00] cost you a thousand dollars a year, let’s say. And then after twenty years that would be, that would grow to forty four thousand dollars. So, wow, that’s like, it’s money, but it’s not.

Life changing money. I hate when they do that. And by the way 44, 000 20 years from now is probably the equivalent of 15, 000 today because we’re talking about Inflation so that’s always a misleading thing when they say it’s the X amount of hundreds of thousands of dollars and you know 30 30 years from now It’s like stop like you’re missing That that number seems way bigger than it really is because of the future value of the money is always gonna be much higher So that’s that’s the thing that’s annoying about that example I will say though, back to your point Meg, you’re getting, this person is presumably enjoying their coffee, or whatever it is, and they get some sort of personal enjoyment from it.

I would say if somebody’s spending, um, [00:06:00] ten bucks a day on lottery tickets, I would have a different take on that.

Jeff Mastronardo: What if they won?

Mike Traynor: They will not win. Um, or if somebody is, you know, got a, uh, Online gambling habit, Jeff, like, like you. Guilty. Um, now, you get enjoyment from that, so maybe you could argue that, Hey, I know I’m net spending money on this, but I, I like it.

I’m in the green.

Jeff Mastronardo: Yeah, you’re in the green. Is it green or black? Oh, I don’t know. Let’s go with green. No, when you’re in the red, you’re, you’re not making money. I, I hate those calculations where they tell you what it could have, like how much you’re. What that money could have grown to like we use software where you have someone’s cash flow and they say like, Hey, can I should I buy a new car now?

And if you enter that transaction in like what if scenario like what [00:07:00] if you spend 30, 000 for this car, how that impacts you over the next 30 years and like that that 30, 000 purchase is going to cost you like 250 grand over your lifetime. I hate, like, you would never buy anything, right? Should I get this 50 shirt?

Well, if you buy that 50 shirt, 30 years from now, it’s going to cost you 17, 000. Like, okay, but like, I need a shirt.

Meghan Tait: But, but that’s what you were saying, right? It’s the balance that we have to strike. We just strive to create, like, it’s for who, for what, right? Like sacrificing these lottery tickets, lattes, whatever it is.

For what? Like, is your goal to have X amount of dollars when you’re 50 so you can stop working early? Is your goal to be able to put your kid through college? Is your goal, like, to me, all of this is too general and too high level to matter to anybody. Like, anybody reading this article [00:08:00] and being like, oh, I should or shouldn’t do anything, it’s not in the context of their situation, so it’s like, it’s far too general for us to even, Be mad about yeah, and mad isn’t the right word, but I’m like basically taking back everything I said, because I’m like, this is just annoying.

Mike Traynor: Yeah, well, I, I was listening to somebody on another podcast complaining about. Today’s, I’ll say today, too many of today’s people, um, don’t, will not accept delayed gratification and it’s immediate gratification. Um, and I think there’s a point to that, um, but to your point, Meg, 100% delayed gratification isn’t, is no good either.

Right. Um, and you have to figure the balance between the two, so, um, we could do a whole nother Subject on the immediate gratification crowd, but yeah, that’s not this. No,

Jeff Mastronardo: I think if these articles can spark people to be [00:09:00] more conscious of their spending and be more thoughtful with it, whereas you’re taking and hearing what we’re talking about, which is don’t sweat the little things, do the little things right.

But also be more conscious on the bigger decisions like. , you’re looking for a new car and they have like an R three model and R five and an R six. Like do you really need the 320 horsepower car R six or is the R three with 220 horsepower? Good. Like that one’s gonna cost you 10 grand more like just get, get the car that you like.

But it doesn’t have to be like the top of the line model. You’re looking for a new house. Yeah. It doesn’t have to have like absolutely everything. Like if it doesn’t have AC now, But it’s cheaper. Maybe you get it. Maybe you add a C later. Like I think if they can help people make Better small decisions and then hopefully they’re making better bigger financial decisions, too.

Yeah.

Meghan Tait: Yeah, I think that’s a

Jeff Mastronardo: good takeaway.

Mike Traynor: Cool. We’re good. Yeah

Click here to listen to our reactions to Charles Schwab’s Modern Wealth Survey in our newest Coach’s Corner segment

Click here to listen to the full Untucked Episode 86. You can also listen on Apple, Spotify or Google podcasts.

Untucked Episode 86 – Schwab Modern Wealth Survey

Meghan Tait: [00:00:00] Coach’s corner Um, so we’re going to talk about the Charles Schwab Modern Wealth Survey. Uh, Schwab conducted this survey in March of 2023 and, uh, surveyed a national sample of Americans aged 21 to 75. Survey covered a lot of ground, so we’re going to pick a few specific topics that we want to cover.

Anywhere in particular you guys want to start?

Mike Traynor: I, I don’t like surveys in general, and, you know, they all do the same ones, Schwab and Fidelity and Bangor, they all put out the same thing, which is like, we surveyed people about how much they feel it takes for them to feel wealthy, and yada yada yada, I guess the one thing that stuck out to me was, When they talked about, um, the differences between generations when it comes to maybe the use of social media, specifically to use it to make investment decisions or follow other [00:01:00] people’s advice on social media or not.

Like, anyone would predict that younger generations are going to be way more up to scale than older. But I still was surprised at the level of engagement that younger people have with financial advice on social media and specifically they are following advice from people on social media to do things.

Um, so for example, uh, you know, 60% of Gen Z. Follows influencers around about who share financial advice, but yet also fit almost the same percentage makes purchases based on what I see my friends and other influences sharing on social media, which is very concerning to me and, um, a red flag to say the least, because we’ve talked before about some of the garbage that’s out there.

There may be some good. There are there. There are good things [00:02:00] out there being shared, but I think it’s in the minority

Jeff Mastronardo: for sure. It’s in the minority. And that’s but that’s the way that generate this generation is being raised. I mean, my kids are being raised. By their parents to be good human beings, but they’re getting their information from social media, right?

Like how to lift, how to eat, how to clean your house, how to, like, do everything. It’s all following people that do not have to show any credentials whatsoever. My son’s following people that lift and, oh, I have to eat, drink creatine and take pre workout. Like, dude, you’re 14. Like, you don’t have to do… You shouldn’t do any of that stuff.

So, and we’re seeing the same thing in the financial world with people that have no credentials whatsoever, but are telling the entire world, this is how you generate wealth and

Mike Traynor: this is what you should do. of those things are predictably things like crypto. Stop, [00:03:00] um, flip real estate, you know, those sorts of things, which are absolute jokes of pieces of advice to give the masses.

And how many times

Jeff Mastronardo: have we even seen, um, what’s her Susie Orman and the guy who started FUBU, uh, I forget his name. Oh, the guy from shark tank. Yeah. Like, I mean, we’ve seen them with social media posts that they posted with information that was just dead. Yeah.

Mike Traynor: Or math that was totally wrong. Math was

Jeff Mastronardo: completely off.

And it’s probably like being edited and clipped where it’s like, they just brain farted and said it because they just speak so much and spew so much opinion and bullshit all the time that yeah, you’re bound to like say something that’s wrong, but people watch it. And people follow it and then people believe it.

Oh, if I put a hundred, a hundred dollars away a month for the, between 25 and 65, I’ll have 6 million. Like, no, you’ll have like 25, 000.

Meghan Tait: Yeah. I mean, but I think, and we’ve talked about it [00:04:00] before and these surveys really just reiterate the point. Like. Social media is here to stay, right? Like, we can talk about how, um, how poor the advice is, or how, you know, not applicable it is to the vast majority of people, or how wrong some of the things that are being talked about or advised on are.

But TikTok’s not going anywhere, Instagram’s not going anywhere, Twitter and Facebook aren’t going anywhere, like, I shouldn’t say Facebook, I think that makes me a boomer, but like, um, you know, there, there has to, we have to start, I’m not saying the three of us, but generally, like, if this is going to be a platform or these are going to be platforms in which people are seeking advice, the people who do it the right way have to have a presence there.

And it’s not going to drown out the noise of all of the other, you know, other people who are saying the wrong things, but we can equate that to TV and the news cycle, right? There’s a lot [00:05:00] of, there’s a lot of outlets that say or, you know, exaggerate things and I mean, the, the advisors and the firms that are doing it the right way have to build.

Online social presences even though we hate it and we cringe about it Like it’s critically important if this is how people are going to absorb information

Mike Traynor: true, and i’m gonna whine now because What’s just amazing is how heavily regulated we are In terms of what we can say publicly and, you know, what we can say, really anywhere and the amount of garbage that can be shared and monetized, frankly, on social media by people who have no accountability to regulators is just unacknowledged.

Amazing that this is what our sec and our regulators are, are doing. They don’t have no clue whatsoever about technology first and foremost, because [00:06:00] they’re a bunch of 71 year old old people mostly. Um, but it’s really something that should be talked about more. Um, I don’t know who or how or where, where, why, but it’s just a, it’s a real problem because they fly under a, there’s like, the radar is so high that you can fly under in terms of.

You can go out there and give financial advice and with no repercussions. And then you get views and clicks and revenue and all that. It’s just, it’s just insane.

Meghan Tait: It’s not whining. That’s the reality of it. It’s just, and maybe that’s where as advisors it’s like. It’s a complete uphill battle, right? Like, it’s daunting to think about, okay, we’re gonna spend time, energy, and resources doing it this particular way because we have to, but then 99% of the other information doesn’t have to adhere to the same rules and regulations.

It’s like, well, [00:07:00] why even start? But I guess, again, back to my point, it’s just like, if we do nothing, then we’re also at a, like, leaving consumers, they’re at a disservice because they don’t have access to people and firms like ours who, I’m saying do it the right way, follow the rules, for lack of a better term.

Right.

Jeff Mastronardo: Why do these firms like Fidelity and Schwab and Vanguard, why do they produce these surveys? What’s the purpose of them? Because so many people want to know where they stand?

Mike Traynor: Yeah, that’s a good question. I think I don’t find any value in them. Yeah, I agree. I, I, I know what you mean. Um, are they for us

Jeff Mastronardo: or for the, or for the cons or they’re for consumers?

Meghan Tait: I think they’re more for advisors or more

Mike Traynor: for a little bit. Yeah. Probably more for advisors. But I’ll also say this, having worked in.

These kinds of places. There’s a lot of people in there that need stuff [00:08:00] to do. And I’m not kidding. Like there’s marketing departments full of people that do this stuff. And they feel really proud of their product. That this is what, you know, they’ve produced this phenomenal comprehensive survey showing this, that, and the other.

But, um, and then Schwab puts it out and Fidelity’s like, Whoa, hey, you guys got to do the same thing. Vanguard, you got to do this. You know, they all, that’s why there’s three of them or 10 of them or whatever it

Meghan Tait: is. I know the information seems very common sense to us, but if you think about the majority of, and I’m going to say like older school financial planning firms that are run by, you know, people like 60 plus, Right, like we have a multi generational office with people kind of ranging in age.

So there’s an awareness of I think some of the more modern technological features of life that a lot of firms, older firms, maybe don’t have. [00:09:00] So I do think some of this would be more valuable to like a 62 year old planner who’s like how do I think about bringing in younger clients or something like that.

Maybe

Mike Traynor: and also though it is targeted towards Individuals because I’ll, I’ll reference one of the slides here, the title of which is about a third of Americans have a documented financial plan, and those who have one feel more in control of their finances. Well, guess who sells booklets and of financial plans to people?

Um, Fidelity, for example, will give you a 55 page bound quote unquote financial plan and say, here it is, now don’t you feel better about yourself? And it’s, it’s worth the paper it’s printed on, right? I mean, the documented financial plan thing, I think we should debate, Jeff. Because I think,

Jeff Mastronardo: go ahead. I think if someone’s going to go to a Fidelity or Vanguard and get their boilerplate documented financial [00:10:00] plan.

I would have to guess that that couple or person is probably doing better than the people that aren’t at least taking that step. Okay. Fair enough. As, as boilerplate as they are, it, it, it, it, it shows me that their, their wheels are at least turning and they’re, they want to get more information and they want to improve their situation.

They’re, they may do a few things a little bit better than the person who doesn’t do that. If they’re not getting like a true document, a financial plan, like what we give people, or were you saying like, we

Mike Traynor: don’t even give people? Because a financial plan is not a document. It literally changes by the.

Month and year and, uh, ever,

Jeff Mastronardo: forever. Right. The concept of a financial plan is always changing. Correct. But you gotta start somewhere. And we start with a financial plan for people.

Mike Traynor: But we don’t hand them a binder that says, Here’s your financial plan. We literally

Jeff Mastronardo: hand them a binder that says, Here’s your financial plan.

[00:11:00] No,

Mike Traynor: that’s not how it

Jeff Mastronardo: goes. That’s exactly what we do. Like, here’s how we’re going to start your financial plan. You’re going to sell all these assets over here. You’re going to buy all these assets over here. You’re going to go talk to this attorney and get a will. Like, we literally hand it to them.

Mike Traynor: But that’s one piece of the process of planning.

Planning. It’s not a plan. It’s not a noun. It’s planning. It’s a, it’s a, it’s action, right? So what

Jeff Mastronardo: do we hand people? What do we call those? You

guys

Meghan Tait: are agreeing.

Jeff Mastronardo: Kind of, but. I agree. But like to say we don’t give people a document, a financial plan to start their planning. Is wrong. We absolutely do. We, we give

Meghan Tait: documents and we give, we give advice and we give guidance in the form of a physical Sure.

Handout. I, but it’s not the full plan in

Mike Traynor: one book. It’s not. Yes. Megan’s making my point. I am, I am comparing this to what Fidelity says. Okay. We wrapped up your, you’ve, we’ve, you have your financial plan, you have the intake of all the information. Here is your financial plan. Here’s the have a nice day.

That’s the

Jeff Mastronardo: [00:12:00] distinction. It’s like people think they got their financial plan. And now they’re good to go. Yes. And then it goes back to like these other people that think like, okay I got that i’ll just come back in five years and like redo my financial plan. Yeah, right Okay. Well, what did you do between years one and five?

Right? Yeah

Mike Traynor: We’re saying the

Jeff Mastronardo: same

Meghan Tait: thing. Okay, so generally speaking, we didn’t feel like this survey gave us a lot of new or valuable information. It kind of just validated the way we think anyway. Yeah. Old

Jeff Mastronardo: people don’t use social media, young people do. Got it.

Mike Traynor: Right. And it’s a lot of like the value of time versus the value of like your financial assets.

Obviously, as you get older, time is more important than, you know, the money. Again, to us, you know, no brainer. We, we know this, but, um. I don’t know. Did

Meghan Tait: you guys have any, were you surprised by any of [00:13:00] the factors not having enough, or why people don’t engage in financial planning or why they don’t build a financial plan?

The first is the perception of not having enough money. Feeling like it’s too complicated, not having enough time, haven’t had a major life event, or probably too expensive. You’re like, check, check, check, check. Like, duh. Yeah.

Jeff Mastronardo: It’s exactly why people don’t do it. Yeah. Yeah. Yeah.

Mike Traynor: Yeah. And again, across demographics, it, it skews as you would

Jeff Mastronardo: expect.

But it’s, it’s like, that’s exactly why people don’t eat better. Right. It’s too expensive. It takes too much time. Like, yeah, it’s why we don’t do a lot of things in life. Like, thank you for identifying why I don’t do the things I should. You nailed it.

Click here to listen to our Coach’s Corner segment where we discuss all things gifting.

Click here for the full Untucked Episode 84. You can also listen to the full episode on Spotify, Apple, or Google podcasts.

Untucked Episode 84 – Gifting

Jeff Mastronardo: [00:00:00] What we got, Meg Coach’s Corner

Meghan Tait:. We’re gonna talk about gifting. Okay. And the transfer of wealth. So one of the more common planning scenarios we deal with is gifting both to people and charitable organizations. So what we wanted to discuss today is, um, how some of our clients choose to approach it. Some of the difficulties we often see in the conversation, and really the execution and maybe how we think some of those, um, difficulties or concerns can be lessened or alleviated.

Okay, so the reason this kind of came up is I recently met with a client who has more than enough money to be able to significantly and impactfully gift to family members, gift to organizations she’s passionate about, and she’s struggling with it. She’s struggling with it because she wants to. She wants to kind of [00:01:00] dictate how the money is used once it’s gifted.

She wants it to be, she uses the word responsibly. She doesn’t want it spent frivolously, and she’s struggling with. You know, kind of getting out of her own way, I guess, for, for lack of a better word, cuz it’s, it’s not at all a concern from a financial standpoint whether or not she can afford to do it.

But she is the daughter of, you know, great depression parents and has accumulated a ton of wealth, but just can’t really see through the gifting. Execution

Jeff Mastronardo: and it’s either gift with no restrictions or don’t

Meghan Tait: gift. That’s how we see it. Yeah, I mean the, the adding the restrictions just, we get to this place where people don’t do anything.

They keep talking about wanting to do it, but then they actually don’t do it.

Jeff Mastronardo: So you and I were talking about this and, um, the only solution I could think of, which I don’t think is a viable solution, right? If grandmom says to, to grandkid, I’m gonna gift you X amount of [00:02:00] money, uh, but I want you to use it responsibly and do this with it.

That’s not gonna work. So if the, the only other way I can think of is, is grandma is a part of those purchases. Like, Hey grandma, I’m gonna use your gift to buy a car. Well, grandma doesn’t want Johnny to go out and get a Corvette. Well then, okay, Johnny, I’ll go with you, like do some car research and I’m gonna go with you to the store and I’m gonna write the check.

That way she can control, you’re gonna get like a Kia instead of a Mercedes, but like, what, what, what grandparent? Who’s gonna do that? Right. Who, who’s gonna be involved in all of those Right. Decisions and, and just if you have enough money and your advisor tells you you do just gift or don’t. Yeah. Right.

If you feel like it’s gonna lead them to be irresponsible, then don’t. And I guess maybe now that I’m like thinking out loud as I talk, like that’s a real problem because if they don’t gift, then they’re gonna leave [00:03:00] more to the kids. And if you think they’re gonna be irresponsible when you give ’em 17 grand, well isn’t that more frustrating that they’re gonna be super responsible when you’re dead and you give them two and a half million, but I guess you’re dead, so who cares?

Yeah. I just won’t gift and then I’ll die and I won’t know what they did with it.

Meghan Tait: Yeah. Um. I, I, I, I don’t have, that’s it.

Jeff Mastronardo: Now I’m putting myself in their, in, like their spot. Like yeah, that’s a toughie. I guess I’d rather just give it to them and then be disappointed that they’re using it for whatever, but at least I, I, I was able to help them in some form or fashion while I was alive and watched him blow it on stupid

Meghan Tait: stuff.

I may be like oversimplifying it, but if it’s a genuine concern, having that conversation with the recipient of the gift. Like, Hey, I have an opportunity to help and I, I would like to see this money used thoughtfully or responsibly by whatever measure, or even if it’s just saying [00:04:00] those words like, aren’t most people like I.

Gonna be considerate of that. Maybe I’m giving too many people the benefit of the doubt, but like, I don’t know. In this case, like she’s talking about her grandchildren who are 30 years old, have kids of their own, like very likely the use is gonna be. You know, summer activities or paying the daycare bill.

Like I know that there are scenarios where the money is used incredibly irresponsibly. I’m not suggesting that it’s perfect all the time, but I guess in my mind, like you say how you feel to the person who’s gonna receive the gift and then you hope for the best.

Mike Traynor: Yeah, and I think, you know, Jeff, your, your example of the car is probably a little bit impractical to think grandmom’s going to the.

You know, Toyota dealer or whatever. But if it’s something like a down payment on a house, right, that’s specifically a check written that that’s part of that transaction, [00:05:00] it’s probably super helpful to the, to the kid or kids. Um, and that’s a great way to help somebody who’s younger, who otherwise maybe couldn’t afford to, to buy a house.

Um, Just writing a check though and giving, just giving money cuz you’d rather give it to ’em while you’re still alive. And the more substantial that check is, obviously the more problematic it it could be because it’s, um, at that point it might be spent fri frivolously or whatever. I don’t know. Um, to me I feel like the gifting thing, the smaller, the smaller gifts to me are.

Way more, way less should be, way less of an issue. I think when it comes to it, it’s really the encouraging, or not, maybe that’s not the right word, but, um, um, helping create potentially a situation where somebody just plays video games all day because they don’t have to get a job now [00:06:00] that there’s a lot of money come in their way or has come their way.

And maybe that leads into the other part of our conversation, which is, which is the, um, Where are we gonna talk about like the family planning, the family planning aspect, where there is a substantial inheritance, um, that may or may, may not be known about, and is it good or bad to talk about that as a family prior to that happening?

And yeah. What are the pitfalls there?

Jeff Mastronardo: Yeah, I’m a, I’m a big fan of having family generational planning discussions, right? Like, Mom and dad have a couple million bucks. They live very modestly. They have two kids. Those kids are gonna inherit two, 3 million bucks each. Um, I think, yeah, I, I think it’s, it’s in everyone’s best interest to have that conversation with, you know, son one and daughter one.

Like, look, we [00:07:00] we’re not going to go through our money. You’re gonna get $2 million at least when we die. Because I think that can help them now start to maybe modify their planning. Like maybe you don’t have to save as much in your 401k, or maybe you don’t have to struggle the way you’re struggling now because there is going to be an inheritance.

And we always tell people when we do our planning for people in their sixties, like you can’t bank on the inheritance. But I think that’s different. I think that that other generation didn’t have as much wealth as this generation does. So it’s like our clients will have like a million or 2 million bucks and they’re kind of on the cusp of being able to, to live comfortably.

And they may get an inheritance from mom for 400 grand, which can really kind of changed their life. Um, and we tell ’em, you can’t, you can’t bank on that. I’m talking about a bigger wealth transfer, um, to young, to a younger generation. I think it’s. It the, I think the conversation absolutely should be had.

Meghan Tait: Well, and, and the conversation. Maybe that’s what [00:08:00] we as Advi advisors can encourage to make what we were fir first talking about the gifting discussion easier, right? Like if there’s this open line of communication and mom and dad can say, Hey, you know, we don’t live your scenario. We don’t need our, a ton of our money.

We live very modestly. There’s going to be an inheritance. Well, maybe the kids are then raising their hands and saying, Like we need help with college funding in five years, so I don’t wanna wait 15 more for you to die. How about you contribute to your grandchild’s college education? Like maybe it allows for more, more opportunity to help while mom and dad are still here.

Cuz I keep coming back to that like, Wouldn’t you want to see if you could, wouldn’t you want to see your money positively benefiting your family? And to me, that opportunity should [00:09:00] outweigh maybe the one-off frivolous expense or the one vacation that you wouldn’t have sanctioned or you know, the upgraded car purchase.

Like to me, that opportunity. Maybe because we’ve now created that generational approach to the discussion, um, maybe it encourages more people to do it because I do believe a lot of the concern we talk about people having is a generational thing. The pe, the age of the, the demographic of the clients we see who can’t get over the hump are.

Like, I don’t think that’s going to be a perpetuated issue we deal with. Agree. I agree on. Does that make sense? Yeah, I agree a hundred percent. So maybe for now, the way that we can help again, like execute on these like thoughts or ideas is by having the rest of the family like actively participate in the conversation.

Jeff Mastronardo: I mean, I’ve, [00:10:00] there’s been many circumstances that I’ve personally been a part of where we’ve had those conversations. And it’s impactful when you, when you’re talking to mom and her boys and mom lives on her social security and a pension and has $400,000 in a Roth IRA and she’s 80 years old. Well, that Roth IRA shouldn’t be invested for the 80 year old.

Right. She’s never gonna use it. And I’ve, we’ve, we’ve had this conversation with clients. Yeah, let’s invest that 100% stocks for the next 10 years that you’re gonna be alive cuz it’s just. It’s going to grow more and it’s gonna be a bigger impact for these kids. Like that’s kids’ money. I’ve, I’ve said that a million times.

This is basically your kids’ money, so let’s invest it for them kids. Are you okay with that? And they’re always like, yes, let’s do that. Of course. Yeah. That’s why I just think it needs to be a bigger conversation. Um,

Meghan Tait: um, yeah, but my, I guess the issue I see most is that, The mom and dad [00:11:00] just don’t, they can’t wrap their brains or grasp the amount of wealth they have, right?

There’s the constant like, well, what if? What if, what if? And I can think of multiple scenarios where like, there isn’t a what if there isn’t a what if That could be put in front of me that I would. That would even concern me, right? So it it, it’s without concern that we can unequivocally say, give gift, invest for the kids and still doesn’t happen because

Jeff Mastronardo: those what ifs are never going to be something that’s just going to make you go.

Bankrupt. I mean, unless you were doing something really crazy stupid with your money. Right. But like, even like a concern that, like Mike brought up a few, a few months ago, like the, the, um, SVB debacle. Mm-hmm. And you know, your bank accounts and your money markets going below $1 share. Like, okay, but then that will get corrected and we’ll figure it out.

Right. The only [00:12:00] thing that’s like, the only thing that could happen that is a zombie apocalypse. So we, but we’re not, we’re not preparing for that. Right. Yeah. It’s, I think I agree with you, Meg. I think it’s generational. I think it will go away. I think the 60, the 55 to 60 year olds that we’re dealing with now Yeah.

Won’t have as big of a hangup when they’re 80. Yeah. I think they’ll get it unless they start going senile and like start losing their minds. Um, but that’s, it’s, it’s something that I think people should be talking about with mom and dad and with each other about their family’s wealth so that we can just be better at what we do.

Meghan Tait: Yeah, and, and I mean, we can only take it so far, right? We can only help, we can only help move the conversation. We can only give the ideas, but I mean, without someone willing to, to execute, it’s, it’s just a lot of talk. And I guess that’s where my frustration lies. There’s a lot of talk with certain situations recently for me, [00:13:00] and they seem like no-brainers and I don’t know how to.

Push anymore.

Jeff Mastronardo: Yeah. And I feel like there has definitely been more people that are willing to have that conversation. I feel like, yeah, let’s, 10, 15 years ago when I would say to someone, are you willing to like, you know, share some of this information with your kids and, and bring your kids in so they can understand the planet was like, no, I don’t want my kids to know how much money I have.

I, I feel like recently there’s been more acceptance of that. That’s true. I agree with

Mike Traynor: that. Mm-hmm. There is a threshold that just to before we leave this, yeah. Um, I feel like there’s a threshold of wealth at which it starts to be the, the, the issues become much more complicated. So talking about a few million bucks or right.

Five or 10 million. But when you’re talking about 5,000, you know, lots and lots of, of, of assets, you know, at that point you have real concerns about. Okay. Family planning. Our kids know that they’re inheriting just sure they don’t have [00:14:00] ever have to work. Their kids don’t have to work. How are we gonna get them to work?

How are we gonna create a work ethic in our, in our, their, our kids and their kids? And that, that kind of thing. So,

Jeff Mastronardo: um, I can’t help you with that. Michael. Yeah. What does Jay-Z say?

Meghan Tait: No money, no problem.

Jeff Mastronardo: Was that Jay-Z? No. Where’s that? Biggie? I think it was, I think it was, uh, uh, puffy, actually. Puffy and Mace.

Yeah, you might be right. I think Biggie was dead when that came out. His track was, uh, was added afterlife. Mm.

Meghan Tait: Should have consulted with the resident rap connoisseur. All right, well, no answers were found through that.

Jeff Mastronardo: Sorry.